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18 May, 09:30

What is the most common reason why countries create trade agreements?

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  1. 18 May, 10:33
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    The most common reason why countries create trade agreements is to outline the consequences if deviated from the agreement.

    Explanation:

    When two or more countries come into a trade agreement, each party proposes a different set of rules and conditions before signing the agreement.

    This is done in order to avoid deception or cancellation of the agreement before the agreed period of time. A trade agreement comprises of huge investments, low tariff packages and free quotas. Cancellation or deception would incur huge loss.

    International agencies such as IMF (International Monetary Fund), therefore, monitors compliance of agreement between the countries to avoid any such violations.
  2. 18 May, 11:46
    0
    to create free trade

    Explanation: trade is with two or more countries agree on the commerce against them
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