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International Trade

The United States and Canada signed the Canada- SUMMARY
U.S. Free Trade Agreement in 1989, which provided for The world has a long history of international trade—trad-
the removal of all trade barriers—such as tariffs, quotas, ing among nations can be traced back to the earliest civi-
and other trade restrictions—between the two countries lizations. Trading activities are directly related to an
within a ten-year period. This act helped promote even improved quality of life for the citizens of nations
more trade between the two countries, thus further involved in international trade. It is safe to say that nearly
strengthening an already strong trade relationship. every person on earth has benefited from international
trading activities.
The United States, Canada, and Mexico signed the
North American Free Trade Agreement (NAFTA) in 1994
in order to create a free-trade zone among the three coun- WEB SITES OF INTEREST
tries. Leaders of these three countries realized that a large For further information about tariffs, the Hawley-
North American free-trade zone could compete effectively Smoot Tariff Act, and the Reciprocal Trade
against the EEC and other trading blocs that might Agreements Act of 1934:
develop in the future. This competitive factor was a driv- http://economics.about.com/cs/taxpolicy/a/
ing force in the nations’ signing of the agreement, each tariffs.htm, http://www.state.gov/r/pa/ho/time
believing that, over the long run, all three would benefit /id/17606.htm, and http://www.itds.treas.gov
from the agreement. /tradelaws.html
In addition to feeling the impact of trade agreements For more information regarding import quotas:
and trade organizations per se, international trade is http://internationalecon.com/v1.0/ch10/10c060
affected more indirectly by the financial stability and gen- .html
eral economic well-being of all countries in the increas- For more information regarding nontariff trade bar-
ingly interconnected world. Thus two other international riers: http://www.dti.gov.ph/contentment
organizations ultimately affect the health of world trade. /9/62/127/585.jsp
To further promote trade among countries, the Allied For more information regarding bribery:
nations of World War II met in 1944 in Bretton Woods, http://www.berrymoorman.com/articles/1199rm
New Hampshire, to help set postwar global financial poli- wbribery.html
cies and thereby avoid future financial crises. The Interna- For more information about the GATT:
tional Monetary Fund (IMF) was created as a result of http://www.ciesin.org/TG/PI/TRADE/gatt.html
that conference, its mission being to provide loans to
For more information regarding the EEC:
countries that are in financial trouble. The IMF dictates
http://www.infoplease.com/ce6/history/A081788
the terms of the loans, which may include cutting domes- 9.html
tic subsidies, privatizing government industries, and mod-
erating trade policies. To fund these loans, IMF members For more information on the Canada-U.S. Free
Trade Agreement of 1989:
make annual contributions, with each country’s contribu-
http://www.agr.gc.ca/itpd-dpci/english
tion determined by its size, national income, population,
/trade_agr/fta.htm
and volume of trade. Larger contributing countries, such
For information regarding the World Bank:
as the United Kingdom and the United States, have more
http://www.worldbank.org
say as to what countries get loans and the terms of the
loan. SEE ALSO International Business; International Market-
The World Bank, with approximately 184 members, ing; Marketing
is another international organization to which the United
States is a major contributor. The World Bank’s mission is BIBLIOGRAPHY
to help less-developed countries achieve economic growth Bhagwati, Jagdish (2002). Free trade today. Princeton, NJ:
Princeton University Press.
through improved trade. It does so by providing loans and
Boone, Louis E., and Kurtz, David L. (2005). Contemporary
guaranteeing or insuring private loans to nations in need
marketing 2006. Eagan, MN: Thomson South-Western.
of financial assistance. The World Bank has been charac-
Braithwaite, John, and Drahos, Peter (2000). Global business reg-
terized as a last-resort lender, a facilitator of development
ulation. New York: Cambridge University Press.
projects so as to encourage the inflow of private banking
Churchill, Gilbert A., Jr., and Peter, Paul J. (1998). Marketing:
funds, and a provider of technical assistance for fostering Creating value for customers (2nd ed.). New York: Irwin
long-term economic growth. McGraw-Hill.
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