Recently, all major US free trade deals in North America, Latin America and Asia Pacific have fallen under fire. As American legacy in free trade is dimming, there is a new opportunity for real free trade in Asia Pacific.
Recently, Canadian Prime Minister Justin Trudeau concluded a visit to China. The joint talks about a free trade pact began over a year ago. As Trudeau left Beijing, Western media headlined “Trudeau leaves China empty-handed”, while Chinese Foreign Ministry said that “both China and Canada showed willingness to negotiate and sign a free trade agreement”.
In reality, the world of free trade is now in the kind of flux that has not been since the post-1945 era.
If the US withdraws from the North American Free Trade Agreement (NAFTA), that would start a six-month legal process before official termination. While President Trump may see this as a negotiating tool to force Canada and Mexico to accept its demands, the latter may use the time to complete trade talks with Brazil and the European Union (EU).
After the fifth round of NAFTA talks ended amid simmering tensions, Canada and Mexico are hedging their bets against a potential NAFTA collapse by pushing for deals with new partners, particularly with China and other Asian countries.
About the Author
Dr. Dan Steinbock is Guest Fellow of Shanghai Institutes for International Studies (SIIS), see http://en.siis.org.cn/. The commentary is part of his SIIS project “China in the Era of Economic Uncertainty and Geopolitical Risk”. For his global advisory activities and other affiliations in the US and Europe, see http://www.differencegroup.net/