Chapter 8 - Capitalizing on Global & Regional Integration Flashcards
Regional economic integration
trying to reduce trade and investment barriers within ONE REGION
Global economic integration
trying to reduce trade and investment barriers around the GLOBE
General Agreement on Tariffs in Services (GATS)
a set of rules that many countries agree to follow when they trade services with each other
World Trade Organization (WTO)
the official title of the multilateral trading system and the organization underpinning this system since 1995
regulates and facilitates international trade
*it’s like a global referee or organizer for international trade
*it’s an organization where many countries come together to agree on the rules of trading across borders
What does the WTO do?
regulates and facilitates international trade
Types of regional economic integration
- FTA
- Customs Union
- Common Market
- Economic Union
- Monetary Union
- Political Union
(Four Cooky Cats Eat Mouse Poop)
Free trade area (FTA)
a group of countries that remove trade barriers among themselves
this makes it easier for them to trade with each other!
*Canada, Mexico, and U.S.A. use this together
Customs union
imposes common external policies on non-participating countries (a step beyond an FTA)
easier wording: basically a team of countries that decide to work together to make trading goods with each other even easier by
- removing rstrictions and taxes on their trade
- using the same rules when dealing with countries outside of their union
Common market
a market that combines everything a customs union has; it permits the free movement of goods and people
*more features than a FTA has
easier wording: its a group of countries that not only trade with each other easily, but also collaborate more deeply by allowing different aspects of their economies to go across the borders with less restrictions
Economic union
members coordinate and harmonize economic policies to blend their economies into a single economic entity
e.g.: The European Union
easier wording: higher level of partnership where countries align their economic strategies to work more closely togehter
Monetary union
a group of countries that uses a common currency
e.g. The Eurozone = Germany, France, and Italy – use the Euro
- this makes it easier for them to trade and do business because they use the same currency
Political union
an integration of political and economic affairs of a region (U.S.A. uses this)
e.g. The European Union
*when a group of countries decide to not only work together on money + trade, but also make important decisions as a team
*almost like having a shared government
