REGIONAL

ECONOMIC
COOPERATIONS

PRESENTATION BY :
ROHAN SINGH
● One of the most important developments in the world trade system in
the 1990s has been the emergence of regional cooperation.

● The end of the Cold War reduced political tensions between countries in
Asia as well as globalizing production processes and increasing vertical
integration.

● Regional economic cooperation is an important means for creating new

trade, investment and employment opportunities, enhancing economic
security, and addressing broader socioeconomic and environmental
issues.
INTRODUCTION

● Regional Economic Integration refers to agreement between groups of

countries to reduce/remove tariff and non tariff barriers for the free
flow of goods & services between each other countries.

● It has enabled countries to focus on issues that are relevant to their

stage of development as well as encourage trade between neighbors.
KINDS OF REGIONAL INTEGRATION

There are four major types of regional integration :

1. Free Trade Area

2. Custom Union

3. Common Market

4. Economic Union
PROs FOR CREATING A REGIONAL
INTEGRATION

● Trade Creation
● Employment Opportunity
● Consensus and Cooperation

CONs FOR CREATING A REGIONAL

INTEGRATION
● Trade Diversion.
● Employment shifts and reductions.
● Loss of national sovereignty.
REASONS FOR ECONOMIC INTEGRATION

1. POLITICAL REASONS

2. ECONOMICAL REASONS
 ECONOMIC REASON FOR INTEGRATION

● Opening a country to free trade stimulate economic growth in the country

which creates dynamic gains from trade.
● Economic theories suggest free trade and foreign direct investment is a
positive activity in which all participating countries gain .
● As an attempt to achieve additional gain from the free flow of trade and
investment between countries beyond those attainable under international
agreement .
● Motivate desires to exploit gains from free trade and investment.
 POLITICAL REASON FOR INTEGRATION

● Attempt to establish trade areas, customs union, ETC.

● By linking neighbouring economies and making them increasingly dependent on
each other, incentive are created for political cooperation between
neighbouring states Integration will reduce potential violent conflict between the
state.
● By grouping their economies together, the countries can enhance their political
weight in the world.
 SOME REGIONAL TRADE BLOCS

● European Union (EU)

● African Union (AU)
● Union of South American Nations (USAN)
● Caribbean Community (CARICOM)
● Central American Integration System (SICA)
● Arab League (AL)
● European Free Trade Association (EFTA)
● Eurasian Economic Community (EAEC)
● Association of Southeast Asian Nations (ASEAN)
● Central European Free Trade Agreement (CEFTA)
● North American Free Trade Agreement (NAFTA)
● South Asian Association for Regional Cooperation(SAARC)
● Pacific Islands Forum (PIF)
THANK YOU !