Question

Compare two tariff treatments and two trade free trade agreements in Canada.

Answer 1

The two tariff treatments in the country of Canada are most favored nation treatment and general tariff treatment. The most favored nation (MFN) treatment is granted to all the nations who are the part of WTO, whereas general tariff treatment is applied to all the nations who are not the member of WTO. MFN treatment makes Canada to treat the same trade guidelines with all the WTO members without any discrimination. It means that one benefit provided to one WTO member, will also be granted to other WTO member nations. But, general tariff treatment causes 35% increase in tariff during trade with the nations who are not the member of world trade organization. So, different tariff treatment provides different treatment to the nations on the basis of their allegiance with the world organizations.

The first free trade agreement  is NAFTA that includes Canada, USA and Mexico, whereas the another free trade agreement is CETA that is comprehensive and economic trade agreement that is with the European Union. CETA is in force with provisional recognition, making it 98% duty free trade between the Canada and EU. It has been in force since 2017. In comparison to it, NAFTA is 100% free trade agreement and it is in force since 1994. Hence, NAFTA has passed many years of the agreement, making the member nations to work together at the strategic front also.