W10 Mindmaps RTA PDF

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W10 Sample Exam Questions: Regional Trading ArrangementQ1. Differentiate between a Free Trade Area, a Customs Union, a Common Market, Economic Union and Monetary Union.Economic unionNational, social, taxation & fiscal policies harmonized & administered by supranational institution (l...

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W10 Sample Exam Questions: Regional Trading Arrangement Q1. Differentiate between a Free Trade Area, a Customs Union, a Common Market, Economic Union and Monetary Union. Economic integration Process of eliminating restrictions on global trade, payments and factor mobility.

The European Union (EU) Achieved the status of a common market in 1992 More complete stage of integration (factor mobility, common external trade restrictions, free movement of goods and services)

Results in the uniting of two or more national economies in a regional trading arrangement.

Free trade area All tariffs & NTBs removed among members Each member maintains its own set of restrictions against outsiders Example: EFTA: European Free Trade Association consists of Norway, Iceland, Switzerland and Liechtenstein.

Customs union Monetary union (or currency union) The ultimate degree of economic union includes this

RTA’s

Examples: the Eurozone, the US

All tariff & nontariff barriers removed among members Plus identical trade restrictions against nonparticipants Example: Benelux - Belgium, the Netherlands & Luxembourg, formed in 1948.

Economic union National, social, taxation & fiscal policies harmonized & administered by supranational institution (loss of national sovereignty)

Common market

An economic union is the last step in the process of economic integration, after free trade area, customs union, and common market.

Between members, permits free movement of goods, and factors of production, and common external trade restrictions against nonmembers

Example: Belgium & Luxembourg in 1921

Example: The European Union...