CAFTA and the balance of trade

[AJH032]

I have a question for any economists out there about how CAFTA would worsen our trade deficits. It's clear that CAFTA and other free trade agreements would hurt the workforce here in the United States, but I don't really see how our trade deficits would balloon from free trade. By definition, a trade deficit means we're importing more than we're exporting. If American companies move their factory jobs overseas to produce cheaper inventory, then theoretically they would be able to export more to other countries because the products would be cheaper (acknowleding the fact that these would be foreign exports, so no jobs would be generated here in the United States). Shouldn't this, in effect, close our trade deficits? Or are foreign exports considered imports?

Any input would be much appreciated, thanks!

[benevolent dictator]

1. I'm no economist, but from what I understand

part of the problem is that our markets get opened up while their markets are still closed for several more years.

Plus, if American jobs move to Honduras or El Salvador, and then they export more stuff because it's cheaper, well, it's not being exported from the United States, it's being imported into the US and elsewhere.

I believe (someone correct me if I'm wrong) that the trade is based on where it's produced, not where the company is based. So if an American Company is producing things in Central America and then we buy them, it's considered an import even though the parent company is owned here.

[AJH032]

2. if that's true, then it makes sense

thanks