21 terms

Trade Agreements

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Trade agreements
Since the 1950 have been formed by countries to form trade blocs in order to stimulate trade between themselves and to gain economic benefits from co-operation.
Customs Unions
A group of states that have agreed to charge the same import duties as each other and usually to allow free trade between themselves.
Common Markets
A group of countries imposing few or no duties on trade with one another and a common tariff on trade with other countries (this last bit is the difference between a custom union and a common market).
Economic & Social Unions
An economic union is a type of trade bloc which is composed of a common market with a customs union. The participant countries have both common policies on product regulation, freedom of movement of goods, services and the factors of production (capital and labour) and a common external trade policy.
Free Trade Areas
A free trade area is a grouping of countries within which tariffs and non-tariff trade barriers between the members are generally abolished but with no common trade policy toward non-members
Examples of Trading Blocs
NAFTA (North American Free Trade Agreement), the African Union (AU), OPEC and the European Union
Defence
There are defence groupings such as NATO (North Atlantic Treaty Organisation)
Eurozone
The EU's monetary union where the currency is the 'Euro'.
Advantages of trading entities
Improves global peace and security; increases global trade and co-operation on trade issues; helps members develop their economies and standard of living.
Disadvantages of trading entities
Loss of sovereignty; loss of financial control; pressure to adopt central legislation; certain economic sectors are damaged by having to share resources.
OPEC
Organisation of Petroleum Exporting Countries is made up of members mainly from the Middle East but also from South America and Africa, their focus is to control oil trade, of which is the most important commodity
CARICOM
Caribbean community of 20 countries
EFTA
European Free Trade Association: Iceland, Liechtenstein, Norway, Switzerland.
NAFTA
North American Free Trade agreement: Canada, Mexico, USA.
Pacific Alliance
Chile, Colombia, Mexico, Peru.
SADC
South African Development Committee: Angola, Botswana, Dem. Rep. Of Congo, Lesotho, Madagascar, Malawi, Mozambique, Namibia, South Africa, Swaziland, Tanzania, Zambia, Zimbabwe.
SAARC
South Asian Association for Regional Co-operation: Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka.
UEMOA
West Africa Economic and Monetary Union: Benin, Burkina Faso, Côte d'Ivoire, Mali, Niger, Senegal, Togo.
ASEAN (AFTA)
Asia-Pacific Economic Co-operation: Australia, Brunei Darussalam, Canada, Chile, China, Hong Kong-China, Indonesia, Japan, Republic of Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, Philippines, Russia, Singapore, Chinese Taipei, Thailand, United States, and Vietnam.
EU
European Union: Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.
OECD
Organisation for Economic Co-operation and Development, inter-governmental economic organisation with 37 member countries, founded in 1961 to stimulate economic progress and world trade