A public policy professional based in North Grafton, Paul Andrew has written and presented extensively on national and international policy around the world. Focused on economic policy, Paul Andrew has advised various Caribbean governments on progressive economic integration.
Economic integration happens when two or more countries unify trade systems between themselves fully or partially so as to increase economic growth and improve competitiveness. There are different levels of economic integration:
i) Preferential Trade Agreement
Goods between member countries are given preferential treatment such as reduced tariffs.
ii) Free Trade Agreement
Countries take a step closer to full integration by removing barriers to trade such as tariffs, import quotas, and inhibitive preferences. However, countries still maintain control of their individual commercial policies.
iii) Customs Union
Member nations develop a common commercial policy that creates barriers for third-party countries intending to export to member countries. This significantly boosts intra-regional trade and reliance.
iv) Common Market
As intra-regional trade increases, focus shifts to movement of goods and services. Border processes are harmonized to ensure free flow of all goods, whether finished or unfinished, and labor between member countries. This virtually eliminates national borders.
v) Monetary Union
After removing tariffs and border barriers to trade, and achieving free flow of goods and services regionally, a common monetary system is adopted to facilitate seamless trade without the hassle and risk of currency exchanges. The result is a deep fiscal macroeconomic convergence that almost blurs individual countries’ political lines.