Regional Trade Agreements Reshape Global Commerce, Benefit Insiders, Hurt Outsiders
Regional agreements on standards can impact trade. When countries agree on standards, trade between them increases, but not necessarily with other countries. If standards are harmonized, exports from countries not in the agreement may decrease, especially if the standards become stricter. Mutual recognition agreements generally boost trade within the region, unless they have strict rules about where products come from, in which case trade within the region increases at the expense of imports from other countries.