By kmurray
Interested in exporting your small business’s goods or services outside the United States? Have you heard of free-trade agreements? Here’s what you should know about how they can benefit you in the exporting process.
What is a free-trade agreement?
A free-trade agreement, or FTA, is an agreement between two or more countries where the countries agree to take steps to make trade between the countries’ businesses easier and faster. FTAs reduce trade tariffs and non-tariff barriers, such as import quotas, and also cover protections for investors and intellectual property rights.
For the United States, the main goals of trade agreements are to:
- Reduce barriers to U.S. exports
- Protect U.S. interests competing abroad
- Enhance the rule of law in the FTA partner country or countries
Ultimately, it’s easier and cheaper for U.S. companies to export to these trading partner markets, because FTAs help create a more stable and transparent trading and investment environment, which reduces risks for you as a small-business exporter.
With which countries does the U.S. have an FTA?
As of January 1, 2014, the United States has 14 FTAs in force with 20 countries:
- Australia
- Bahrain
- Chile
- Colombia
- DR-CAFTA: Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, & Nicaragua
- Israel
- Jordan
- Korea
- Morocco
- NAFTA: Canada & Mexico
- Oman
- Panama
- Peru
- Singapore
Other benefits of FTAs
Some other kinds of benefits often found in FTAs are:
- The ability for a U.S. company to bid on certain government contracting opportunities in the FTA partner country
- The ability for a U.S. investor to get prompt, adequate and effective compensation if its investment in the FTA partner country is taken away by the government
- The ability for U.S. service suppliers to supply their services in the FTA partner country
- Protection and enforcement of American-owned intellectual property rights in the FTA partner country
- The ability for U.S. exporters to participate in the development of product standards in the FTA partner country
Learn more at Export.gov and find out what else you should know about exporting by exploring the resources below!
Related Resources
- A Small Business Guide to Exporting: Part 1 – Getting Started
- A Small Business Guide to Exporting: Part 2 – Getting Financing
- Interested in Exporting? These Four Resources Can Help
- 6 Steps to Assess Your Small Business’ Readiness to Export
- Is There a Form for That? An Introduction to Commonly Used Exporting Forms for Your Small Business
- 8 Ways the U.S. Government Can Help You Finance Your Small Business Exports
Via: The Industry Word
