Regional Paper (Cafta)
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Regional Paper
Globalization has brought incredible benefits to the world. There is little doubt that globalization can be a powerful tool for prolonged economic growth. The role of regional integration in supporting global business does not happen immediately. “Global business is made possible to help other countries in their own area create trade negotiations by using policy and regulatory reform” (Feketekuty, 2007). Some developing nations are worried about the dangers of integrating with other countries, even though this will lead to more economical goods and services, along with increasing the economy.
By joining the economies together various countries from Central America have been trying to develop competitive improvements in order to make profitable businesses that are associated with the free trade agreements. “As soon as Central America was introduced to the strength of the U.S.-Central American Free Trade Agreement (CAFTA), a high trade priority that the second term of President Bushs Administration helped create for regions like Dominican Republic, will join the historic trade with the United States” (CAFTA, 2005). The countries from Central America are demonstrating their commitment to produce and increase the financial opportunities that will support a better way of living for everyone in Central America.
Free trade and economic development have helped many countries expand. Central Americas economy is slowly rising due to their inability to handle an aggressive anti-poverty agenda (Central Amйrica Regional, 2007). The resident of the countries of Central America are not able to share the economics equally. Other quarrels have rose that are leading to risks of profit loss and the change of rural jobs. These problems were brought when CAFTA was established and the termination of the Multi-Fiber Agreement (CAFTA, 2005). “Additional challenges that CAFTA faces are customs integration and harmonization of tax, fiscal, sanitary and phyto-sanitary (SPS), and ecological procedures as well as board of the Meso-American Biological Corridor” (CAFTA, 2005).
In order to achieve benefits from the CAFTA and from future global trade opportunities, Central America and the Mexican governments have had to improve the way they compete by lowering operation expenses across the borders; harmonizing regional commercial, tax, environmental, and labor laws and policies; along with using the natural resources that these countries promote as an example could be green market products that are use in third-party certifications (CAFTA, 2005). The natural resources that come from these countries are beneficial in helping them to expand. Coffee production has been an excellent way to raise the economy. Both governments from these countries are expected to make sensible financial choices for the help and use of the agriculture farms. Through remarkable economic gains the people of Central America will be able to have a higher standard of living along with improved domestic businesses.
The disadvantage for the countries is the minute volume of the economy. The domestic resources are limited, which does not allow for expanding to the economies activities. The soaring dependence of products for exports leaves the countries economies vulnerable. The opportunities for economy development are somewhat limited causing a dependence on external factors, which creates an increase of economic instability.
In the countries of Latin America and Central America, the idea of globalization is being taken in slowly by the citizens. People in these countries have gradually retorted by voting against certain issues and some have even protested in the streets (Central Amйrica Regional, 2007) . Due to this type of reaction the public have raised the concern about CAFTA. The