What is the Central American Free Trade Agreement (CAFTA-DR)?

The Central American Free Trade Agreement (CAFTA-DR) is a trade agreement between the United States and several countries in Central America, including Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic. It was signed in 2004 and implemented in 2006.

CAFTA-DR aims to promote economic integration and trade liberalization among the participating countries. It eliminates or reduces tariffs and other trade barriers on goods and services traded between the member countries. The agreement also includes provisions on intellectual property rights, investment, government procurement, and labor and environmental standards.

One of the main objectives of CAFTA-DR is to enhance market access for goods and services, allowing businesses to expand their export opportunities and access new markets. By eliminating tariffs and reducing non-tariff barriers, the agreement facilitates trade and promotes economic growth in the region.

CAFTA-DR also includes provisions to protect intellectual property rights, which encourage innovation and creativity. It establishes standards for the protection of patents, trademarks, copyrights, and trade secrets, providing a framework for businesses to protect their intellectual property and promote investment in research and development.

Furthermore, the agreement includes provisions on investment, providing legal protections and guarantees for investors from the participating countries. This helps to attract foreign direct investment and promote economic development in the region.

CAFTA-DR also addresses labor and environmental standards, aiming to ensure that trade liberalization does not lead to a race to the bottom in terms of working conditions or environmental protection. The agreement includes commitments to enforce labor laws, protect workers' rights, and promote sustainable development.

Overall, the Central American Free Trade Agreement (CAFTA-DR) is a comprehensive trade agreement that promotes economic integration, market access, and investment among the participating countries. It aims to boost economic growth, create jobs, and improve living standards in the region.