Fundamentals of Global Business

Module 4
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• What is Regional Economic Integration?
• Regional Economic Integration can best be defined as an agreement between groups
of countries in a geographic region, to reduce and ultimately remove tariff and non-
tariff barriers to the free flow of goods, services, and factors of production between
each other.
• Need for Economic Integration
• A) Factor Movements
• Factors of production such as labor, machineries, entrepreneurial abilities are moved
voluntarily from a relatively saturated area to places for which those skills can be
applied more effectively
• B) Specialization will flourish
• Meaning that countries within the block will engage in creative specialization
instead of being jack-of-all-trades.
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• Levels of Economic Integration

• 1) Sectoral trading agreements (STA)

• 2) Preferential trade agreements or areas (PTA)

• 3) Customs unions (CU)

• 4) Common markets (CM)

• 5) Economic union (EU)

• 6) Supra-national union (SNU)

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• Factors affecting Regional Integration Arrangement (RIA)
• 1) Trade Uncertainty
• It can be measured through a country’s openness in terms of exports and imports
as a ratio of gross domestic product (GDP).
• 2) Political uncertainty
• It can be measured in terms of corruption and levels of economic freedom
• 3) Business cycle uncertainty
• It is reflected by the risk associated with the general health of the economy for
individual producers as they are subject to the vicissitude of their domestic
environment
• 4) Price uncertainty
• It is proxied with inflation rates
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• Effects of economic integration
• The removal of tariffs on imports from member countries leads to beneficial
increase in the volume of trade according to the principles of comparative
advantage
• After the removal of tariffs, member countries would tend to increase their
production of goods for which they are best suited.
• The formation of a community results in a single enlarged market for many
commodities.
• The member countries, particularly raw material producing countries, can
cooperate as regards the supply of commodities to world market
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• Trade Blocs
• Advantages
• Lower prices and more varied products
• Larger market
• Boost direct investments
• Access to cheaper and more abundant capital
• Encourage specialization
• Decrease monopoly power as competition increases
• Positive effect on knowledge abundance and technology transfer
• Better quality intermediate inputs
• Minimize the potential for conflict among members.
• Increase economic power.
• Offers new opportunities for trade and investment
• Growth in member countries also tends to extend to other members
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• Disadvantages of Trade Blocs

• 1) Shutting down the domestic industry

• 2) Increased economic dependence

• 3) Loss of state sovereignty

• 4) Bring up the trade diversion

• 5) Retaliation from non-member countries

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• The Common Market of Eastern and Southern Africa (COMESA)
• The history of COMESA began in December 1994 when it was formed to replace the
former Preferential Trade Area (PTA) which had existed from the earlier days of
1981.
• COMESA (as defined by its Treaty) was established ‘as an organization of free
independent sovereign states which have agreed to co-operate in developing their
natural and human resources for the good of all their people’ and as such it has a
wide-ranging series of objectives which necessarily include in its priorities the
promotion of peace and security in the region.
• With its 21 Member States, population of over 583 million a Gross Domestic Product
of $805 billion, a global export/import trade in goods worth US$ 324 billion,
COMESA forms a major market place for both internal and external trading
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• Specific Objectives of COMESA
• A. Industry and Agriculture
• To support increased agricultural productivity and agro-processing for improved food security and nutrition, and
agro-product competitiveness in the COMESA region.
• To promote and support competitive and diversified industrial development in the COMESA region.
• To foster linkages between industry, value addition to agriculture and other natural resources as well as
supporting development of other economic sectors for inclusive and sustainable development in the COMESA
region

