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Regional trade areas such as European Union and NAFTA

What are the advantages and disadvantages of regional trade areas such as the European Union and NAFTA?

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Advantages:

Trading blocs have a very substantial impact on regional and world economies in the form of promoting bilateral trade between member nations. Further, it also promote the overall economic development of the region such as EU did for European countries. It has also led to the strengthening of the economies of nations in the bloc. Trading blocs have been successful in providing nations to set up operations in countries in their blocs which provide comparative advantage with respect to production of goods and services as well as enhanced cooperation among countries. For example, trade between US and Mexico grew with the formation of NAFTA. It also promote free trade between nations in the same bloc. In the case of European Union, it has led to advent of a single currency Euro which is ...

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What are the advantages and disadvantages of regional trade areas such as the European Union and NAFTA

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