The free trade area often benefits the poor most. Developing countries cannot afford the high implicit subsidies, which often go towards the narrow privileged interests that trade defence offers. In addition, growth resulting from free trade tends to increase the incomes of the poor at about the same rate as those of the general population.6 New jobs are being created for the unskilled labour force, which places them in the middle class. Overall, inequality between countries has decreased since 1990, due to faster economic growth in developing countries, partly due to trade liberalization.7 In the latest work, we examine the impact on consumers of trade agreements negotiated by the EU between 1993 and 2013 (Berlin 1. 2018). In this context, the EU provides an interesting case study, given that it is the largest trading bloc in the world and has been a productive negotiator of trade agreements over the past two decades. The pros and cons of free trade agreements affect employment, business growth and living standards: for many countries, unilateral reforms are the only effective way to reduce barriers to internal trade. However, multilateral and bilateral approaches – removing trade barriers in coordination with other countries – have two advantages over unilateral approaches. First, the economic benefits of international trade will be strengthened and strengthened if many countries or regions agree to remove trade barriers. By expanding markets, concerted trade liberalization enhances competition and specialization between countries, increasing efficiency and consumer incomes. This is why international trade rules established in free trade agreements (FTA) must be used strategically. While free trade is generally beneficial, removing a trade barrier to a given asset harms shareholders and workers in the domestic industry that produces that good. Some groups that are aggrieved by foreign competition have sufficient political power to protect themselves from imports.
As a result, despite their considerable economic costs, trade barriers continue to exist. For example, according to the U.S. International Trade Commission, the U.S. benefit from lifting trade restrictions on textiles and clothing would have been nearly $12 billion in 2002. This is a net economic benefit after deducting losses suffered by businesses and workers in the domestic industry. Nevertheless, local textile producers were able to convince Congress to maintain strict import restrictions. The failure to open a new round of multilateral trade negotiations at the 1999 WTO conference in Seattle was a setback for the international trading system. Such large-scale multilateral negotiations are particularly important because they provide countries with the opportunity to obtain visible benefits for their exporters from the opening of markets by other countries. This perspective provides more incentives for countries to open their own markets and overcome the resistance of entrenched, protected interests. In this way, the trade liberalisation packages that are under way for these negotiations will ensure that they benefit all participating countries.
Canada is the only G7 country to have free trade agreements with all other G7 countries. Current agreements include CUSMA, the Canada-EU Comprehensive Economic and Trade Agreement (CETA), the European Free Trade Association (EFTA) with Iceland, Liechtenstein, Norway and Switzerland, as well as agreements between Chile, Colombia, Costa Rica, Honduras, Israel, Jordan, Korea, Panama, Peru and Ukraine. The comprehensive and progressive Trans-Pacific Partnership (PPCC) agreement is now in force between Canada, Australia, Japan, Mexico, New Zealand, Singapore and Vietnam. Our overall results mask a high heterogeneity of the impact of treatment between EU countries, trading partners and types of comm agreements