This article reports the news of China, Japan and South Korea seeking a trilateral trade pact between the three countries. The minister of trade met in Tokyo and agreed to increase efforts in free trade agreement in order to promote free flow of trade and investment which is vital to sustaining economic growth.
The recent financial crisis from key markets such as U.S. and Europe has decreased the demand as well as the disaster in Japan. The tsunami and the earthquake in Japan has disrupted the various supply chains that had big effects in both China and Korea's economies. The trade ministers of China and Korea urged Japan to restore the supply lines as soon as possible and also emphasized the positive role of increased trade will have in Japan's recovery.
A Joint Study Committed between the three countries were set up in order to develop a trilateral free trade agreement.
4 comments:
Japan seems to be getting the best deal out of this pact. If it goes through, the deal may ensure that Japan quickly gets back on its feet via active trading with China and South Korea.
But does this deal look troublesome for the U.S? One of the reason's the three economies are even talking about the deal is because U.S. demand for goods has been lacking due to the financial crisis. If the deal goes through, is it a sign that U.S. demand for goods is not an integral part of China's growth anymore? This is simply a theory and is open to comment.
International trade will be largely beneficial to all 3 countries. Increasing inter region trade was an inevitable step that had to be taken.
Tough times may have caused the 3 countries to come together. The economic benefits are a stronger motive then unfriendly past politics among the countries.
Reduced cost and greater ease of transportation will be one of the many benefits.
The earthquake and tsunami in Japan has caused a lot of companies March sales decrease. I'm doing a stock project so i was tracking stock prices. Adobe Inc. generates 15% of its sales from Japan, and in early March, right after the disaster, its stock price dropped and the forecast sales for the 2nd quarter decreased by 50%.
This trade pact is very beneficial to all three countries. It not only improves the economic situation of the area through free flow of trade and investment, but it can also help stabilizing the political situation in the area by making the three countries become more dependent on each other.
It could be troublesome for the US, as freer trade between the three countries could decrease their demands on US goods and services; these goods and services were forbidden to trade between the three countries because of their political conflicts.
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