Answer to Question #253658 in Management for Ben

Question

Write a literature review on the economic benefits and consequences of free trade in the pacific island countries

Answer 1

Free trade is a policy by which goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies or prohibitions to inhibit their exchange. The free trade among the pacific island countries has benefited its countries since the government do not restrict international trade which helps domestic industries grow. The products must be treated same in order to be articulated under regional Free Trade Agreement. Free trade ensures countries strictly do not discriminate against foreign products and goods. Other benefits of Free Trade Agreement other than reducing and eliminating tariffs is that it handles the border barriers improving investments and rules affecting e-commerce and government procurements. However Free Trade Agreement causes less successful companies to go out of business since they can not compete with prominent industries, this companies lose their price advantage when protective tariffs, quotas are removed.