The Rise of Mega-FTAs. EU Centre in Singpore Fact Sheet (October 2013)

Free trade agreements (FTAs) are negotiated so that countries and businesses can benefit from the possibilities that international economic integration offers. By eradicating barriers to trade, mutual gains can be generated. FTAs, in general, create a bigger market, increase competition, but at the same time reward economies of scale, which in turn induces companies and countries to allocate their time and resources more efficiently. Moreover, greater business competition arising from FTAs can catalyse economic reforms such as accelerating the adoption of existing technologies and stimulating the development of new ones (Krist, 2012)