Trade Policies and Practices

The Trade Facilitation Agreement (also known as TFA) is expected to make a huge, positive impact on the way products cross borders and move all over the world (World Economic Forum, 2017). This seamless way of transporting packages gives Latin American countries a lot to be excited about. The TFA is a fast-paced, affordable, and safer way of trading, which will allow businesses and consumers in Latin America to engage with markets around the world. One major benefit of this agreement is increased security. Customs agencies in Latin America are limited in their ability to efficiently and effectively guard against corruption and prohibited goods. This is because of the lack in transparency throughout the trading process (World Economic Forum, 2017).

Many countries have yet to apply technology that uses advanced data to conduct risk assessments and clear shipments before they arrive at the border. This is a commonly used practice that improves compliance among businesses and consumers who ship regularly and keeps borders safe. The TFA also assists the exporting process by removing unnecessary costs, making it easier for  businesses to reach foreign consumers (World Economic Forum, 2017). This is particularly aimed towards small and medium-sized businesses who have been avoiding expansion in other countries due to complexity. The current costs to trade in Latin America are much higher than the costs in North America, which makes it a lot harder for them to compete against other markets (World Economic Forum, 2017). However, the TFA is specifically structured to help strengthen the weakest link on any supply chain.