...ABC The Pacific Alliance 1 The Pacific Alliance – Deep integration for prosperity The Pacific Alliance is a mechanism for regional integration formed by Chile, Colombia, Mexico and Peru, in April 2011. It acquired legal and formal existence on 6 June 2012, with the signature of the Framework Agreement. The process seeks to create attractive markets among its member countries and enhance their competitiveness in the wider world. 2 Member Countries T h e Pa c i f i c A l l i a n c e Mexico Colombia Peru Chile 3 Finland United Kingdom Netherlands Germany France Switzerland Italy Canada Turkey People's Republic of China Japan Republic of Korea United States of America Honduras Guatemala El Salvador Dominican Republic Costa Rica Panama Spain Portugal Morocco Israel India Singapore Ecuador Australia Paraguay Uruguay New Zealand Member-Candidate countries The Pacific Alliance Observer Countries T h e Pa c i f i c A l l i a n c e Costa Rica Panama 4 Objectives of the Pacific Alliance: To build, through participation and consensus, an area of deep integration that will move progressively forward towards the free circulation of goods, services, capital and persons. To dynamize growth, development and competitiveness in the economies of the Parties, in order to achieve greater welfare, overcome socioeconomic disparities and secure social inclusion in their societies. To become a platform for political articulation, economic and commercial integration, and projection...
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...uncertain situation as they focus to defend their own domestic products all whilst maintaining a steady external trade. A continuing worldwide economic power house, Mercosur continues to struggle with certain facets of trade and political structure. Background South America throughout past decades has seen bloodshed and political instability, and despite much improvement there is still reoccurring corruption to date. Although the Pablo Escobar reign in Colombia, Noriega’s rule in Panama, and Castro’s hold on Cuba are no longer relevant, there still remains similar political instability today. Mercosur directly translated is Mercado Comun del Sur, or The Southern Common Market, and is a trade bloc for six of South America’s member nations (See Appendix A for current member countries) where they enjoy free trade, very similar to that of the North American Free Trade Agreement, where the goal is full South American economic integration. Enacted in 1991 under the Treaty of Ascuncion, Mercosur was created around the time of NAFTA, and other world trade blocs where they sought to fill the grey areas of GATT , General Agreement on Tariffs and Trade, that over looked regional, political, and cultural needs for its members (Kionsky, 2012). Further issues with non-transparent trades and non-uniformity in investments through GATT allowed for investors to make under the table trades where no tariffs...
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...operating in other subsidiaries such as Q catering, frequent flyer, freight enterprises as well as other airlines (Qantas, 2013). It employs 33,000 people with 93 per cent of these employees being based in Australia (Qantas, 2013). Recently, Qantas has undergone changes that have threatened and seen Australians question if Qantas will remain an Australian brand. Reports have demonstrated 1000 jobs being cut due to restructuring of international arms as well as the decision to move Australian jobs offshore. Qantas has implemented plans to strengthen international ties particularly in Asia by funding start up airlines internationally. The global market is continuously evolving and as Bernard et al. stated ‘firms that are engaged in international trade are larger and more productive than the ones that serve only domestic markets’ (2007). However, the Federal transport Minister Anthony Albanese has stressed that “it is very important that Qantas reassure the Australian public that it regards itself very much as the Australian icon” (ABCnews, 2011). Qantas is an Australian company that has increased their operations in the global world. Therefore, macro-environmental factors such as political, economic and environmental factors impact Qantas’ product, price, place and promotional strategies....
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...participates in the world economy as one economic unit and operates under one official currency, the euro. The EU's goal is to create a barrier-free trade zone and to enhance economic wealth by creating more efficiency within its marketplace. The current formalized incarnation of the European Union was created in 1993 with 12 initial members. Since then, many additional countries have since joined. The EU has become one of the largest producers in the world, in terms of GDP, and the euro has maintained a competitive value against the U.S. dollar. EU and non-EU members must agree to many legal requirements in order to trade with the EU member states. The European Union is a group of countries whose governments work together. It's a bit like a club. To join you have to agree to follow the rules and in return you get certain benefits. Each country has to pay money to be a member. They mostly do this through taxes. The EU uses the money to change the way people live and do business in Europe. Countries join because they think that they will benefit from the changes the EU makes EU is a unique economic and political partnership between 27 European countries that together cover much of the continent. The EU was created in the aftermath of the Second World War. The first steps were to foster economic cooperation: the idea being that countries who trade with one another become economically interdependent and so more likely to avoid conflict. The result was the European Economic Community...
