What is Regional Economic Integration? Essay Sample

Regional Economic Integration is a pact that exists between or among groups and countries that exist in a geographical area. It enables the countries to put more emphasis on the issues that have an impact on their development as a whole while at the same time fostering partnerships with their neighbors.

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It is divided into four categories which include Free Trade Area, Customers Union, Common Market, and Economic Union.

Trump's NAFTA changes

The North America Free Trade Agreement is an integral part of the economic plan of President Donald Trump (Amadeo, 2020). His main focus is on lowering the trade shortage that exists between the United States and Mexico. The agreement involved the United States, Mexico, and Canada hence the coining of USMCA.

President Trump suggested that the percentage of car parts manufactured by the United States, Canada, and Mexico was to rise from the initial 62.5% to 75%. Additionally, he added that 40% of the total value of a passenger car and 45% of the total value of a light truck had to be contributed to by the workers earning not less than $16 an hour (Amadeo, K. (2020). The autos that would not conform to these will be subject to tariffs.

Canada had to create a favorable atmosphere for United States farmers in its dairy market. The products comprise infant formula, milk protein, and skim milk powder. In addition, there are cheeses that would be marketed in the United States and Mexico.

Mexico was to provide a favorable platform for its workers to form and join unions. This was after the proposal that Mexican trucks had to meet all the safety standards set by the United States.

Allow companies in the United States to go for ten years without facing any competition in the sale of drugs to Canada and Mexico

What is trade diversion?

Trade diversion refers to a state of international economics where trade is shifted from an exporter that is more efficient towards one that is less efficient via the formation of a Customs Union or a Free Trade Agreement.

What type of regional economic integration is the North America Free Trade Agreement?

It is a Free Trade Area - This is because the member countries that is the United States, Mexico and Canada have removed all barriers concerning trade within themselves, but still independently decide on trade policies with countries that are not members

What type of regional economic integration is the European Union?

It is an Economic Union - Countries form an economic union when they enter into an economic agreement to remove barriers to trade and adopt economic policies.

Provide two changes that Trump brought about to the former NAFTA

Trump brought about the elimination of provisions, which allowed Canada and Mexico to appeal duties imposed by the United States (Amadeo, 2020). He also limited the United States' ability to impose import restrictions on Canada and Mexico.

Trump wanted a reduction realized in the American trade deficit (Amadeo, 2020). This would improve the country's economy and in turn, make the contribution of the United States tremendous in that economic bloc.

What is Brexit?

Brexit stands for British Exit; it refers to the United Kingdom ceasing to be part of the European Union (BBC News, 2020). After a public vote held in June 2016, a majority of the people opted for Britain to leave the European Union as of 31st January 2020.

Brexit Guide: Where we are now - and how did we get here?

As of the 31st of January 2020, the United Kingdom had officially left the European Union. They had been part of this union for 47 years (Sandford, 2020). The European Union is a political and economic partnership bringing together 28 countries.

Brexit sunk the United Kingdom into the worst ever constitutional and political crisis ever experienced (Sandford, 2020). In the process of quitting the European Union, a lot of turmoil was witnessed in the British parliament leading to the replacement of Theresa May by Boris Johnson as prime minister. Currently, a transition force is being realized between the United Kingdom and the European Union that will have to go on until 31st December 2020 for it to expire.

What is Brexit and how did it come about?

BBC News (2020) highlights that Brexit is the exit of the United Kingdom from the European Union. It came about as a result of the United Kingdom feeling little as if they were not getting any benefit from the union as the other countries. This was because, compared to other countries, the United Kingdom contributed a great deal in the moving forward of the processes of the European Union.

What is the status of Brexit today?

At the moment, the United Kingdom is not a member of the European Union because the process was to begin on 31st January 2020 (BBC News, 2020). Additionally, the remainder of the processes involved is to continue up until 31st December 2020 when it will expire and the United Kingdom will have no relationship with the European Union.

References

Amadeo, K. (2020). Trump's NAFTA Changes. The USMCA Would Create U.S. Jobs and Raise Auto Prices, the balance. Retrieved from: https://www.thebalance.com/donald-trump-nafta-4111368

BBC News. (2020). Brexit: All you need to know about the UK leaving the EU. BBC News. Retrieved from: https://www.bbc.com/news/uk-politics-32810887

Sandford, A. (2020). Post-Brexit Guide: Where are we now - and how did we get here? Euro News. Retrieved from: https://www.euronews.com/2019/11/01/brexit-draft-deal-first-of-many-hurdles-to-a-smooth-exit