At the macro level, i.e. at the level of interstate (intergovernmental) agreements, there is overall strategy economic and political development of countries, based on the development general rules displacement , . Real integration is a combination of market (spontaneous) mechanisms for the formation of a single economic space with purposeful actions of the state.
Reasons and prerequisites for integration processes
Integration processes cover primarily countries that are territorially included in one region. The economic unification of countries means the formation of regional economic blocs - the regionalization of the world economy. As a rule, not only geographical proximity is necessary, but also economic, cultural, religious, and ethnic similarities.
The same level of social economic development . The main prerequisite for the real integration of countries is approximately the same, the compatibility of economic mechanisms, socio-economic and legal uniformity (homogeneity). The main macroeconomic indicators - , growth rates , its sectoral structure, level and - should not differ significantly. That is why integration is the most effective. The union of poor or rich and poor countries does not allow the implementation of joint projects on a parity (equal) basis.
Complementarity of the economies of neighboring countries. The second most important prerequisite is the complementarity of the economies of neighboring countries. It manifests itself primarily in the diversity of export structures of the integrating countries. Countries trading in the same goods cannot really integrate.
The presence of political will. The third prerequisite is the presence of political will, leaders who develop and implement the integration process at the state level.
The prerequisites include the so-called demonstration effect, when the success of integration stimulates other countries to join the economic bloc. The same applies to the "domino effect" - the more countries are included in the integration group and increase intra-regional trade, the more difficulties are experienced by third countries outside the group. This encourages them to integrate.
The intensity of integration ties is usually measured by such indicators as:- the share of intra-regional exports or imports (trade) to the total GNP of the region (in%);
- share of intra-regional trade turnover to the total foreign trade turnover integrated countries (in %);
- the volume of mutual foreign direct investment () within the integration group compared to FDI of member countries in third countries (in%);
- the number and scale of mergers and acquisitions of companies (M&A) within the group and outside it.
Stages of international economic integration of countries
Economic integration can be carried out in breadth and depth. The expansion characterizes the quantitative side of the process - the number of countries in the group. Deepening integration - quality characteristic. It shows the tightness of the relationship, the level of unification of countries. Economic integration is carried out gradually from simple to more complex forms. The pre-integration phase is the phase of preferential trade, when neighboring countries provide each other with preferences (benefits) that simplify trade between them compared to other countries. Such a benefit may consist of a reduction in the customs tariff, reduction or cancellation of quotas for goods, and simplification of customs formalities.
Bela Balassa distinguishes five forms (stages) of integration:- Free trading zone(FTA) - the abolition of tariff and non-tariff restrictions for the movement of goods within the zone, while maintaining each member country of its own foreign trade policy towards third countries. At this stage of integration are EFTA,.
- Customs Union(CU) - along with the functions of an FTA, a unified foreign trade policy is being pursued in relation to third countries, a single external border is being formed (for example,).
- Common Market (OR) - along with the functions of the CU, the cross-border movement of all factors of production (capital and labor) is freely carried out. Supranational legislative, executive and judicial structures are being formed. National legislations are being unified.
- Economic and Monetary Union(EMU) - along with the functions of the OR, there is an agreement on socio-economic and monetary policy. Economic convergence (rapprochement) of the countries of the union is being carried out, a single currency is being introduced.
- Political union- along with the functions of the EMU, a transition is being made to a common security policy, a unified structure of justice and internal affairs, and a single citizenship is being introduced.
The above theoretical integration models turn out to be more vague and diverse in practice. For example, APEC, which positions itself primarily as a free trade zone, assumes free movement of investments. The same applies to member countries, where, at the stage of the free trade zone, liberalization is expected in the sphere of services and investments, harmonization in the field of protection environment and other elements characteristic of more high level associations.
The role of international economic integration for countries
Canadian scientists J. Weiner and J. Mead have identified static and dynamic effects arising from economic integration.
Static effects that occur shortly after a country joins the union include:- the effect of creating trade or expanding intra-regional trade;
- the effect of diverting trade or reducing trade with third countries, even if the costs of production and circulation in these third countries are lower than within the union.
- expansion of the market of the country belonging to the group, and the resulting increase in the scale of production, and hence the reduction in costs per unit of output;
- development of the infrastructure of the participating countries;
- stimulation;
- a gradual rise in the standard of living of the population, especially in economically weaker countries, and other effects.
The development of integration processes in the world economy, which has been observed in recent decades, was a natural result of the growth in the volume of international trade and the increase in the intensity of the international movement of factors of production. This required the creation of more reliable supply chains between countries, as well as the elimination of existing barriers to international trade and the movement of factors of production. It turned out to be possible to do this only within the framework of interstate integration associations (political and economic).
Under economic integration refers to the process of economic interaction between countries, leading to the liberalization of international economic relations which is reflected in the reduction and removal of restrictions on their implementation.