• To promote and support compliance with regional and international standards and Sanitary and phytosanitary
(SPS) measures for increased access to competitive markets and enhance intra-regional and international trade.
• To support development, harmonization and implementation of policies, regulations, strategies and programmes
on agriculture and industry development in the region.
• To promote and support creation of enabling environment for investment and business development in the region.
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•Livestock
•Support efforts aimed at driving sustainable livestock production and productivity, value addition and access to markets
in the COMESA region.
•Services: 
•COMESA support member States to attract public and private investments along the different livestock values chains;
•It supports member states to enhance Livestock Production and Animal Health to increase productivity and resilience of
livestock production systems;
•Blue Economy
•Support investment in sustainable use of ocean resources for economic growth, improved livelihoods, and jobs while
preserving the health of ocean ecosystem.
•Services: 
•We promote and support increased investment in diversification of existing ocean-based economic sectors (particularly
fisheries, tourism and ports) to realize greater value and efficiency from the existing resource base;
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• Industrial and Private Development
• We support the development of regional Industrial Policy and strategic frameworks;

• We support the development of regional SMEs policy framework;

• We support Member States to domesticate the regional industrialization and SMEs and the local content policy
frameworks;

• We mobilize technical and financial resource to support the implementation of regional and national industrialization
and SMEs strategies and programmes.

• Investment Promotion
• We support adoption of COMESA Common Investment Area Agreement (CCIA);

• We support Member States in improving the ease-of-doing business environment, building on regional best practices
and peer- to- peer experience sharing.
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• Sanitary and Phytosanitary (SPS) and Technical Barriers to Trade (TBT)
• We work with SPS regulatory authorities to facilitate market access agreements, implement capacity building
programmes across the private and public sectors aimed at compliance with trade partners SPS requirements .
• We work with Member State national bureaus of standards to develop mutual recognition frameworks for
conformity assessment
• Alliance for Commodity Trade in Eastern and Southern Africa (ACTESA)
• We support harmonization of agro-inputs (e.g. seeds and fertilizers) policies/regulations, standards, quality
assurance and market development in COMESA region.
• We support harmonization of grades and standards for staple food commodities to enhance small-scale
farmers access to national, regional and international markets;
• We build capacities of farmers and providing market linkage support to enhance their access to markets
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• Trade and Customs Division

• The main function of the division is to implement programmes to enhance
cooperation in Trade, Customs and Monetary Affairs in order to achieve a fully
integrated, internationally competitive and unified single economic space within
which goods, services, capital and labor are able to move freely across national
frontiers.
• The cooperation programmes aim to achieve the removal of all physical, technical,
fiscal and monetary barriers to intra-regional trade and commercial exchanges through
the following stages of integration.
• The unified economic space with the four freedoms – goods, services, capital and
labour – comprises the following basic elements namely A regional market without
internal frontiers , macroeconomic policy coordination and assurance of the total and
irreversible convertibility of currencies
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• THE SOUTHERN AFRICAN DEVELOPMENT COMMUNITY (SADC)

• The Southern African Development Community (SADC) was established as a development coordinating
conference (SADCC) in 1980 and transformed into a development community in 1992 .
• It is an inter-governmental organization whose goal is to promote sustainable and equitable economic growth
and socio-economic development through efficient productive systems, deeper co-operation and integration,
good governance and durable peace and security among fifteen Southern African Member States.
• SADC total trade has followed a similar pattern to total world trade.
• Total SADC trade almost quadrupled between 2000 and 2011 from US$ 91089.52 million in 2000 to US$
353636.4 million in 2011, although there was a sharp decline of more than 25% in 2009 as a result of the
global economic crisis.
• Main intra SADC trade export items include petroleum oils, agricultural products, electricity and some
clothing and textile products.
• Main export items to the rest of the world consist of predominantly export of resources (e.g. coal,
ferrochromium, manganese ores, platinum, as well as precious metals and diamonds), resource intensive
manufactured goods, mainly for the automotive industry, some clothing and textiles, and tobacco.
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• The objectives of SADC, as stated in Article 5 of the SADC Treaty (1992) are to:
 Achieve development and economic growth, alleviate poverty, enhance the standard and quality of life of the people of
Southern Africa and support the socially disadvantaged through Regional Integration;

