Question: What is a Free Trade Agreement?

Answer:

There are many ways to understand free trade agreements. In the most common way, a free trade agreement (FTA) is an agreement between two or more members to eliminate most of the barriers to trade between members.

FTA can carry many different names, for example, Economic Partnership Agreement, Regional Trade Agreement, ... but essentially, agreements all towards trade liberalization among members.

Members of FTAs may be countries (for example, Vietnam, China, the United States, ...) or independent tariff areas (for example, European Union, Hong Kong - China, ...). Therefore, usually, when it comes to FTA members, people often use the word "economy".

FTAs can be bilateral (02 members) or multilateral/regional (more than 02 members).

The "trade" in FTAs is understood in a broad sense, which may include all profitable business activities, including commercial goods, services, investment and other directly or indirectly related issues to trade (intellectual property, public shopping, labor, environment, ...).

Center for WTO and International Trade

• What types of FTA are there?
• What contents does an FTA usually contain?
• How is FTA formed?
• In case Vietnam has more than one FTA with the same partner country, which FTA will be followed?