Trade agreements are pushing the global economy ahead – this is a fact that few economists dare to argue. No matter if it’s Donald Trump’s aggressive NAFTA negotiations or the historic deal 55 African nations are working on as we speak, trade deals are important – and quite often, they are game-changing. Sometimes, they even have the potential to change history – like the tree below that left a lasting mark on the way the world looks today.
The European Coal and Steel Community (1952)
Europe seemed to be bent on tearing itself apart in the first half of the 20th century, culminating in not one but two World Wars that killed millions and ended with the deployment of the most terrifying weapon in human history. After the war, in turn, these countries returned to their businesses – literally. And six of them – Belgium, France, Italy, Luxembourg, the Netherlands, and West Germany – decided to set aside any disagreements and strike a deal to regulate their industrial production under a centralized authority. The deal was called the “European Coal and Steel Community” and came into force on July 23, 1952.
The ECSC is seen by most as the first precursor of the European Union. The deal served as a model for later communities set up in a similar vein: the Treaty of Rome in 1957, the European Economic Community, and the European Atomic Energy Community. Ultimately, this has led to the founding of the European Union.
The Comprehensive Economic and Trade Agreement (2016)
The Comprehensive Economic and Trade Agreement (CETA) is a trade deal signed by Canada and the member states of the European Union in 2016. The two entities have negotiated the deal until 2014 – it was pretty tough, considering that all 28 members of the European Union had to give their approval. Belgium was the last one to sign. The deal is not fully approved yet – only parts of it are provisionally in effect since September 2017 – but it still eliminates close to 99% of the tariffs applies to good and services moving between the two entities.
Comprehensive and Progressive Agreement for Trans-Pacific Partnership (2018)
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) gave birth to the third biggest free-trade area in the world, after the North American Free Trade Agreement (NAFTA) and the European Single Market. Its 11 signatories – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam – represented 13.4% of the world’s GDP at the time of its signing.
The CPTPP was born out of a previous agreement between the 11 countries above plus the United States but the US decided to withdraw in 2016. The remaining countries resumed negotiations in 2018 and signed the agreement later in the year. Since then, several other countries have expressed their interest in joining the area – the US, the United Kingdom, Taiwan, Indonesia, and South Korea, among others.
The CPTPP covers a market of almost 500 million people, even more, if the countries above decide to join.