Chapter 10 International Marketing

Front 1

Know the term used to identify groups ofcountries that seek mutual economic benefit from reducing interregional tradeand tariff barriers. p284

Back 1

Multinational market regions, most important today

Front 2

Know and be able to explain the primary waymarket opportunities are enlarged by economic unions. pg 285

Back 2

Preferential treatment for members, barriers against outsiders, agreement methods

Front 3

Be able to explain what “state sovereignty”means and why it is so important to countries considering joining some sort oftrade organization. pg 285-286

Back 3

Political compatibility before giving up independence for trade benefits

Front 4

There are five sortsof multinational cooperation – from most basic to the most fully integratedform of regional cooperation. Be able tolist and describe each. (Note that there will be several questions over thismaterial – so be sure to be able to describe each form. pg 287-288

Back 4

Regional Cooperation Groups, Free Trade Area, Customs Union, Common Market, Political Union

Front 5

Know which treatyestablished the European Economic Community (EEC) and in what year. pg 288

Back 5

Treaty of rome, 1957

Front 6

Know what theMaastricht Treaty created. pg 288-291

Back 6

Called for a common currency, established targets for monetary union, called of political union of member nations.

Front 7

Know the four largestEuropean Union countries are in population (see Exhibit 10.1) in order. pg 289

Back 7

Germany, France, UK, Italy, Spain

Front 8

Know what organizationserves as the EU’s Supreme Court. pg 293

Back 8

European court of justice

Front 9

Know and be able toexplain what the “Treaty of Amsterdam” involved. pg 294

Back 9

Expansion, euro/emu conversion, one voice of foreign policy, increased authority of EU institutions.

Front 10

Know how the expansionof the European Union worries existing EU members when it comes to cheap labor. pg 294-296

Back 10

Immigrants from soviet stats, new citizens should have transition period before being able to move freely.

Front 11

Regional Cooperation Groups

Back 11

the most basic economic cooperation and integration is Regional Cooperation for Development (RCD)governments agree to participate jointly to develop basic industries beneficial to each economy; each country makes an advance commitment to participate in the financing of a new joint venture and to purchase a specified share of the output of the ventureEX: the project between Colombia and Venezuela to build a hydroelectric generating plant on the Orinoco River

Front 12

Free Trade Area

Back 12

requires more cooperation and integration than the RDCIt is an agreement between two or more countries to reduce or eliminate CUSTOMS DUTIES and NONTARIFF TRADE BARRIERS among partner countries while members maintain individual tariff schedules for external countries.basically, FTA provides its members with a mass market without barriers to impede the flow of goods and services

Front 13

Customs Union

Back 13

represents the next stage in economic cooperation. It enjoys the free trad area's reduced or eliminated internal tariffs and adds a COMMON EXTERNAL TARIFF on product imported from countries outside the union.It is a logical state of cooperation in the transition from FTA to Common market.Custom Unions exist between France and Monaco, Italy and San Marino, Switzerland and Liechtenstein

Front 14

Common Market

Back 14

eliminates all tariffs and other restrictions on internal trade, adopts a set of common external tariffs, AND removes ALL restrictions on the free flow of CAPITAL and LABOR among member nationsThus, a common market is a common marketplace for goods as well as services (including labor) and for capital.It is a UNIFIED ECONOMY and lacks only POLITICAL UNITY to become a political nation

Front 15

Political Union

Back 15

most fully integrated form of regional cooperationinvolves complete political and economic integration, either voluntary or enforced***The most notable enforced political union was the Council for Mutual economic Assistance (COMECON)- a centrally controlled group of countries organized by the Soviet Union(when the Soviet Union dissolved COMECON was disbanded)