Global social and economic groupings have significant beneficial effects for their members. ” Discuss the extent to which you agree with this statement (40) It is beneficial to us when assessing said statement to begin by considering the main reasons for the formation of social and economic groupings. First and foremost considering the 4 main types of alliances. Between Free Trade Areas and Customs Unions it is fair to say that the main goal is to restrict imports from non-member countries, in turn allowing the economies of the member countries to flourish and revive for themselves, amongst themselves, in terms of trade.
Common Markets on the other hand keep import tariffs in place, instead allowing the free movement of labor and capital; this allows member countries to share human resources in order to advance their economies. Lastly Economic Unions allow tariff-free trade between members, free movement of people and goods, but also adopt common policies for all members; these often include environmental or transport policies. In my opinion social and economic groupings have had some beneficial impacts for heir members, especially when considering the major groupings of which we know today.
For one the establishment of the European Union has allowed for great levels of development across its many members. The establishment of free trade within the union means that the 28 member countries can obtain and provide goods and services at greater profits, allowing economies a better chance to grow. The free movement of people also goes a long way to breaking down trade barriers, and enabling human resources to be shared between union members. The EX. also has many other benefits, for one it has allocated funds to support the underdeveloped regions of the ELI.
They have provided funds to support their countries to conform to the standards of the ELI. Poland for instance has benefited greatly from the investment, which has served to shift to a greater market orientation from a state-controlled economy. It has also funded infrastructural development to improve transport links with neighboring countries such as Germany. Another benefit of the EX. comes from its ability to lead 28 countries towards environmental awareness and improvement through common policies.
Its Common Environmental Policy has aimed to address issues such as acid rain, the thinning of the ozone layer, air quality, noise pollution, waste and water pollution. They also set common targets such as in 2007 when they agreed to use 20% renewable energy and Global, Social and Economic Groupings: Significant Beneficial Effects for Their Members By osmosis However the unique characteristic of the European Union is that it comes with membership fee and agreement. The member countries vouch to bail out fellow economies in times of crisis, as well as all together agreeing on common laws and policies.
This can serve wonders for countries such as Greece, and possibly Italy in the near future. But as devil’s advocate, can be a great inconvenience for countries such as the UK and Germany. The most recent bail out having been awarded to Greece in the total amount of ?¬Bonn, all together over 3 negotiations, most recently renegotiated in this 1st quarter of 2015. This can be a ‘set-back’; to say the least, for the members of the EX. with stable economies, as money which could otherwise be seed to better the levels of development of such countries is now being used to fund the survival of the Greek economy for a 3rd time.
Other disadvantages of the ELI, this time to its residents, is that it removes the ability of a person to move to a new society if they dislike the one in which they live. As more and more common policies and legislations are put into place effective over all member countries, it becomes harder and harder for the individual to escape a culture. This is feared to possibly lead towards cultural homogeneities, as member countries begin to lose their identities retainer politically, as the EX. becomes a supposed super-state.
While others will argue that this social grouping allows for a more peaceful situation between all member countries, this was especially true following World War 2; which in itself lead to the creation of the EX.. As well as arguing that the EX. allows for more accessible travel, allowing European citizens to discover different cultures and live in better harmony. Another well know grouping is NONFAT, a free trade agreement created in 1994 between the United States, Canada and Mexico. This created one of the largest free read areas of the world.
Its success has been astounding boosting trade between the member countries from $Bonn to $Bonn. However in more recent assessments it has been suggested that in the long haul it has been more damaging than helpful for Mexico; as an LED at the time some suggest it may have exploited. Suggestions are based on the assumptions that as a result of the NONFAT agreement Mexico rate of development has been hindered. The most basic measure of economic progress, especially for a developing country like Mexico, is the growth of income (or GAP) per arson.
Out of 20 Latin American countries (South and Central America plus Mexico), Mexico ranks 18, with growth of less than 1% annually since 1994. From 1960-80 Mexico GAP per capita nearly doubled. This amounted to huge increases in living standards for the vast majority of Mexicans. If the country had continued to grow at this rate, it would have European living standards today. In counter arguments we can point out that it is easy to see that NONFAT was a bad deal for most Americans.
The promised trade surpluses with Mexico turned out to be effects, some hundreds of thousands of American Jobs were lost, and there was downward pressure on US wages – which was, after all, the purpose of the agreement. This was not like the European Union’s (pre-Rezone) economic poorer countries of Europe so as to pull their living standards up toward the average. The idea was to push US wages downward, toward Mexico, and to create new rights for corporations within the trade area. In conclusion I believe that both economic and social groupings can offer some beneficial effects for those involved.
However it does come with its reservations, as illustrated by the disadvantages, which resulted from the NONFAT agreement. In the more complex matter of the European Union it can be said that it has mostly had more benefits than disadvantages, which would effectively render it a success. However we must keep in mind that its overall performance does not reflect its effects for all countries. Especially for the I-J, whose economy has been only seen a draining of their finances in order to benefit and improve other European countries.
Some may be bold to suggest these lesser developed countries have been reliant on he Union’s obligations to help them, to fund development as opposed to actively seeking solutions for themselves. Whereas improvements to infrastructure in transport within the Union, including specifically Poland, can be seen as cost for the wealthier countries such as the I-J and Germany, as means towards a better end. I believe each individual grouping and its workings will always be made up of its unique benefits and disadvantages, however that there is always a set of benefits on offer as a result of the creation of a grouping.
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