Step-by-step explanation:
Similarities between AFTA (ASEAN Free Trade Area) and NAFTA (North American Free Trade Agreement):
1. Regional Free Trade Areas: Both AFTA and NAFTA are regional free trade agreements aimed at promoting trade and economic cooperation among member countries.
2. Elimination of Tariffs: Both agreements aim to reduce or eliminate tariffs on goods traded between member countries. This facilitates trade by reducing barriers and costs associated with tariffs.
3. Market Access: AFTA and NAFTA provide member countries with increased market access to each other's markets, promoting trade and investment opportunities.
Differences between AFTA and NAFTA:
1. Geographical Scope: AFTA focuses on Southeast Asian countries and includes members such as Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. On the other hand, NAFTA is specific to North American countries and includes the United States, Canada, and Mexico.
2. Objectives: AFTA aims to enhance economic integration and cooperation among member countries in Southeast Asia, with the goal of creating a single market and production base. NAFTA aims to promote trade liberalization and economic integration specifically between North American countries.
3. Level of Integration: AFTA is considered a less integrated trade agreement compared to NAFTA. While AFTA has made progress in reducing tariffs and non-tariff barriers, it allows for certain flexibilities and transitional periods in achieving its objectives. NAFTA, on the other hand, has a higher level of integration, including provisions for dispute resolution, intellectual property rights, and investment protection.
4. Membership and Size: AFTA has a larger number of member countries compared to NAFTA. Additionally, the economic sizes and levels of development of the member countries differ between the two agreements.
5. Duration and Evolution: AFTA was established in 1992 and has evolved over time, with ongoing efforts to deepen economic integration among member countries. NAFTA was established in 1994 and operated until it was superseded by the United States-Mexico-Canada Agreement (USMCA) in 2020.
It's important to note that the information provided is based on the knowledge available up until September 2021, and there may have been subsequent developments or changes in the agreements.