Now it is only 12 weeks and I'm done with my MBA. It has been a long journey of learning - and it has been worth it. Started yesterday the seminar on Global Management, and international trade will be the thing for the next six weeks. Very exciting!
To start I had to compare two types of economic blocs. A trade bloc is actually a kind of trade barrier where members of the bloc can import among themselves with low or no tariff and impose higher tariffs on imports from outside the bloc. Examples are NAFTA, EU, MercoSul, etc. I selected to talk about free-trade area and customs union.
Free trade are is a kind of bloc where members remove trade barriers for participants of the bloc, and keep their own national barriers against countries which are not members of the block. NAFTA is an example os this kind of bloc. In customs unions, on another hand, members remove all barriers amongst participants and adopt uniform barriers against external countries. An example is the MercoSul, formed by Argentina, Brazil, Paraguay and Uruguay, having Bolivia, Chile, Colombia, Ecuador and Peru as associate members. Venezuela signed an agreement to be a member but it has not been ratified by the Brazilian senate yet.
Speaking of the Mercosur, I know that the it has had many challenges, economical and political implications. Recently Venezuela has signed an agreement to join, but because Hugo Chaves is Hugo Chaves, the Brazilian senate is putting resistance to approve the deal. In a declaration some time ago, Hugo called the Brazilian congress "subservient" to the U.S. Now he and his country may pay the price of his big mouth.
Another interesting episode was the attempt to create FTAA, the Free Trade Area of the Americas. It faced opposition from other formed blocs, mostly MercoSur, and has not become anything yet. In the meantime, MercoSur has increased his reach with associate countries... it is a political game. SO what we had was many bilateral treaties between US/NAFTA and other countries, which led to pressures on other blocs. The USTR.gov site's last press release on the FTAA is from 2005... I assume things are blocked for now.
So, the next six weeks will be great - I expect exciting discussions on international trade and its implications to business. Will keep the blog updated.