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Free Trade Agreement

Free Trade Agreement. Economic Integration. Economic integration occurs when two or more countries come together for purposes of trade and/or economic coordination. Greater integration may yield additional benefits, but it may also involve giving up increasing sovereignty.

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Free Trade Agreement

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  1. Free Trade Agreement

  2. Economic Integration • Economic integration occurs when two or more countries come together for purposes of trade and/or economic coordination. • Greater integration may yield additional benefits, but it may also involve giving up increasing sovereignty.

  3. 4 Types of Integration • Free Trade Areas (FTAs) • Customs Unions (CUs) • Common Markets • Economic and/or Monetary Union

  4. Free Trade Areas • Members remove tariffs and other trade barriers on each other. • Each member maintains its own tariff structure for non-members. • Possible problem: transshipment • Example: NAFTA

  5. Customs Unions • Tariffs between members are eliminated (just like a FTA), but also: • members agree to a common set of external tariffs and other trade barriers, and • members speak with one voice in external trade negotiations. • Example: Southern African Customs Union (SACU)

  6. Common Markets • Tariffs between members are eliminated, a common external tariff is established (all of the features of CUs) plus free movement of labor and capital. • Example: European Community (1957 – 1993)

  7. Economic and/or Monetary Union • Similar to a common market: • Tariffs between members are eliminated. • A common external tariff is established. • Factors can move freely between member countries. • But economic policy is coordinated by a supranational institution in the economic and/or monetary union.

  8. FTAs • European Union • NAFTA Nations • South East Asia Nations • Latin America • GCC

  9. List of the countries under EU • Austria (1995) • Belgium (1952) • Bulgaria (2007) • Croatia (2013) • Cyprus (2004) • Czech Republic (2004) • Denmark (1973) • Estonia (2004) • Finland (1995) • France (1952) • Germany (1952) • Greece (1981) • Hungary (2004) • Ireland (1973) • Italy (1952) • Latvia (2004) • Lithuania (2004) • Luxembourg (1952) • Malta (2004) • Netherlands (1952) • Poland (2004) • Portugal (1986) • Romania (2007) • Slovakia (2004) • Slovenia (2004) • Spain (1986) • Sweden (1995) • United Kingdom (1973)

  10. Map of EU Countries

  11. Objective of EU • To promote social and economic progress. • To establish an area of freedom, security and justice. • To enhance the environment of Europe and the world. • To secure and defend the Union.

  12. Single Market & Common Commercial Policy • Competition Policy • Free movement of goods • Free movement of persons • Services • Capital • Taxation

  13. Composition of Indian export to eu • Auto mobile, auto engines, • Metal and metal based products • Leather products • Handicraft • Engineering goods like diesel engines • Textiles yarn, woolen and cotton fabrics • Agricultural products • IT products & services • Consumer durables • Biotech products

  14. North American Free Trade Agreement

  15. Objective of NAFTA • To eliminate barriers to trade in and facilitate the cross – border movement of goods and services between the territories of the parties. • To promote condition of fair competition in free trade area • To substantially increase investment opportunities in the territories of the parties. • To provide adequate and effective protection and enforcement of intellectual property rights in country’s territory.

  16. Contd… • To create effective procedure for the implementation and application of this agreement for its joint administration and for the resolution of dispute. • To establish framework for further trilateral, regional and multilateral cooperation to expand and enhance the benefits of this agreement.

  17. India’s export to Canada • Readymade garment • Textiles, cotton yarn • Carpets, floor spreads, • Gems & jewelry • Precious stones • Organic Chemicals • Coffee, spices • Light engineering goods • Iron & steel articles • Footwear • Spices • Rice • Cereals • Processed foods • Marin products

  18. India’s import from Canada • Wood pulp • Iron scrap • Copper • Minerals • Industrial chemicals

  19. India’s export to usa • Precious stones • Metals • Woven apparel • Knit apparel • Textiles Articles • Fish & seafoods • Textiles floor covering • Iron / steel products • Organic Chemical • Machinery • Taps, valves, transmission shafts, gears

  20. India’s import from usa • Sophisticated machinery • Electronic machinery • Medical and surgical instruments • Aircrafts • Spacecraft • Organic Chemicals • Plastic • Cotton & cotton waste

  21. India’s export to mexico • Transport Equipment • Drugs, pharmaceutical and fine chemicals • Readymade garment • Machinery & instrument • Electronic goods • Dyes & intermediaries • Organic Chemicals • Manmade yarn fabric made ups

  22. India’s import from mexico • Articles of iron & steel • Electronic machinery • Iron & steel • Nuclear reactors • Boilers • Plastic • Ores, slag & ash

  23. ASEAN COUNTRIES(association of south east asian countries) • Brunei • Cambodia • Indonesia • Laos • Malaysia • Myanmar • Philippines • Singapore • Thailand • Vietnam

  24. OBJECTIVE • To accelerate economic growth, social progress and cultural development ion the region. • To promote regional peace and stability through abiding respect for justice and the rule of law in the relationship among countries in the region.

  25. India’s export to asean • Oil meals • Gems & Jewellary • Meat & meat preparation • Cotton yarn • Fabrics • Engineering goods • Transport equipment • Machinery & Instruments • Marine products • Fruits & Vegetables • Rice • Drugs • Pharmaceuticals & chemicals

  26. India’s import from asean • Artificial Resins • Plastic Materials • Natural Rubber • Wood & wood products • Electronic goods • Non – ferrous metals • Metal scrap • Organic Chemical • Edible oils • Coals • Fertilizers

  27. GULF COOPERATION COUNCIL • Bahrain • Kuwait • Oman • Qatar • Saudi Arabia • United Arab emirates

  28. OBJECTIVE • To effect coordination, integration and interconnection between members of stated in all fields. • To strengthen ties between their people. • To formulate similar regulations in various fields such as economy, finance, trade, customs tourism, legislation and administration. • To foster scientific and technical progress in industry, mining, agriculture.

  29. www.cia.gov • www.export.gov • http://www.traderoots.org/

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