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Development Economics

Economics

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Emmanuel Bongay
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13 views20 pages

Development Economics

Economics

Uploaded by

Emmanuel Bongay
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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DEVELOPMENT ECONOMICS

ECONOMIC INTERGRATION
TEAM
JOSPHINE C. MBAYO
EMMANUEL BONGAY
TABLE OF CONTENTS

 What is economic integration


 Examples Economic integration
 Types of economic integration
 Condition of economic integration
 Functions of economic integration
 Reason for economic integration
 Negative effects of economic integration
 Positive effects of economic integration
 Sierra leone regional integration index
 Challenges of economic integration
 Solutions
ECONOMIC INTEGRATION

It is the process in which two or more states in a


broadly defined geographic area reduce a range of
trade barriers to advance or protect a set of economic
goal.
It is the agreement between nations to reduce or
eliminate trade barriers and the coordination of
monetary and fiscal policies.
EXAMPLES OF ECONOMIC INTEGRATION

The following are examples of Regional Economic


Integration: NAFTA (North American Free Trade
Agreement)-An agreement among the U.S.A.,
Canada, and Mexico.
EU (European Union)-A trade agreement with 15
European countries.
APEC (Asian Pacific Economic Cooperation Forum) -
This includes NAFT A members, Japan, and China
CONDITION OF ECONOMIC INTEGRATION

Among the requirements for successful development


of economic integration are "permanency" in its
evolution (a gradual expansion and over time a
higher degree of economic/political unification); "a
formula for sharing joint revenues" (customs duties,
licensing etc.
TYPES OF ECONOMIC INTEGRATION

Free trade area


Second generation free trade
Customs union
Common market
Economic union
Monetary union
FREE TRADE AREA

The most basic type of economic integration is a


simple free trade area.
In this form, attention is focused almost exclusively on
a reduction of tariffs and quotas that restrict trade.
SECOND-GENERATION FREE TRADE AREA

The basic nature of simple free trade is extended to


include trade in non-goods such as service, where a
simple free trade area only address the question of
tariffs and quotes, the trade in services and a
widening of trade in goods.
CUSTOM UNION

A customs union is an agreement between two or


more countries to remove trade barriers and lower or
eliminate tariffs. Members of a customs union
generally apply a common external tariff on imports
from non-member countries. The European Union
(EU) is an example of a customs union
COMMON MARKET

A common market is a formal agreement where a


group is formed amongst several countries that
adopt a common external tariff. In a common
market, countries also allow free trade and free
movement of labor and capital among the members
of the group.
MONETARY UNION

monetary union, agreement between two or more


states creating a single currency area. A monetary
union involves the irrevocable fixation of the
exchange rates of the national currencies existing
before the formation of a monetary union.
ECONOMIC UNION

An economic union is an agreement between two or


more nations to allow goods, services, money and
workers to move over borders freely. The countries
may also coordinate social and financial policies to
support this common market. The European Union
(EU) is an example of an economic union.
FUNCTIONS OF ECONOMIC INTEGRATION

Economic integration can reduce the costs of trade,


improve the availability of goods and services, and
increase consumer purchasing power in member
nations. Employment opportunities tend to improve
because trade liberalization leads to market
expansion, technology sharing, and cross-border
investment.
NAGATIVE EFFECTS OF ECONOMIC INTERATION

It leads to less national sovereignty, and the


responsibilities of central banks are delegated to an
external body instead. The external control becomes
troublesome in terms of managing a cohesive fiscal
and monetary policy among many different
countries.
POSTIVE EFFECTS

Some positive influences comprise


low-cost country sourcing
 evolved social interaction as well as increased
employment opportunities.
SIERRA LEONE REGIONAL INTEGRATION INDEX

The Africa Regional Integration Index measures the


extent to which African countries meet their
commitments under various pan-African integration
frameworks, such as Agenda 2063
This graph shows sierra Leone ranking on overall
regional integration within its regional economic
community. Country is a high performer
CHALLENGES OF ECONOMIC INTEGRATION

Apart from the often cited problems related to


corruption, instability, undemocratic rule and civil
strife, there is also a lack of private sector activity in
regional integration schemes.
 In some instances economic reforms have also not
been properly designed and implemented.
SOLUTIONS

The solution is the harmonization of border


procedures, which in its ultimate form leads to the
virtual elimination of national boundaries as internal
barriers to trade and the formation of a free-flowing
regional economic space.
THANK YOU

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