 Evolve common political values, systems and institutions;

 Promote and defend peace and security;

 Promote self-sustaining development on the basis of collective self-reliance, and the inter-dependence of Member States;

 Achieve complementarity between national and regional strategies and programmes;

 Promote and maximise productive employment and utilisation of resources of the region;

 Achieve sustainable utilisation of natural resources and effective protection of the environment;

• Strengthen and consolidate the long-standing historical, social and cultural affinities and links among the people of the
Region
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• SADC Common Agenda

• The SADC Common Agenda is underpinned by a series of principles , policies, and
strategies including:
• Principles

 Promotion of sustainable and equitable economic growth and socio-economic development

that ensures poverty alleviation with the ultimate objective of its eradication;

 Promotion of common political values, systems, and other shared values, which are
transmitted through institutions that are democratic, legitimate and effective; and

 Promotion, consolidation and maintenance of democracy, peace and security.

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• SADC Policies
• Promote sustainable and equitable economic growth and socio-economic development that will ensure poverty
alleviation with the ultimate objective of its eradication, enhance the standard and quality of life of the people
of Southern Africa and support the socially disadvantaged through regional integration;
• Promote common political values, systems and other shared values which are transmitted through institutions
that are democratic, legitimate, and effective
• Consolidate, defend and maintain democracy, peace, security and stability;
• Promote self-sustaining development on the basis of collective self-reliance, and the interdependence of 
Member States;
• Achieve complementarity between national and regional strategies and programmes;
• Promote and maximize productive employment and utilization of the resources of the Region;
• Achieve sustainable utilization of natural resources and effective protection of the environment;
• Strengthen and consolidate the long-standing historical, social and cultural affinities and links among the people
of the Region
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• SADC Strategies
• Harmonize political and socio-economic policies and plans of Member States;
• Encourage the peoples of the Region and their institutions to take initiatives to develop
economic, social and cultural ties across the region, and to participate fully in the
implementation of the programmes and projects of SADC.
• Create appropriate institutions and mechanisms for the mobilization of requisite resources
for the implementation of programmes and operations of SADC and its institutions.
• Develop policies aimed at the progressive elimination of obstacles to the free movement of
capital and labor, goods and services, and of the peoples of the region generally, among 
Member States
• Promote the development, transfer and mastery of technology
• Improve economic management and performance through regional cooperation
• Promote the coordination and harmonization of the international relations of Member States
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• Economic Integration Milestones of SADC
• A) Free Trade Area in 2008
• Objectives :
• Liberalisation of intra-regional trade in goods and services; ensure efficient
production; contribute towards the improvement of the climate for domestic, cross-
border and foreign investment; and enhance economic development, diversification
and industrialisation of the region.
• Impact
• Since 2000, when implementation of the SADC Trade Protocol commenced, intra-
SADC trade has more than doubled, with intra-SADC trade estimated to have grown
from about US$13.2 billion in 2000 to about US$34 billion in 2009, representing an
increase of about 155%.
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• B. Customs Union
• The second SADC Integration Milestone is the establishment of a SADC
Customs Union.
• A Customs Union is where a group of countries that have established a free trade
area agree on common external tariffs and a common external trade policy.
• Driven by the need to increase trade and economic development in the region, this
milestone is focused on trade and financial liberalization, competitive and
diversified industrial development and increased investment in the region.
• Results
• Due to capacity constraints within the SADC Secretariat the implementation of
the Regional Indicative Strategic Development Plan started late, meaning this
milestone has not yet been attained.
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• COMMON MARKET
• A Common Market is an agreement between two or more countries removing all
trade barriers between themselves, establishing common tariff and non-tariff
barriers for importers, and also allowing for the free movement of labour, capital
and services between themselves.
• The SADC Common Market is one of the primary goals of SADC in the area of
Trade, Economic Liberalisation and Development and it is projected that the
region will reach this milestone by 2015. Prior to reaching this milestone, SADC
must establish a Customs Union, which was projected for completion by 2010.
• Results
• Despite current delays in reaching the preceding milestones, SADC is working
hard to overcome the challenges presented by the Customs Union, with the long-
term goal of establishing a Common Market.
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• Monetary Union
• Monetary Union is where two or more countries achieve macroeconomic
convergence, stable and harmonize exchange rates systems, liberalize capital and
current accounts transactions and adopt market-oriented approaches to the conduct
of monetary policy.
• The Regional Indicative Strategic Development Plan implementation framework
identified 2016 as the target for this milestone, which follows the establishment of
the Free Trade Area, the Customs Union and the creation of a Common Market.
• Results and Impact
• 1) Operationalization of payment clearing and settlement systems 
• 2) Implementation of best banking practices, norms and standards 
• 3) Development of an institutional administrative and legal framework 
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• SINGLE CURRENCY
• The final step in the process of deepening regional economic integration in SADC is the implementation of a Single
Currency, which will establish the region as an Economic Union.
• The Regional Indicative Strategic Development Plan Implementation Framework targets 2018 for the attainment of this
milestone.
• Results and Impact
• This system would allow the settlement of payment transactions in a central location and was based on a single currency.
• This model system will initially be tested on the current Common Monetary Area countries that use the South African
Rand (South Africa, Lesotho, Namibia and Swaziland) and if successful, will be ready to be rolled out to the rest of the
SADC Member States as the region advances its integration process.
• Challenges
• Currently, the single biggest challenge in obtaining this, and any of the more advanced economically related integration
milestones, is the lack of clarity surrounding the issue of countries with membership of more than one customs union.
• Only when this issue is resolved will SADC be able to move forward with its agenda of regional economic integration.
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• CONTINENTAL AND INTERCONTINENTAL COOPERATION
• Continental and inter-regional cooperation and integration efforts have been ongoing for several
decades now.

