That restrict trade the ultimate goal is zero duties

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that restrict trade The ultimate goal is zero duties on goods that cross borders between the partners within a free-trade area Countries are allowed to maintain independent trade relations with countries outside the free-trade area To date, more than 300 free trade agreements have been negotiated globally NAFTA Free Trade Area (FTA) Rules of origin are used to discourage the importation of goods into the member country with the lowest external tariff for transshipment to one or more FTA members with higher external tariffs Because of FTA between Chile and Canada, Canadian-built Caterpillar grade tractor imported to Chile will not be subject to duty But a US-built tractor will be subject to $13000 in duties Can Caterpillar send the US-built tractor to Chile by way of Canada to avoid paying the duty?
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US negotiated bilateral free trade agreement with Chile in 2003 Customs Union A customs union represents the logical evolution of a free trade area Members of a customs union agree to the establishment of common external tariffs (CETs) Importing goods are charged the same amount EU and Turkey The Central American Integration System (SICA) E.g., E l Salvador, Honduras, Guatemala, Nicaragua, Costa Rica, and Panama Common Market A common market is the next level of economic integration Elimination of internal barriers to trade (as in FTA) AND establishes common external barriers to trade (as in customs union) AND allows for free movement of factors of production, including labor and capital, among the member nations EU Economic Union Includes the elimination of the internal tariff barriers (as in FTA) AND establishes common external barriers (as in customs union) AND allows for the free flow of factors (as in common market) AND coordinates and harmonizes economic and social policy within the union A common marketplace not only for foods but also for services and capital Practice licensing for professionals Full evolution of economic union creation of unified central bank use of single currency common policies on issues such as agriculture, social policy, transport, competition, mergers, taxation requires extensive political unity would lead to a central government in time Economic Union A true economic union requires extensive political unity, which makes it similar to a nation The EU is approaching its target of completing most of the steps required to become a full economic union - We talked about four forms of economic integration, can you explain the similarities and differences between them? Can you give an example of each? (e.g., an example of FTA is
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NAFTA).
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