Disadvantages Of Economic Integration

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Business, Diplomacy and Politics: American and European Region. Febryan Rivaldo Cliff Pelleng IR Diplomacy 2 016201400060 1. Economic Integration a. Definition Based on some reliable source, Economic integration is an economic arrangement between different regions marked by the reduction or elimination of trade barriers and the coordination of monetary and fiscal policies. Well basically in my own perspective, Economic Integration is a process of agreement in which two or even more parties, in this case country states, agreed to reduce or remove a trade barriers for the advantages of both parties. Economic Integration is often has a specific motives that drive, the driven parties to create one. Like for an example the Regionalism…show more content…
Economic integration is like a continuum line that have two different ends. First is no integration at all means the country is a single economic that have no agreements with other parties. And the other one is a complete integration which have the fully advantages of economic integration. The table above is the basic explanation about the economic integration levels. But we will only focusing from the Free Trade, Customs Union, Common Market, and Economic Integration. We will not discuss about the Political Union which are going to be out of the context of the discussion. Let’s start with the simplest…show more content…
The simple way to describe the Custom Union, it is like the FTA + Common External Tariff. They have the same trade barriers elimination and also have the a unified trade policies with the countries outside of the union, also known as the External Tariff. For an example, Customs Union will establish a common tariff that is applied to all imports that coming into each member counties. The revenue of the tariff may be divided among the members according to the agreement they have agreed. The example of this Union is the Andean Community that consist of Colombia, Ecuador, Peru, and Bolivia. It was previously known as the Andean Pact with the purpose to promote the expansion of markets and guarantee an effective economic development to the
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