FTA :

• AFTA
• CAFTA
• EXCISE TAX
• TARIFF TAX

Pros And Cons Of Afta

      AFTA, or the ASEAN Fee Trade agreement, can prove beneficial to all the countries in the Asian continent. However, like any other deal there are pros and cons of this agreement. A discussion of the advantages and disadvantages help one better understand the global trade perspectives and the inner details of this agreement. More..

AFTA is the acronym for the ASEAN Free Trade Agreement. The common effective preferential tariff has been attached to the agreement, and it is sometimes known as the CEPT-AFTA. The trade agreement of AFTA affects several industries in the continent of Asia.

Recently, a new comprehensive agreement has been made legal to enhance the growth of industries in this part of the world. This new agreement helps in the liberalization of the trading various goods. These amendments in AFTA have shown to facilitate the economic growth by expediting trading in the Asian continent.

Very recently, the ASEAN abolished nearly sixty-three percent of the duty charges on almost all the products in the intra-ASEAN trade, or trading among the participating Asian countries. The import taxes and duty charges have been cancelled on a number of common goods to facilitate the trade processes in the continent. Some of the industries that have been exempted from this rule are rice, tropical fruits, firearms, tobacco, sugar, and liquor.

Tobacco tops the list, among all the products which have been exempted from the taxes and import fees. Not only does tobacco have a huge buyer’s market in Asian countries, Asia is also the largest producer and manufacturer of tobacco in the whole world. So, it makes perfect sense to exempt duty charges on tobacco imports.

A recent study conducted by AFTA has shown that these exemptions not only help in building a stronger economy for the Asian countries but also have a positive impact on the global economy. However, by excluding the tobacco industry, the AFTA is having a negative impact on the local tobacco farmers in the different Asian countries who are trying to keep the tobacco industry alive.

The strict regulations of AFTA can put the Asian countries at a disadvantageous position, while the rest of the world’s countries may benefit from it. However, the governments in the Asian countries which produce tobacco are trying to escape the strict and high import taxes imposed by the AFTA rules. The only way to escape the high taxes is to relocate the tobacco farmers to other industries. Malaysia would be one of the most affected countries in this situation.

More Articles :

• Implication Of Afta On Tobacco Industry
• Pros And Cons Of Afta
• What Is Afta ?