The fast pace of globalization is creating serious issues and questions for many developing countries to deal with, such as should they join a free trade bloc or not? What will they gain by being a member and what will they lose?
Since the creation of the European Union, first formed by 15 Western European countries and most recently expanded to 10 additional European nations, have influenced many countries around the world to follow the European example and worked together in order to expand their marketplace and increase economical and political power. NAFTA, Mercosul, CAFTA, CARICOM, and CAN are good examples of such economic blocs. The North America Free Trade Agreement (NAFTA) is formed by United States, Canada, and Mexico. Argentina, Paraguay, Uruguay, and Brazil form Mercosul, the South America Common Market. The Central American Free Trade Agreement (CAFTA) is formed by El Salvador, Honduras, Nicaragua, Guatemala, Panama, and Costa Rica. The Caribbean Community (CARICOM) is formed by the 20 Caribbean nations. Finally the Andean Community (CAN) formed by Bolivia, Colombia, Ecuador, Venezuela, and Peru.
The latest of these economic blocs is the proposed implementation of the FTAA by December 31, 2005, which will be the world’s largest economic bloc. The FTAA is planned to include all 34 countries on the North and South America continents, except for Cuba. In contrast to the European Union, in which the majority of its initial member countries had highly developed economies with the exception two or three countries, the majority of the FTAA country members are third world countries except for the United States and Canada. The main problem behind the FTAA is how secretively and quickly the whole process is being developed and scheduled to be implemented. It took a couple of decades for the European Union to become a reality. The FTAA timetable is supposed to be implemented in less than 10 years.
The implementation of the FTAA will have some benefits to those small economies in South American, Central America, and Caribbean nations, which are desperate to reach the NAFTA market. However, to countries like Brazil, which have a larger industrial park and compete directly with U.S., Canada, and Mexico, the implementation can cause serious problems to its country economy.
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...t, the only economical sector in Brazil and Argentina that can compete with the United States and Canada is the agricultural sector. However, the United States and Canada have already stated that they would not agree to stop their heavy subsidies of their agriculture sectors. Therefore, with nothing else to compete equally with the developed nations of the north, Brazil and Argentina best option is to stay out of the proposed FTAA plan.
Multinational Monitor, (Dec 2003). Retrieved June 20th, 2004 from InfoTrac database
Brazil’s Central Bank, (2004). Retrieved June 19, 2004 from the World Wide Web: http://www.bcb.gov.br/
FTAA. Retrieved June 20, 2004 from the World Wide Web: http://www.corpwatch.org/
Methanx (2004). Retrieved June 27, 2004 from the World Wide Web: http://www.globalexchange.org
Free Trade Area of the Americas, Retrieved June 20, 2004 from the World Wide Web: http://ftaa.org/
Free Trade Area of the Americas Summit, Retrieved June 20, 2004 from the World Wide Web: http://stoptheftaa.org/ftaa
Sindicato Mercosul. Mercosul: General Information. Retrieved June 20, 2004 from the World Wide Web: http://www.sindicato.org.br/mercosul/
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