Free Trade

Topics: Free trade, International trade, World Trade Organization Pages: 4 (1303 words) Published: March 25, 2013
North American Free Trade Agreement, one of the largest free trade areas, which in 1994 established a free-trade zone between the US, Canada, and Mexico. NAFTA passed with some important negotiations to protect the environment and labor standards. In 2001, President Bush organized the proposal of expanding NAFTA to a Free Trade Area for the Americas, surrounding 34 countries and 800 million people by 2005. President Obama continues to push for expansion to CAFTA known as Central America Free Trade Agreement. NAFTA now links 450 million people producing $17 trillion worth of goods and services. The United States goods and services trade with NAFTA totaled $1.6 trillion in 2009. Under the NAFTA, United States textile and apparel exporters benefits from duty-free entry on all products into Canada and Mexico. President Obama signed off on the 3 biggest free trade agreements since NAFTA. Free trade agreements of his administration, deals with South Korea, Colombia, and Panama that could be worth billions to American exporters and create tens of thousands of jobs. The policy of the free trade states that free trade is an element of capitalism that essentially means that there are no restrictions from the government about trading. The government also says that there no restrictions of importing/exporting with other countries. Free trade is also a policy were the government accepts imports and exports by applying tariffs. Tariffs are a tax imposed on imports in and out of a country. World Trade Organization, an international organization intended to reduce trade barriers, formed in 1995. WTO members (which include China since 2001) charge minimal import tariffs on each other. I think tariffs could benefit and harm free trade. Some reasons tariffs are used is to protect consumers, national security and retaliation. When protecting the consumers a government has the right to levy a tariff on products that they feel can harm its population. For example, Japan could place...
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