When trade is no longer free

AFTER Donald Trump assumed the American presidency earlier last year, the whole concept and practice of free trade came under the scrutiny of

as president was to withdraw from the

so-called “free trade plus” arrangement which, though not initiated by the United States, was actively promoted by the previous Obama administration. Then came the renegotiation of the longstanding North American Free Trade Agreement (Nafta). This was followed by the slapping of high tariffs on steel and aluminum imports from American allies and foes alike. And of course, since half a year ago, the US and China have been entangled in a so-called trade war that still sees no end despite a forthcoming three-month respite early next year.

The concept and practice of free trade is actually a relatively modern one. In olden days, governments around the

imported goods, both to bolster their respective coffers and to protect their local industries from foreign competitions. As a result, trade among nations

today. This sort of low level of commerce among the major powers has also been cited as one of the factors that led to the two world wars in the last century, as nations which have little to do with one another economically tend to develop a “not much to lose” attitude when treating each other. It was essentially after World War 2 that the economic concept of comparative advantage started to take hold among the ruling elite of the major powers. The idea that each country could produce what it produces best and trade each other’s needed products, thus leading

all and every single country involved, became increasingly self-evident. Ironically, it was the US which has until recently been the most active and persuasive promulgator of free trade, preaching it to, among others, the so-called emerging markets. American producers of course have long availed

for example by shifting their factories from a too tightly regulated and laborexpensive America to many developing countries, chief among them China and Southeast Asia, to enjoy the still evolving regulatory regimes and the cheaper labor there, as they would be able to import those products they make overseas back to the huge American consumer markets under relatively low tariffs. It is apparently this particular practice of American factories moving overseas which especially irks Trump.

And free trade negotiations are not easy jobs, but involve tedious economic and political maneuvering of the highest order. Under the worldwide free trade regime, if one participating country were to offer reduced, or removed, tariff barriers to another country, then it has to offer the same deal to all other participating countries. But not all countries are willing to, in a sense, open up their markets to all other countries, but perhaps only to a selected few, with particular “sweetheart” deals in return. That was why the global free trade negotiations, typically called “rounds,” moved at a snail’s pace. Many countries instead string up like-minded neighbors or allies, and formed free-trade “coalitions of the willing.” The European Union, for example, started as a coal and steel common market among several European countries, but has evolved into a political and social union as well, with mixed success. Here in Southeast Asia, we formed an Asean Economic Community back in 2015 supposedly becoming a common market, but trade among Asean nations remains only a fraction of Asean’s trade with the major economies of the world. And negotiations toward a broadened free trade agreement called Regional Comprehensive Economic Partnership (Recep) involving Asean and six other major regional economies are also struggling as not all economies feel comfortable opening up a large swathe of their domestic markets to foreign competition.

Then there are the bilateral free trade agreements in all shapes and forms. The US, for example, has granted China “most favored nation” trade status since at least a quarter century ago, and the trading volume between the world’s largest and second largest economies is also the largest in the world. But Trump

against the US, which means, at least on paper, that the US imports much more than it exports to the rest of the world, and especially China. But it is one thing to try to force other countries to buy more things produced in America

After all, the US still produces some of the agricultural and high-tech goods of the best quality. But I often wonder why Trump wants to bring back the steel and aluminum plants that had been relocated overseas many years ago. Granted these are job-generating juggernauts, but they are also reputed to be not the most environmentally friendly production facilities anywhere they go. Is Trump thinking that the American air is too fresh, its forest too pristine, and its water too clear? If I were the leader of an advanced country, I would admit

the high-polluting industries to leave my country for elsewhere as soon as possible, and let others deal with these undoubtedly polluting consequences. Why would I want to bring them back into the country to pollute my backyard? Instead, I would try my best to consolidate my country’s leading edge in the most advanced technology sector, devoting precious resources to nurture them as best I can. That would be the right stuff to do.