The Different Levels of Economic Integration

 

Economic Integration pic
Economic Integration
Image: investopedia.com

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.

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Federal Interest Rates to Remain at Current Rate Through 2016

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Federal Interest Rates
Image: therealdeal.com

Though he is based in North Grafton, Massachusetts, Paul Andrew is a public and economic policy expert who is in demand in nations across the world. Paul Andrew’s experience has helped to shape institutions both in and outside of North Grafton, including Fortune 500 companies, United States political campaigns, and international policies.

In late July, the Federal Open Market Committee voted to leave federal interest rates at their current level for the time being. Though this decision fell in line with most predictions, some analysts were surprised by the committee’s somewhat optimistic position statement after the announcement.

Representatives of the Federal Reserve pointed to rising employment levels as an example of economic recovery in recent months. Though investment in business has remained slow, household spending increased by a significant degree. These factors suggest a slowly but steadily improving domestic economy, making conditions ripe for a small interest rate hike sometime in 2017.