Difference between trading blocs and free trade agreements (1 Viewer)

[relativity1]

So my understanding is that trading blocs are formal agreements that exclude other countries; do free trade agreements also exclude countries, or is it an agreement between set countries that is open to other countries?

 

[spatula232]

You would mostly look at FTAs as being exclusive. For example, ChAFTA between Australia and China is only between the two economies (bilateral), thus excluding other nations. However multilateral FTAs such as the TPP (which possibly could be defined as a trading bloc) isn't to the exclusion of others, however the EU is (as seen in their Common Agriculture Policy).

Honestly, it depends on the specific agreement. Like the TPP is relatively open (with no higher tariffs against members) whilst the EU is not

 

[swagmeister]

A trading bloc is normally a group of countries that agree to remove protectionist policies with each other to some degree, whereas a free trade agreement is normally between two countries and removes all protectionist policies