Regional Integration and Economic Development
Available evidence suggests that free-trade areas, customs unions, and partial preferential trade areas have, prior to 1990, generated only limited tangible benefits, inevitably eroding political support for their continuation. Poor sequencing, and ill-chosen instruments and structures have in some cases contributed to failure. Where Regional Integration Arrangements (RIAs) have succeeded in generating visible gains, their distribution has often been perceived as inequitable by the less-developed members of the group. For these and other reasons, RIAs in developing countries have lacked credibility. Of course, factors such as the oil, debt and commodity crises, with their international repercussions, contributed to the failure of RIAs in the developing world. But policy responses to the crises which such shocks created have aggravated extant economic maladjustments and distortions and rendered earlier RIAs in continents such as Africa and LAC even less effective and, indeed, inappropriate.
KeywordsTrade Liberalization Regional Integration Market Integration Close Integration Static Gain
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