Which Of The Following Is An Advantage Of The Establishment Of Free-Trade Agreements Quizlet

Which Of The Following Is An Advantage Of The Establishment Of Free-Trade Agreements Quizlet

In the headlines of newspapers, trade policy most often appears to be a bitter and erausal quarrel. Countries almost constantly threaten to challenge the “unfair” trade practices of other nations. Procedures for the settlement of disputes from the WTO, the European Union, NAFTA and other regional trade agreements are under way. Politicians in national parliaments, denounced by lobbyists, are often threatened with bills that “create a level playing field” or “prevent unfair trade” – although most of these bills aim to achieve these ambitious goals by further limiting trade. Protesters in the street may oppose certain trade rules or the practice of international trade. The best known of these regional trade agreements is the European Union. In the years following The Second World War, the leaders of several European nations argued that if they could strengthen ties between their economies, they might be more likely to avoid another devastating war. Their efforts began with a free trade association, became a common market, and then turned into a comprehensive economic union today, called the European Union. The EU, as it is often called, has a number of objectives. Thus, in the early 2000s, it introduced a common currency for Europe, the euro, excluding most previous national monetary forms, such as the German mark and the French franc, although some retained their own currencies. Another key element of the union is the removal of barriers to the mobility of goods, labour and capital across Europe.

There are different types of economic integration around the world, from free trade agreements in which participants mutually allow each other imports without tariffs or quotas, through common markets where participants have a common trade policy and free trade within the group, to comprehensive economic unions that coordinate, in addition to a common market, monetary and fiscal policy. Many nations are part of both the World Trade Organization and regional trade agreements. Pro-free trade economists are concerned that some of these regional agreements could promise free trade, but in fact serve as a means for countries, under the regional agreement, to limit trade everywhere. In some cases, regional trade agreements may even conflict with broader World Trade Organization agreements. For the United States, perhaps the best-known regional trade agreement is the North American Free Trade Agreement (NAFTA). The United States also participates in some smaller regional trade agreements, such as the Caribbean Basin initiative, which proposes reduced tariffs for imports from those countries, and a free trade agreement with Israel. The world has seen an avalanche of regional trade agreements in recent years. About 100 such agreements are now in force. Some of the most important are listed in Table 7. Some are just agreements to keep talking; others have set specific targets for reducing tariffs, import quotas and non-tariff barriers. One economist described the current trade agreements as a “spaghetti bowl,” like a map with lines that link all countries to trade agreements. The slow pace of the GATT negotiations gave rise to an old joke that GATT was really synonymous with gentleman`s Agreement to Talk and Talk.

However, the slow pace of international trade negotiations is understandable, if not reasonable. Dozens of nations have approved any treaty, is a long process. GATT has often established separate trade rules for certain economic sectors, such as agriculture, and for some countries such as low-income countries. There were rules, exceptions to the rules, ways to unsubscribe from the specific rules and formulations that we would have to fight for.


Comments are closed.