Over the weekend, 160 countries met in Bali and struck the first major global trade deal in 20 years, agreeing on measures that could add as much as $1 trillion to the global economy and cut trade costs.
The “Bali Package” includes an agreement to simplify customs procedures and increase the trade of goods, and the deal also allows developing countries to stockpile food to sell at subsidized rates to the poor. The deal is the most substantial trade agreement since the World Trade Organization was created in 1995, CNN Money reports.
Developing countries could see as much as $445 billion in savings per year, and over time, the package could create even larger benefits by increasing investment, revenue collection and trade flows.
President Obama said the agreement “represents the rejuvenation of the multilateral trading system that supports millions of American jobs and offers a forum for the robust enforcement of America’s trade rights,” according to CNN Money.
As a result of stagnation in multilateral negotiations in recent years, countries have focused on bilateral or regional trade deals to cut barriers to trade. The U.S. and EU are set to begin a third round of negotiations on the Transatlantic Trade and Investment Partnership—or TTIP—later this month.
Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, which make up a combined 40 percent of the global economy, will also participate in the TTIP negotiations, CNN Money reports.