Regional Economic Integration Agreements

Despite the perceived benefits, EU policymakers recognise that the EU`s labour markets suffer from rigidities, regulations and tax structures that have contributed to economic growth with high unemployment and low capacity for job integration. This is especially true for relatively low-skilled workers. Regional integration has been defined as the process by which independent nation-states “voluntarily mix, merge and mix with their neighbours to lose the factual attributes of sovereignty while acquiring new conflict-resolution techniques among themselves.” [1] De Lombaerde and Van Langenhove describe it as a global phenomenon of territorial systems that increases interactions between their components and creates new forms of organization that coexist with traditional forms of state organization at the national level. [2] Some scientists see regional integration as the process by which states in a given region strengthen their interaction at the economic, security or social and cultural level. [3] The Asia-Pacific Economic Cooperation (APEC) was established in 1989 by twelve countries as an informal forum. Today, it has 21 member countries on both sides of the Pacific Ocean. APEC is the only regional trade group that uses the concept of member countries, not countries, in fear of China. Taiwan was allowed to join the forum, but only under the name Chinese Taipei.Sanjyot P. Dunung, Doing Business in Asia: The Complete Guide, 2nd ed. (San Francisco: Jossey-Bass, 1998).

Divisions between countries created by geography, poor infrastructure and inefficient policies are hampering economic growth. Regional integration enables countries to overcome these costly divisions that integrate markets for goods, services and factors, facilitating the flow of trade, capital, energy, people and ideas. The volume of trade under these agreements is about 35%, or more than a third of world trade. [Citation required] The main objective of these agreements is to reduce barriers to trade between the nations concerned, but the structure may vary from agreement to agreement.

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