DB REPLIES - BUSI 464
William Vaughn
Free Trade Area of the Americas
Export management strategy focuses on many subjects, one being the Free Trade Areas of the world and the issues dealt with them. Importing procedures and documentation are how products are received into a country or area. What is the Free Trade Area of the Americas (FTAA) and how is importing procedures incorporated at this FTA level?
The Free Trade of the Americas (FTAA) is the FTA of nearly all of the North, Middle and South America Countries. 34 democracies to be exact met with, "[t]he effort to unite the economies of the western hemisphere into a single free trade agreement was initiated at the Summit of the Americas in Miami in 1994" (Prevost, 2005). This meeting concluded nearly ten years of negotiations and plans to get rid of tariffs and other trade barriers allowing the largest trading agreement currently (Rivas-Campo, & Benke, 2003). What it has allowed is the competition in international trade which has allowed more people to want to work and caused labor strikes to decrease substantially (Castelan, 2016). The open competition has allowed countries to become much more profitable and allow more trade between them. Some countries would even allow another country to come into its borders to grow crop, but only by renting their land. The renting of the land and growth from other countries allowed more imports to happen.
Importation fees may have been substituted according to Grinberg because of the inflation of currency needing to cover costs and grow cities to be worth more (2010). Countries began to charge higher rent for land use so to combat the rising rent, the farming country would charge a higher buy price. It wasn't always the case for import fees to be waived because of overvalued currency and land costs, but it was mostly the case for Latin American countries wanting to value themselves the same as others.
The FTAA opened trade to many countries and has become quite the largest free trading area in the world. It has allowed many more jobs to be fulfilled and competition has created a much stabler economy. God allows all to work to his will and even through countries negotiating their final agreements, God completed them. Proverbs 19:21 "Many are the plans in the mind of a man, but it is the purpose of the LORD that will stand" (ESV).
References:
Castelan, D. (2016). Domestic coalitions in the FTAA negotiations: The brazilian case. Contexto Internacional, 38(1), 313-348.
Grinberg, N. (2010). Where is latin america going? FTAA or "twenty-first-century socialism"? Latin American Perspectives, 37(1), 185-202.
Prevost, G. (2005). Contesting free trade: The development of the anti-FTAA movement in the streets and in the corridors of state power. Journal of Developing Societies, 21(3-4), 369-387.
Rivas-Campo, J. A., & Benke, R. T. J. (2003). FTAA negotiations: Short overview. Journal of International Economic Law, 6(3), 661-694.
Discussion Board 3
Cody Mitchell
Liberty University
International trade is growing more and more and continually having a larger impact on nations’ economies. As trade across borders continues to grow, so will the desire for nations to reduce barriers to trade. One significant barrier to trade is tariffs. Tariffs are the schedule of duties imposed on imports, or it can also mean the tax a country puts on goods that enter its borders. Originally, tariffs were a very large part of most nations incomes, but due to growing trade tariffs are now primarily used to protect certain industries within a nation. More tariffs discourage trade in that particular industry, which can prevent cheap products from another country coming into dominant a domestic market. Regional trade agreements can often form a common external tariff, which is a tariff that all the nations within the trade agreement place on nations who are not. Cutting or minimizing these external tariffs can often make a larger difference into how much trade that particular agreement does. One such example is that for a trade agreement that the U.S. had with Canada prior to NAFTA, “tariff cuts were by far the most important tool of liberalization (Breinlich and Cunat, 2015)”. Another huge example of tariff reduction significantly increasing trade is the SADC, which “is a free trade zone and so has effectively eliminated trade barriers (Barnekow and Kulkarni, 2017)” within its own agreement and has therefore experienced greater trade. Tariffs are very significant to our class, since they can pose an additional cost for a company exporting or importing. Certain goods, such as agricultural goods, have higher tariffs in the U.S., which can make it more difficult to import these goods, and obviously other countries have tariffs that will making exporting to them much more costly. The World Trade Organization also has an impact on tariffs and trade. Globally, the WTO has helped to contribute to the reduction of tariffs. To show this, “tariffs today are below 5 percent on most trade (Baldwin 2016)”. The WTO in general is an organization whose goal is to reduce tariffs and increase trade, and will continue to increase in importance as countries trade more.
References
Baldwin, R. (2016, Winter). The World Trade Organization and the Future of Multilateralism. Retrieved April 22, 2017, fromhttp://www.jstor.org/stable/pdf/43710012.pdf
Barnekow , S. E., & Kulkarni, K. G. (2017, February 1). Why Regionalism?A Look at the Cost and Benefits of Regional Trade Agreements in Africa . Retrieved April 22, 2017, from http://journals.sagepub.com/doi/full/10.1177/0972150916666881
Breinlich, H., & Cuñat, A. (2015, July 14). Tariffs, Trade and Productivity: A Quantitative Evaluation of Heterogeneous Firm Models. Retrieved April 22, 2017, from http://onlinelibrary.wiley.com/doi/10.1111/ecoj.12218/full
