I have no experience in this, but, couldn’t they just agree to export and import all the things they need just like that and that’s it?
In: Economics
Each country wants to be able to freely sell their goods in the other country. This is beneficial to their citizens.
Each country also wants to obtain as many restrictions as possible on what the other country can export to them, to protect their own industries.
There is a substantial amount of negotiation about how far each country is willing to let the other go.
Big sticking points are things like each countries environmental and labor regulations – if the other country has a massively exploited labor force paid $2/day and gets rid of pollution by dumping it in the ocean they’re gonna be able to undercut your domestic production, either putting your own industries out of business or forcing your country to adopt similar practices to remain competitive. It’s not uncommon for tarrifs in situations like this to shore up domestic industries against cheap imports.
Other things that get negotiated are things like subsidies – many countries have extensive agricultural subsidies, but they allow producers to work on much lower margins than farmers in other countries. If you’re signing up to a trade deal and farmers in the other country get boatloads of corn subsidies while your domestic market doesn’t do the same it’s going to put your own farmers out of business.
Then there’s what products can be sold in each country – though this overlaps heavily with regulations mentioned earlier. For example in the US the chicken farming practices are more economical, but require eggs to be washed and refrigerated and for chicken meat to be washed in a chlorine solution. In the EU the approach to disease control is more aggressive, but more expensive, so eggs don’t need refrigeration and chicks aren’t chlorine bathed, but cost more. Should the EU change their standards to match the US? Should the US adopt EU standards? Can the EU out a tariff to equalize the pricing? Alternatively the EU has less restrictive rules on engine emissions than the US. A lot of vehicles sold in the EU are illegal in the US due to their emissions, particularly diesels. Should the US allow EU trucks? Should the EU raise their standards? Can the parties agree “this is an item that can’t be imported”? But if you go with the last option you open the door to each side using regulation to block imports from the other.
TL;DR – There are a lot of conflicting interests, and a lot of legislative and regulatory alignment items to come to agreement on.
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