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...and investments prolonged negotiations. They finally reached agreement on October 5, 2015), the United States, Japan and ten other countries concluded negotiations on the Trans-Pacific Partnership (TPP). It is the largest regional trade accord in history and one that does not include China-----the TPP is the centerpiece of the U.S “rebalance” to the Asia-Pacific, and its twelve members account for 35 percent of global trade. China appears to currently have enough international economic negotiations on the table to keep it occupied, and it is unlikely that it is really concerned about the TPP. A No China Club China was invited to join the TPP by Hillary Clinton in 2012. While China has long stated that it is willing to consider joining the Trans-Pacific Partnership (TPP), the world’s second-biggest economy was not included in the agreement. From its inception, some have speculated that China would not join the bloc because it is a “high standards agreement,” even speculating that this was put in place to lock China out of the agreement. It is also assumed that the TPP have used specific rules and guidelines to prevent China's involvement, presumably due to its negative impact on the WTO and that the TPP has been considered by many as a strategic instrument to isolate or contain China. Given the country’s ambitions, its leaders are understandably concerned about the concerted effort by the U.S. and other Asia-Pacific countries to curtail its economic growth and geopolitical influence...
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...Technology in International Trade Technology plays a major role in international trade. Databases, overnight delivery and faxes have opened the world market to not only larger companies but small ones too. To add to this globalization, companies and even competitors are combining and forming alliances to cut cost and increase the profit margin. Chrysler, General Motors and Ford have formed an alliance in research and development to avoid duplication. These alliances are not only with domestic companies but they also go over national lines. Companies are pushing for integration of the world economy in hope for increased profits and governments are beginning to listen. Since 1986 (GATT) General Agreement on Tariffs and Trade have taken the incitive to move towards the liberalization of international trade. GATT members agreed to reduce tariff and non-tariff trade barriers. From 1986 to the present due to GATT's lead many markets have been open to the United States increasing exports and increasing efficiency through competition. One of the most aggressive liberalization groups to follow GATT's lead is APEC (Asian Pacific Economic Community). APEC consist of 18 countries that account for 1/2 of the worlds output. The three largest economies Japan, China and the United States are members. APEC leaders are committed to achieving free and open trade for the region by 2010...
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...to these questions might actually help: 1. Mexico has always portrayed itself as one of the most pro-trade countries in the world. For instance, we have a free trade agreement with the United States and Canada, and another one with the European Union. We are active members of the WTO, the OECD, the APEC, the Pacific Alliance, and have also signed multiple bilateral agreements with many nations, most of them deemed “strategic”. Answer the next two questions in your own words: a. What are the potential costs and benefits of adopting such a free-trade strategy? International trade allows a country to specialize in the manufacture and export of products that it can produce efficiently, and in the meantime, to import products that can be produce more efficiently in other countries and helps reduce cost of tariffs. b. What can it be done to reduce the costs and maximize the benefits? They can buy raw materials in the foreign and labor; produce only products that can be more efficient and have economies of scale. 2. Drawing upon the new trade theory and Porter's theory of national competitive advantage, outline the Mexican case for one of these national industries: (1) oil and petrochemicals, (2) agriculture and foods, (3) mining, (4) manufacturing, (5) automotive, (6) entertainment and sports. Choose only one out of the six, and answer: a. What kind of trade and economic policies would you recommend that the federal government adopt in order to build national competitive...
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...rising Asia-Pacific community. Economically, Asia itself already accounts for more than one-quarter of global GDP. Over the next five years, nearly half of all growth outside the United States is expected to come from Asia. This growth is fueling powerful geopolitical forces: China’s ascent, Japan’s resilience, an eastward-looking India, Southeast Asian nations more interconnected and prosperous than ever before, and of course the rise of a “Global Korea.” President Obama has made U.S. engagement in the Asia-Pacific region a priority. We have already begun a strategic rebalance of diplomatic, economic, and security investments in Asia. And America’s 60-year alliance with Korea is a lynchpin of that strategic rebalance. 60 years. 60 years of peace and stability. 60 years of hard work and economic growth. 60 years of partnership and shared prosperity. This year marks the 60th anniversary of the U.S. – Korea Mutual Defense Treaty, the armistice, and the formation of the American Chamber of Commerce in Korea. As we celebrate 60 years of partnership and shared prosperity, we are also upgrading important aspects of our partnership – what I call the four pillars. Security The first pillar of our partnership is clearly our shared commitment to security on the peninsula, as evidenced by the more than 28,500 men and women of the U.S. armed forces in Korea. Recent threats and provocations from the DPRK underscore the importance of our security alliance. The DPRK’s...