There are three main approaches to the liberalization of world economic relations and, above all, world trade: international, regional and transnational.
International approach implemented through international conferences (rounds) under the auspices of the World Trade Organization, the purpose of which is to reduce tariff and non-tariff barriers in international trade around the world.
Transnational approach is actively implemented, in recent years, in particular, through the production and economic activities of transnational companies (TNCs).
Regional approach involves reaching agreements between a small number of states in order to establish a free trade regime while maintaining trade restrictions with the rest of the world. The European Communities (EC) and the US-Canada-Mexico Agreement (1994) are the best-known examples of such preferential trade relations.
Even if the signing of such agreements is driven more by political than economic factors, such regional trade groupings raise a number of important economic problems and issues.
1. Does the formation of regional trade groups represent a movement towards free trade, or is it an increase in protectionism?
2. Do preferential agreements increase the economic efficiency and welfare of the entire world economy as a whole?
3. Is the formation of regional economic unions beneficial to all participating countries?
Let's try to answer these questions.
First of all, we note that preferential trade agreements can be implemented in the form of the following structural formations:
Preferential Trade Club;
Free trading zone;
Customs Union;
Common Market;
Economic union (full economic union).
At the same time, a preferential trading club is the lowest level of economic integration, and an economic union is the highest.
Let us consider the listed forms of economic integration in more detail.
Preferential trade club (association). Two or more countries form a preferential trading club if they reduce import duties on all goods (excluding capital) for each of the members of the club while maintaining their original tariffs for the rest of the world. An example of such a form of economic integration can be the "Commonwealth of Nations Preference System", formed in 1932 by Great Britain and 48 states, most of which were its own colonies.
Free trading zone. Two or more countries form a free trade area (free trade association) if they abolish all trade barriers (duties and quantitative restrictions) between themselves, but each maintains them in relation to third countries. In such a zone customs control on the borders of the participating countries must be maintained. Its purpose in this case is to tax or prohibit imports from third countries that could enter the zone through the low customs barrier of a neighboring participating country. An example of a free trade area is the European Free Trade Association (EFTA), formed in 1960 by Austria, Denmark, Norway, and Portugal. Sweden, Switzerland and the UK.
Customs Union. Two or more countries form a customs union if they abolish all customs restrictions in mutual trade in all goods (except for servicing capital), and also accept (establish) single system external trade barriers with third countries, thereby removing the need to maintain customs service on internal borders. In terms of trade, an example of a customs union is the European Economic Community (EEC).
Common Market. Two or more countries form a common market if they create a customs union and, in addition, allow free movement of all factors of production among themselves (migration of labor and capital). An example of such a market is the EEC, or the European Common Market, which has the official name of the European Communities.
In principle, the free movement of factors of production within a certain grouping of countries should contribute to a more rational use of aggregate resources, the development of the division of labor and the specialization of production. At the same time, the full realization of this is hindered by differences in the economic policies pursued by the states that are part of the common market.
Economic Union. Two or more countries form an economic union if they create a common market and, in addition, unify their economic policies, including monetary, tax and social, as well as policies regarding trade and the movement of labor and capital. An example of an economic union was Benelux - an economic union formed by Belgium, the Netherlands and Luxembourg (the term Benelux is made up of the first letters of the names of the participating countries). These three countries formed a customs union in 1949, which was turned into an economic union in 1960.
A striking example of an economic union is the United States of America, where 50 states are united in a complete economic union with a common currency and a single Central Bank (Federal Reserve System). Trade between the individual states is free, and capital and labor move freely in pursuit of maximum profit. Fiscal and monetary policy, as well as international relations, military spending, pensions, health care programs, are unified and provided by a single federal government. Other programs: education, culture, law enforcement (police) - are funded by the states, which allows the latter to assert their "identity" within the union.
Economic Union is the highest form of economic integration that the European Community is currently striving for.
In a generalized form, the characteristics of modern types of trade and economic unions are presented in Table. 8.1.
Table 8.1 Summary of economic unions
The experience of many integration associations shows that they are formed on two basic methods. The first principle is the powerful initiative role of the state (a classic example is the creation and development of the EU). Another principle is the predominant role of big business, which forces the state to take the path of rapprochement with one country or another. An example is the treaty between the United States, Canada and Mexico - NAFTA).
In the first case, an institutional type of integration develops, in the second, a private-corporate type of integration. The former CMEA should also be referred to the institutional type of integration, since it was organized exclusively at the interstate level, although with the aim of solving, first of all, the economic problems of the Eastern European countries.
In terms of scale, integration associations are divided into bilateral (for example, the integration agreement of Australia and New Zealand), multilateral - the most common in regional integration, continental - Latin American Economic Integration (LEI), the Organization of African Unity.
