Trade bloc in the context of Market forces

An economic union is a type of trade bloc which is composed of a common market with a customs union. The participant countries have both common policies on product regulation, freedom of movement of goods, services and the factors of production (capital and labour) as well as a common external trade policy. When an economic union involves unifying currency, it becomes an economic and monetary union.

The purposes for establishing an economic union normally include increasing economic efficiency and establishing closer political and cultural ties between the member countries.

The European Free Trade Association (EFTA) is a regional trade organisation and free trade area consisting of four European states: Iceland, Liechtenstein, Norway and Switzerland. The organisation operates in parallel with the European Union (EU), and all four member states participate in the European single market and are part of the Schengen Area. They are not, however, party to the European Union Customs Union.

EFTA was historically one of the two dominant western European trade blocs, but is now much smaller and closely associated with its historical competitor, the European Union. It was established on 3 May 1960 to serve as an alternative trade bloc for those European states that were unable or unwilling to join the then European Economic Community (EEC), the main predecessor of the EU. The Stockholm Convention (1960), to establish the EFTA, was signed on 4 January 1960 in the Swedish capital by seven countries (known as the "Outer Seven": Austria, Denmark, Norway, Portugal, Sweden, Switzerland and the United Kingdom). A revised Convention, the Vaduz Convention, was signed on 21 June 2001 and entered into force on 1 June 2002.

A single market, sometimes called common market or internal market, is a type of trade bloc in which most trade barriers have been removed (for goods) with some common policies on product regulation, and freedom of movement of the factors of production (capital and labour) and of enterprise and services. The goal is that the movement of capital, labour, goods, and services between the members is as easy as within them. The physical (borders), technical (standards) and fiscal (taxes) barriers among the member states are removed to the maximum extent possible. These barriers obstruct the freedom of movement of the four factors of production (goods, capital, services, workers).

A common market is usually referred to as the first stage towards the creation of a single market. It usually is built upon a free trade area with no tariffs for goods and relatively free movement of capital, workers and services, but not so advanced in reduction of other trade barriers.

A customs union is generally defined as a type of trade bloc which is composed of a free trade area with a common external tariff.

Customs unions are established through trade pacts where the participant countries set up common external trade policy (in some cases they use different import quotas). Common competition policy is also helpful to avoid competition deficiency.

An economic and monetary union (EMU) is a type of trade bloc that features a combination of a common market, customs union, and monetary union. Established via a trade pact, an EMU constitutes the sixth of seven stages in the process of economic integration. An EMU agreement usually combines a customs union with a common market. A typical EMU establishes free trade and a common external tariff throughout its jurisdiction. It is also designed to protect freedom in the movement of goods, services, and people. This arrangement is distinct from a monetary union (e.g., the Latin Monetary Union), which does not usually involve a common market. As with the economic and monetary union established among the 27 member states of the European Union (EU), an EMU may affect different parts of its jurisdiction in different ways. Some areas are subject to separate customs regulations from other areas subject to the EMU. These various arrangements may be established in a formal agreement, or they may exist on a de facto basis. For example, not all EU member states use the Euro established by its currency union, and not all EU member states are part of the Schengen Area. Some EU members participate in both unions, and some in neither.

Territories of the United States, Australian External Territories and New Zealand territories each share a currency and, for the most part, the market of their respective mainland states. However, they are generally not part of the same customs territories.

The North American Free Trade Agreement (Spanish: Tratado de Libre Comercio de América del Norte, TLCAN; French: Accord de libre-échange nord-américain, ALÉNA), referred to colloquially in the Anglosphere as NAFTA, (/ˈnæftə/ NAF-tə) was an agreement signed by Canada, Mexico, and the United States that created a trilateral trade bloc in North America. The agreement came into force on January 1, 1994, and superseded the 1988 Canada–United States Free Trade Agreement between the United States and Canada. The NAFTA trade bloc formed one of the largest trade blocs in the world by gross domestic product.

The impetus for a North American free trade zone began with U.S. president Ronald Reagan, who made the idea part of his 1980 presidential campaign. After the signing of the Canada–United States Free Trade Agreement in 1988, the administrations of U.S. president George H. W. Bush, Mexican president Carlos Salinas de Gortari, and Canadian prime minister Brian Mulroney agreed to negotiate what became NAFTA. Each submitted the agreement for ratification in their respective capitals in December 1992, but NAFTA faced significant opposition in both the United States and Canada. All three countries ratified NAFTA in 1993 after the addition of two side agreements, the North American Agreement on Labor Cooperation (NAALC) and the North American Agreement on Environmental Cooperation (NAAEC).

