Trade in a world of regions
Brigid Gavin and Luk Van Langenhove
The past decade has seen a renaissance of regional trade agreements (RTAs) world-wide. The “new regionalism” of the 1990s, which compares with the “old regionalism” of the 1960s, took place against a background of significant structural changes in the global political and economic order. The collapse of the Soviet empire ended the bipolar world of rivalry between democracy and market economics at one end of the spectrum and communism and planned economies at the other. The “end of history” thesis predicted a generalized move towards democracy and free market economies on a global scale. The general trend has been in this direction, which undoubtedly has accelerated economic globalization over the past decade.
Growing regionalism in a world of globalization? Is it just a coincidence or the emergence of something new? Economic integration in Europe since the fall of the Berlin Wall has taken on a new dimension – “projecting collective power” to defend Europe's values in the world. The new approach sees Europe as a cornerstone of a multipolar world order. Regions must organize themselves and develop as a counterweight to any one single pole of power in the global economy. In this worldview, regionalism is about pooling sovereignty to enhance sovereignty. The more regions can unite, the more they can determine their own destiny in the global order. Because sovereign states feel that their sovereignty