As soon as the agreements go beyond the regional level, they need help. The World Trade Organization is intervening on this point. This international body contributes to the negotiation and implementation of global trade agreements. First, the customs duties and other rules which are maintained in each of the signatory parties to a free trade area and which are applicable at the time of the establishment of such a free trade area shall not be higher or more restrictive for trade with non-parties to such a free trade area than customs duties and other rules which existed in the same signatory parties before the establishment of the free trade area. In other words, the creation of a free trade area for preferential treatment among its members is legitimate under WTO law, but parties to a free trade area should not treat non-parties less favourably than before the establishment of the area. A second requirement of Article XXIV is that tariffs and other barriers to trade must essentially eliminate all trade within the free trade area. [10] This view first became popular in 1817 by economist David Ricardo in his book On the Principles of Political Economy and Taxation. He argued that free trade expands diversity and reduces the price of goods available in a nation while making better use of its resources, knowledge and specialized skills. However, a free trade policy can simply be the absence of trade restrictions. Overall, the United States currently has 14 trade agreements involving 20 different countries. For example, one nation could allow free trade with another nation, with the exception of exceptions that prohibit the importation of certain drugs that have not been authorized by its regulators, animals that have not been vaccinated, or processed foods that do not meet their standards.

These agreements between three or more countries are the most difficult to negotiate. The larger the number of participants, the more difficult the negotiations. They are inherently more complex than bilateral agreements, with each country having its own needs and wishes. Both the creation of trade and the diversion of trade are crucial effects observed during the establishment of a free trade agreement. The creation of businesses will lead to the relocation of consumption from an inexpensive producer to an inexpensive producer, which will increase trade. On the other hand, trade diversion will have the effect of shifting trade from a lower-cost producer outside the area to a more expensive one under the free trade agreement. [16] Consumers will not benefit from such a deferral under the free trade agreement, as they will be disinterested in the possibility of buying cheaper imported goods. However, economists find that trade diversion does not always harm aggregate national welfare: it can even improve aggregate national welfare if the volume of diverted trade is low. [17] Free trade agreements, which constitute free trade areas, are generally outside the scope of the multilateral trading system. . .

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