Economic Groping of Nations
Characteristics
Promotes and allows trade within the group in reference of to trade with outside nations by discriminating against non-members(through import tariffs for example)
Has the goal of liberalization or integration with the aim of establishing a free trade area, custom union, or common market
Strives to reach common positions in negotiation with third countries, with other trade blocs, or in multilateral forums.
Key words
Free Trade Area - a grouping of countries within which tariffs and non-tariff trade barriers between the members are generally abolished but with no common trade policy toward non-member. Ex: NAFTA
Customs Unions - a group of states that have agreed to charge the same import duties as each other and usually to allow free trade between themselves.
Common Market – a group of countries imposing few or no duties on trade with one another and a common tariff on trade with other countries (this last bits is the difference between a custom union and a common market).
Economic (& Social)Union- a trade bloc which composed of a common market with a customs union. The participant countries have both common policies on product regulation, freedom of movement of goods, services and the factors of production (capital and labour) and a common external trade policy.