Even as global trade fails on contentious issues between the developed and developing nations, several countries are looking to create islands of regional co-operation to foment trade between themselves. (See: Free trade hopes fade as WTO talks collapse)
Southern African countries yesterday launched a regional trade zone at a summit on Sunday that aims to eliminate import tariffs, with plans for a common currency by 2018. Eleven of the 14 countries that are part of the Southern African Development Community (SADC) will participate in the free trade area. Three SADC countries - Angola, the Democratic Republic of Congo and Malawi - plan to join at a later date due to weak economies.
"While 85 per cent of all intra-SADC trade is duty-free in 2008, we must acknowledge that the work is not yet complete," South African president Thabo Mbeki said at the launch. "The remaining 15 per cent of trade is still to be liberalised by 2012 and we need to ensure that all members are able jointly to meet that milestone."
Parts of the free trade zone were put in place in January. The free trade area precedes a customs union planned by 2010, a common market by 2015, monetary union by 2016, and a single currency by 2018.
On the same day, four prime ministers of the 15-member Caribbean Community (Caricom) agreed to pursue the goal of advancing new initiatives on economic and political integration.
The announcement followed a meeting hosted by Trinidad and Tobago's Prime Minister Patrick Manning, which also included the prime ministers of St Vincent and the Grenadines, St Lucia and Grenada, and the foreign ministers of Barbados and Guyana.
They proposed to advance the process for an expanded economic union of the Organisation of Eastern Caribbean States (OECS) to involve Trinidad and Tobago, as well as any other Caricom country, by 2011. Central to such an agenda is that the proposed OECS economic union will be a reality, as envisaged in 2009.
Additionally, they agreed to work for the creation of some form of political union by 2013 by the countries that will be involved in the expanded economic union being proposed for inauguration in 2013.
Even India is in advanced talks to sign a Free Trade Agreement (FTA) with the ASEAN bloc.
Under the pact, ASEAN and India aim to gradually start reducing tariffs on 80 per cent of goods in 2010. Tariffs will be phased out to zero by 2012. Tariffs on another 10 per cent of goods would be decreased to 5 per cent by 2015.
The agreement is expected to be signed in December after five years of negotiations.