Trade bloc

A trade bloc is a large free trade area formed by one or more tax, tariff and trade agreements. Typically trade pacts that define such a bloc specify formal adjudication bodies, e.g. NAFTA trade panels. This may include even a more democratic and participative system, as the EU and its parliament. Particularly since the demise of most of the world's empires, a number of international—generally regionally based—economic blocs have been developed to promote trade between member states. Several blocs also have stated or implicit political goals—notably the EU. Varieties of economic blocs include free trade areas, customs unions, single markets, and economic and monetary unions. One of the first economic blocs was the German Customs Union (Zollverein) initiated in 1834, formed on the basis of the German Confederation and subsequently German Empire from 1871. A trade bloc is established through a trade pact (or pacts) covering different issues of the economic integration.

Trade Series International trade History of international trade Free trade Protectionism Trade pact Trade bloc Preferential trading area Free trade area Customs union Trade creation Trade diversion Monetary union Common market Economic and monetary union

 

Contents 1 Most active regional blocs 2 List of regional blocs 2.1 European Economic Area (EEA) 2.2 Central European Free Trade Agreement (CEFTA) 2.3 Caribbean Community (CARICOM) 2.4 Union of South American Nations (Unasur/Unasul) 2.5 Economic Community of West African States (ECOWAS) 2.6 Economic and Monetary Community of Central Africa (CEMAC) 2.7 East African Community (EAC) 2.8 Southern African Customs Union (SACU) 2.9 Common Market for Eastern and Southern Africa (COMESA) 2.10 Greater Arab Free Trade Area (GAFTA) 2.11 North American Free Trade Agreement (NAFTA) 2.12 Association of Southeast Asian Nations (ASEAN) 2.13 South Asian Association for Regional Cooperation (SAARC) 2.14 GUAM Organization for Democracy and Economic Development 2.15 Eurasian Economic Community (EurAsEC) 2.16 Pacific Regional Trade Agreement (PARTA or PIF) 2.17 Central American Common Market (CACM) 2.18 African Economic Community (AEC) 2.19 Other states or entities 3 Comparison between regional blocs

Most active regional blocs

Most active regional blocs in the world.

It is possible that a country is member of two (or more) different blocs. To avoid overlapping for this classification such countries are only included in the most active of the blocs in question. The "activity" of each block is measured by the following three criteria: to have greater real practical achievements (not only declarations that are not followed by actual actions by its members) to have more recent (or regular) activities (meetings, new agreements, other internal procedures) to have more ambitious plans for future integration and a tighter timescale for it.

Also a country may be classified here as part of the less active regional bloc if the country itself is more active in it; Venezuela, for example, is a member of both the Andean Community and Mercosur. While Mercosur is a more active bloc than the Andean Community, Venezuela itself is much more active in the Andean Community than in Mercosur. Therefore Venezuela is assigned to the Andean Community for the purpose of this classification. (This is only an example. So, note, that Venezuela is planning to completely integrate with Mercosur by 2010).Priority is given to such regional blocs that have ambitions for integration in more spheres than just economy (i.e. political, defense and other spheres). Sometimes activities are divided between different (but related) blocs with small deviations in membership (e.g. NATO and EU members are almost the same).
Some colors on the map are used multiple times for different blocs. A darker color means full member; a lighter color means associate state, observer state, prospective member, candidate, acceding state or a similar status.

Most active regional blocs as of 2004
Regional bloc1	Area (km²)	Population	GDP (PPP) ($US)		Member states1
			in millions	per capita
Agadir	1,703,910	126,066,286	513,674	4,075	4
AU	29,797,500	897,548,804	1,515,000	1,896	53
ASEAN	4,400,000	553,900,000	2,172,000	4,044	10
CACM	422,614	37,816,598	159,536	4,219	5
CARICOM	462,344	14,565,083	64,219	4,409	(14+1)3
CCASG / GCC	2,285,844	35,869,438	536,223	14,949	6
CEFTA	298,148	28,929,682	222,041	7,675	(7+1)3
EU	4,325,675	496,198,605	12,025,415	24,235	27
EurAsEC	20,789,100	208,067,618	1,689,137	8,118	6
EFTA	529,600	12,233,467	471,547	38,546	4
GUAM	810,506	63,764,600	456,173	7,154	4
NAFTA	21,588,638	430,495,039	15,279,000	35,491	3
PARTA	528,151	7,810,905	23,074	2,954	(14+2)3
SAARC	5,136,740	1,467,255,669	4,074,031	2,777	8
Unasur / Unasul	17,339,153	370,158,470	2,868,430	7,749	12
UN and countries for reference2	Area (km²)	Population	GDP (PPP) ($US)		Units4
			in millions	per capita
UN	133,178,011	6,411,682,270	55,167,630	8,604	192
Brazil	8,514,877	188,078,261	1,594,482	9,108	27
Canada	9,984,670	32,507,874	1,165,000	35,200	13
India	3,287,590	1,102,600,000	4,042,000	3,700	35
Japan	377,873	128,085,000	4,220,000	33,100	47
PR China5	9,596,960	1,306,847,624	10,000,000	7,600	33
Russia	17,075,200	143,782,338	1,723,000	12,100	89
USA	9,631,418	300,000,000	12,980,000	43,500	50
Source: CIA World Factbook 2005, IMF WEO Database. Legend      smallest value among the blocs compared     largest value among the blocs compared Footnotes 1 Including data only for full and most active members. 2 Including the largest five countries by area, population and GDP (PPP), but not #4 in population or #5 in GDP (PPP). 3 Including non-sovereign autonomous areas of other states. 4 Members or administrative divisions. 5 Data for the People's Republic of China does not include Hong Kong, Macau, or regions administered    by the Republic of China (Taiwan).

