According to the article “Free trade agreements versus customs unions”, Krueger explained that customs union is an arrangement between the member countries. “Customs union is an arrangement in which there is zero duty between members on imports of goods and services, and a common external tariff” (Krueger 6). The difference between free trade area and customs union is that the free trade areat has a common market, but the member counties still maintain own trade barriers and set up different external tariff to other countries. However, for customs union, while each country enjoys the common market, they still adopt a common external tariff and trade policy to foreigner trade. It maintains the normal flow of goods issue and increases the ability to fend off
According to the article “Free trade agreements versus customs unions”, Krueger explained that customs union is an arrangement between the member countries. “Customs union is an arrangement in which there is zero duty between members on imports of goods and services, and a common external tariff” (Krueger 6). The difference between free trade area and customs union is that the free trade areat has a common market, but the member counties still maintain own trade barriers and set up different external tariff to other countries. However, for customs union, while each country enjoys the common market, they still adopt a common external tariff and trade policy to foreigner trade. It maintains the normal flow of goods issue and increases the ability to fend off