Regional trade agreements (RTAs) are becoming increasingly popular in the global economy. These agreements are formed between two or more countries from the same geographic region who agree to reduce trade barriers and increase cooperation. RTAs in force have become a vital component of world trade and have immense economic implications for the member countries.
Regional trade agreements involve the establishment of free trade zones or customs unions, which is a group of countries that agree to eliminate tariffs, quotas, and other trade barriers. These agreements may also include trade-related aspects such as intellectual property rights, investment, and services.
There are several regional trade agreements in force across the world. One of the most prominent is the North American Free Trade Agreement (NAFTA) between Canada, the United States, and Mexico. The agreement has been in force since 1994 and has led to a significant increase in trade between the member countries.
Another example is the Association of Southeast Asian Nations (ASEAN) Free Trade Area, which was established in 1992. The agreement aims to promote intra-regional trade and reduce trade barriers among the ten member countries. The ASEAN Free Trade Area has been successful in increasing trade among the member countries and has contributed to the region`s economic growth.
The European Union (EU) is also a significant player in the world of regional trade agreements. The EU has established multiple trade agreements with countries and regions such as South Korea, Japan, and Canada. These agreements provide significant benefits to the EU member states, including increased access to new markets, improved investment opportunities, and reduction of regulatory barriers.
Moreover, Mercosur, the Southern Common Market of Latin America, is another example of a regional trade agreement. It was established in 1991 and is made up of Argentina, Brazil, Paraguay, and Uruguay. Mercosur aims to promote regional integration and economic development. Mercosur has been successful in promoting intra-regional trade and has increased the member countries` access to international markets.
In conclusion, regional trade agreements in force are a vital component of world trade. These agreements provide significant benefits to member countries, including increased access to new markets, improved investment opportunities, and reduction of regulatory barriers. As the global economy continues to evolve, regional trade agreements are likely to play an increasingly important role in shaping international trade.