Forms of Regional Integration
Forms of Regional Integration
rising degree of intensity. They are:
· Preferential Trade Agreement (PTA), which is formed with the reduction of
custom duties (mainly tariffs) on trade among members relative to those on trade
with non-members.
· Free Trade Area (FTA), which involves the elimination of tariffs and quotas on
the trade among member countries.
· Customs Union (CU), which goes a step further than the FTA as in addition to
free trade within the union, there is a common external tariff (CET) against nonmembers.
· Common Market (CM), which is a CU that allows for the free movement of
factors of production among member countries. Thus, it encompasses intra-union
free trade, a common external tariff against non-member countries and free
movement of factors of production (labour and capital) within the union.
· Economic and Monetary Union (EMU), which is a common market in which
there is a single currency and monetary policy, and in which major economic
policies (particularly fiscal policy) are coordinated or harmonized. Often, there is
a compensation policy, which involves transfer of income to poorer or
disadvantaged members of the Union.
African Development Bank
Economic Research Working Paper Series
Enhancing Africa’s Trade: From Marginalization
to an Export-Led Approach to Development
Milton A. Iyoha
Professor, Department of Economics & Statistics
University of Benin, Nigeria
Economic Research Working Paper
No 77 (August 2005)
Forms of Regional Integration - To learn more about this author, visit African Development Bank's Website.
Like this article? Share it with your friends
We may identify five main types or forms of regional integration, classifying them by a
rising degree of intensity. They are:
· Preferential Trade Agreement (PTA), which is formed with the reduction of
custom duties (mainly tariffs) on trade among members relative to those on trade
with non-members.
· Free Trade Area (FTA), which involves the elimination of tariffs and quotas on
the trade among member countries.
· Customs Union (CU), which goes a step further than the FTA as in addition to
free trade within the union, there is a common external tariff (CET) against nonmembers.
· Common Market (CM), which is a CU that allows for the free movement of
factors of production among member countries. Thus, it encompasses intra-union
free trade, a common external tariff against non-member countries and free
movement of factors of production (labour and capital) within the union.
· Economic and Monetary Union (EMU), which is a common market in which
there is a single currency and monetary policy, and in which major economic
policies (particularly fiscal policy) are coordinated or harmonized. Often, there is
a compensation policy, which involves transfer of income to poorer or
disadvantaged members of the Union.
African Development Bank
Economic Research Working Paper Series
Enhancing Africa’s Trade: From Marginalization
to an Export-Led Approach to Development
Milton A. Iyoha
Professor, Department of Economics & Statistics
University of Benin, Nigeria
Economic Research Working Paper
No 77 (August 2005)
Forms of Regional Integration - To learn more about this author, visit African Development Bank's Website.
Like this article? Share it with your friends
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John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
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