Bilateral Agreements can be defined as
back and forth between the two different nations or commerce groups which give
each of them a fortunate status regarding certain goods and commodities
obtained from an individual. These agreements are made in order to guarantee
the purchases made, to remove the excise and other market barriers. This will
certainly add to each country’s monetary growth and will also help them broaden
their access to each other’s commercial enterprise.
Bilateral agreements are a potential way
for individual countries to renovate their taxes and revenue systems. The
removal of the custom duties and the tariff barriers is the main objective of
these agreements. The increasing nature of these bilateral agreements resulted
in various countries to enhance their trading policies. Independent nations
usually join together to create these free trade agreements. According to
various studies these reductions in the trade barriers has benefited the
economy of the countries.
It helps to protect one country from
stealing other innovative products and ideas, to put away products at a cheaper
cost and to use unfair means. These agreements have some standard regulations
and protections. This provides a monetary advantage to both the countries.
These are easier to negotiate since this involves only two countries. So, these
can be taken in to effect immediately, gaining benefit more quickly. If the
negotiation on these agreements fails many nations then negotiate on the
progression of bilateral agreements instead.
Considering the recent example of Transatlantic
Trade and Investment Partnership it has removed the barriers to trade between the
United States and Europe. It is one of the largest bilateral agreements till
current scenario of the International trades and economic climate could lead to
more enhanced bilateral agreements. Various parties of these trade agreements
have stated the value of the agreement being more universal and of high quality
reforms helped to open the market and the benefits
obtained depend in large measure on the subsequent uptake of opportunities by
business. Some of the benefits of these agreements are-
Easy access to enlarged
Reducing the foreign
market cost due to elimination and the reduction of the custom duties.
Easy access to foreign
investors and financial institutions to satisfy their financial needs.
Production operations can
be optimized by moving it to abroad completely or partially.