When “Free Trade” Agreements Are a Polite Form of Protectionism
Even some libertarians are under the delusion that regional free trade agreements are motivated by a desire to reduce trade barriers. In reality, states form trade associations to increase their bargaining powers on a global scale. As such, trade agreements are merely tools to promote the agenda of elites. Although Americans may be uninterested in the parochial affairs of Caribbean states, a recent trade dispute among members of the regional trade bloc Caricom aptly demonstrates the ironic effects of agreements purporting to advance trade. Essentially, here we see an international “free trade” agreement being used by a Dominica-based company to demand more limits on trade between Jamaica and a country outside the bloc. A report published in the Jamaica Gleaner on December 11, 2020 puts the issue into perspective:
Dominica Coconut Products Successors [DCPS] Limited, the sole Caricom producer of animal fat and palm oil-based noodles that are the core ingredient for the production of soap bars, wants to lock Jamaican companies into buying its raw material over their current suppliers in Indonesia, in order for the local firms to continue qualifying
Article from Mises Wire
