Economics commentary. The above article taken from Bernama, the Malaysian national news agency, talks about economic integration in the continent of Asia and how this would lead to the betterment of the Asian economies

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Economics Commentary 4

February 10, 2012 21:48 PM

The above article taken from Bernama, the Malaysian national news agency,  talks about economic integration in the continent of Asia and how this would lead to the betterment of the Asian economies and help them prosper. Economic integration can be simply defined as “a process whereby countries coordinate and link their economic policies”. It simply refers to the unification of states/economies by a full/partial abolishment of trade barriers that take place within the border of each state/economy.

The concept of economic integration found it’s origins in the term Globalization which is increased integration of national economies into global than national markets led by liberal capital flows and the advantages in the field of technology and a decrease in the costs. The process of globalization is truly highlighted by MNC’s i.e. Multi National Corporations which produce their products in more than one countries influenced by decreases in the costs o production, known as integrated international production.

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Economic integration can be both a merit and demerit for a country’s economy. This integration can be of many types, which are explained below.

  1. Trading Bloc: This is integration where some countries join hands to gain trading benefits from cooperation on some fixed level.  A trading bloc too can be of many types:

  1. FTA: An FTA is a free trade area which is an agreement made by a group of countries agreeing to trade amongst themselves without any trade barrio whatsoever and dealing with the countries outside their FTA individually.

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