Economic Integration Flashcards
Common Market
Allows nations to trade freely with each other, set a common external policy and allow free movement of factors of production between member states.
Bilateral Trade Agreement
A preferential trade agreement (PTA) related to the reduction or removal of trade barriers for specific goods or services between the participating countries.
Complete Economic Integration
This is the highest level of economic integration. It would be closer integration than a monetary union because countries would also align fiscal policies.
No trade bloc has achieved this level of integration yet.
Customs Union
Created via an agreement between nations to both trade freely among each other and set a common external policy towards non-member countries.
Economic Integration
An agreement and a process among nations to reduce or eliminate trade barriers such as tariffs, and agree on fiscal policies.
Free Trade Area
Created by a FTA among countries to remove all barriers to trade with each other.
Countries are free to set their own barriers to non-member countries.
Generalised System of Preferences
A scheme of reduced tariffs and improved treatment to imports from developing countries.
It is provided unilaterally by developed countries.
Multilateral Trade Agreement
A PTA related to the reduction or removal of tariffs for specific goods or services among more than two participating countries.
Preferential Trade Agreement
When a country gives preferential access to certain products from certain countries by reducing or eliminating tariffs or by other agreements relating to trade.
