Free trade is a policy of not prohibiting imports or exports, and it is accepted between many countries nowadays, including some international organizations, which uphold free trade among their

Free trade.

Free trade is a policy of not prohibiting imports or exports, and it is accepted between many countries nowadays, including some international organizations, which uphold free trade among their members, for example EU or Customs Union. Let's consider some of the advantages and disadvantages of free trade.

1. Free trade allows people to export their goods.

People can open their own business in any sphere and to consumers not only in their country but also abroad.

2. Free trade stimulates competition.

Competition keeps prices down and gives people wider choices.

3. Free trade allows companies to grow.

Due to lack of fees and state control company can independently adjust the volume of products produced for the market. In case of having competition, the company will grow and develop, in order not to lose market share.

4. Free trade promotes world peace and understanding.

A lot of wars are caused for economic reason; over trading routes or markets, or access to natural resources.

5. Free trade encourages travel.

Due to free trade the number of firms, which are involved in passenger transportation, will increase, respectively, prices for passenger transportation will fall down. In consequence, people will be more profitable to travel.

Most nations are today members of the World Trade Organization (WTO) and multilateral trade agreements. Russia signed the WTO treaty recently, thus joining the biggest trade union ever.

Free trade allows all nations to participate in global commercial operations and allows selling goods from every corner of the earth. In theory, it guarantees prosperity, cheap prices, wide range of products and enrichment of all people. Nevertheless, free trade can destroy the economics of both less and more developed countries, wrack the industry and provoke unemployment. Besides, forcing every country of the globe to adopt the free trade policy is impossible, so the whole idea remains theoretical. In my humble opinion, it should be decided with caution if the country will adopt free trade or protectionism.

Some people think that free trade hurts domestic producers by opening up competition to companies which operate in nations with less stringent labor laws. In the European Union, for example, there are specific rules about working hours, fair rates of pay, working conditions, and so forth, which drive up the cost of production for companies which operate in the European Union.

I think that benefit of free trade for consumers is the ease of access to goods that may otherwise be unavailable. In many instances, there are demands for goods within a market that either lacks the ability to fulfill part or all of the demand. For example, a country may not have the ability to grow certain produce that is a popular item among its immigrant population. The lack of trade barriers can allow these consumers to readily access the goods they desire.

To sum up, despite many advantages, free trade policy has never been completely adopted by all the countries of the world. Globalization has made the world a much smaller place. And global trade refers to the act of buying and selling goods and services between countries, which has different economy system.

Дата добавления: 2015-11-04