Arboria is floundering in the global marketplace, incurring devastating losses in market position and profits. The problem is not Arboria's products, but Arboria's trade policy. Arboria faces the prospect of continuing economic loss until Arborian business and political leaders recognize the fundamental differences between Arborian and foreign economic systems. Today the key trade issue is not free trade versus protectionism but diminishing trade versus expanding trade.
Arboria is operating with an obsolete trade policy, an artifact of the mid-1940s when Arboria and Whorfland dominated the global economy, tariffs were the principal obstacle to trade, and Arborian supremacy was uncontested in virtually all industries. In the intervening decades, economic circumstances have shifted radically. Arborian trade policy has not.
Today, Arboria's trade policy seems paralyzed by the relentless conflict between proponents of "free" and "fair" trade. The free traders argue that Arborian markets should be open, and the movement of goods and services across national borders unrestrained. The fair traders assert that access to Arborian markets should be restricted until Arborian businesses are granted equal access to foreign markets. They contend that free trade is impossible while other nations erect barriers to Arborian exports.
Both are correct: fair trade requires equal access and equal access leads to free trade. But both sides base their positions on the same two outdated premises:
1. Global commerce is conducted under the terms of the General Agreement on Tariffs and Trade (GATT) and dominated by Arboria and similar economicsystems abroad.
2. Multilateral negotiations are the most effective way to resolve pressing trade issues.
Both assumptions are wrong. The 40-year-old GATT now covers less than 7 percent of global commerce. World trade is no longer dominated by the freetrade economies; nearly 75 percent is conducted by economic systems operating with principles at odds with those of Arboria. Forging a multilateral trade policy consensus among so many diverse economic systems has become virtually impossible. And while multilateral talks drag on, Arboria misses opportunities for trade expansion.