6.30.2005

Free-trade agreements (on behalf of the US)...who wins?

The U.S senate today puts in hearing the Dominican Republic-Central America Free Trade Agreement (DR-CAFTA). The gentlemen from OHIO (Rep) makes his case, using Heinz tomato ketchup (made in ohio)...I hope you see where this is going.

These agreemnts are conceived to stimulate economic activity, and healthy competition between the parties at stake. Yet ultimately what it creates is a specialization of markets; especially when you deal with lesser developed countries simply because within any particular sector within the parties there are no grounds for competition.

What drives these lesser developed nations to take part in these agreements? Well, it's the only door for them to come out on the stage. They see a window of opportunity for growth. True, it happens; but in the long run, when you consider the increase in the imports from their more developed counterpart, they face a trade deficit...and this ALWAYS happens.

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