• Some of the inter-regional cooperation initiatives within and involving the SADC Region include
the following initiatives, also discussed on the following pages:

 The African Union, SADC and NEPAD – working relationship between the these three key
regional and continental institutions.

 The Tripartite Cooperation – orchestrated cooperation between SADC, 

the East African Community (EAC) and the 
Common Market for Eastern and Southern Africa (COMESA)
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• Indian Ocean Rim Association (IORA)

• The Secretariat of the Indian Ocean Rim Association (IORA) is hosted by the Government of the
Republic of Mauritius which is based in Cyber City, Ebène, Mauritius. 
• It manages, coordinates, services and monitors the implementation of policy decisions, work
programmes and projects adopted by the Council of Ministers. 
• The Secretariat is responsible for the servicing of all IORA meetings, the representation and promotion
of the Association, the collation and dissemination of information, the maintenance of an archive,
depository and registry for IORA documentation and research material and the mobilization of resources.
• The Secretariat is headed by a Secretary-General, who is assisted by four Directors and Experts,
on voluntary secondment from Member States.
• A Chair in Indian Ocean Studies has been established to support the work of the Association
through rigorous, in-depth research on the six priority areas of IORA.
•  The Secretariat is also supported by locally recruited staff focusing on various areas of
development.
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• PRIORITIES AND FOCUS AREAS
• 1) Maritime Safety & Security
• The Indian Ocean region faces many traditional and non-traditional safety and security challenges including
piracy, armed robberies at sea, terrorism, human trafficking, irregular movement of persons, drugs trafficking,
illicit trafficking in wildlife, trafficking of weapons, crimes in the fisheries sector such as IUU fishing,
degradation of ocean health, unlawful exploitation of marine resources and climate change with its related
repercussions on environmental security.
• Covering a vast maritime zone of nearly 68.56 million sq. km. and incorporating coastal states from South
Africa in the west, running up the eastern coast of Africa, along the Gulf to South and Southeast Asia, ending
with Australia in the east, IORA serves as the ‘first line of defence’ to build upon existing national, regional
and international measures, thereby enhancing coordination and supporting harmonized international
Maritime Safety and Security (MSS) collaboration
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• Trade and Investment Facilitation
• Today half of the world’s container ships and two thirds of the world’s oil shipments pass through the Indian
Ocean, including key transit points such as Bab el-Mandeb and the Straits of Hormuz and Malacca.

