What are trade deals?
Trade deals are agreements signed between two or more nations, they determine the tariffs and duties that countries impose on imports and exports.
The most common type of trade deal is preferential (a deal that involves a trading bloc that gives preferential access to certain products from participating countries.Examples include:The North American free trade agreement.
Another type of common trade agreement is “Free trade”, this establishes a “free trade area ” between several different countries where tariffs or hinderances are not imposed, however in contrast to a common market, items may not move freely.An example is the European free trade Association.
Following the “withdrawal” of the UK from the EU, and the expectation of countries to follow,They will enter a Free Trade Agreement (FTA) with members of the European union.Most economists agree this is a worse-off deal than previously made in the 1970s ,this i because the UK and EU want to stick to the deal on both sides, however it is much harder to “keep watch” of the other side and whether the stick to the deal.Whereas in the European union, the European court of justice has the power to force an EU member to stick to the rules.
EU trade regulations the benefits:
The European single market is the largest international single market in the world.This can generate immense amounts of competition in services(which is good for businesses and consumers, as businesses ‘have to’ charge lower prices-competitive pricing, in order to reach economic equilibrium).Moreover the removal of trade barriers, mainly via the introduction of an international trading currency , makes it easier to trade globally.Moreover the European union has introduced measures to harmonise company law to help assist SMES (Small and Medium Enterprises),such as easier access to funding, clearer and more effective legislation swell as increased protection for shareholders, creditors and employees.
EU trade regulations- The drawbacks:
Excise duty and duty drawback; excise duty is a tax HMRC (HM revenue and customs) charges on beer, wine and spirits and other alcoholic drinks, hydrocarbon oils (eg. kerosene, fuel and petrol), cigarettes and tobacco, that are acquired, imported or produces in the uk.The euro, has proved to have many problems and has contributed to low levels of economic growth.Austerity pressure from the EU has increased since 2008, but in the middle of a recession these austerity measures have prolonged economic stagnation. It can be argued that there is more bureaucracy and less democracy by taking away the decision making.
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