FTA :

• AFTA
• CAFTA
• EXCISE TAX
• TARIFF TAX

When Did Nafta And Cafta Begin ?

      NAFTA is the acronym for the North American Free Trade Agreement; while CAFTA is its counterpart in Central America. Both these agreements were initiated by the United States to practice free trade with its neighboring countries and to exempt all duty costs, tariffs and trade taxes. This was thought to be able to let the United States present opportunities to companies to expand their business and manufacture new products. More..

CAFTA, or the Central American Free Trade Agreement, is the third trade agreement in the series of trade agreements in the region of Central America. There are a total of seven participating countries in CAFTA. The member countries are El Salvador, Nicaragua, Guatemala, Honduras, United States of America, Dominican Republic and Costa Rica.

All the above countries have implemented the free trade agreement except for Costa Rica. Ever since the government announced signing this trade pact, there have been recurrent oppositions and resistance from the general population in the country. Costa Rica has a large number of its citizens in the farming industry, and they fear they will be completely wipe out by agricultural giants companies in developed countries like the United States. This reason is preventing the President of Costa Rica to win any favor from the people to sign this pact. Many people in Costa Rica believe that CAFTA is a way the United States is attempting to colonize the trade activities in Central America. This belief among Costa Ricans is preventing the government to implement the trade agreement in the country.

All the other countries in the CAFTA agreement have been granted open access to trade in the United States of America, except Costa Rica. Simultaneously the agreement has also expanded business prospects for the companies in the United States to expand base in these Central American countries.

CAFTA eliminates the taxes and tariffs on nearly 80 percent of goods manufactured in the United States. This is not limited to just the manufactured goods, but also on services including the ones associated with the environmental standards. This trade pact allows nearly 85 percent of the goods manufactured in the United States to be bought without paying duty fees. That means most people in these Central American countries can buy the same goods at the same price as what they are sold for in the United States. Many believe that this will be very beneficial to many manufacturing companies in the future.

More Articles :

• Cafta Timeline Of Events
• Problems With Cafta
• What Is CAFA ?
• When Did Nafta And Cafta Begin ?