North America and Europe are regions that are developed and continue to dominate the world. They have modern and sophisticated transport infrastructure for the delivery of goods, especially with their intense trade participation. They have also globalized their trading activities by forming blocs such as North American Free Trade Agreement (NAFTA) and European Union (EU). This paper seeks to examine the similarities and differences between North American and European freight transport systems, global trade and global policy implications.
Compare and contrast European and North American freight transport systems
In the current world, transportation has become very important. Various industries have been noted to exhibit massive production of goods. Therefore, it has become more paramount for businesses and organizations to have a well-structured system for freight transport. Freight transportation has been involved in transporting goods to other regions. North America and Europe are unique with respect to organization, market focus and ownership. The transport system in North America is more dominated by private owners especially the rail market (Rodrigue & Notteboom, 2010). This has made such an industry to have intense competition. On the other hand, the freight industry is highly dominated by the government. The distinctiveness between infrastructure manager and rail operators revived former national railway networks.
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Customization has also emerged in distinguishing freight transport systems between Europe and North America. The European market is heterogeneous filled with different cultures (Rodrigue & Notteboom, 2010). In such an environment, customization in the freight systems is vital to meet the needs of the various nations. On the contrast, North America’s market is homogenous thus leading to less customization in the freight systems.
Globalization trade
These two blocs have participated in global trade through trade blocs. North America Free Trade Agreement (NAFTA) and European Union (EU) are trade blocs for North America and Europe respectively. These two blocs have enabled liberalization of trade for their members. They are also similar in that they alleviate trade barriers placed on its members such as quotas, tariffs, among others. NAFTA lacks antitrust policies compared to EU which are founded on certain laws (Gough & Venkataramany, 2006). In addition, NAFTA lacks supranational institutions which are the foundation of European Union which has a commission, court justice and competition rules. The lack of strong competition laws has limited the progress of North America.
Global policy implications
Global policies have had a serious impact on trade. To start with, NAFTA appears to limit the levels of income and productivity growth. This is because the United States and Mexico have placed in low wage strategies within NAFTA region (Smith & Lindblad, 2003). This has influenced the increase of unequal wages thus limiting productivity. Such policies have had a negative impact for the North American region. Therefore, it will be vital for NAFTA members to adopt high labour standards and productivity in order to boost the economic growth of this region.
The Europe Union has been facing tough times after the exit of United Kingdom. This has had a serious implication on the US with regards to trade. After Trump’s entrance into White House, the European Union believes that US might protect itself after UK’s exit (Gough & Venkataramany, 2006). The US and its NAFTA members are supposed to champion for global engagement. It appears that the interests and concerns of Europe might be ignored due to global policies that might be initiated by Trump’s government.
Conclusion
In conclusion, there is a significant difference between Europe and North America with respect to freight transport systems, global trade and global policy implications. It appears that the European Union is more organized compared to the United States despite their immense power and influence. In the NAFTA region, the US is more developed than its fellow members because they lack robust economic strategies, unlike the European Union. EU is more organized as it has a commission, court and competition rules which enable nations to grow at a similar and progressive pace.
References
Gough, G.M., & Venkataramany, S. (2006). Regional economic cooperation . International Business & Economic Research Journal, 5(2), 50-68.
Rodrigue, J.P., & Notteboom, T. (2010). Comparative North America and European gateway logistics: the regionalism of freight distribution . Journal of Transport Geography, 18(4), 496-510.
Smith, G., & Lindblad, C. (2003). Mexico was NAFTA worth it? Business Week, 3863, 7.
