Proponents of the agreement reject these arguments. They claim that, in the case of Asia, the signing of the free trade agreement coincides with similar announcements of agreements with Thailand and Singapore. More recently, the Association of Southeast Asian Nations has asked Australia (and New Zealand) to participate in negotiations on trade liberalization between the ASEAN Free Trade Area and the Transtasmanic Pact, known as close economic relations. Australia also enters into trade and economic framework agreements with our major trading partners, Japan and China. The United States has a gross domestic product (GDP) of about $17 trillion and a high GDP per capita. Faced with a huge market, U.S. negotiators actually hold a lot of cards at the negotiating table. However, several bilateral agreements, with many technical provisions, can make it more expensive and more difficult for U.S. exporters to use market opening opportunities.
In theory, it would be possible to have uniform rules on issues such as rules of origin and transshipments, through bilateral agreements. In practice, there are usually discrepancies in the measures, which creates a cat cradle of commercial rules. As a result, many U.S. companies have started to take common steps that can be made available through multilateral agreements. The comparative advantage lies in the fact that all countries will always benefit from cooperation and participation in free trade. Popularly attributed to the English economist David Ricardo and his 1817 book « Principles of Political Economy and Taxation, » the Comparative Advantage Act refers to a country`s ability to produce goods and provide services at a lower cost than other countries. The comparative advantage shares many of the characteristics of globalization, the theory that opening up trade in the world will improve living standards in all countries. The good thing about a free trade area is that it promotes competition, which increases a country`s efficiency in being on the same account of its competitors. The products and services will then be of better quality without being too expensive.