Free trade is a policy in international markets in which governments do not restrict imports or export. Good examples of it are European Economic Area and the North American Free Trade Agreement.

Free trade.

Free trade is a policy in international markets in which governments do not restrict imports or export. Good examples of it are European Economic Area and the North American Free Trade Agreement. Most nations are today members of the World Trade Organization (WTO) multilateral trade agreements. The organization deals with regulation of trade between its members. The main idea of free trade is trading of goods without taxes or other trade barriers.

A lot of experts claim that the policy of free trade is a good choice for countries because it has some significant advantages. It increases export opportunities and creates wealth. It is also beneficial for counties with small populations because they can find new markets which will allow them to expand.

Many people believe that free trade is a good thing because it creates competition between producers. First of all competition gives people wider choices. That keeps prices down and producers try to make quality of the products high. Another advantage of free trade is that it allows countries to exploit their comparative advantage.

But at the same time free trade has some disadvantages. Free trade is dangerous for countries which want to star manufacturing their own goods. In this case it will be better to use the policy of protectionism because this will make them less dependent on imports and help with their trade balance. Only protectionism can help against unfair competition. Aggressive companies dumb their goods in importing countries. They don’t make a profit and this kills the local competition. Arguments for protectionism also has moral aspects such as inequality of income and damage that caused by the increasing number of factories with cheap labor.

In my opinion free trade is a good way to unite nations because as we know a lot of wars are caused by economic reasons. But free trade has some big disadvantages. It can be especially dangerous for small countries with weak economics.

To conclude we can say that free trade can be beneficial but at the same time it does not suitable for every country because different countries have different economical systems and abilities.

Дата добавления: 2015-10-21