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...bond of trade. Designated as trade blocs, these bonds are a type of intergovernmental agreement, usually associated with geographically aligned intergovernmental confederations, “where regional barriers to trade, (tariffs, and non-tariff barriers) are reduced or eliminated among the participating states” (Boundless, n.d.). As such trade blocs enable politico-economic ventures to flourish in the benefaction of its member nations. Albeit, trade blocs also represent diverse forms of economic integration, markedly, the preferential trade area, free trade area, custom union, common market, economic union and complete political integration (“What are trading blocs?”, n.d.). Customarily, the preferential trade area denotes the lowest level of commitment to reducing tariff barriers; typically member nations reduce trade barriers sans eliminating any amoung themselves (Finance Train, 2012). Whereas, the free trade area exists under the terms whereby trade barriers are removed on all member country imports, whilst independent tariff policies for non-member imports are retained (Finance Train, 2012). Comparatively, within the custom union, trade barriers are not only removed on all imports from member states, but a set of common policies are authorized in dealing with imports from non-member countries (Finance Train, 2012). More so, in a common market, member participants eradicate internal trade barriers, endorse mutual policies concerning external non-members and facilitate the free movement...
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...302 Danmeng Yin U.S. Korea Trade Agreement and Arizona The U.S.-Korea Trade Agreement is an integral part of the President’s efforts to increase opportunities for U.S. business, farmers and workers through improved access for their products and services in foreign markets. The KORUS Agreement supports the President’s National Export Initiative goal of doubling of U.S. exports in five years. It would also promote the further integration of the U.S. and Korean economies and enhance the competitiveness of U.S. business in the world’s 12th largest economy. For agricultural products, the KORUS Agreement would immediately eliminate or phase out tariffs and quotas on a broad range of products, with almost two-thirds of Korea’s agriculture imports from the United States becoming duty free upon entry into force. Effective March 15, 2012 entry into force of the U.S.-Korea Free Trade Agreement (KORUS) marks a historic milestone in the economic integration of the United States and Korea. Companies with U.S.-Korea business interests should carefully plan to take full advantage of the many opportunities KORUS presents. Effective March 15, 2012, with justifiable fanfare, the United States and South Korea bring into force the U.S.-Korea Free Trade Agreement (KORUS), marking an important and historic milestone in the economic integration of these two major trading partners. With two-way trade already valued at more than US$85 billion annually...
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...Chapter EIGHT CROSS-NATIONAL COOPERATION AND AGREEMENTS OBJECTIVES • To profile the World Trade Organization • To discuss the pros and cons of global, bilateral, and regional integration • To describe the static and dynamic effects and the trade creation and diversion effects of bilateral and regional economic integration • To define different forms of regional economic integration • To present different regional trading groups, such as the European Union (EU), the North American Free Trade Agreement (NAFTA), and Asia-Pacific Economic Cooperation (APEC) • To describe the rationale for and success of commodity agreements Chapter Overview Regional economic integration represents a relatively new phenomenon in the history of world trade and investment. Chapter Eight first examines the roles of the General Agreement on Tariffs and Trade and the World Trade Organization in determining the ground rules of the world trade environment. It then introduces the basic types of economic integration and explores the potential effects of the process. Next it examines in detail both the European Union (its structure and its operations) and the North American Free Trade Agreement and briefly describes a variety of other regional economic groups. The chapter concludes with a discussion of various commodity agreements and producer alliances, including the Organization for Petroleum Exporting Countries. Chapter Outline OPENING CASE: TOYOTA IN EUROPE Known for...
