Intraregional trade grew faster than interregional trade in the 1980s

Evidence

Trade expansion follows economic integration, and during the 1980s and early 1990s intraregional trade became increasingly more important relative to interregional trade. Trade within the European Community constituted 50.6 percent of the community’s total trade in 1980 and grew to 58.9 percent by 1989. Similar shifts toward regional trade occurred in North America and East Asia. In Latin America, the creation of Mercosur and the revival of the Andean Pact stimulated an upsurge in intra-Latin American trade in the early 1990s, with trade between Brazil and Argentina tripling and Colombia-Venezuela trade quadrupling between 1990 and 1993. In 1994 Brazil replaced the United States as Argentina’s principal trading partner. The creation of NAFTA was similarly accompanied by a significant increase in Mexican-U.S. trade. Trade within East Asia also expanded more rapidly than extraregional trade, but its expansion was hampered by Japan’s tendency to keep its markets closed. Trade among the countries of the Chinese cultural zone (ASEAN, Taiwan, Hong Kong, South Korea, and China), on the other hand, increased from less than 20 percent of their total in 1970 to almost 30 percent of their total in 1992, while Japan’s share of their trade declined from 23 percent to 13 percent. In 1992 Chinese zone exports to other zone countries exceeded both their exports to the United States and their combined exports to Japan and the European Community. — Samuel P. Huntington, The Clash of Civilizations and the…, 365

Categorization

• XREF: Connects to my own trade-fragmentation observations about regional blocs replacing global free trade, and to Milgrom’s institutional economics material on how trade needs shared enforcement.
• DEFINE: Establishes the ‘Chinese cultural zone’ as a concrete trading bloc with specific trade shares.
• corroborated: 2 independent passages support this claim — Samuel P. Huntington, The Clash of Civilizations and the…, 365