ABSTRACT
This chapter provides an overview of existing mechanisms for global and regional integration.
The chapter begins with a history of GATT and how this basic agreement led eventually to the creation of a permanent organization, the WTO, to manage the reduction in trade barriers around the world. Prior to GATT and the WTO, most trade agreements were bilateral, that is just between two countries. The Chapter then discusses regional trade agreements. The chapter notes that RTAs range from simple agreements for preferential treatment to the more complex agreements of the customs union and economic union. For illustrations, the chapter describes the history and structure of the EU, USMCA, and APEC. The EU is the most integrated of all RTAs, especially with the use of the euro as a common currency for most members. USMCA is a less integrated preferential trade agreement but could become more like the EU with new agreements such as the Central American Free Trade Agreement. APEC is a loosely configured preferential trade agreement without binding treaties. Nevertheless, APEC has succeeded in reducing trade barriers among member nations. The Chapter concludes that new agreements provide both opportunities and threats for companies in different countries and different industries.