• Emerging economies such as India, Indonesia, Kenya, and South Africa will ensure that the importance of the
Indian Ocean Rim to the global trading environment will only increase in years to come.
Short Term:

 Conduct capacity building on reducing barriers to trade;

 Cooperate to promote SMEs;

• Medium Term:

 Revitalize IORA’s private sector arm, the Indian Ocean Rim Business Forum (IORBF); and

 Cooperate to promote financial services;

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• Fisheries Management
• Indian Ocean coastal states share a keen interest in the management and
conservation of the region's vital resources whereby fisheries is a key aspect.
• Fisheries and related industries are critical in ensuring food security and the
impact of overfishing and climate change has accelerated the reduction of major
fish stocks within the Indian Ocean region.
• Out of the estimated 28.5 million people directly employed by the marine fishing
sector (both industrial and artisanal) worldwide, artisanal fishing comprises 90%
of all fishing jobs globally, representing approximately 45% of the world’s
fisheries, and nearly a quarter of the world catch.
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• Disaster Risk Management
• The Indian Ocean Region (IOR) is sometimes called the “World’s Hazard Belt” as it
is prone to disasters, both natural and man-made. Natural disasters under the group
of Climatological (cyclones and droughts), Geological and Tectonic (earthquakes
and tsunamis) and Hydrological (floods and tidal surges) origins are very common
and reoccurring phenomena in the region.
• According to the UN ESCAP, around 50% of natural disasters occurring in this
region are climatogenic and seismogenic in nature.
• Manmade disasters arise from anthropogenic hazards, that is, hazards caused by
human action or inaction; many mirror natural disasters, yet man has a direct hand
in their occurrence, as may be seen in cases of oil spills, fires, leakage of poisonous
and destructive substances, illegal dumping, and so on.
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• BLUE ECONOMY
• Oceans cover 72 percent of the surface of our blue planet and provide a substantial portion
of the global population with food and livelihood.
• Enhancing more than 80 percent of global trade, marine and coastal environments
constitute a key resource for economic development.
• The objective of the Blue Economy is to promote smart, sustainable and inclusive growth
and employment opportunities within the Indian Ocean region’s maritime economic
activities.
• The Blue Economy is determined to initiate appropriate programs for: the sustainable
harnessing of ocean resources; research and development; developing relevant sectors of
oceanography; stock assessment of marine resources; introducing marine aquaculture, deep
sea/long line fishing and biotechnology; and human resource development; among others.
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• Fisheries & Aquaculture
• Fisheries, which is a vital oceanic resource forms the core of the Blue Economy,
as one of the main resources of the Indian Ocean which provide food to hundreds
of millions of people and greatly contribute to the livelihoods of coastal
communities.
• It plays an important role in ensuring food security, poverty alleviation and also
has a huge potential for business opportunities.
• There has been a strong increase in fish production from 861,000 tons in 1950 to
11.5 million tons in 2010 and the world's total demand for fish and fisheries
products is expected to rise from 50 million to 183 million tons in 2015, with
aquaculture activities predicted to cover about 73% of this increase.
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• Renewable Ocean Energy(IORA)
• The world population is expected to increase to an estimated 9 billion people in
2050, which is 1.5 times greater than the current population, resulting in an
increase in countries' demands on fossil fuels.
• Recently there has been a collapse in the price of crude oil, but the possibility of
an eventual normalization (of return to higher prices) should not be disregarded
and thus necessitates the continued attention of IORA Member States to consider
alternative renewable sources of energy.
• Renewable sources of energy such as solar and wind are already being
implemented worldwide.
• However, additional incentives in renewable energy are strongly in demand to
further decrease the burden on fossil fuels.
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• Seaports and Shipping
• The seaport and maritime transport sector is one of the important priority sectors under
the Blue Economy, in which Member States are showing a greater interest.
• In spite of the continuous rise of maritime transport and shipping transactions in the
region, uneven distribution of trade exists among the rim countries, where only a
handful are benefiting economically from maritime exchanges and transportation.
• Some Member States unfortunately are struggling to keep pace with the rapid
development and complexity of maritime trade as they face challenges in terms of
congestion, new information technology and equipment, improvement of port
infrastructure and professional services.
• In this regard, regional cooperation is important for unlocking the bottlenecks to ports
development and maritime economy expansion in the Indian Ocean so as to enhance
blue growth through economic cooperation and trade relations between Member States.
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• Offshore Hydrocarbons & Seabed Minerals
