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Explain how trade agreements are a factor in globalisation. - AQA - A-Level Geography - Question 1 - 2019 - Paper 2
Question 1
Explain how trade agreements are a factor in globalisation.
Worked Solution & Example Answer:Explain how trade agreements are a factor in globalisation. - AQA - A-Level Geography - Question 1 - 2019 - Paper 2
Step 1
Trade agreements promote economic cooperation
Answer
Trade agreements are formed by countries coming together to encourage trade between themselves. For example, agreements like NAFTA promote economic co-operation and integration among member countries, thus facilitating international trade. This cooperation can help to decrease trade barriers and tariffs, making it easier for countries to trade with one another.
Step 2
Facilitation of international market access
Answer
Trade agreements often provide countries with greater access to international markets. This means that enterprises from one country can extend operations to another country, improving the flow of goods and services. For instance, a company such as Audi might set up a factory in Mexico to benefit from lower production costs, showcasing how trade agreements enable companies to operate across borders.
Step 3
Bilateral and multilateral trade agreements
Answer
These agreements can take forms such as bilateral or multilateral treaties that promote trade liberalization. By lowering tariffs and reducing trade barriers, countries can benefit from comparative advantages, leading to an increase in trade volumes and economic interdependence.
Step 4
Globalisation enhancement through trade agreements
Answer
Trade agreements not only increase trade but also foster a degree of globalization. By standardizing trade regulations, countries can minimize trade conflicts, which can further encourage investment and enhance economic growth on a global scale.