About the mafia I consider this it's very important in the economy
search, because this permitted that different countries conduct
exchanges of money and services illegal, this hurts the domestic
economy of each country but fail to see the administration that
different groups give the illegal use of resources optimized all
winnings. Although the mafia and smuggling are harmful to the
domestic economy of the countries have managed to give an
excellent use of resources. In my opinion I do not defend the mafia,
but if there is something that governments are not doing well.
2. What is trade creation trade diversion? Why are these important in
relationship to international trade? How are these concepts affecting
Colombian commerce in Colombian organizations today?
Trade creation
Trade creation means that a free trade area creates trade that would not
have existed otherwise. As a result, supply occurs from a more efficient
producer of the product. In all cases trade creation will raise a country's
national welfare.
Trade diversion
Trade diversion means that a free trade area diverts trade, away from a
more efficient supplier outside the FTA, towards a less efficient supplier
within the FTA. In some cases, trade diversion will reduce a country's
national welfare but in some cases national welfare could improve
despite the trade diversion.
Trade diversion may be, but is not necessarily, welfare-reducing
Trade creation and trade diversion, are important for the creation of
trade allows changes of consumption of a high-cost producer for a low-
cost producer. Trade diversion and allows changes consumption of a
lower-cost producer outside the trading bloc greater cost within it.
A trading bloc is more likely to lead to trade diversion rather than trade
creation if:
Free Trade Agreements (FTAs) have proved to be one of the best ways to
open up foreign markets to U.S. exporters. Trade Agreements reduce
barriers to U.S. exports, and protect U.S. interests and enhance the rule
of law in the FTA partner country. The reduction of trade barriers and the
creation of a more stable and transparent trading and investment
environment make it easier and cheaper for U.S. companies to export
their products and services to trading partner markets.
The United States-Colombia Trade Promotion Agreement (TPA) entered
into force on May 15, 2012. On the day of implementation, over 80
percent of U.S. industrial goods exports to Colombia became duty-free
including agricultural and construction equipment, building products,
aircraft and parts, fertilizers, information technology equipment, medical
and scientific equipment, and wood. Other benefits of the TPA include:
- More than half of U.S. exports of agricultural commodities to
Colombia became duty-free, including wheat, barley, soybeans, high-
quality beef, bacon, and almost all fruit and vegetable products.
- Stronger protection and enforcement of intellectual property rights in
Colombia.
- Increased access to Colombias $180 billion services market for highly
competitive American companies.
References
http://export.gov/FTA/colombia/
http://www.revisionguru.co.uk/economics/creatdiver.htm
http://www.fder.edu.uy/contenido/rrii/contenido/curricular/comercio-
matutino/unidad-v-grupo-matutino/teorias-del-comercio-internacional-
material-de-apoyo.pdf
http://internationalecon.com/Trade/Tch110/T110-2A.php