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Integration - Trade Blocks

Economic integration involves preferential arrangements between members to encourage freer trade through eliminating restrictions on goods, services, capital, and labor. It can take various forms from free trade areas and customs unions to common markets and complete economic integration. The European Union started as the European Economic Community to abolish internal tariffs and avoid conflict, establishing common external tariffs and agricultural policies while expanding membership. It is governed by institutions like the European Commission, Council, and Parliament. NAFTA created free trade between the US, Canada, and Mexico through eliminating most tariffs and restrictions to boost regional trade.

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Gaurav Yadav
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17 views

Integration - Trade Blocks

Economic integration involves preferential arrangements between members to encourage freer trade through eliminating restrictions on goods, services, capital, and labor. It can take various forms from free trade areas and customs unions to common markets and complete economic integration. The European Union started as the European Economic Community to abolish internal tariffs and avoid conflict, establishing common external tariffs and agricultural policies while expanding membership. It is governed by institutions like the European Commission, Council, and Parliament. NAFTA created free trade between the US, Canada, and Mexico through eliminating most tariffs and restrictions to boost regional trade.

Uploaded by

Gaurav Yadav
Copyright
© Attribution Non-Commercial (BY-NC)
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Download as PPT, PDF, TXT or read online on Scribd
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Economic Integration

IBM - Unit 2
Economic integration
• Preferential economic arrangement
amongst the members
• Co-operation & elimination of restrictions
on flow of goods, services, capital & labor
• Freer trade will produce gains from trade
for all members
Levels of Integration
• Free Trade Area ( FTA )
• Customs union
• Common market
• Complete economic integration
• Political Union
European Union
• Started as European Economic Community
• Objective was to abolish internal tariffs and avoid
political conflict
• Milestones
– Elimination of tariffs
– Common external tariff – 1967
– Common Agricultural policy
– Expanded membership
– European monetary system - 1999
EU organization structure
• European commission
• European council
• European parliament
• Court of Justice
European commission
• Initiating Proposal for legislation
• Guardian of treaties
• Manager & executor of policies &
international trade relationships
European Council
• Made up of heads of state & government
of member states and the commission
president
• Sets general political guidelines for union
parliament
• 25 different councils each with tremendous
authority and has major influence on the
union’s political guidelines
European Union Parliament
• Has legislative, budgetary & supervisory
powers
• Common foreign & security policy
• International agreement & treaties
• Globalization
• Defend human rights in the world
• Area of Freedom, security & justice
NAFTA
• USA , Canada & Mexico
• Agreement includes
– Abolition of tariffs on 99% goods
– Removal of cross border flow of services
– Protection of intellectual property rights
– Removal of restriction on FDI
– Application of common environmental
standards
– Establishment of commissions to penalize.
Impact of NAFTA
• Small positive impact on jobs
• Growth of trade by 156 % within NAFTA
against 65 % with rest of world ( USA)

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