✅Case Study - Trade Blocs Flashcards
What is SAARC?
South Asian Association for Regional Cooperation
Which countries are involved in SAARC?
Afghanistan,Bangladesh, Bhutan, India, Nepal, Maldives, Pakistan, Sri Lanka
What does SAARC promote?
Development of economic and regional integration
What are the main objectives of SAARC?
To promote competition in the area and provide equitable benefits for all countries involved as well as increasing trade and economic cooperation
How does SAARC provide special preferences?
To the least developed countries, preferences are given to aid development to enhance and support least developed and landlocked countries
How has tariff reduction been put into place within SAARC?
A time frame was put in place, with an additional three years for least developed nations, giving them time to still benefit from other countries paying their tariffs
How are human resources shared within SAARC?
Shared between countries to improve trade and also the lives of people in each of the countries involved
What is NAFTA?
The North American Free Trade Agreement
Which countries are part of NAFTA?
USA, Canada, Mexico
Why was NAFTA set up?
To eliminate barriers to trade and facilitate cross border movement of goods and services
What does NAFTA promote?
Conditions of fair competition, increased investment opportunities and protection
What was the time scale on NAFTA’s provisions?
Some implemented immediately, others over the next 15 years.
What did NAFTA provide?
Greater equality on import tariffs between the countries
How were the economies of the countries within NAFTA impacted?
GDP in all three countries grew by up to 40%, Canadian and US economies more integrated with Mexico
When was the EU founded?
1958`
Why was the EU founded?
To prevent further conflict between countries after the World Wars, particularly between France and Germany
When was the EU single market established and what changes did it bring?
1968, customs tariffs were no longer charged and economic growth was bigger than ever before
In the 1970s, what impact did EU growth have?
More and more countries joined and the influence of the EU began to fund development in poorer regions to create jobs and improve infrastructure
What global impact does the EU have?
The largest world trade bloc, provides members with free trade with a much larger market than if they were separate.
Provides common front in negotiating trade deals with larger economies eg. US and Russia
How does the size of the EU impact its influence?
Its huge market due to combined populations means it can out-compete other economies.
1 in 7 jobs in Europe rely on EU trade
How does the EU impact travel and migration?
Flow of EU citizens between countries is easy, lack of borders.
How does the EU create inequality?
Fees paid in vs economic gain can be unequal, in 2016 the UK paid in £8.6 billion more than it received back, never been given more than paid in
What does EFTA stand for?
The European Free Trade Association
Which countries are a part of EFTA?
Iceland, Norway, Lichtenstein, Switzerland
Why was EFTA established?
For the progressive elimination of customs duties on industrial products while not affecting agricultural or fisheries products
How does EFTA’s trade policy work?
No formal trade policy and members free to trade with any non-EFTA nations, free to make their own deals
How has EFTA impacted its members?
Trade has been improved greatly between the member countries as they aim to support each other
How do the EU and EFTA overlap?
They work parallel, giving EFTA nations access to the single market and allowing them to still benefit from EU trade despite not being members. EFTA countries also have an open border policy to EU citizens.
Where is MERCOSUR located?
South America
What does MERCOSUR function as?
A customs union and free trade area with ambitions to become a common market
Why was MERCOSUR set up?
During a period when Argentina and Brazil were longtime rivals, it was set up to improve relations through trade
What have MERCOSUR countries agreed to?
Eliminating customs duties, implementing a common external tariff of 35% on certain imports from outside the bloc and adopting a common trade policy towards outside countries
What is the main goal of MERCOSUR?
To standardise regulations between member countries in order to ease commerce.
How do MERCOSUR countries trade with the wider world?
They have a number of third part free trade agreements including with Chile, Colombia and Israel
Which countries are part of Pacific Alliance?
Chile Colombia, Mexico and Peru
What is the main goal of Pacific Alliance?
To form an area of integration with the purpose of ensuring a complete freedom in the movement of goods, services, capital and people
What is Pacific Alliance’s international goal?
To further free trade with a clear orientation towards Asia
Which states are ‘observers’ within Pacific Alliance?
54 in total , including economic heavyweights such as Japan, China, Germany, USA and UK.
How has Pacific Alliance aided economic growth?
All the countries involved have seen huge economic growth, seeing around 57% of Latin America’s foreign trade and 41% of total investment
Which economies are the fastest growing within Pacific Alliance?
Peru and Chile, growth rates of up to 3.7% every year
How have Peru’s exports changed since Pacific Alliance formed?
They have increased at an annual rate of 22.6% with an increase of external sale and exports of hydrocarbons, mining and agroindustry sectors
What does OPEC stand for?
Organisation of Petroleum Exporting Countries
Why was OPEC founded?
To improve communication among petroleum exporting countries as the world recovered from WWII
What impact does OPEC have on trade?
As a trade agreement, OPEC has very little impact as all the countries trade the same product but it does control the trade between countries within the agreement and the ones they trade oil with.
