Free trade can provide consumers with access to goods at lower prices. It can provide domestic employment opportunities that may not otherwise be available, resulting in higher levels of illegal immigration. In some cases, however, it results in competition that destroys industries in one nation. There are also risks that free trade may lead to developed nations supporting work conditions in a developing nation that it would not allow in its own.
One of the benefits of free trade is that tariffs are often reduced or eliminated. This means that a producer's goods are often more attractive to foreign consumers and that those consumers can acquire those goods at lower prices. Free trade can also result in low prices because goods can often be produced in the nation that possesses the raw materials to make them. If businesses in one country first buy raw materials from a foreign source and then pay laborers to create the end product, the retail prices for those items can be substantially higher. In some cases, quality is also jeopardized when raw materials are imported because individuals in the country where those raw materials are located may be more skilled at working with them.
Competition in business is generally considered to be a positive element. One of the drawbacks of free trade, however, is that it can subject markets to an overwhelming amount of competition. In some cases, after a nation enters such an agreement, it may witness the destruction of an industry or massive job losses because it becomes advantageous to obtain products or services that are available domestically from a foreign source at a cheaper price.
When properly implemented, free trade agreements can be used to address illegal immigration. Landlocked nations commonly experience such problems. When one country is richer than its neighbor, people attempt to cross the borders in search of a better life. If nations with strong economies allow poorer nations easy access to their markets, however, it can provide employment opportunities that will encourage individuals to remain in their home countries.
Another drawback of free trade is that it can result in a developed nation directly or inadvertently supporting behavior that it would not allow in its own country. In some developing nations, production workers are paid extremely low wages, child labor is exploited, and working conditions may be substandard. When these countries have access to the large markets of developed nations, the citizens of the developed nations become supporters of those circumstances and those injustices may occur on a larger scale.