Global Markets - Regional Economic Trading Blocs around the World
American Companies Exploit Overseas Job Market
In an article filed December 27, 2010 on the Huffington Post, author Pallavi Gogoi reported that large American corporations were actively hiring but not in the United States of America. Indeed while the U.S. economy lagged and the unemployment rate continued at 9.8% at the end of 2010, American corporations and entrepreneurs found demand for their products and services in overseas markets. Consequently, many top American corporations such as Caterpillar, Dupont, Coca Cola and UPS experienced profits and higher stock prices due to expanded operations around the world in emerging markets like Brazil, India, and China.
That American corporations expand operations to other regions of the world is only natural in this age of globalization. Indeed, global markets and especially emerging markets like China, India, Brazil as well as regional trading blocs like ASEAN (Association of Southeast Asian Nations); NAFTA (North American Free Trade Agreement); European Union; and Mercosur (the Common Market of the South) have allowed American corporations to find new opportunties that they would not otherwise have in the United States alone.
This hub introduces the reader to some of the regional economic trading blocs around the world.
The European Union (EU) formed under the Maastricht Treaty in 1993 is the world's largest political and economic trade bloc. The EU, which traces its beginning to a six member pact called the European Economic Commission, currently has 27 members. As of 2009, the combined nominal GDP of the European Union was just under $16.5 trillion making it the second largest economic trading bloc in the global markets behind the three member NAFTA economic bloc. The 27 members include: Austria, Belgium, Bulgaria, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Republic of Ireland, Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom.
North American Free Trade Agreement (NAFTA)
The North American Free Trade Agreement (NAFTA) was first signed in 1994 to establish a free economic trade bloc amongst Canada, Mexico, and the United States of America. According to an article posted on the Council on Foreign Relations website, "The central thrust of the agreement is to eliminate the vast majority of tariffs on products traded among the United States, Mexico, and Canada." As of 2008, the combined GDP of the three NAFTA members estimated at nearly $17 triliion which makes it the world's largest economic trading bloc just ahead of the European Union.
Association of Southeast Asian Nations (ASEAN)
The Association of Southeast Asian Nations (ASEAN) was founded in 1969 as an alliance promoting both political and economic alliance. This political alliance and economic trading bloc in Southeast Asia has ten members including:
- Myanmar (Burma)
ASEAN is the world's third largest economic trading bloc behind the European Union and NAFTA. In 2010, trade between the ten Southeast Asian nations was expected to surpass $1.5 trillion. Moreover, ASEAN is the United States' fourth largest regional trading partner with over $200 billion in trade in 2008.
Mercosur - Common Market of the South
Founded in 1991, the purpose of Mercosur is to allow for free trade among member nations. Mercosur has four permanent member nations including Argentina, Brazil, Paraguay, and Uruguay; and six associate members including Bolivia, Chile, Columbia, Ecuador, Peru, and Venezuela. According to an article posted by the U.S.-based Council on Foreign Relations, Mercosur is the world's fourth largest trading bloc after the European Union, NAFTA, and ASEAN with a collective GDP of $2.4 trillion in 2008. The total population of the four permananet members plus Venezuela was 270 million people. Venezuela's petition for full membership is still pending approval by Brazil and Paraguay.