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...Bibliografía: * eHow (s.f.) Ma Wen Jie, What Are the Costs of Free Trade?. Retrieved on September 07, 2015. From: http://www.ehow.com/about_5367523_costs-trade.html * Trade Link (August 2008) México elimina los obstáculos a la importación de medicamentos. Retrieved on September 07, 2015. From: http://www.economia-snci.gob.mx/sic_php/pages/bruselas/trade_links/esp/agoesp2008.pdf * Investopedia (s.f.) Free Trade. Retrieved on September 07, 2015. From: http://www.investopedia.com/terms/f/free-trade.asp | 1. Mexico has always portrayed itself as one of the most pro-trade countries in the world. For instance, we have a free trade agreement with the United States and Canada, and another one with the European Union. We are active members of the WTO, the OECD, the APEC, the Pacific Alliance, and have also signed multiple bilateral agreements with many nations, most of them deemed “strategic”. Answer the next two questions in your own words: What are the potential costs and benefits of adopting such a free-trade strategy? International trade allows a country to specialize in the manufacture and export of products that it can produce efficiently, and in the meantime, to import products that can be produced more efficiently in other countries. Some benefits of adopting a free-trade strategy are: * Tariff. One of the main objectives is to remove tariff barriers in the trade of goods and services, thus allowing that a person exports their products to another country...
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...I. LEVELS OF ECONOMIC INTEGRATION A. THE FREE TRADE AREA—ALL BARRIERS TO TRADE AMONG MEMBER COUNTRIES ARE REMOVED, BUT MEMBERS MAY DECIDE THEIR OWN TRADE POLICIES TOWARD NONMEMBERS B. The Customs Union—Free Trade Area plus a common trade policy toward nonmembers C. The Common Market—Customs Union plus free flow of labor, capital, and technology among members (factor mobility) D. The Economic Union—Common Market plus integration of economic policies such as monetary policies, taxation, government spending, and a common currency II. Arguments Surrounding Economic Integration A. Trade Creation and Trade Diversion 1. Trade creation—increased exports by new member to other members resulting from membership 2. Trade diversion—decreased exports to members of the economic union by nonmember nations often resulting in the advantage shifting away from the lower-cost producer to the higher cost producer B. Reduced Import Prices can result from importers efforts to remain competitive despite tariffs imposed C. Increased Competition and Economies of Scale 1. The larger market created also means more competing firms which can result in greater efficiency and lower consumer prices 2. Economies of Scale—lower production costs resulting from greater production for an enlarged market D. Higher Factor Productivity 1. Factor mobility leads to movement of labor and capital from areas of low productivity to areas of high productivity 2. Poorer countries may lose badly needed investment...
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...importance of belonging to an economic bloc is that through this you can get "mutual benefits in international trade" The Mercosur as we know is a South American economic bloc that “is integrated by Argentina, the Federative Republic of Brazil, the Republic of Paraguay, the Oriental Republic of Uruguay and the Bolivarian Republic of Venezuela” (Exhibit 1). The countries that belong to the MERCOSUR are differentiated by the alliance of values held and reflected in its democratic and pluralistic societies, the protection of human rights, the environment and sustainable development. MERCOSUR is also committed to strengthening democracy, eradicate poverty and strengthen the economic and social development of the members with equity. In recent years the President of Ecuador Econ. Rafael Correa expressed his desire to become a member of this economic bloc, but what does it mean to Ecuador to join to this organization? This economic bloc offers attractive proposals for countries; among them is the establishment of a common external tariff, plus the free movement of goods and services between the member countries. For a developing country like Ecuador, it is difficult to make the decision of belonging to an economic bloc, as it must evaluate the economic factors that affect and the conditions under which it should enter to the block in order to benefit and expand its trade relations. On the one hand, the fact that Ecuador entering to MERCOSUR brings many questions of why it should...
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...According to the case, in the years 2013 and 2014, which factors were responsable of the economic slowdown? The first half of 2013 , the global economy signs of weakening , with significant differences between regions. As mentioned , the euro zone was in recession DUE queue persist in some countries of the ESA region's sovereign debt problems and the fragility of their financial systems. : In addition , US economic growth was moderate , while the productive activity of various Emerging economies slowed , BECAUSE of both the slowdown in the industrialized countries and the slowdown in their internal demands. Mexico has a 2.2 percent average tariff rate. It has reduced tariff and non-tariff barriers unilaterally and through trade agreements like the Pacific Alliance. A law passed in December 2013 will partially open the energy sector to foreign investment. The financial sector is relatively small and lacks dynamism. Mexico needs to build a deeper and more accessible banking system. The OECD bemoaned Mexico’s record: it is alone among big emerging markets in suffering from sustained declines in the broadest measure of productivity during the past decade. In order for GDP growth to rise from its current potential of about 3% to a healthier 4%, the productivity trend must be reversed through structural reforms, it said. Mexico’s three main political parties, which have created a pact to promote more than 100 such changes, are aiming for 5%. How much is our country´s external debt? In...
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