MgmT 80 Ch 8: Regional Economic Integration

What are the 3 main objectives of the Association of SouthEast Nations(ASEAN)? Who are some participating members

- Promote economic, cultural, and social development in the region - Safeguard the region's political and economic stability - Serve as a forum in which differences can be resolved fairly and peacefully Members are: Phillipines, Thailand, Vietnam, etc.

What is the Copenhagen criteria that future countries must satisfy in order to join the EU?

1) Must have a stable market economy 2) Institutions in place that protect human rights, democracy, and law 3) Assume monetary, economic, and political obligations 4) Adopt rules of Community, Court of Justice, and Treaties..

List the effects of NAFTA

1) Three Nation Trade Flows have increased exports between neighboring countries. 2) Jobs and Wages: Effects on both sides are vague 3) Fast Track Authority is given to the president to decide on trade promotions. Congress can also vote on trade deals 4) Single Currency might be a reality in order to make trade more efficient.

Name the 5 key EU institutions, give a brief explanation, and Contrast their differences

1)Council of the EU: along with European Parliament, negotiate and adopt EU laws, votes in legislation, coordinates EU policies, develop's the EU's foreign and security policies that follow the European commission's guidelines, and concludes agreements. 2)Court of Justice: EU court of appeals that hear cases that member nations bring before it. 3) European Parliament: Consultative body that debates and amends legislation proposed by the European Commission. 4) Court of Auditors: audits EU accounts and implements its budget 5) European Commission: The executive branch that drafts legislation, manages and implements policies, and monitors compliance with the EU laws.

Why did the EU form and what are its significant impacts?

27 European countries adopted a single currency, the Euro. A common currency eased trade barriers and financial obstacles that come with multiple currencies, and made prices more transparent.

What is the Asian Pacific Economic Cooperation(APEC)? What are its goals?

APEC includes 21 nations that make up 40% of the global economy. It aims to strengthen the multilateral trading system, and expand the global economy by simplifying and liberalizing trade and investment procedures among member nations. It has been successful in reducing tariffs between member nations by 50%, and moves towards completely free trade and investment by 2020.

How is APEC trying to simplify and harmonize customs procedures?

APEC is making business vistas more universal so that businessmen don't have to obtain multiple vistas to operate in multiple regions. Also, it recognizes mutual agreements on professional qualifications so that engineers can practice in any country, regardless of nationality.

Who makes up the Southern Common Market?

Argentina, Brazil, Venezuela, etc. is emerging as the most powerful economic group in Latin America. Customs union, and aims to liberalize trade and investment among its members.

What are the pros and cons of Regional integration?

Benefits: Creation of trade and more jobs. Encourages a greater consensus, and allows for political cooperation. Cons: Lowers sovereignty, shift of employment, inefficient trade diversion from productive exporters to less capable exporters.

What are the objectives of the Andean Communities?

Bolivia, Colombia, Peru. Stribes to reduce internal tariffs, establish a common external tariff, and common policies in transportation and other key industries. Downside is that each country has a significant exception to the common tariffs, which impair progress and hurt Andean credibility.

What is CAFTA? What are the pros and cons?

Central American Free Trade Agreement includes nations such as the US, Costa Rica, Guatemala, etc. This agreement has cut down tariffs, and should create greater competition and investments, better protect intellectual property rights, and enhance regional peace and stability. - Pros: encourages trade efficiency and promotes investment that brings high-paying jobs to the poorer member nations Cons: Smaller farmers and businesses could be hurt by the large benefits reaped by big US companies,

What limitations do the Central America and the Caribbean nations face when trying to economically integrate?

Countries like Guatemala, Costa Rica, Honduras, have been constrained by wars that have limited success. These countries are trying to form a single market, but are bleeding due to the fact that its members trade more with nonmembers than with each other. MEmbers simply don't have the imports/exports each other needs.

What are the NAFTA Rules of Origin Requirements?

In order to qualify for an exemption of tariffs, goods must be wholly produced or obtained in the NAFTA region, must meet Annex 401 origin rules, goods produced in NAFTA region wholly from originating materials, goods that make up product must have sufficient North American regional value content. Since NAFTA has been in effect, trade among the 3 nations has increased

How has NAFTA affected its member nations?

NAFTA eliminated all tariff and non tariff trade barriers on goods originating within North America. This agreement calls for liberalized rules regarding government procurement practices, the granting of subsidies, and the imposition of countervailing duties. Other provisions specified deal with issues such as trade in service, intellectual property rights, and standards of health, safety, and the environment

Why did European Countries form the European Free Trade Association

These nations wanted the benefits of a free trade area, but didn't desire a fully common market. Members include Iceland, Norway and Switzerland, who wanted to focus on trade in industrial goods.