List of regional blocs

European Economic Area (EEA)

• European Union (EU)
• full members: Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, United Kingdom
• candidates: Croatia, Turkey, Republic of Macedonia
• potential candidates: Albania, Montenegro, Bosnia and Herzegovina, Serbia
• free trade agreements with Faroe Islands (non-sovereign autonomous entity of Denmark) and Switzerland (EU-EFTA FTA) (see EU's FTAs)
• common market with Iceland, Liechtenstein, Norway
• customs unions with Andorra, San Marino, Turkey (see here)
• currency unions with Andorra, Monaco, San Marino, Vatican City, Montenegro, Kosovo (see here)

• European Free Trade Association (EFTA)
• full members: Iceland, Norway, Switzerland, Liechtenstein
• prospective member: Faroe Islands

Central European Free Trade Agreement (CEFTA)

• full members: Albania, Bosnia and Herzegovina, Croatia, Republic of Macedonia, Montenegro, Serbia
• full members, non-sovereign entities administered by the United Nations: Kosovo

Caribbean Community (CARICOM)

• full members: Antigua and Barbuda, Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Haiti, Jamaica, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Suriname, Trinidad and Tobago
• full members, non-sovereign autonomous entities of the United Kingdom: Montserrat
• candidates for full membership: Dominican Republic (currently an observer)
• associate members, non-sovereign autonomous entities of the United Kingdom: Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Turks and Caicos Islands
• candidates for associate membership: Netherlands Antilles (currently an observer)

Union of South American Nations (Unasur/Unasul)

• full members of MERCOSUR: Brazil, Argentina, Paraguay, Uruguay, Venezuela
• full members of the Andean Community (CAN): Bolivia, Colombia, Ecuador, Peru
• full member, CAN associate member: Chile

Economic Community of West African States (ECOWAS)

• full members: Benin, Burkina Faso, Cape Verde, Côte d'Ivoire, Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, Togo

Economic and Monetary Community of Central Africa (CEMAC)

• full members: Cameroon, Central African Republic, Chad, Republic of the Congo, Equatorial Guinea, Gabon
• partners as ECCAS members: Democratic Republic of the Congo, São Tomé and Príncipe

East African Community (EAC)

• full members: Burundi, Kenya, Rwanda, Tanzania, Uganda

Southern African Customs Union (SACU)

• full members: Botswana, Lesotho, Namibia, South Africa, Swaziland
• partners as SADC members: Angola, Madagascar, Malawi, Mauritius, Mozambique, Seychelles, Zambia, Zimbabwe

Common Market for Eastern and Southern Africa (COMESA)

• full members: Sudan, Ethiopia, Eritrea, Djibouti, Comoros
• partners as IGAD members: Somalia

Greater Arab Free Trade Area (GAFTA)

• full members of the Agadir Agreement: Egypt, Jordan, Morocco, Tunisia
• full members of the Cooperation Council for the Arab States of the Gulf (CCASG/GCC): Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, United Arab Emirates
• full members, other: Iraq, Lebanon, Libya, Palestinian Authority, Syria, Yemen
• candidate/s: Mauritania
• prospective members of the Agadir Agreement: Algeria

North American Free Trade Agreement (NAFTA)

• full members: Canada, Mexico, United States of America

Association of Southeast Asian Nations (ASEAN)

• full members: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam
• candidate: Timor-Leste

South Asian Association for Regional Cooperation (SAARC)

• full members: Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka
• candidates: China

GUAM Organization for Democracy and Economic Development

• full members: Azerbaijan, Georgia, Moldova, Ukraine

Eurasian Economic Community (EurAsEC)

• full members: Belarus, Kazakhstan, Kyrgystan, Russia, Tajikistan, Uzbekistan

Pacific Regional Trade Agreement (PARTA or PIF)

• full members: Fiji, Kiribati, Marshall Islands, Micronesia, Nauru, Palau, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu, Vanuatu
• full members, non-sovereign autonomous entities of New Zealand: Cook Islands, Niue
• associate members: Australia, New Zealand

Central American Common Market (CACM)

Cooperation in the framework of the bloc currently stalled and status in light of DR-CAFTA is unclear

• full members: Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua

African Economic Community (AEC)

Under the umbrella of the African Union it is expected that ECOWAS, CEMAC/ECCAS, SACU/SADC, COMESA/IGAD and EAC will join into a common African Economic Community in 2019.

