Free trade agreements have also a lot may con and negative effects on a trading nation. When trading with other nation is kick started then this is a serious threat or area of concern for domestic industries and jobs in the nation. Goods that are produced are directly exported to foreign countries due to which the local demand is not met. At times when a country imports a lot of goods from other nation then the production market of the importing country is badly affected and people end up losing their jobs. Free trade agreements can greatly lead to dislocation in the economy if it creates bigger economic pie.
At times Free trade agreements are threat to the infant industries, and in order to protect such industries, many nations do not sign free trade agreements with other nations. It is responsibility of a government to protect such industries at the same time when it trades with other nations so that a balance could be maintained.
When free trade agreements are made, the nation relies totally on trading activities as the goods that are available in the market are solely coming into the market through trade. If there is some problem during trading or if the trade relations deteriorate then the nation would be stuck with crises as the goods which are in demand are obtained through trade and this creates too much dependency on foreign goods.
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