8-1 copyright © 2009 pearson education, inc. publishing as prentice hall cross-national cooperation...
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8-1Copyright © 2009 Pearson
Education, Inc. publishing as Prentice Hall
Cross-National Cooperation and Agreements
8-2Copyright © 2009 Pearson
Education, Inc. publishing as Prentice Hall
GATT
• The General Agreement on Tariffs and Trade (GATT), begun in 1947, created a continuing means for countries to negotiate the reduction and elimination of trade barriers and to agree on simplified mechanisms for the conduct of international trade
8-3Copyright © 2009 Pearson
Education, Inc. publishing as Prentice Hall
WTO
• The World Trade Organization (WTO) replaced GATT in 1995 as a continuing means of trade negotiations that aspires to foster the principle of trade without discrimination and to provide a better means of mediating trade disputes and of enforcing agreements
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Education, Inc. publishing as Prentice Hall
Regional Economic Integration
• Efforts at regional economic integration began to emerge after World War II as countries saw benefits of cooperation and larger market sizes
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The Effects of Integration
• Once protection is eliminated among member countries, trade creation allows MNEs to specialize and trade based on comparative advantage
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European Union • Regional, as opposed to global, economic integration occurs
because of the greater ease of promoting cooperation on a smaller scale
• The European Union (EU) is an effective common market that has abolished most restrictions on factor mobility and is harmonizing national political, economic, and social policies
• The EU is comprised of 27 countries, including 12 countries from mostly Central and Eastern Europe that joined since 2004– created a common currency, the euro
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Education, Inc. publishing as Prentice Hall
The North American Free TradeAgreement (NAFTA)
• The North American Free Trade Agreement (NAFTA) is designed to eliminate tariff barriers and liberalize investment opportunities and trade in services
• Key provisions in NAFTA are labor and environmental agreements
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Regional economic integration in the Americas
• Caribbean Community (CARICOM)• Central American Common Market (CACM)• Central American Free Trade Agreement (CAFTA-DR)• Andean Community (CAN)• The Southern Common Market (MERCOSUR)• The proposed South American Community of
Nations.
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Education, Inc. publishing as Prentice Hall
Regional economic integration in Asia & Africa
• Association of Southeast Asian Nations (ASEAN)
• Asia Pacific Economic Cooperation (APEC)• The African Union