As globalization has taken root, trade agreements have become an increasingly important tool to promote international trade and economic growth. Major trade agreements are crucial as they help to reduce trade barriers and create a level playing field for countries, leading to the facilitation of trade and investment. Here we discuss some of the major trade agreements that have been established globally.

North American Free Trade Agreement (NAFTA)

NAFTA is a landmark trade agreement that was signed between Canada, Mexico and the United States in 1994. NAFTA eliminated most tariffs on traded goods between the three countries, increased investment, and facilitated the growth of cross-border trade and supply chains. Critics of the agreement claim that it led to job losses and lower wages in certain sectors, but its supporters argue that it has helped to increase economic efficiency and promote competitiveness among the three countries.

Trans-Pacific Partnership (TPP)

The TPP was a proposed trade agreement that involved 12 countries – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam. The agreement aimed to reduce trade barriers and promote economic growth, while also addressing issues such as labor rights, the environment, and intellectual property. The TPP was signed in 2016 but was not ratified by the United States, and the other signatories are working on a revised version of the agreement, called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

European Union (EU)

The EU is a political and economic union of 27 countries in Europe. The EU has established a single market, which allows for the free movement of goods, services, capital, and people within the bloc. The EU also negotiates trade agreements with countries outside the bloc, including the United States, Japan, and Canada. The EU is a major trading partner for many countries, and its trade policies have a significant impact on global trade.

China-Australia Free Trade Agreement (ChAFTA)

ChAFTA is a bilateral trade agreement between China and Australia that was signed in 2015. The agreement aims to reduce tariffs and increase trade and investment between the two countries. China is Australia`s largest trading partner, and the agreement has helped to strengthen economic ties between the two countries.

Conclusion

Major trade agreements play a critical role in shaping global trade and promoting economic growth. Though there are arguments against their implementation, these trade agreements can bring about significant benefits such as increased investment, greater access to markets, and reduced trade barriers. Going forward, trade agreements are likely to be a key focus for many countries as they seek to establish new economic relationships and maintain existing ones.