Regional Economic Integration MENA Regional Economic Integration MENA Introduction Regional economic integration envisages the removal or reduction of duties and other taxes imposed on goods and services trade between countries…
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This was further strengthened because of the development of contemporary technologies in construction, telecommunication, heavy machinery, overland, sea and air transportation, and the development of the Internet (Ludema & Wootonb, 2000). The MENA region can be divided in various different segments. Two major resources of the region are the abundance of oil and the availability of human resources. MENA countries can be divided into three groups: a) Countries with enormous mineral resources and with large populations such as Algeria, Iraq, Syria and Yemen. b) States/countries that have small indigenous populations and huge mineral resources and they need to import manpower, such as This group of countries comprises the Gulf Cooperation Council (GCC) members (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates) and Libya. c) Countries which have minimal resources and need to import oil and gas such as Egypt, Djibouti, Jordan, Lebanon, Mauritania, Morocco, Tunisia and the Palestinian Authority. National integration was necessary in this region because the countries have the same status that is they have the lease natural resources and need to import gas and oil. The countries are neighbours and linked via land routes. They all same share the same religion and culture, and the products produced are compatible with their living standards and life styles. By removing tariff barriers, they can obtain goods from each other at very competitive prices than if they had to import the same product from some distant country. Cost of freight could double the product’s market price. When neighbouring countries increase trade with each other, they develop infrastructure such as roads, railways etc. including communication networks. Increased trade brings prosperity to all countries involved which boosts employment (Booz & Company, 2012). MENA COUNTRIES These countries were selected because the data available can be analyzed properly. The countries have the same characteristic such as the implemented economic reforms and the type of economic integration so that they can be amply compared with each other in particular and the world in general. The economies of these countries are more service oriented. The major countries participating in bilateral trade agreements are Egypt, Jordan, Tunisia and Morocco. Jordan has bilateral free trade agreements with Tunisia, Syria, Lebanon, Egypt. The UAE, Bahrain and Kuwait, all signed since 1998. The country also has similar agreements with Libya, Algeria and Yemen. Egypt has agreements with Syria, Morocco, Tunisia, Libya, Jordan and Iraq, and Tunisia has agreements Algeria, Egypt, and Libya. MENA states have increased their participation in the WTO, and during the last ten years the area has witnessed an increase in bilateral between the Arab States in the region. The rise in trade agreements are because these countries are seriously interested in encouraging cooperation for the export of jointly produced goods. Another good reason is that countries all over the world are gaining enormous through intraregional trade agreements, and the countries comprising MENA also need to take advantage of such agreements. The Arab world has a history of failed agreements concluded in their region. Bilateralism is necessary as a response to the increasing numbers of European and American free trade agreements, and also as a means to maintain some semblance of equilibrium in trade
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(Regional Economic Integration: MENA Essay Example | Topics and Well Written Essays - 2500 Words)
“Regional Economic Integration: MENA Essay Example | Topics and Well Written Essays - 2500 Words”, n.d. https://studentshare.org/business/1404098-regional-economic-integration-mena.
Mena region in many ways is dependent upon two core factors; these are prices of oil and policies of the states. About 23% (out of 300 million) population of MENA region has daily earnings of less than 2 dollars. Therefore regional integration is integral for this region (The World Bank, 2011a).
This integration is usually done by signing some written agreements that briefly describe which areas need cooperation (EU Learning, n.d.). GCC, Gulf Corporation Council includes the six Gulf countries; Saudi Arabia, Bahrain, Kuwait, Qatar, the United Arab Emirates and Oman.
The GDP by economic sectors of the Philippines is 14, 9% of agriculture, 29, 1% - industry and 51, 1% - service sector (2009 est.). The GDP of Taiwan is 3 % of agriculture, 35% - industry and 73% of a service sector. In the industrial economic sector Malaysian GDP is 42, 3%, in agricultural sector the GDP is 10, 1% and in service sector – 47, 6% (2009 est.).
As years pass on there is an increasing trend witnessed in regional economic integration. According to World Trade Organisation (WTO) report, more than 150 member countries are enlisted in one or the other trade agreements at regional level. Generally, the countries those who are geographically near were come closer to each other and establish economic linkages through preferential trade agreements and form regional integration.
The main aim of increasing the trade helps the distributors and consumers as the prices being lowered once there is no requirement to pay the custom duties within the specific integrated states. For the recent years, the economic integration between Brazil and other nations has been flourishing and still it is on the rise.
The agreement of regional integration done on political base is mostly for the purpose of bringing two separate nations together. Likewise, economic agreement focuses on filling the gaps between two countries and bringing them close to each other to serve their economic purposes (Rathus, 2011).
The best example of regional integration in this regard is the european union, which has evolved into one of the most richest regions of the globe as a result of such cooperation. There are many such similar alliances in place, popular ones among them being organizations such as the NAFTA and the ASEAN.
Protectionist measures have therefore been adopted in order to deal with the above issues for example one measure includes borrowing neighbour system which might have devastating consequences in reference to the political, social
Free trade area, for instance the North American Free Trade Agreement (NAFTA) presents the simplest form of economic integration where all member states cancel all trade obstacles between them (Laursen 34). However, member nations have the freedom to establish their
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