"International trade: the regionalism does it threat the universalism? "

By F.A. Khavand.


The regionalist wave storms on all continents. From the birth of the international commercial system in 1947 more than 200 regional commercial agreements were notified in GATT or in OMC, among which 130 operate always. In other words, the most part of the states of the planet is now a part of regional sets. The distribution of these zones of preferential exchanges is compatible to the multilateral system of exchanges submitted by the global Organization of trade (OMC) ? Liberalization in regional reaches - is it a threat against the liberalization in universal reaches ?

From an integration up to another.

It is necessary to specify that the degree of integration varies from one regional regulation up to another. There are, for example, significant disagreements between the European construction, on the one hand, and the big North American market, on the other. As a matter of fact, European union involves the sovereignty of the state members in the common economic and political enterprise while ALENA enters mainly in the perspective of free movement of goods and capitals. On their degree of integration, regional regulations are represented under four essential forms: the Zone of free trade, the Customs union, the Common market and the financial and economic union.

In the Zone of free trade, partners cancel, for the essence of their mutual exchanges, obstacles opposing to free movement of goods and services, not accepting nevertheless the common commercial policy in relation to the countries of the third world. In other words, each country - member keeps its own customs rate in relation to the countries, which are does not belong to the zone. Among the most ancient zones of free trade, may be quoted the European association of free trade (the AELE) of 1959 and the Latin American Association of free trade (ALALC) of 1960. The trading agreement of economic rapprochement between Australia and New Zealand (1983), the North American Agreement on free trade (1992) and the European Economic Space, becoming valid in January 1994, are the more recent examples.

The customs union is similar to a zone of free trade, but it differs also by the acceptance of the common commercial regulation in relation to the countries of the third world. The countries making Customs union apply the external customs rate, common for the products occurring from territories that are not included in it. Therefore, in its general form, the Customs union includes replacement of one customs territory together or some customs territories. The most well known type of such association was carried out in 1834 by the German states, during the constitution of Zollverein. Among the more recent examples, may be quoted the customs and economic Union of the central Africa (UDEAC) created in 1964, and the Group Andin, created by the agreement of Carthage 1969.

A common market demands the free movement of persons, goods, services and capitals. Twelve countries of European Economic Community which were already a part of the Customs union, have created January, the 1st, 1993 a Common market.
As to the financial and economic union, it is the most produced form of the regional integration. It adds to "the four rights" established by the Common market, the implementation of the common macroeconomic politics. The financial and economic union (UEM), uniting today twelve countries of the European union, represents today the unique project aiming at the realization of a perfect integration. Except these four types of regional integration, there are certainly hybrid or fragmented forms.

The logic of regionalism.

From the analysis of Jacob Viner (1950) becoming classical, the economic participations of a zone of regional integration are explained on the basis of two theoretical concepts: "trade creating" or "trade diverting". If the growth of intra-zone trade is carried out in damage to less competitive products from the countries not members, we may speak about an "expansion of exchanges" allowing to the discussed integration to improve the economic efficiency in the world. In exchange, the "expansion exchanges" consist to increase the trade an intra-zone opposing obstacles to more competitive products from the countries external to the zone. In this case, regional liberalization of exchanges may be provided only to the detriment of global economic efficiency. Meanwhile it is very difficult to draw an exact line of demarcation between the regulations, wishing to give an occasion "to expansion" or "to deviation" from exchanges, these two phenomena wishing quite to coexist inside a regional integration.

However, the creation of regional zone integration is motivated by the desire of the interested countries to improve their position inside the international Division of work. These last want to increase the scale economy to improve the productivity and to strengthen the introduction on the export markets.
The regionalism bases firstly on the beginning on the argument of economy scale. The expansion of the market is considered as a driving force of a zone of integration, taking into consideration, that the national markets are frequently in inability to assure, by themselves, the necessary size for the exploitation of economy scale and specialization. On the other hand, the liberalization of exchanges inside a zone of regional integration obliges the enterprises to meet competition, to reduce their expenses and to improve their productivity. They may send progressively competitive products to the markets of the countries of the third world.

"Commercial blocks" in the industrial regions.

The occurrence of statement "the commercial block" in the literature of the international relations coincides with the an infatuation of the 80's years of the United States for the regional economic integrations. Within these years, some facts illustrated this big turn of the American commercial diplomacy : creation, in 1988, of zones of free trade with Canada, declaration, on June, 27, 1990, by George Bush, of the "Initiatives for the America" directed on the formation of an "hemisphere of free trade going from Alaska up to Tierra del Fuego" and, at last and mainly, the conclusion of American Northern Agreement on free trade (NAFTA) from August, 12, 1992.

The occurrence of this powerful dynamical regionalism in Northern America has sped up the movement aspiring the organization of global economy in spacious regions. Face to turbulences, touching the international economic relations, powerful currents of idea will be mobilized, in all industrial regions, for the benefit of preference of affinity, that is a free trade limited to "natural zones of exchange ". In other words, there is a risk to concede easily the desire to force to change the doze of free trade on geographical affinity.

"Commercial blocks" in regions in development.

