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A better solution than protectionism is to include rules in trade agreements that protect against inconvenience. The European Union is now a remarkable example of free trade. Member States form an essentially borderless unit for trade purposes, and the introduction of the euro by most of these countries paves the way. It should be noted that this system is governed by a Brussels-based bureaucracy, which has to deal with the many trade-related issues that arise between the representatives of the Member States. But the biggest agreement, NAFTA, has had a bigger impact. A CBO report estimated that NAFTA accounted for 34% of U.S. trade growth with Canada and Mexico in the first seven years of the agreement. In total, over the same period, NAFTA accounted for 7% of total U.S. trade growth. Many of us involved in exporting are urging the president not to give up this agreement. Free trade agreements such as NAFTA are vital to the growth of the U.S.

economy and give our country the opportunity to play a leading role in areas such as workers` rights and the environment. Read on to learn more about the reasons for the free trade agreement and how they benefit the United States. In addition, free trade is now an integral part of the financial and investment systems. U.S. investors now have access to most foreign financial markets and a wider range of securities, currencies and other financial products. First, the parties that signed a free trade area applicable to trade with non-parties to that free trade area at the time of the creation of that free trade area must not be higher or more restrictive than tariffs and other rules applicable in the same signatory countries prior to the creation of the free trade area. In other words, the creation of a free trade area to give preferential treatment to their members is legitimate under WTO law, but parties to a free trade area are not allowed to treat non-parties less favourably than before the creation of the territory. A second requirement under Article XXIV is that tariffs and other trade barriers must be eliminated primarily for all trade within the free trade area.

[10] A government does not need to take concrete steps to promote free trade. This upside-down attitude is called “laissez-faire trade” or trade liberalization. Free trade agreements, which are free trade zones, are generally outside the scope of the multilateral trading system. However, WTO members must inform the secretariat when new free trade agreements are concluded and, in principle, the texts of free trade agreements are reviewed by the Committee on Regional Trade Agreements. [11] Although a dispute in free trade areas is not the subject of litigation within the WTO`s dispute resolution body, “there is no assurance that WTO panels will comply and reject jurisdiction in a particular case.” [12] The biggest criticism of free trade agreements is that they are responsible for outsourcing employment.