Regarding The Benefits Of Regional Trade Agreements Which Of The Following Is Not A Benefit

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Regarding The Benefits Of Regional Trade Agreements Which Of The Following Is Not A Benefit

WTO members are allowed to conclude the RTA under certain conditions, defined in three sentences. These rules include the creation and operation of customs unions and free trade zones for trade in goods (Article XXIV of the 1994 General Agreement on Tariffs and Trade), regional or comprehensive agreements for trade in goods between developing countries (empowerment clause) and trade agreements on services (Article V of the General Agreement on Trade in Services). In general, ATRs must essentially cover all trade – unless they are subject to the enabling clause – and make trade between RTA countries freer without increasing trade barriers with the outside world. A regional trade agreement (RTA) is a treaty between two or more governments that sets the trade rules for all signatories. Examples of regional trade agreements include the North American Free Trade Agreement (NAFTA), the Central American-Dominican Free Trade Agreement (CAFTA-DR), the European Union (EU) and the Asia-Pacific Economic Cooperation (APEC). Member States benefit from trade agreements, including increased employment opportunities, lower unemployment rates and increased market opportunities. Since trade agreements generally come with investment guarantees, investors who wish to invest in developing countries are protected from political risks. Using the term `regional`, it should be remembered that trade agreements are international – member states of a trade pact do not need to be in a neighbouring country. As a result, regional trade agreements can cover large geographic areas. WTO members also stated that ATRs can complement the multilateral trading system, not replace it. Director-General Roberto Azev├ędo said that many key issues – such as trade facilitation, liberalisation of services and subsidies for agriculture and fisheries – can only be addressed comprehensively and effectively if everyone has a place at the negotiating table.

In addition, a multilateral system ensures the participation of the smallest and weakest countries and contributes to the integration of developing countries into the global economy. Regional trade agreements refer to a treaty signed by two or more countries to promote the free movement of goods and services beyond the borders of its members. The agreement contains internal rules that Member States comply with each other. As far as third countries are concerned, there are external rules to which members comply. Trade agreements open many doors. With access to new markets, competition intensifies. Increasing competition is forcing companies to produce better quality products. It also leads to greater diversity for consumers. If there are a variety of high quality products, companies can improve customer satisfaction. One of the main advantages of regional trade agreements is the removal of trade barriers.

This is an advantage because it acts as a catalyst for more trade and growth, as states have easier access to foreign markets. RTAs are, by their nature, much smaller than mega-regional trade agreements and extremely extensive global trade agreements. This makes it much easier and quicker to successfully conclude a regional trade agreement because there are fewer parties involved. International relations and peacekeeping are another advantage of regional trade agreements.