Ethiopia Economy: Regional Economic Integration And Ethiopian Economy

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1.1.1 Regional Economic Integration and Ethiopian Economy
It has elapsed decades since economic cooperation and grouping among countries got paramount attention. We can observe different experience of economic integration in every corner of the world. Africa, Latin America, the Caribbean, Europe and Asia all have tasted either the pains or the pleasures of economic integration. The globe has experienced a large number of economic groupings among nations. Mostly the objective of such groupings is either political or economic motives. It is this practice of regional cooperation to day shifting towards globalization.

Countries in the world in general and the developing nations in particular have followed different global economic policies to
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Theoretically, the aim of regional economic integration is to appreciate member countries’ incremental trade possibilities that may be generated by elimination or reduction obstructions to trade and investment (both tariff and non-tariff barriers), encouragement and facilitation of such trade via harmonization of their trade-related regulatory systems, and coordination of compatible macroeconomic policies. It is argued that the possible economic gains for regional integration arrangements include trade creation, increased efficiency of production through increased specialization, increased domestic production, enhancement of product quality, inward investment and transfer of new technologies, and improved domestic terms of trade. Such benefits can be attained through the combined size of their collective productive capacities and markets and the sectoral complementarities that may exist among them. For regional economic integration to be beneficial to all concerned, the benefits of integration must exceed the costs associated with the exercise of integration (Sunny et al,…show more content…
COMESA is a regional integration bloc comprising 19 member states of Eastern and Southern Africa. As it is indicated in the treaty, COMESA envisions a fully integrated, internationally competitive regional economic community; a community within which there is economic prosperity as evidenced by high standard of living for its people. In order to achieve its mission, COMESA has to pass through achieving zero tariffs for all tradable goods among member countries; hence, it has established a Free Trade Area (FTA) in October 2000 and it plans to introduce the Common External Tariff (CET) or the customs union by the year 2004 and establish the economic community by the year 2025. (COMESA,

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