China

China and Peru agree to trade deal

China and Peru concluded their talks on a free trade agreement this past Wednesday. Peru is the second Latin American country to complete such a deal with China, after Chile in 2005. China’s President, Hu Jintao, said the agreement symbolized that bilateral ties are entering a new era of rapid development. President Hu was warmly welcomed in Peru, reflecting enthusiasm for close ties between two of the world’s fastest growing economies. However, small business workers in Peru are concerned about the agreement, fearing floods of cheaper imports could put many Peruvians out of work.

In general, liberalism focuses on trade as a means of good negotiation and communication between states. Neo-liberalism, specifically, emphasizes free trade as a means to more prosperity and peace between states. States that are bound by a free trade agreement become dependent on these trade flows and will act in a way that sustains them. According to this theory, China and Peru will now act in ways that sustains a good trade relationship between them. They will become interdependent and, for this reason, the possibly of war between them will decrease. China is looking to create more free trade agreements with Latin American countries, which will only facilitate more interdependence between the fast growing economy in the East and the resource-abundant Latin American economies. This type of interaction between states is beneficial. Not only are they communicating and negotiating more, but more trade will lock them into peace. This is a crucial when understanding states and the relations between them.

Liberal

http://news.xinhuanet.com/english/2008-11/20/content_10386865.htm

http://news.bbc.co.uk/2/hi/asia-pacific/7738930.stm

November 20, 2008 at 8:54 pm