• With the decreasing inland mineral deposits and increasing industrial demands,
much attention is being focused on mineral exploration and mining of the seabed.
• The seabed contains minerals that represent a rapidly developing opportunity for
economic development in both the Exclusive Economic Zones of coastal nations
and beyond the limits of national jurisdiction.
• Seabed exploration in the Indian Ocean has already started, but the major
constraints in the commercialization of these resources lie in the fact that Member
States have limited data on the resources their exclusive economic zone (EEZ)
possesses, lack capacity for exploration, mining and processing of these minerals.
• Therefore, improved information is needed to assess the potential across the
region.
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• Marine Biotechnology Research & Development
• Marine biotechnology (or Blue Biotechnology) is considered an area of great interest and potential due to the
contribution for the building of an eco-sustainable and highly efficient society.
• A fundamental aspect is related to aquaculture, whereby new methodologies will help in: selective breeding
of species; increasing sustainability of production; and enhancing animal welfare, including adjustments in
food supply, preventive therapeutic measures, and use of zero-waste recirculation systems.
• Aquaculture products will also be improved to gain optimal nutritional properties for human health. Another
strategic area of marine biotechnology is related to the development of renewable energy products and
processes, for example through the use of marine algae.
• In addition, the marine environment is a largely untapped source of novel compounds that could be
potentially used as novel drugs, health, nutraceuticals and personal care products; Blue Biotechnology could
be further involved in addressing key environmental issues, such as in bio-sensing technologies to allow in
situ marine monitoring, in bioremediation and in developing cost-effective and non-toxic antifouling
technologies.
• Finally, marine derived molecules could be of high utility as industrial products or could be used in industrial
processes as new enzymes, biopolymers, and biomaterials.
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• Tourism
• Marine tourism, with its related marine activities (including cruise tourism), is a
growing industry that represent an important contributor to the economy of
countries and for generating employment.
• However, these activities, if not managed sustainably, could develop a parasitic
relationship with the environment, leading to destruction and degradation of
marine habitats and environment, loss of biodiversity, marine pollution and over-
exploitation of resources.
• This necessitates actions for environmental protection in order to prevent any
irreversible impacts (for example sedimentation over coral organisms by sheer
human physical impact, beach erosion, and mangrove clearance) that may arise
from marine tourism industry.
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• Sustainable Whale and Dolphin Watching Tourism
• Whale and dolphin watching tourism can create economic, social, and environmental benefits such as
inclusive economic growth and job creation for coastal communities, while also encouraging the
protection of marine species and habitats.
• The Indian Ocean region is home to many unique marine species, including vulnerable species such as
the Indian Ocean humpback dolphin and the Arabian Sea humpback whale.
• Recognising this, the IORA Sustainable Whale and Dolphin Watching Tourism Network was
established in 2016 to help IORA member states become world leaders in sustainable practice.
• The purpose of the Network is to provide a regional forum for key stakeholders to facilitate the
exchange of experience, information, and expertise on whale and dolphin watching, and to encourage
collaboration. Information relevant to the Network is shared through a biannual newsletter.
•  
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• IORA Indian Ocean Blue Carbon Hub
• The IORA Indian Ocean Blue Carbon Hub aims to build knowledge and capacity
relevant to protecting and restoring blue carbon ecosystems (which include mangroves,
seagrasses and tidal marshes) throughout the Indian Ocean in a way that enhances
livelihoods, reduces risks from natural disasters and helps mitigate climate change.
• The objectives of the Hub include
• Providing a source of advice to, and expertise for, IORA Member States
• Engaging in and facilitating research that seeks to improve knowledge and provide the
evidence base for development of robust policy and finance mechanisms
• Establishing best practice and disseminating information about best practice
• Developing partnerships with organizations that can assist with implementation of
activities that meet these objectives.
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• THE ASIA PACIFIC ECONOMIC COOPERATION (APEC)
• The Asia-Pacific Economic Cooperation (APEC) is an inter-governmental
forum for 21 member economies in the Pacific Rim that promotes free trade
throughout the Asia-Pacific region. 
• Headquartered in Singapore, APEC is recognized as one of the highest-level
multilateral blocs and oldest forums in the Asia-Pacific region and exerts a
significant global influence.  
• Mission
• APEC is the premier Asia-Pacific economic forum. Our primary goal is to support
sustainable development
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• Structure
 APEC consists of Annual Ministerial Meetings, Senior Officials Meeting, Working Groups and a Secretariat.  

