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The Free-Trade Area of the Americas - Essay Example

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The study would aim at answering these research questions: What the reasons why governments across the Americas are pushing for the free trade area? Why do some groups protest the implementation of the FTAA? What could governments do to help their small companies compete in trading blocs?…
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The Free-Trade Area of the Americas
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Download file to see previous pages For the past few years, diplomats from 34 nations have been working hard to push for the establishment of a free trade area. The following are reasons why governments across the Americas are pushing for the free trade area. First, a country will only specialize in selling goods and services which it can do be and trade with other nations for its wants. This is a representation of actual supply and demand of free trade market. This is because when a certain country concentrates the products that it can do best, such a country takes economy of scale advantage and manufactures their products at reduced production costs. Secondly, these governments argue that free trade area will lead to increased imports and exports, thus increasing the availability of products in the involved nations, therefore, bringing healthier competition. Another reason why governments across the Americas are pushing for a free trade area is that it will reduce living costs, thus increasing economic growth. This is because it will do away with governmental interventions such as taxes and tariffs thus enabling consumers to purchase products at reduced costs. This will also bring good bond between the involved countries leading to healthier governance and diplomatic global ties. Anti-FTAA group claims that free trade agreement extends treaties that were already adopted (NAFTA and FTA) from the acute North of Tierra del Fuego, Canada, and NAFTA had noxious outcomes with Mexico and the impacts negatively workers in the United States and in Canada. Therefore, the protests argue that from this example, it is evident that the FTAA will bring disastrous effects on Latin America. From the protests point of view, the accords of Free Trade are Globalization masterpieces and thus they will allow deregulation as well as the opening of new markets through the elimination of trade barriers such as worker rights and environmental protection. Additionally, these accords will contribute to commodification and privatization of things such as education and healthcare services and due to globalization, Free Trade aims at enriching “world masters” called big capitalists and financiers.
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