The wave of regionalism has also stormed on regions in development. As a matter of fact, we were present, in these regions, to the creation of new integrations or to the reactivation of already existing integrations. In Latin America, MERCOSUR (uniting Argentina, Brazil, Paraguay and Uruguay), created in April 1991, has strengthened its presence during these last years. Mexico, Columbia and Venezuela have decided to create a zone of free trade. Mexico and five countries of Central America (Guatemala, Costa Rica, Honduras, Nicaragua, El Salvador) have decided, from 1996, to liberalize the exchanges. Asia is not the last one: the Organization of Economic cooperation (OCE) unites since November 1992, besides three members - founders (Iran, Pakistan, Turkey), five Muslim republics of the Central Asia, as well as Afghanistan and Azerbaijan. In parallel, the former created integration mainly in 1950 and 1960, and which the most part had only came to existence, know now some shiver. It is necessary to recognize meanwhile that heavy difficulties continue to weigh on the integrations uniting less developed countries : not complementarities of savings, rigidity of foreign trade, instability of political and institutional order, border conflicts, and etc... These difficulties, and a lot of others, are they going to find out, again, the impasse of local movement in the Third world? Nothing is less sure. As a matter of fact, this regional effervescence is shown now in a context fundamentally various of that of 1960. Two essential occasions induce today PED to be organized, as much as it costs, inside zones of preferential exchanges:

- To avoid the marginalization : the occurrence or the strengthening of regional associations in industrial zones might involve less developed countries in a new marginalization. In these conditions, the regionalism is considered, by these countries, as the answer the best appropriate to the dynamism of the European integration and NAFTA.

- To search for new trade channels : from about fifteen years, the less developed countries pass progressively from industrial strategy "introverted" ("revolved to the home market") to industrial strategy "extroverted" (revolved to the international markets. This change will have significant impact on the configuration of the international exchanges during the next decades. The less developed countries do not want to remain more prisoners of the national markets. But their access to the markets of the rich countries remain uncertain, taking into consideration, that these last are closed more and more under the influence of protectionism and under the influence of growth regionalism. Expecting an improvement of the international context, only the liberalization of exchanges in regional spaces allows to the enterprises of less developed countries to increase their trade channels and to be accustomed to compulsions in the international competition. Taking into account all these elements, the regionalism in the zones in development should amplify the next years. They may only follow the example given by the big commercial powers.

To the fragmentation of the international commercial system ?

Being considered, up to the end of the 70's, as two parallel roads conducting to liberalization generalized of exchanges, the regionalism and the multilateralism have they became definitely various ? Do the modern economic integrations enter inevitably in logic of comparison ? The answers given to these questions are far to be unanimous. If some observers consider, that they are guided to "a fragmentation of global economy in large preferential zones", the others on the contrary, insist to believe, that the restoration of regional integrations does not detain in any way the growth of commercial liberalization to the universal scale. According to the literature extending from OMC, the present rise of the regionalism far to be a proof of decline of the multilateralism. This organization considers, that the regional associations may become a threat only if they withdrawal on themselves, raise new commercial barriers and become hostile blocks, as the world has found out in 1930.

Rules of GATT in a question about the regionalism do not appear in the list of "burning" themes of the international commercial negotiations. This fact should not hide meanwhile all disputes that might cause "the right of regional regionalism" in the future negotiations concerning the evolution of the international economic order. Stated by the article 24 of GATT, these rules reflect an ambiguous position of the international commercial System in relation to establishment of zones of preferential exchanges. This ambiguity is based on double ascertaining :

- Regional cooperation, whichever it is, punches a gap in the fortress of "economic nationalism" and, in this name, represents some achievement in relation to the status quo.
- But the regional regulations are not innocent, and they give an occasion, a way or another, to change the direction of exchanges to the detriment of the countries of the third world.

These ascertaining have resulted, the general Accord to recognize regional agreements, subjecting this recognition to especially strict conditions. As a matter of fact, instead of their forbiddance, which was impossible, tried in opposite to limit them in an internal part of the general Accord on customs rates and trade.

GATT counts as lawful only two forms of integration : a zone of free trade and the Customs union. These are determined precisely and their establishment is subjected to duties of internal and external order. All these precautions, meanwhile, have not prevented local movement to shake in the not conformity the rules of the general Accord and to be shown under "dirty" forms and "hybrids".

This "rebel" movement should be seized as not to loose the bases even of the international commercial System. Certainly, the literature extending from GATT/OMC repeats tirelessly, that multilateralism and regionalism may amplify mutually. It does not mean never the less that from the end of the 80's, effervescence of regions occurs increasingly as a retort to lacks of the multilateral order. The cycle of Uruguay has expressed, in its way, the doubts weighing on relations between the multilateralism and regionalism. In its Memorandum of Accord about interpretation of article 24 of the general Accord on customs rates and trade of 1994, the Uruguay Round recognizes the contribution of regional regulations in expansion of world trade. But this "concession" is accompanied by a caution : "Such agreements should have for purpose to facilitate trade between constituent territories instead of to oppose obstacles to trade of other members with these territories, and that the parties which conclude such agreements or expand its reach, should, in proportion to possible, avoid that unfavorable effects result for the trade of other Members".

HOME