A free trade agreement (FTA) is a trade deal between two or more countries wherein they agree upon certain trade-related rules and regulations that benefit them mutually. An FTA may include easing of certain restrictions that are otherwise maintained for the rest of the world. The region where countries have a free trade agreement with each other is known as free trade area.
What types of Trade Agreements are there?
- UNILATERAL TRADE AGREEMENT
- BILATERAL TRADE AGREEMENTS
- MULTILATERAL TRADE AGREEMENTS
* What are the disadvantages of a Free Trade Area?
- Lower tax revenue
- Theft of intellectual property