Those 214 agreements are not all with major developed countries. In fact, more and more of them govern trade among developing countries (so-called south-south FTAs). The WTO has a great database of these agreements that can be fun to play with. Who knew, for instance, that Peru has an FTA with Iceland, Liechtenstein, Switzerland and Norway? Or that there is a Pan-Arab Free Trade Area (PAFTA) covering much of North Africa and the Middle East?

Hmm...what can we sell in India?

The Malaysia-Chile FTA is brand new and involves two of the parties in the negotiations for a Trans Pacific Partnership (TPP). Chile’s 2010 exports to Malaysia were only about US$200 million so it will be a while before the impact of this agreement is seen. Still, Chile anticipates that the FTA will lead to more projects in Chile by Malaysian South-South Corp Bhd (MASSCORP), a consortium of 86 Malaysian corporate leaders. And Malaysia expects the agreement to open the door to building Latin American sales for Malaysia’s Proton cars. Expect to see Malaysian solar panels arriving in Chile, and Chilean wines sipped in Malaysia.

By the way, the WTO’s list of trade agreements is about to grow some more. Not only will the three U.S. FTAs with South Korea, Panama and Colombia be added this spring, but a brand new FTA between Japan and Peru goes into effect in March, freeing up nearly all of their trade in both directions over the next decade.

India has fought long and hard to play host to a Formula One race and the first Indian Grand Prix is scheduled to run later this month at a brand new track outside New Delhi. If the Indian tax wallahs allow the race to get to the first turn. India’s Central Board of Excise and Customs is refusing to grant the F1 teams a duty exemption for temporarily importing all the equipment needed to run a modern auto race. The teams started flying their gear on an Asian swing a couple weeks back to race in Singapore last weekend and Japan next weekend, with India after that. The logistics put a premium on being able to move massive amounts of kit very, very quickly over international borders. Most countries go out of their way to make it as easy as possible. Not India, which wants to pocket $1.5 million dollars in customs duties.

Fast tax

To make things worse, the Indian state in which the track is located wants to tax the racing teams’ income. They argue that the India race is one of 19 races this year, so they are entitled to tax 1/19th of the teams’ income. Leaving aside the matter of whether all races attract the same amount of income, being the only country on the schedule to do this likely means that India won’t be on the schedule again. Oh, and they want to tax the drivers’ income, too. I don’t know if they have gotten down to the mechanics or the cooks in the hospitality centers.

When I heard about the customs duties, my first thought was that the F1 teams simply need to get an ATA Carnet from the International Chamber of Commerce to solve the problem. India, after all, is one of the more than 75 countries that recognizes carnets as a way to bring goods in temporarily – duty free, say, for showing at trade fairs. But, it turns out, India never signed on to the carnet provision to allow temporary imports of “professional equipment”. This means that the Indian customs people are within their rights, but does enforcing those rights make it wise?

The Indian race organizer says they will pay the customs duties if necessary. Don’t know how the income tax thing will come out. If it can’t be resolved, F1 has plenty of offers to race in other countries. FYI, India screwed participants in the 2010 Commonwealth Games the same way.

China is the world’s biggest offender, supplying two-thirds of a $600 billion a year industry that is growing by 30% a year. (And you wonder why my posts on international corruption are almost always linked to China: they simply cheat more than anyone else.) Looking just at U.S. (not worldwide) seizures of counterfeit goods, nearly $205 million was seized last year with Chinese origins. Next up was free-trade (and apparently laissez faire  enforcement) Hong Kong with nearly $27 million. India followed a distant 3rd with a little over $3 million in U.S. seizures.

10% of the world’s drugs are counterfeited, a number that rises to 25% in developing countries. That’s comforting to think about when you are buying drugs online. Fake Viagra made up 57% of all U.S. drug seizures in 2010, which I suppose proves the power of positive thinking (i.e., the placebo effect) among upstanding citizens.

37% of the auto parts sold in India are counterfeits. The Middle East is safer; they only have 20% fakes on their cars and trucks. 36,000 auto fatalities in the United States may have been caused by counterfeit parts.

If the auto parts and the fake drugs don’t get you, China makes enough counterfeit cigarettes to supply every American smoker with 460 packs a year.

There is plenty more, so run, don’t walk.