Free Trade Agreements Multinational Corporations

The problems of poverty in the world`s poor countries are due to the arrival of multinationals that have benefited only from the underlying conditions. While it is true that the amoral measures taken by companies in response to these underlying conditions have little or nothing to improve them, the elimination of multinationals would not solve the problems. Ludema, R D and A M Mayda (2013): “Are trade conditions important for trade agreements? WTO Theory and Evidence,” Quarterly Journal of Economics 128 (4), 1837-1893. “Non-tariff measures such as incriminating regulatory requirements, bureaucratic hurdles and customs procedures… It`s a problem. The services sector – which plays an important and growing role in the global economy – faces particularly important trade barriers, such as discriminatory regulations and restrictions on foreign investment. – Douglas Lippoldt – Tadeusz Bara-Slupski, HSBC multinationals play an important role in coordinating production around the world. This section represents a dynamic quantitative model of multinational business expansion, which can be used to analyze the impact of policies that affect the cost of multinational business activity. It uses this model to mitigate the effects of possible Brexit transpositions. It should be noted that in the least developed countries, workers in the industry often zealously accept the jobs provided by multinationals, while these jobs are considered undesirable by people in the most prosperous countries. In fact, poverty is so extreme in much of the world that companies see an almost irresistible advantage in using the cheapest labour and the cheapest regulatory environment. Is it good or bad that trade policy is sensitive to the activities of multinationals? We don`t know.

For some trading partners, the link between investment policy and trade policy can lead to a virtuous circle of improved market access and increased multinational investment, which would promote economic and political integration. At the same time, there is concern that the same mechanism could lead to large investments and trade diversions, which would increase the integration of “assets” – countries that already have rich investment networks and trade integration – to the detriment of “nothing-free” countries that are probably most eager to wait for economic development and connections with the outside world. How these competing effects will ultimately unfold remains an important issue for both research and policy. The growth of trade and its importance for global economic progress have led to an extension of regional trade agreements (RTA) to ensure the unpolluted cross-border transport of goods, services and capital. Their number has grown from just 124 agreements in 1991 to more than 400 today.