FREE TRADE AGREEMENT

1.- Definition.- A free trade agreement ( FTA ) is a binding trade

agreement signed two or more countries to agree on mutual granting
of tariff preferences and reduction of non-tariff trade barriers in goods
and services . In order to deepen the economic integration of the
signatory countries, the FTA also incorporates issues of access to new
markets , other regulatory issues related to trade, such as intellectual
property, investment , competition policy , financial services,
telecommunications, electronic commerce , labor and environmental
provisions and mechanisms of trade protection and dispute
settlement . FTAs have an indefinite term, that is, to remain in force
over time so they have in perpetuity
2.- What advantages and disadvantages can bring free trade
agreements ?
The free trade agreements bring benefits which are related not only
commercial aspects but are positive for the economy as a whole: can
reduce and often eliminate non-tariff and tariff barriers to trade;
contribute to improving the competitiveness of companies (since it is
possible to provide raw materials and machinery at lower costs);
facilitate the increased flow of foreign investment, by providing
certainty and stability over time investors; They help them compete
on equal terms with other countries that have achieved similar
benefits from access through trade agreements and to obtain
advantages over countries that have negotiated preferential trade
agreements; and, finally, encourage job creation from increased
export activity. Also, trade liberalization creates greater integration of
the country into the global economy, making it possible to reduce the
volatility of its growth, the level of country risk and the cost of
financing the private sector in general.
However , not all sectors of the economy benefit in the same way with
free trade agreements. There are certainly more sensitive products in
the negotiation process to be protected with certain trade defense
mechanisms . However , the negative effects on certain products can
also be attenuated and better if the right to boost its competitiveness
or at least encourage their conversion to activities with higher growth
potential measures taken .
3.- Peru maintains the following trade agreements
3.1.- Regional Agreements
The Andean Community (ACN)

Peru participates in the CAN in agreements related to the tariff

reduction in the trade of goods, the subregional liberalization of
services markets, community rules relating to intellectual
property,
land
transportation,
air
and
water,
telecommunications and a wide range of other trade issues.
Mercosur-Peru
With this arrangement is looking to form a free trade area
between Peru and the four Mercosur countries (Brazil,
Argentina, Paraguay and Uruguay), through the expansion and
diversification of trade and the elimination of tariff and nontariff restrictions that affect the reciprocal exchange of goods
and services.
3.2.- Multilateral Agreements
World Trade Organization (WTO)
It is a forum for the negotiation in which discusses the rules
governing the trade in countries around the world. Essentially,
the WTO is the place to come the member states to try to fix
the business problems that may exist between if. Peru is a
member of the WTO since its formation in 1995.
Economic Cooperation Forum Asia Pacific (APEC)
Peru is a member of the APEC since 1998 and the admission to
this forum responds to the desire to strengthen the existing
economic links and generate greater economic relations with
the region in recent years, has submitted the most active ones
in terms of economic growth.
3.3.- Bilateral trade agreements