With the expansion of the European Union (EU), the birth of the South American Community of Nations (CSN), and the strengthening of trade ties among Asian economies, the year 2004 witnessed closer regional cooperation in the world economy.

The World Trade Organization (WTO), the Geneva-based body which regulates international trade rules, said it had been notified of 293 regional trade arrangements as of January 2004, and up to 45 percent of world trade are conducted under regional cooperation agreements.

The figures indicated that closer trade ties among neighbors has become a popular option for many economies to sharpen their competitive edge.

The EU, an economic powerhouse, is widely regarded as a good example in regional economic integration.

Already the world's leading trader and home to one of the world's most sought-after currencies, it is seeking further expansion with the goal of making the region "the world's most competitive" one by the year 2010.

The bloc's enlargement in May added 75 million consumers, creating a single market of 450 million people, compared to 420 million for that of the North American Free Trade Agreement (NAFTA), inked by Mexico, the United States and Canada a decade ago.

Gross domestic product (GDP) of the EU exceeded 10 trillion US dollars after the expansion, accounting for 30 percent of the world's total and almost equal to that of the United States.

Compared with the EU, NAFTA saw no big headway in the passing year, especially as the US initiative to form a free trade zone astriding the two Americas failed to gain sufficient support.

The South America sub region, however, realized the linking of two of its biggest trade blocs, the Common Market of the South (MERCOSUR) and the Andean Community (ANCOM).

South America saw the birth of the South American Community of Nations (CSN), the world's third largest regional bloc only after the EU and the NAFTA, on Dec. 8.

Of the 12 CSN members, nine are grouped by either ANCOM, which is comprised of Bolivia, Colombia, Ecuador, Peru and Venezuela, or MERCOSUR, which groups Argentina, Brazil, Paraguay and Uruguay, with Bolivia, Chile and Peru as associate members.

The new community, covering an area of 17 million square km with 360 million inhabitants and a total GDP of 970 billion dollars, is expected to largely unite South America politically and economically.

Meanwhile, Asia, with the fast-growing economy of China and economic powers like Japan and South Korea, has also become a hot spot for economic cooperation.

In November, China signed two agreements with the Association of Southeast Asian Nations (ASEAN), envisioning a free trade zone by 2010 with a population of 2 billion, a combined GDP of 737 billion dollars and a total trade volume of 720 billion dollars.

Following China, Japan and South Korea have also begun to build up links with the ASEAN, which is made up of Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, giving further impetus to Asia's economic integration.

As cooperation goes well underway within these regions, links among them have also been strengthened rather than weakened.

Celebrating the 15th anniversary of the Asia-Pacific Economic Cooperation (APEC) this year, the Asia-Pacific rim economies are discussing more free trade agreements with each other.

Together with the transatlantic trade links, organizations and mechanisms like APEC are offering opportunities for different parts of the world to get closer through trade and commerce.