Us Preferential Trade Agreement
Preferential trade agreements facilitate trade and investment between Member States. In order to encourage, reduce or eliminate trade barriers between Member States, such as import duties (taxes imposed by countries on products manufactured abroad), restrictions on trade in services and other trade rules that impede the flow of trade. In addition, ATPs facilitate investment between Member States by relaxing the rules on foreign investment and providing better legal protection for foreign investors. The United States is a member of the World Trade Organization (WTO) and the Marrakesh Agreement establishing the World Trade Organization (WTO) establishes rules governing trade between the WTO`s 154 members. The United States and other WTO members are currently leading the Doha Development Round of global trade negotiations, and a strong and market-open Doha Agreement for both goods and services would go a long way in managing the global economic crisis and restoring the role of trade in managing economic growth and development. International trade brings several benefits to the U.S. economy. Trade increases competition between foreign and domestic producers. This increase in competition leads to a contraction of the least productive U.S. companies and industries; It also enables the most productive U.S. companies and industries to expand to exploit new, profitable overseas sales opportunities and achieve cost savings through greater economies of scale.
As a result, trade promotes a more efficient allocation of resources in the economy and increases the average productivity of businesses and industries in the United States. This increase in productivity allows trade to increase economic performance and the average real wage (adjusted for inflation) of workers. In addition, U.S. consumers and businesses benefit because trade reduces the prices of certain goods and services and increases the diversity of products available for purchase. Another important type of trade agreement is the Trade and Investment Framework Agreement. TTIFA provides a framework for governments to discuss and resolve trade and investment issues at an early stage….
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