 The governing body of APEC is the Annual Ministerial Meeting of the foreign and trade ministers of all the member-states.  

 The chairmanship of the meetings rotates every year among the members. 

 The Senior Officials Meetings, consisting of representatives of all the member-states,  are held annually and are responsible for the
implementation of policies framed by  Ministerial Meetings.  

 There are ten Working Groups dealing with Telecommunications, Trade and Investment  Data, Fisheries, Tourism, Transportation,
Trade Promotion, Investment and Technology,  Human Resource Development, Regional Energy Cooperation and Marine Resource 
Conservation, and two ad hoc groups dealing with Regional Trade Liberalization and  Economic Policy.  

 The Secretariat is headed by the Executive Director who holds a term of one year.
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• How Has the Region Benefited? 
 APEC has grown to become a dynamic engine of economic growth and one of the most important regional forums in the Asia-
Pacific. Its 21 member economies are home to around 2.9 billion people and represent approximately 60 per cent of world GDP and
48 per cent of world trade in 2018.  

 As a result of APEC’s work, growth has soared in the region, with real GDP increasing from USD 19 trillion in 1989 to USD 46.9
trillion in 2018. Meanwhile, residents of the  Asia-Pacific saw their per capita income rise by 74 per cent, lifting millions out of
poverty and creating a growing middle class in less than three decades. 

