CONCEPTS AND TERMS FOR REGIONAL INTEGRATION

 Regional Integration - this is the process in which neighboring countries enter into an
agreement in order to upgrade cooperation through common institutions and rules.

 Monetary Policy - The process a government central bank or monetary authority of a

country uses to control the supply of money, availability of money and the cost of money
or rate of interest to attain a set of objectives oriented toward the growth of an economy.

 Bilateral Agreement – An agreement between two groups, countries or nations

 Multilateral Agreement – Agreement among many groups, countries or nations

 Common Market – An economic unit, formed of nations, intended to eliminate or

markedly reduce trade barriers among its members

 Single Market – A group of countries that have few or no restrictions on the movement
of goods, money and people between the members of the group

 Economic Integration – the process by which the economies of a group of countries are
drawn closely together so that the group as well as the individual countries becomes
stronger or more developed.

 Independent State – self government of a country, nation or state by its residents and
population

 Underdeveloped country – a relatively poor country with little or no material wellbeing.

 Developing country – a country that has not yet reached the stage of economic growth to
stand on its own for further growth

 Developed country – a country that has high level of development and high gross
domestic product (GDP) per capita.

 Trade Liberalization – the movement towards the removal of trade barriers among the
members of the World Trade Organization (WTO).

 Globalization – the process by which countries all over the world are becoming
connected or because large companies are doing business in many differences countries.
  Multinational Corporation – Sometimes called Transnational corporation is a
corporation or enterprise that manages production and delivers services in more than one
country.

 Trading Bloc – made up of a large number of countries, with the same political and
economic aims, linked by special trading arrangement among them.

 Free Trade Area – an arrangement whereby a group of countries agrees to remove the
tariff and non-tariff barriers to trade among them.

 Intra- Regional Trade – countries in the region buying locally produced goods from or
selling locally produced goods to, other countries in the region.

 Fiscal Policy – the use of government spending and revenue collection to influence
economy.

Trade Barriers

Government policies which place restrictions on international trade.

Examples of Trade Barriers:

1. Tariff Barriers – these are taxes on certain imports

2. Non- Tariff Barriers – these involve rules and regulations which make trade more
difficult.

3. Quotas – a limit placed on the number of imports

4. Subsides – a domestic subsidy from government can give the firm a competitive
advantage.

5. Embargo – a complete ban on imports to a certain country.