Territory in which, as a result of an agreement between the countries that make it up, there is freedom of trade in industrial and agricultural products. Some trade barriers, such as tariffs and quotas, are eliminated, and bureaucratic procedures are reduced in the hope of attracting new business and foreign investment. The objective is to promote international trade among these countries and thus contribute to the growth of economic activity, job creation, productivity improvement, financial stability, and improvement of living conditions in the contracting countries. An example of a free trade zone is the NAFTA, created by the United States, Canada, and Mexico after the signing of the North American Free Trade Agreement.
« Back to Glossary IndexFree trade zone (FTZ)
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