eli5: How do trade deals between countries work and why do they take significant amounts of time and are difficult to achieve?

Question

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

Answer 1

Trade deals are basically formal favouritism: apply tariffs to goods coming into the country to encourage industry making within the country if possible, then use trade deals to create special relationships that remove or reduce tarrifs for specific goods moved between specific countries that basically helps the economy of those two countries but not anyone else.

For example, the European Union has a massive trade-deal where no one charges any tariffs on goods coming from another member of the deal and agrees to follow certain regulatory standards. This strongly encourages European businesses to target other European countries as their primary markets, so that any undertaking the EU does will primarily benefit the EU. The EU also negotiates trade deals with other economies as a union, meaning that on the global trade scale, the EU kind of operates as one massive country.