The Southern Common Market (commonly known by abbreviation Mercosur in Spanish and Mercosul in Portuguese) is a South American trade bloc established by the Treaty of Asunción in 1991 and Protocol of Ouro Preto in 1994. Its full members are Argentina, Bolivia, Brazil, Paraguay, and Uruguay. Venezuela is a full member but has been suspended since 1 December 2016. Chile, Colombia, Ecuador, Guyana, Panama, Peru, and Suriname are associate countries.

Mercosur's origins are linked to the discussions for the constitution of a regional economic market for Latin America, which go back to the treaty that established the Latin American Free Trade Association in 1960, which was succeeded by the Latin American Integration Association in the 1980s. At the time, Argentina and Brazil made progress in the matter, signing the Iguaçu Declaration (1985), which established a bilateral commission, which was followed by a series of trade agreements the following year. The Integration, Cooperation and Development Treaty, signed between both countries in 1988, set the goal of establishing a common market, which other Latin American countries could join. Paraguay and Uruguay joined the process and the four countries became signatories to the Treaty of Asunción (1991), which established the Southern Common Market, a trade alliance aimed at boosting the regional economy, moving goods, people among themselves, workforce and capital. Initially a free trade zone was established, in which the signatory countries would not tax or restrict each other's imports. As of 1 January 1995, this area became a customs union, in which all signatories could charge the same quotas on imports from other countries (common external tariff). The following year, Bolivia and Chile acquired membership status. Other Latin American nations have expressed interest in joining the group.

The Agreement between the United States of America, the United Mexican States, and Canada (USMCA) is a free trade agreement among the United States, Mexico, and Canada, in effect from July 1, 2020. It replaced the North American Free Trade Agreement (NAFTA) implemented in 1994. Further, it is sometimes characterized as "NAFTA 2.0", or "New NAFTA", since it largely maintains or updates the provisions of its predecessor. The region including Canada, Mexico, and the United States is one of the world's largest free trade zones, with a population of more than 510 million people and an economy of $30.997  trillion in nominal GDP – nearly 30 percent of the global economy, and the largest of any trade bloc in the world.

All sides came to a formal agreement on 1 October 2018, and U.S. president Donald Trump proposed USMCA during the G20 Summit the following month, where he signed it, Mexican president Enrique Peña Nieto, and Canadian prime minister Justin Trudeau. A revised version reflecting additional consultations was signed on December 10, 2019. It was ratified by all three countries, with Canada being the last to ratify on March 13, 2020. Following notification by all three governments that the provisions were ready for domestic implementation, the agreement came into effect on 1 July 2020.

A preferential trade area (also preferential trade agreement, PTA) is a trading bloc that gives preferential access to certain products from the participating countries. This is done by reducing tariffs but not by abolishing them completely. It is the first stage of economic integration.

These tariff preferences have created numerous departures from the normal trade relations principle, namely that World Trade Organization (WTO) members should apply the same tariff to imports from other WTO members.

A customs territory is a territory with uniform customs regulations and there are no internal customs or similar taxes within the territory. Customs territories may fall into several types:

• A sovereign state, including a federation
• A trade bloc that has a customs union
• An autonomous or dependent territory that is granted by the sovereign government some degree of independence in foreign trade and customs policy.

There are also some unregulated lands (usually uninhabited) not part of any customs territory.

In economics, a market is a composition of systems, institutions, procedures, social relations or infrastructures whereby parties engage in exchange. While parties may exchange goods and services by barter, most markets rely on sellers offering their goods or services (including labour power) to buyers in exchange for money. It can be said that a market is the process by which the value of goods and services are established. Markets facilitate trade and enable the distribution and allocation of resources in a society. Markets allow any tradeable item to be evaluated and priced. A market emerges more or less spontaneously or may be constructed deliberately by human interaction in order to enable the exchange of rights (cf. ownership) of services and goods. Markets generally supplant gift economies and are often held in place through rules and customs, such as a booth fee, competitive pricing, and source of goods for sale (local produce or stock registration).

