Free Trade Agreements: Impact on U.S. Trade and Implications for U.S. Trade Policy [Updated August 1, 2006] [open pdf - 83KB]
"Free trade areas (FTAs) are arrangements among two or more countries under which they agree to eliminate tariffs and nontariff barriers on trade in goods among themselves. However, each country maintains its own policies, including tariffs, on trade outside the region. In the last few years, the United States has engaged or has proposed to engage in negotiations to establish bilateral and regional free trade arrangements with a number of trading partners. Such arrangements are not new in U.S. trade policy. The United States has had a free trade arrangement with Israel since 1985 and with Canada since1989, which was expanded to include Mexico and became the North American Free Trade Agreement (NAFTA) effective in January 1994...These efforts are of direct interest to Congress. U.S. participation in free trade agreements can occur only with the concurrence of the Congress. In addition, FTAs will affect the U.S. economy, with the impact varying across sectors. FTAs raise some important policy issues for the second session of 109th Congress as it considers implementing legislation and monitors negotiations as part of its oversight responsibilities: Do FTAs serve or impede U.S. long-term national interests and trade policy objectives? Which type of an FTA arrangement meets U.S. national interests? What should U.S. criteria be in choosing FTA partners? Are FTAs a substitute for or a complement to U.S. commitments and interests in promoting a multilateral trading system via the World Trade Organization (WTO)? Experts differ sharply over these questions."
CRS Report for Congress, RL31356