Other states or entities

• Americas:
• Cuba: mostly isolated because of political system, possibility for CARICOM or CACM
• Greenland (non-sovereign autonomous entity of Denmark): left the EU in 1985; status regarding FTA and customs union is unclear.
• Panama: possibility for Unasur or CACM

• East Asia:
• Japan, South Korea: negotiations for cooperation in ASEAN Plus Three format, proposed Comprehensive Economic Partnership for East Asia (CEPEA) as part of the East Asia Summit
• Mongolia: currently little probability to join any bloc, possibility for EurAsEC and East Asia Summit
• North Korea: isolated because of political system

• West Asia:
• Armenia, currently little probability to join any bloc, weak EU links (European Neighbourhood Policy)
• Iran: problems with political system, relations with neighbours uneasy, but has possibility for SAARC
• Israel: isolated by its neighbours, European Neighbourhood Policy cooperation only
• Turkmenistan: self-imposed isolation, possibility for EurAsEC or GUAM

• Non-UN States:
• Taiwan: problems with status, cooperation at WTO level under the name of Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu
• Sahrawi Republic: member of the African Union, problems with status, possibility for Agadir and GAFTA

Comparison between regional blocs

		Activities
Regional bloc		Free Trade Area	Customs Union	Economic and monetary union		Free Travel		Political pact	Defence pact	Other
				Single Market	Currency Union	Visa-free	Border-less
EEA	EU	in force 2	in force	in force	in force 1	in force	in force (Schengen 1 and CTA 1)	in force	in force (NATO 1 and CFSP/ESDP 1)	ESA 1, Euratom
	EFTA	in force	in force 1	in force 1		in force 1	in force (Schengen treaty 1)	in force1 (EFTA Court EFTA Surveillance Authority)	in force (NATO 1)	ESA 1, Euratom
	Common	in force1	in force1	in force1		in force1	in force (Schengen treaty 1)		in force (NATO 1)	ESA 1, Euratom
CEFTA		in force	in force					in force	in force
CARICOM		in force	in force	in force 1	in force 1 and proposed common	in force 1	proposed	proposed
Unasur/Unasul	MERCOSUR	in force	in force			in force		proposed for 2014 [6]
	CAN	in force	in force 1			in force
	Common	proposed for 2014 4	proposed for not after 2019	proposed for 2019	proposed for 2019	in force [7]		proposed for 2019
ECOWAS		in force 1, 3	in force 1		in force 1 and proposed for 2009 1 and proposed common	in force 1	proposed	proposed	in force
CEMAC		in force	in force	proposed	in force	proposed			in force
EAC		in force	in force		proposed for 2009	proposed		proposed for 2010
SACU		in force	in force	proposed for 2012	de-facto in force 1 and proposed common for 2016	proposed
COMESA		in force 1	proposed for 2008		proposed for 2025
ECOWAS		in force 1, 3	in force 1		in force 1 and proposed for 2009 1 and proposed common	in force 1	proposed	proposed	in force
GAFTA	Agadir	in force
	CCASG/GCC	in force	in force	proposed for 2007	proposed for 2010
	Common	in force
CEFTA		in force	proposed			in force 1		in force	in force
NAFTA		in force	proposed		proposed				in force (NATO 1 Security and Prosperity Partnership of North America and NORAD)	Commission for Environmental Cooperation
ASEAN		in force 5		proposed for 2015	proposed	in force		proposed for 2015 [12]	proposed for 2020 [13]
SAARC		in force 6	proposed	proposed	proposed
GUAM		in force	proposed			proposed	proposed	proposed	proposed
EurAsEC		proposed	proposed	proposed		in force			in force 1
PARTA		in effect, proposed	in force1		proposed			proposed
CACM		in effect7, proposed	proposed	proposed
AEC (for reference)		proposed for 2019	proposed for 2019	proposed for 2023	proposed for 2028			proposed for 2028

1 not all members participating yet
2 involving goods, services, telecommunications, transport (full liberalisation of railways from 2012), energy (full liberalisation from 2007)
3 telecommunications, transport and energy - proposed
4 sensitive goods to be covered from 2019
5 least developed members to join from 2012
6 least developed members to join from 2017
7 status is unclear

 

 

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Created by:	Salauddine Mohammed Faruque on July 25,2007, last updated on 25.03.2008

 

 

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