Trade agreements designated by the WTO as preferential agreements are also referred to as regional agreements (RTAs), although they are not necessarily concluded by countries within a given region. Currently, 205 agreements are in effect as of July 2007. More than 300 people have been notified to the WTO.  The number of free trade agreements has increased significantly over the past decade. Between 1948 and 1994, the General Agreement on Tariffs and Trade (GATT), predecessor to the WTO, received 124 notifications. Since 1995, more than 300 trade agreements have been concluded.  The United States has another multilateral regional trade agreement: the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR). This agreement with Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua eliminated tariffs on more than 80% of U.S. exports of non-textile goods. Free trade allows the total import and export of goods and services between two or more countries. Trade agreements are forged to reduce or eliminate import or export quotas. These help participating countries to act competitively.
A free trade agreement is a pact between two or more nations to reduce barriers to trade between imports and exports. Under a free trade policy, goods and services can be bought and sold across international borders without government tariffs, quotas, subsidies or bans. The failure of Doha has enabled China to reach a global level of trade. It has signed bilateral trade agreements with dozens of countries in Africa, Asia and Latin America. Chinese companies have the right to develop the country`s oil and other raw materials. In exchange, China offers loans and technical or commercial assistance. There are three different types of trade agreements. The first is a unilateral trade agreement if one country wants certain restrictions to be enforced, but no other country wants them to be imposed. It also allows countries to reduce the amount of trade restrictions. It is also something that is not common and could affect a country. Together, these agreements mean that about half of all goods entering the United States enter duty-free, according to the government.
The average import duty on industrial products is 2%. There are pros and cons of trade agreements. By removing tariffs, they reduce import prices and consumers benefit from them. However, some domestic industries are suffering. They cannot compete with countries with lower standards of living. This allows them to leave the store and make their employees suffer. Trade agreements often require a trade-off between businesses and consumers. The European Union is now a remarkable example of free trade.