 Bringing the region closer together, reducing trade barriers, and smoothing out differences in regulations have boosted trade which,
in turn, has led to this dramatic increase in prosperity. Average tariffs fell from 17 per cent in 1989 to 5.3 per cent in  2018. During
that same time period, the APEC region’s total trade increased over seven times—outpacing the rest of the world with two-thirds of
this trade occurring between member economies. 
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• Scope of Work
• The Three Pillars of APEC's agenda focus on: 
• 1. Trade and Investment Liberalization  
• APEC members take actions to reduce tariff and non-tariff barriers to trade and investment
that boosts job creation, incomes and growth.
• 2. Business Facilitation  
• APEC members pursue measures to reduce the time, cost and uncertainty of doing business in
the region and open new economic opportunities including for small firms, women and youth.
• 3. Economic and Technical Cooperation (ECOTECH)  
• ECOTECH builds the technical capacity of APEC's diverse members to promote
trade, investment and robust, secure and sustainable economic growth that widely benefits the
region's people
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• Osaka Action Agenda 
• The Osaka Action Agenda provides a framework for meeting the Bogor Goals
through trade and investment liberalisation, business facilitation and sectoral
activities, underpinned by policy dialogues and economic and technical cooperation.
As part of this framework, General  Principles have been defined for APEC member
economies as they proceed through the APEC  liberalisation and facilitation
process.  
• 1) Comprehensiveness 2) WTO-consistency 3) Comparability
• 4) Non-discrimination 5)  Transparency 6) Standstill
• 7) Simultaneous start, continuous process and differentiated timetables
• 8) Flexibility
• 9) Cooperation
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• THE MERCADO COMUN DEL CONO SUR OR SOUTHERN
COMMON MARKET (MERCOSUR)
• The Southern Common Market (MERCOSUR for its Spanish initials) is a regional
integration process, initially established by Argentina, Brazil, Paraguay and
Uruguay, and subsequently joined by Venezuela and Bolivia* -the latter still
complying with the accession procedure.
• Its official working languages are Spanish and Portuguese. The working
documents’ official version will be that of the host country language of each
meeting. As of 2006, through the Decision CMC No. 35/06, Guarani was
incorporated as one of the languages of the Bloc.
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• MERCOSUR is an open and dynamic process. Since its creation, its main objective has been to
promote a common space that generates business and investment opportunities through the
competitive integration of national economies into the international market.
• As a result, it has established multiple agreements with countries or groups of countries, granting
them, in some cases, the status of Associated States – this being the situation of the South
American countries.
• These participate in activities and meetings of the Bloc and have trade preferences with the States
Parties. MERCOSUR has also signed commercial, political or cooperation agreements with a
diverse number of nations and organizations on all five continents.
• Since its origins, MERCOSUR has been based on the principles of Democracy and Economic
Development, which underpins the core values of a human-faced integration.
• Aligned with these, different agreements have been added in terms of migratory, labor, cultural,
and social matters -just to mention a few, which are of utmost importance for its inhabitants
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• These agreements meant the incorporation of the Citizen, Social and Productive Integration dimensions. For
this to be achieved, it was necessary to adapt and expand the institution’s structure throughout the region by
meeting new demands and deepening the effective participation of the citizenship.
• Moreover, it had to equip itself with its own financing mechanisms, such as the MERCOSUR Fund for the
Structural Convergence (FOCEM), amongst other funds.
• Through an annual contribution of over $100 million dollars, FOCEM funds projects aimed at prompting
competitiveness , social cohesion, and the reduction of asymmetries among members involved in the process.
• MERCOSUR full potential is immeasurable and can be found in the most diverse areas. Its territory of almost
15 million km2 consists of a great variety of natural wealth and treasures which humanity possesses: water,
biodiversity, energy resources, and fertile lands. Its greatest asset , nevertheless , is its people.
• Thanks to a lot of population of over 295 million people, it has an invaluable heritage of cultural, ethnic,
linguistic and religious diversity , which coexists harmoniously making MERCOSUR a region of peace and
development.
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• MERCOSUR makes its decisions through three bodies: the Council of the
Common Market (CMC), the main body of MERCOSUR which conducts the
integration process politically; the Common Market Group (GMC), which
oversees the daily functioning of the Bloc; and the Mercosur Trade Commission
(CCM), responsible for the administration of common commercial policy
instruments.
• More than 300 negotiation forums assist these bodies in the most diverse areas,
integrated by representatives of each States Parties in order to promote initiatives
to be considered by decision-making bodies.
• Over time and for the purpose of the implementation of its regional policies,
MERCOSUR has created several permanent agencies in different cities. Examples
of these are the Fund for the Structural Convergence of MERCOSUR (FOCEM),
the Institute of Public Policies on Human Rights (IPPDH), 
MERCOSUR Social Institute (ISM), the 
Parliament of MERCOSUR (PARLASUR), the Secretariat of MERCOSUR (SM)