WTO and trade blocs

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  • Created by: Fi Alade
  • Created on: 02-04-14 17:24
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  • WTO
    • role
      • liberalise trade
        • lower trade barriers
      • provide governments with a forum for negotiating agreements
      • settlement of disputes between member countries
      • provision of a system of trade rules
        • countries cannot discriminate between trade partners
        • imported goods must be treated equally to domestic goods
    • formerly GATT
    • Trade blocs
      • intergovernmental associations that manage and promote trade activities in specific regions of the world
      • free trade areas
        • trade barriers removed between member countries
          • member countries can impose tariffs and quotas on countries outside the area e.g. NAFTA
      • customs unions
        • free trade between member states and a common external tarrif e.g. EU
      • common markets
        • customs unions but free movement of FOPs
      • monetary unions
        • customs unions that adopt a common currency e.g. Eurozone
      • trade creation
        • removal of trade barriers increaes trade
      • trade diversion
        • member countries only buy from each other due to lack of tariffs

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