Definition of Free Trade

The concept of free Commerce, also designated in our language as free trade and how Liberty trade, presents a use excluding inside of the economic field, since in this way it is designated that commercial activity, whether internal or external, that an individual or a company can perform with total freedom, that is, without the presence of obstacles or special fees that limit.

At the request of domestic trade, which is the one that is carried out between individuals and companies residing in the same country, we will speak of a free trade scenario when there is no type of impediment for various economic actors to enter the market and exercise it satisfactorily since there is freedom in the matter of prices, regarding the hours of attention to the public and the opening of the commercial premises and in as for the hiring staff, among other important issues in this regard.

It should be noted that there are various economic actions that, if established, can complicate and limit freedom of trade, among them the following stand out:

the constant intervention of the state in economic matters and that it can actually suffocate an industry or a trade with its restrictions, to the point that it, due to the constant restrictions, has to close its operation in the market.

And on the other hand what is known as protectionism, which is a politics economic of which many states use to protect those products that are produced in the country. It consists of imposing taxes on those products that come from abroad, which of course will be transferred to the price of the product and will make it more expensive compared to the local proposal, generating that this is not beneficial.
Of course, those who postulate free trade are opposed to protectionism and any type of trade barrier.

As a counterpart of protectionism, those nations that strictly propose freedom of trade at the foreign level, eliminate any kind of tax or tariff like those mentioned and then all products, local and foreign, compete at the same level.

Many countries, especially those that are within the same economic zone, such is the case of the Mercosur, establish agreements that are materialized in treaties that provide for the removal of the tariff.

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