Regional Integration For And Against Essay

515 words - 3 pages

Regional Integration for and Against Articles
Mark Drury
445
March 9, 2011
Dr. Paul Mahajan

Regional Integration for and Against Articles
A trade bloc can be defined as a preferential trade agreement between two countries and is designed to significantly reduce trade barriers between the two countries. The integration of countries into trade blocs is commonly referred to as “regionalism” and it does not matter if the trade bloc has a geographical basis or not. They first started in the 1930’s. The main trade blocs of the world are: (1) in Europe, the European Union (EU), the European Free Trade Agreement (EFTA), the European Agreements, and the European Economic Area (EEA); (2) with the United States, the North American Free Trade Agreement (NAFTA), the Canada-US Free Trade Agreement (CUSTA), and the US-Israel ...view middle of the document...

The eastward expansion of the EU and use of the Euro, southern expansion of NAFTA into the FTAA, and increasing co-operation in Asia would seem to validate this prediction.” (Jones, 2010) Economist Jeffrey J. Scott of the Peterson Institute for International Economics notes that members of successful trade blocs usually share four common traits: similar levels of per capita GNP, geographic proximity, similar or compatible trading regimes, and political commitment to regional organization. (Nick, Sept)
There are currently 27 functional trading blocs and 16 free trade agreements around the globe, with 10 more being proposed or in process of being approved. There are another 30 bilateral trade agreements in place between two countries. The United States alone has 16 additional bilateral agreements in force. Are these good for trade?
Advocates of worldwide free trade are generally opposed to trading blocs, which, they argue, encourage regional as opposed to global free trade. (Nick, Sept) Scholars and Economists continue to argue over weather trade blocs are leading to a more fragmented economy and leading to and encouraging a multilateral trading system. They hurt large TNCs (Transnational corporations) as they eliminate global players in global society. Rather, trade blocs encourage free trade - trade that largely works in the mutual benefit of both parties. Free trade enables the free movement of goods and services without imposed tariffs on goods. This is especially advantageous to countries in the global south that tend to find themselves 'priced out' of goods and services from the developed, wealthy global north. So free trade is much more conducive to businesses.

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References
Jones, R. (2010). Trade Blocs. Retrieved from http://www.tradeblocs.com
Nick, D. P. (September 2006). International Report: Trade blocs and the future. Retrieved from http://www.adhesivesmag.com

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