Comparative advantages are the reasons for trade between the United States and Central America (and the Dominican Republic) in agriculture, textiles, clothing and capital goods. Intra-economic trade (e.g.B. Some skilled jobs have developed in Central America (and other developing countries) where they are often located in production-sharing plants (Maquiladora). Economists describe such specialized production as “dismemberment of the value chain” and explain: Why products (and in particular their parts) are often manufactured or assembled in Central America and other countries in partnership with U.S. companies.4 This relationship, which will be discussed further, forms the basis of much of the debate on the work policy on CAFTA-DR The free trade agreement between the Dominican Republic and Central America (CAFTA-DR) is the first free trade agreement between the United States and a group of smaller developing countries: our Central American neighbors, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic. CAFTA-DR promotes stronger trade and investment relations, prosperity and stability throughout the region and along our southern border. Quotas are goods freely subject to the obligation to negotiate at the level of quotas that are reciprocal. Similarly, basic quotas approved by governments exceed the amounts authorized by governments are treated under free trade. Any unauthorized surplus remains subject to the import duties and duties in force in the contracting states at the time of the signing of this treaty or, as expressly stated in the dash of this appendix. Given the relatively small size of Central American economies and the fact that most U.S.
imports from the region have already been introduced duty-free under normal trade relationships or preferential CBI and GSP regimes, CAFTA-DR will not have a major impact on the U.S. economy as a whole. Adjustments will be a little more difficult for some sectors, but none are expected to be serious. Supporters see it as part of a political base that supports both improved intra-regional trade and long-term social, political and economic development in an area of strategic importance to the United States. Opponents called for better trade adaptation and a capacity-building policy to address potentially negative effects on some import sectors and their workers. They also argued that CAFTA-DR should strengthen intellectual property and labour rights. This report discusses the negotiation issues and the evolution of the CAFTA-DR agreement from the opening of the negotiations on 27 January 2003 until its implementation by the last country on 1 January 2009.