College of Business Administration

International Business and Trade

Group Activity

Trading Bloc Worksheet

Trading Bloc Level of Integration

The creation of Andean pact has an initial objective of creating a customs Union and a common Market.
Andean Pact The Community was able to create a Customs Union in February of 1995. Andean Common Market, its
charter provisions, and the Group's initial achievements were formed. The Andean Common Market was
made in response to the inadequacies of the Latin American Free Trade Association. The Ancom charter
contained several provisions, such as a standard external tariff, investment planning, and policy
harmonization, making it uniquely suited for promoting its members' development. Its record has been
good, though much work remains to be accomplished. The various member countries must develop a
more cooperative and less nationalistic attitude if the Group is to be successful. Hence, the Andean Pact's
Level of Intergeneration is the combination of Free Trade and Customs Union.

Member Countries Top 5 Imports Top 5 Exports

(Main Members 1.Plastic Products 1.Petroleum and Minin
Colombia 2.Mining Equipment 2.Heavy Manufacturing
3.Broadcasting Equipment 3.Light Manufacturing
Peru
4.Data Processing Machines 4.Agricultural Products
Ecuador 5.Rubber 5.Metal
Bolivia
Brief Background / Short History
(Associate Members) The Grupo Andino or Andean Common Market was founded under the Cartagena
Agreement in May 1969. The agreement aimed to unite the economies of Chile, Colombia,
Chile Ecuador, Peru, and Bolivia. Chile left in 1976, and Venezuela joined in 1973. The Andean
Argentina Pact's main goal was to encourage local industrialization. In order to achieve this, it
implemented a number of novel tactics, including removing internal trade barriers, creating a
Brazil single external tariff, creating sectoral programs, and strictly controlling foreign investment. At
Paraguay first the Andean Group's endeavors at participation delivered considerable increments in
territorial exchange and mechanical development. By the 1980s, in any case, these positive
Uruguay patterns were switched. The arrangement of substituting nearby mechanical items for imports
was exorbitant. Inside financial disparities were escalates. Owing to the delicacy of Andean
economies and the universal financial emergency, territorial exchange declined. Andean
(Other Members) financial integration too endured mishaps due to clashes of national intrigued over taxes, a
boundary war between Ecuador and Peru, and disappointments to uphold Agreement
Venezuela arrangements. Venezuela chosen in 2006 to pull back from the Gather, citing disappointment
(1973-2006) with the respective free exchange understandings (FTAs) that Colombia and Peru marked
with the Joined together States. In spite of making a few advance in accomplishing financial
solidarity, as of 2007 the Andean Settlement had however to overcome basic issues and
deep-seated territorial

Reasons of forming the trading bloc

1.
To improve the position of the region in the international economic context.

2. To promote its involvement in the regional integration process in order to influence the economic development
and the provision of jobs, with a goal for the eventually establishment of a Latin American Common Market.

3.
To encourage a fair, balanced, and unified growth of the member nations through
cooperation and economic and social relations.
Trade Agreements
1. The Treaty establishing the Andean Parliament
The Andean Community Countries, which comprises of the members countries namely; Ecuador, Bolivia, Colombia, Peru. Convinced that the peoples’
participation is necessary to ensure the consolidation and future projection of the global integration of the countries of the Andean Sub region; Conscious that
it is essential to create a means of common action for affirming the principles, values and objectives that are identified with the effective exercise of
democracy; Bearing in mind that the incorporation of the national legislative bodies into the regional integration project, started with the establishment of the
Latin American Parliament, calls for the existence of Community bodies to represent and interlink those national bodies

2. Complementarity Agreement in the Automotive Sector- Columbia, Ecuador, and Venezuela

The Governments of Colombia, Ecuador and Venezuela.The advances being made by Andean integration call for instruments to be devised for promoting actions to link up industrial
production and specialization processes more closely, in order to contribute to the economic and social objectives set out in the Cartagena Agreement. It has therefore become necessary to
reinforce and boost the development of the sub region’s automotive industry, take advantage of the enlarged sub regional market, promote automotive exports, meet the needs of regional
integration agreements, and make use of the opportunities those agreements offer. The Participating Countries in the Agreement have decided to launch a comprehensive strategy designed
to give shape to an automotive industry that is responsive to international demands.

3. ANDEAN SUBREGIONAL INTEGRATION AGREEMENT or "CARTAGENA AGREEMENT

The governments of Bolivia, Colombia, Ecuador, Peru, and Venezuela, Created to strengthen the union of their peoples and to lay the foundations for advancing toward the formation of an
Andean sub regional community. Integration constitutes a historical, political, economic, social, and cultural mandate for their countries, in order to preserve their sovereignty and
independence based on the principles of equality, justice, peace, solidarity, and democracy; to attain such goals by creating an integration and cooperation system that will lead to the
balanced, harmonious, and shared economic development of their countries. The Cartagena agreement of May 1969 established the Grupo Andino or Andean Common Market. The pact
sought to integrate the economies of Colombia, Ecuador, Peru, Bolivia, and Chile. Venezuela joined in 1973, and Chile withdrew in 1976.