A 3-BLOC DANCE: EAST ASIAN REGIONALISM AND THE NORTH ATLANTIC TRADE GIANTS

Abstract

Asian countries. The US has signed FTAs with Singapore, Australia, and Korea, and started negotiations with Malaysia and Thailand (the fate of US-Korea is unclear under the Obama administration). The EU is negotiating an FTA with ASEAN, India, and Korea. This paper explores some of the novel political economy forces that may be generated by these new cross-regional trade initiatives by the two existing trade 'hubs' - the EU and US. The paper starts by reviewing some background facts that illustrate the importance of Asia as a trade block. It then goes on to consider the current state of trade agreements in Asia and then the arrangements between the US and the EU on the one hand and Asian nations on the other. The paper moves from fact to conjectures with some discussion of various medium run scenarios and their implications for the world trade system. The paper concludes by suggesting that the 3-bloc dance may force the US to push for a global free trade agreement in industrial goods - something like the Information Technology Agreement but covering most industrial sectors.