Free Trade
Free trade is a policy accepted by some international markets. It represents the following process: the governments of the countries do not restrict imports from, or exports to, other countries.
Free trade is exemplified by the European Economic Area and the North American Free Trade Agreement, which have established open markets. Most nations are today members of the World Trade Organization (WTO) multilateral trade agreements. However, most governments still impose some protectionist policies that are intended to support local employment, such as applying tariffs to imports or subsidies to exports. Governments may also restrict free trade to limit exports of natural resources. Other barriers that may hinder trade include import quotas, taxes, and non-tariff barriers, such as regulatory legislation.
Free trade means that countries can import and export goods without any tariff barriers or other non-tariff barriers to trade. Free trade enables lower prices for consumers, increased exports, benefits from economies of scale and a greater choice of goods. Benefits of free trade include: increased exports, increased competition, reducing tariff barriers, unrestricted access to markets.
Free Trade Agreements (FTAs) have proved to be one of the best ways to open up foreign markets to exporters. Trade Agreements reduce barriers to exports, and protect interests of sellers and enhance the rule of law in the FTA partner country. The reduction of trade barriers and the creation of a more stable and transparent trading and investment environment make it easier and cheaper for companies to export their products and services to trading partner markets.
The Enabling Trade Index measures the factors, policies and services that facilitate the trade in goods across borders and to destination. It is made up of four sub-indexes: market access; border administration; transport and communications infrastructure; and business environment. The top 10 countries with the highest rating are Singapore, Hong Kong, Netherlands, United Kingdom, Japan, Germany, Republic of Korea, United States, France, United Arab Emirates.
Starting trading on the international market, it will be the right step to check if your country has Free Trade Agreements with other countries for easier for running business.
