Regional integration is a process in which states ente r into a regional agreement in or der to enhance
regional cooperation through regional institutions and rules. The objectives of the agreement could range from economic to political, although it has generally become a political economy initiative where commercial purposes are the means to achieve broader socio-political and security objectives. It could be organized either on a supranational or an intergovernmental decision-making institutional order, or a combination of both. Past efforts at regional integration have often focused on removing barriers to free trade in the region, increasing the free movement of people, labour labour,, goods goods,, and capital across national borders, borders, reducing the possibility of regional armed conflict (for example, through Confidence and Security-Building Measures)), and adopting cohesive regional stances on policy issues, such as the environment, climate Measures change and migration. Intra-regional trade refers to trade which focuses on economic exchange primarily between countries of
the same region or economic zone. In recent years countries among economic-trade regimes such as ASEAN in Southeast Asia for example have increased their level of trade and commodity exchange between themselves which reduces the inflation and tariff tariff barriers barriers associated with foreign markets resulting in growing prosperity. Regional integration initiatives, according to Van Langenhove, should fulfil at least eight important functions:
the strengthening of trade of trade integration in the region
the creation of an appropriate enabling environment for private sector development
the development of infrastructure of infrastructure programmes in support of economic of economic growth and regional integration
the development of strong public sector institutions and good governance; governance;
the reduction of social of social exclusion and the development of an inclusive civil society
contribution to peace and security in the re gion
the building of environment of environment programmes at the regional level
the strengthening of the region’s interaction with other regions of the world .
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Regional Integration Agreement Regional integration agreements (RIAs)has led to major development in the international relations among many countries which has also led to the mutual understanding among many countries. There has been also increase in the overall trade in the international level due to these agreements. In the context of the Global scenario, there has been a spurt in the context of regional trading blocs. This would contribute to one of the major advances in International relations in recent years. In such context, the whole aspect of
a Regional Integration Agreement has gained high importance. Not only are almost all the industrial nations part of such agreements, but it is seen that a huge number of developing nations, to are a part of at least one, in cases, more than one such agreement. The amount of trade that takes place within the scope of such agreements is about 35%, which accounts to more than one-third of the trade in the world. The main objective these agreement is to reduce the barriers related to the trade among various nations but the structure may vary from one agreement to another. The removal of the trade barriers among various nations by these agreement has led to liberalized economy in many countries which had brought significant economic development among these countries. A number of agreements notified to GATT and WTO is signed in each year has dramatically increased from 1990s. There were 194 agreement notified in 1999 and it contained 94 agreements form the early 1990s. 1990s.
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The last few years have experienced a huge qualitative as well as quantitative changes in the agreement related to the Regional Integration Scheme. The top three major changes were:
Deep Integration Recognition
Closed regionalism to open model
Advent of trade blocs
[edit edit]]Deep
Integration Recognition
Deep Integration Recognition analyses the aspect that effective integration is a much broader aspect, surpassing the idea that reducing tariffs, quotas and barriers will provide effective solutions. Rather, it recognizes the concept that additional barriers tend to segment the markets. This in turn impedes the free flow of goods and services, along with ideas and investments. Hence, it is now recognized that the current framework of traditional trade policies are not adequate enough to tackle these barriers. Such deep-integration was first implemented in the Single Market Program in the European Union. However in the light of the modern context, this debate is being propounded into the clauses of different regional integration agreements arising out of increase in international trade. trade . [edit edit]]Closed
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(EU).
regionalism to Open Model
The change from a system of Closed regionalism to a more Open Model had arisen out of the fact that the section of trading blocs that were created among the developing countries during the 1960s and 1970s were based on certain specific models such as those of import substitution as well as regional agreements coupled with the prevalence generally high external trade barriers. The positive aspects of such shifting is that there has been some restructuring of certain old agreements. These agreements tend to be more forward in their outward approach as well as show commitment in trying to advance international trade and commerce instead to trying to put a cap on it by way of strict control . [edit edit]]Advent
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of Trade Blocs
The Advent of Trade Blocs tend to draw in some parity between high-income industrial countries and developing countries with a much lower income base in that they tend to serve as equal partners under such a system. The concept of equal partners grew out of the concept of providing reinforcement to the economies to all the member countries. Under these section the various countries agree upon the fact that they will help economies to maintain the balance of trade between and prohibit the entry of other countries in their trade process. Economic motives
To reap the trade benefits of improved resource allocation and greater competition
To provide a training ground or launching pad for outward-looking policies
To gain improved market access to other countries and to provide insurance against the breakdown of multilateralism
To lock-in and provide credibility c redibility to politically difficult domestic policies
To increase multilateral bargaining power in international forums and vis à vis third co untries
To raise visibility in attracting external assistance and investment To facilitate ‘deep’ integration, i.e. policy coordination
Political motives
To further national security goals
As a stepping-stone towards political unification
