Friday, November 16, 2012

Free Trade Between China and Russia Promotes Peace

“If goods don’t cross borders, then armies will” has been one my favorite quotes from the great French classical liberal or proto Austro-libertarian Frederic Bastiat.

Emerging market investing guru and Franklin Templeton’s Mark Mobius notes of such dynamic in motion between China and Russia
From a geographic perspective, Russia and China’s common border along the Amur River is an area of past conflict but also one of potential cooperation. Russia’s side is under-populated but boasts arable land, timber and other resources while the Chinese side is densely populated with limited resources. In 1969, cross-border tensions nearly resulted in a full-scale war, but today the mood is quite different. Reports indicate that most Siberian and Far East officials are positive about the presence of Chinese in their regions since they are suffering from the departure of ethnic Russians from their areas, and the Chinese labor force can help cultivate the land.

Of course, even the friendliest of neighbors can disagree at times, but if neighbors like China and Russia can focus on projects to their mutual economic benefit, I think that’s an approach we might pursue in our own backyards.
It’s really individuals from China and Russia, through the employment of voluntary exchange via the “division of labor” channel, who promotes “mutual economic” interests.

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