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Evidencia 3: Ensayo “Free Trade Agreement (FTA): advantages and disadvantages”

Olga Cecilia Pérez Bocachica

Nota del autor

Correspondencia,olgaceciliaperezbocachica@hotmail.com

Servicio nacional de aprendizaje Sena

Tecnólogo en negocios internacionales

Bogotá

2019
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The treaties that the United States has with Colombia are the following:

In 2018, about US $ 2,844 MILLION was exported to the US in agricultural goods, while US $ 3,001
million was imported from the country, with the balance almost balanced compared to other
sectors in the FTA, Colombia became the The main South American market for the agricultural
items of the United States passing to Brazil, for Colombia the agreement has been beneficial since
the United States has consolidated itself as the main buyer of agricultural products by opening
new products such as avocado and cape goose that represent about US $ 4 million and opening
new ones paths for products like gulupa granadilla paprika passion fruit mango paprika etc.

INDUSTRY

Virtually all of Colombia's exportable industry offer of 99.9% gained immediate access to the
United States market as of the term of the treaty.

This includes the entire field of textiles and clothing, preferences that go far beyond ATPDEA
because they cover new sectors such as household clothing and now open export lines for
imports, Colombia granted the United States immediate access to the 81 , 1 of the products of
which 92.5 correspond to raw materials and capital goods not produced in the country, the
remaining 7.5% of imports contain products from sectors that are ready to face the US
competition the examination by sector indicates that 80.5 of the imports of capital goods and 86.8
of the raw materials acquired in the United States, with a five-year relief period, were the group of
paper, inks, iron and steel products, glass and parts of vehicles among others and seven years for
the plastic petrochemical chain.

The negotiation in the field in the field of industrial goods opens up the commercial opportunity in
the textile and confessions sector long-term preferences were achieved in products such as female
underwear for the home, bathing dress, ceramic for bathrooms and kitchens has been
consolidating in The US and the FTA will allow to consolidate and expand the markets in footwear
and leather goods industry highly composed of consolidated SMEs and wide commercial
references of ATPDEA. Colombian fats and oils made from palm has great potential not only for
the reduction of the tariff but because they have lower content of fatty acids harmful to health On
the subject of used goods, the management scheme of these goods is maintained, the prior
licensing regime has been applied for control of this type of products since 1995, even for the case
of used clothing, in remanufactured goods. a definition was agreed that allows it to be
differentiated from used goods and defend the sensitivities identified with the private sector in
the case of auto parts, appliances and metalworking through a slow relief.

SMEs are especially benefited with what has been agreed on access to industrial goods because
the reduction of tariffs not only reduces their production costs but also makes them cheaper to
update technology and improve productivity.
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Services

The achievements in services are remarkable for Colombia; create a favorable environment to
improve competitiveness have a deep local development attract foreign investment in video
image programs audio and video recording

With regard to the approval of titles, each country is autonomous in the regulation of
requirements that must be met but may establish specific agreements for mutual recognition with
other countries, given the chapter on services refers to the provision of cross-border professional
services that require accreditation and licensing by The Colombian initiative established a working
group such as the insurance sector, the inclusion of obligations for mobile telephony and the
exclusion of rural telephony obligations.

Investment

With the FTA Colombia gains potential as a platform in which capital can come not only from the
United States but from other parts of the world to join the national capitals in projects oriented to
the production of goods and services for the North American market, the FTA creates an
environment positive for investment with the establishment of reciprocal guarantees for our
investments in the United States, within the investment are public purchases that have a special
economic interest because governments are large consumers of goods and services in each
country the objective in the negotiation was to achieve a bilateral opening of these purchases
through lists that define the government companies included in the agreements.

OURISM

The government also created tax incentives such as exempting new hotels built, expanded or
remodeled in its physical plant from income tax for thirty years. Ecotourism operators and
ecotourism service providers are also exempted from paying income tax for twenty years from
2003. In addition, they exempted the payment of VAT on purchases of Colombian merchandise by
foreign tourists. This is intended to rescue tourism, stimulating supply and demand, investment,
marketing and operation of ecotourism products. This was also supported by efforts to reduce
internal disturbance by narco-guerrillas, paramilitaries and common crime, in a joint effort with
the police and the armed forces. Similarly, the government managed to lift some travel warnings
and invested all its efforts to disappear them. To improve the image of the country nationally and
internationally and promote and encourage trips to Colombia showing the biodiversity and natural
and cultural wealth of the country.

In 2002, through Law 790, President Álvaro Uribe merged the Ministry of Economic Development
and the Ministry of Foreign Trade and named him Ministry of Commerce, Industry and Tourism,
where the Vice Ministry of Tourism is located, which is Faculty of planning, management and
regulations of the sector, seeking competitiveness, quality and sustainability in the development
of the activity. Together with Proexport, they are responsible for marketing the country abroad.
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The development of Tourist Lodges in rural areas and indigenous villages, together with their
promotion, was one of the most important projects for the development of tourism and for the
support of the community, which, for the most part, was immersed in illicit crops. In addition, the
"Live Colombia, travel by it" caravans were created, which motivate national tourists to travel the
roads of Colombia.

At the same time, the new measures have increasingly encouraged companies dedicated to
tourism development in Colombia to register with the National Tourism Registry, thus making an
increasingly formal sector, leaving more income for the State and promoting greater quality in the
service provided However, although the Sector Technical Standards are not mandatory, they have
greatly helped to improve the quality seen as an investment and not an expense.

This is how Colombia enters the global economy and the globalized world. At this time, signing a
free trade agreement with Colombia's largest economic ally was the country's commercial
challenge and the hope that will contribute to local development, competitiveness and
preparation, in order to expand further and grow, improving sustainability of its companies and
the quality of life of its inhabitants.

THE ADVANTAGES ARE:

Increase and acceleration of economic growth derived from increased capital flow

Increase in exports especially of products and services that were not considered traditional in the
market

Increase of the competitiveness of the national industry derived from the access to the new
technology raw material and knowledge coming from the other country at lower cost

Stability of the labor market in the industrial sector, to the extent that companies will require their
staff to produce the goods they export

The possibility of generating jobs to the extent that job creation was expanded

Investor confidence

Modernization of the state of the organization with foreign trade

DISADVANTAGES

The panorama of difficulties and risks are not easy to predict

Imbalance of the internal economy and lack of protection of productive sectors little benefit with
the negotiation of the treaty

Tax income mismatch since eliminating import tariffs on foreign products ceases to receive taxes
for this concept, which could deepen the national fiscal deficit, however analysts expect this
money to be recovered by VAT and tax of income derived from the largest movement in the
economy
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Little capacity of adaptation of the national company in front of the international standards of
production generating monopolies and capture of the market by the North American supply that
enters the country.