Regional Integration
CHAPTER 15 REGIONAL INTEGRATION
1. OVERVIEW OF RULES (1) | Regional Integration
In addition to the global economic regime based on the GATT and IMF systems, which has sustained the world economy since World War II, regionalism, through which neighbouring countries seek to strengthen their economies by entering into some form of "regional integration" has become a major trend. This trend was triggered by the EU market integration. In both developed and developing countries, customs unions and free trade areas (FTAs) continue to increase and expand. Today, they account for a considerable amount of world trade. The WTO calls agreements that establish customs unions and FTAs "regional trade agreements (RTAs)." In this chapter, we use the term "regional integration" to signify both RTAs and other forms of regional cooperation.
Some 90 percent of the WTO Members are parties to such RTAs. Japan and Hong Kong are among the few exceptions.
Article XXIV of the GATT allows RTAs to be exempted from the most-favoured nation principle under certain conditions; RTAs must not raise barriers to trade with countries outside of the region. This is because while RTAs promote trade liberalization within the respective regions, if they raise barriers to trade with countries outside the regions, they would impede trade liberalization as a whole. Such RTAs should not be overlooked so that the WTO framework does not become a dead letter.
Moves towards "Regional Integration"
In recent years, moves towards regional integration have been more and more active, with countries seeking to strengthen their ties with other countries. In Europe, when the Treaty on the European Union (the Maastricht Treaty) took effect in November 1993, the European Union (EU) was created, which enlarged and built upon the European Community (EC). The enlargement of the EU took place on 1 January 1995 by accession of new three countries, Austria, Sweden and Finland, which were former members
1. OVERVIEW OF RULES (1) | Regional Integration
In addition to the global economic regime based on the GATT and IMF systems, which has sustained the world economy since World War II, regionalism, through which neighbouring countries seek to strengthen their economies by entering into some form of "regional integration" has become a major trend. This trend was triggered by the EU market integration. In both developed and developing countries, customs unions and free trade areas (FTAs) continue to increase and expand. Today, they account for a considerable amount of world trade. The WTO calls agreements that establish customs unions and FTAs "regional trade agreements (RTAs)." In this chapter, we use the term "regional integration" to signify both RTAs and other forms of regional cooperation.
Some 90 percent of the WTO Members are parties to such RTAs. Japan and Hong Kong are among the few exceptions.
Article XXIV of the GATT allows RTAs to be exempted from the most-favoured nation principle under certain conditions; RTAs must not raise barriers to trade with countries outside of the region. This is because while RTAs promote trade liberalization within the respective regions, if they raise barriers to trade with countries outside the regions, they would impede trade liberalization as a whole. Such RTAs should not be overlooked so that the WTO framework does not become a dead letter.
Moves towards "Regional Integration"
In recent years, moves towards regional integration have been more and more active, with countries seeking to strengthen their ties with other countries. In Europe, when the Treaty on the European Union (the Maastricht Treaty) took effect in November 1993, the European Union (EU) was created, which enlarged and built upon the European Community (EC). The enlargement of the EU took place on 1 January 1995 by accession of new three countries, Austria, Sweden and Finland, which were former members