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The Global Trade Environment, Chapter 3, Summary

Terms in this set (9)

The multilateral World Trade Organization, created in 1995 as the successor to
The General Agreement on Tariffs and Trade, provide a forum for settling disputes among member nations and tries to set policy for world trade.
The world trade environment is also characterized by preferential trade agreements among
Smaller numbers of countries on regional and subregional bases. These agreements can be conceptualized on a continuum of increasing economic integration
Free Trade Areas, such as the one created by the North American Free Trade Agreement (NAFTA
Represent the lowest level of economic integration.
The purpose of a free trade agreement (FTA)
Is to eliminate tariffs and quotas.
Rules of Origin are used
To verify the country from which goods are shipped.
A customs union, such as Mercosur
Represents a further degree of integration in the form of common external tariffs.
In a common market, such as the Central American Integration System (SICA) and the East African Community
REstrictions on the movement of labor and capital are eased in an effort to further increase integration.
An economic union, such as the EU
Is the highest level of economic integration and is achieved by unification of economic policies and institutions.
Harmonization
The coming together of varying standards and regulations, and is a key characteristic of the EU.
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