Why Do We Use Free Trade Agreement

Global companies with multiple offices or with customers in other countries have a complex network of import and export partners. Prior to the Compass trade™, there was no instrument that would allow these companies to properly compare and review which free trade agreements they could use based on the rules of origin* and which combination of transactions would be most appropriate given future tax rates. At the same time, it is not easy to find the right staff in a timely manner, as a high level of expertise is required to read the agreements signed by each country. Trade Compass™ allows you to easily and quickly find the optimal free trade agreements without reading the abstruse agreements. A better solution than protectionism is to include in trade agreements provisions that protect against inconvenience. Free trade agreements are designed to increase trade between two or more countries. Increasing international trade has the following six main advantages: What should a company do? Of course, free trade agreements are important because they can lead to more efficiency and cost savings, but many importers decide in advance that trying to manage an FTA program may not be worth the perceived and unknown profit, as they usually manage free trade agreements manually. It takes a long time. When a new product is purchased, a company must determine which dozens, if not hundreds, of free trade agreements apply, and then ask suppliers for product information and certificates of origin that meet the requirements of the agreement.

Managing thousands of products for hundreds of agreements can quickly become overwhelming and cripple many importers before they leave. Free trade agreements (FTAs) between the United States and certain trading partners provide low or duty-free access and other benefits, including enhanced intellectual property protection, fair treatment for U.S. investors, greater contribution by exporters to FTA countries` product standards, and increased opportunities for foreign government procurement and U.S. service providers. Not surprisingly, financial markets see the other side of the coin. Free trade is an opportunity to open up another part of the world to domestic producers. There are already about 400 free trade agreements in the world (including free trade agreements in the planning phase). They are intertwined in a complex way, creating a so-called „spaghetti effect“.

In addition, negotiations are progressing to conclude multilateral free trade agreements, which are remarkable for their economic scale, the population they cover and the number of countries in which they are involved, but which are enormous. In addition to existing agreements, global economic partnerships are becoming increasingly complex and complex. The policy of free trade is not so popular among the masses without advertising. Among the main problems are unfair competition from countries where lower labour costs allow for price reductions and the loss of well-paying jobs with manufacturers abroad. .