Factors affecting trading realtionships between countries

USA

Traditionally, this country has a protectionist economy meaning it has generally lagged behind other HDE in terms of formal trade agreements

This bloc is protectionist in it’s own way as whilst the 27 members states trade freely there is an external tariff barrier for countries outside of the union

65% of the trade bloc is intra-regional. High levels of interdependence result

This bloc has negociated trade deals bilaterally with some nations, not necessarily zero-tariff trade but do offer some reduced tariffs and easing of restrictions e..g Japan, New Zealand

One of the most recent and most liberal is the Canada-EU deal, approved in 2017, it is not a broad ranging agreement with virtually free trade. However deal with Mercosur has not yet been ratified

There has been strong resistance to free trade agreements from within the bloc, largely against attempts to make deals with US and Mercosur = due to cheap imports of products such as beef - also member argue that the countries do not meet the standards of EU e.g. injecting cattle with chemicals

The withdrawal of the UK is a possible blow to the EU as it contributed to its funds, provided a large market, and attracted investment.

Companies have built up supply networks acorss the EU during decades of interdependence.

Africa

There is minimal intra-regional trade in this continent and it’s main exports are primary resources

The region struggles with the lack of skills, poor transport (In Central African Republic it takes 116 days to move container from the factory in the centre of the country to the nearest port)

Also energy infastructure, along with persistent corruption. This has deterred investment into industrial development, which would denbale nations to add value to their exports

Resultantly they rely on imports for most manufactured goods

Traditionally, the continents main trading partner has been Europe, but China has increased its involvement - has invested in developing infrastructure which has increase connectivity of the continent

It hasnt achieved the level of integration seen in Latin America due to the cultural, ethnic, and language divisions across its 54 nations

The African Continental Free Trade Area, signed in 2018, has 43 parties and 11 other signatories involving 54 of 55 African nations

Therefore the largest FTA by number of states, population and geographical area

Its main aim is to increase intra-regional trade which is very low at 16%

However, trade liberalisation may disadvanatge the poorest of people due to the differing levels of development and the existing fragmentation

China

The country’s exceptional economic growth over the last 4 decades has been centred on the expansion of manufacturing. it now accounts for approximately 15% of global trade

The country generally imports raw materials from developing countries, such as those in Latin Amercia and sub-Sahran Afrcia and exports processes goods to developed countries

The export of cheaply produced steel onto the world market from this triggered a trade war with USA, with high tarrifs being imposed on goods. The impact on the growth of the world trade is potentially severe

In 2013, it launched the Belt and Road Initiative (BRI) which involves the construction of significant road, rail, and pipeline corridors along with ports and shipping lanes.

Concerns that the BRI is a form of economic imperalism, which gives China too much leverage over other countries. Some poorer countires may not be able to repay their loans