Markets can differ by products (goods, services) or factors (labour and capital) sold, product differentiation, place in which exchanges are carried, buyers targeted, duration, selling process, government regulation, taxes, subsidies, minimum wages, price ceilings, legality of exchange, liquidity, intensity of speculation, size, concentration, exchange asymmetry, relative prices, volatility and geographic extension. The geographic boundaries of a market may vary considerably, for example the food market in a single building, the real estate market in a local city, the consumer market in an entire country, or the economy of an international trade bloc where the same rules apply throughout. Markets can also be worldwide, see for example the global diamond trade. National economies can also be classified as developed markets or developing markets.

A customs and monetary union is a type of trade bloc which is composed of a customs union and a currency union. The participant countries have both common external trade policy and share a single currency.

Customs and monetary union is established through trade pact.

The ASEAN Free Trade Area (AFTA) is a trade bloc agreement by the Association of Southeast Asian Nations supporting local trade and manufacturing in all ASEAN countries, and facilitating economic integration with regional and international allies. It stands as one of the largest and most important free trade areas (FTA) in the world, and together with its network of dialogue partners, drove some of the world's largest multilateral forums and blocs, including Asia-Pacific Economic Cooperation, East Asia Summit and Regional Comprehensive Economic Partnership.

The AFTA agreement was signed on 28 January 1992 in Singapore. When the AFTA agreement was originally signed, ASEAN had six members, namely, Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand. Vietnam joined in 1995, Laos and Myanmar in 1997 and Cambodia in 1999. AFTA now comprises the ten countries of ASEAN. All the four latecomers were required to sign the AFTA agreement to join ASEAN, but were given longer time frames in which to meet AFTA's tariff reduction obligations.

The Pacific Alliance (Spanish: Alianza del Pacífico) is a Latin American trade bloc, formed by Chile, Colombia, Mexico and Peru, which all border the Pacific Ocean. The alliance was formed with the express purpose of improving regional integration and moving toward complete freedom in the movement of goods, services, capital and people between the four member states. Together, these four countries have a combined population of more than 230 million people and make up roughly 35 percent of Latin American GDP.

The Regional Comprehensive Economic Partnership (RCEP /ˈɑːrsɛp/ AR-sep) is a free trade agreement among the Asia-Pacific countries of Australia, Brunei, Cambodia, China, Indonesia, Japan, South Korea, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, Thailand, and Vietnam. The 15 member countries account for about 30% of the world's population (2.2 billion people) and 30% of global GDP ($29.7 trillion), making it the largest trade bloc in history. Signed in November 2020, RCEP is the first free trade agreement among the largest economies in Asia (excluding India), including China, Indonesia, Japan, and South Korea.

The RCEP was conceived at the 2011 ASEAN Summit in Bali, Indonesia, while negotiations formally launched during the 2012 ASEAN Summit in Cambodia. India, which took part in the initial negotiations but later decided to opt out, was invited to join the bloc at any time. Any other country or separate customs territory in the region can accede to the pact from 1 July 2023 onward. The treaty was formally signed on 15 November 2020 at the virtual ASEAN Summit hosted by Vietnam. For the first ten ratifying countries, the trade pact took effect on 1 January 2022.

Asia-Pacific Economic Cooperation (APEC /ˈeɪpɛk/ AY-pek) is an inter-governmental forum for 21 member economies in the Pacific Rim that promotes free trade throughout the Asia-Pacific region. Following the success of ASEAN's series of post-ministerial conferences launched in the mid-1980s, APEC started in 1989, in response to the growing interdependence of Asia-Pacific economies and the advent of regional trade blocs in other parts of the world; it aimed to establish new markets for agricultural products and raw materials beyond Europe. Headquartered in Singapore, APEC is recognized as one of the highest-level multilateral blocs and oldest forums in the Asia-Pacific / Americas region, and exerts significant global influence.

The heads of government of all APEC members except Taiwan (which is represented by a ministerial-level official as economic leader) attend an annual APEC Economic Leaders' Meeting. The location of the meeting rotates annually among the member economies, and a famous tradition, followed for most (but not all) summits, involves the attending leaders dressing in a national costume of the host country. APEC has three official observers: the Association of Southeast Asian Nations Secretariat, the Pacific Economic Cooperation Council and the Pacific Islands Forum Secretariat. APEC's Host Economy of the Year is considered to be invited in the first place for geographical representation to attend G20 meetings following G20 guidelines.