Trade agreements

Trade agreements are when two or more nations agree on the terms of trade between them. For this reason, when most people say trade agreements, they mean international trade agreements. Trade agreements determine the tariffs (taxes and duties) that countries impose on imports and exports.

Are the product of negotiations between two or more sovereign nations that dictate the terms of the acceptable exchange of goods and services between the parties. As sovereign nations, each of the approximately 200 countries in the world has the authority to say what they will allow to come in and go out of their country. Every country has realized, albeit to varying degrees, that they can't survive as complete isolationists. As soon as the potential for trade between two countries is evident, trade negotiations usually begin.