Economic integration is realized in several forms. To date, there is no single methodology for determining the total number of forms of international economic integration. According to estimates prevailing in the economic literature, their number varies from four to seven. The WTO uses the approach of Bela Balassa, who identified five main forms of economic integration:
- 1) free trade zone;
- 2) customs union;
- 3) common market;
- 4) economic (monetary) union;
- 5) political union.
In some sources, the economic union is continued in a fundamentally new link - the monetary union. The latter is separated from the economic union into an independent form. Some authors, among the main forms of economic integration, consider another one - a single internal market. Consequently, the largest number of integration agreements can be represented by such constituent parts as a free trade zone; Customs Union; Common Market; single internal market; economic union; monetary union; (full) economic and political integration.
Free Trade Zone (FTA)- This is a regional grouping of countries within which duty-free trade is carried out. With third countries, each participant in the free trade zone sets its own tariffs. Therefore, between the countries participating in the FTA, customs posts and borders are maintained that control the origin of goods crossing their state borders. This form of integration removes internal barriers and creates favorable conditions for the bloc member countries to specialize in the production of those goods and services for which they have a comparative advantage and facilitates the import of those goods and services in the production of which they do not have a comparative advantage. At the same time, each country retains its independence in trade and other types of economic policy. One of the most famous agreements of this type is the European Free Trade Association, established in 1960, which currently unites the countries of Western Europe that are not members of the EU: Norway, Switzerland, Iceland. Another example is the North American Free Trade Agreement (IIAFTA), which united the United States and Canada in 1989, which later included Mexico.
Customs Union (CU)- this is the common customs territory of two or more countries with a single customs tariff for goods exported or imported from third countries. A customs union leads to the adoption by countries of a common customs policy. Each member will transfer part of the management functions related to trade policy to the group as a whole. At this stage, common supranational bodies are already being created to coordinate the implementation of a coordinated foreign trade policy. Examples of this form of integration are the Andean Community (ANCOM), which includes five Latin American countries; Caribbean Community, consisting of 15 countries of the Caribbean region (CARICOM); EurAsEC customs union; MERCOSUR (common market of South America). An example of the successful development of the CU can also be the EEC, which during the 1960-1990s. was at this stage of interaction.
Common Market- this is a space covering a number of countries in which they establish equal conditions that ensure the movement of goods and services, factors of production. By implementing a single trade policy, countries retain independence in monetary and fiscal policy, but they are harmonized. The main features of the common market are the absence of any barriers to trade between states, a common trade policy in relation to other countries, the mobility of production factors between the member states of the union. Interstate administration for this form of integration is based on the coordination of economic policy in the most important areas - monetary, fiscal, structural, scientific and technical, social, antimonopoly, etc. regulation. An example of this form of integration is the Caribbean Community, a trade and economic union of Caribbean countries.
Economic (currency) union- this is an association of the economies of countries that have common external customs tariffs and implement a single trade, monetary and fiscal policy. This is the deepest form of economic integration, which is characterized by the free movement of goods, services, factors of production between member countries. The economic union unifies monetary and fiscal policies, introduces a common currency, establishes uniform tax rates and tax structure. Member countries are practically losing their independence in making decisions on the main issues of economic policy, which can lead to some contradictions. The EU countries pursuing a common economic policy create supranational regulatory bodies. Their governments transfer the solution of most of the fundamental issues to joint governing bodies. The highest form of development of the economic union is the introduction of a single currency and the creation of the Central Bank of the union of integration states. An example of the highest form of economic integration is the EU.
The final stage of integration is a political union (PS). It is characterized by common citizenship, a common defense policy, the election of a single parliament and the introduction of a constitution. The political union implements cooperation in the field of justice and internal affairs, regulates interaction in the field of culture, education, protection of the rights and personal freedoms of citizens. Only the European Union has passed all these stages.
The essence of international economic integration, the causes of MPEI.
Forms of international economic integration.
Mechanism and consequences of economic integration
International Economic Integration (MPEI) - salient feature present stage of development of the world economy.
At the turn of the 20th and 21st centuries, it became a powerful tool for accelerated development of the world economy and increased competitiveness in the world market of countries - members of integration groups. MPEI is understood as the process of merging the economies of neighboring countries into a single economic complex based on stable economic ties between their companies. Developed on the basis of regionalization, it is possible that in the future it will move into global integration based on the merger of regional unions and the development of a mechanism for managing continental and global economic associations.
At the heart of all theories of the development of international economic integration is the principle of the benefit of the country from the specialization of each country within the framework of the MRI, and the cooperation of efforts in the economic, social and political spheres in cases where the resources of one state are not enough. The first stage of MPEI is direct economic relations at the level of primary economic entities, that is, firms. Then, in the process of development, the national, legal, fiscal and other systems are mutually adjusted up to a certain merging of management structures.
The simplest, initial form of international economic integration is free trade zones. In this case, trade restrictions for the countries participating in the integration grouping are canceled, and, first of all, customs duties are reduced or canceled altogether. As a result, a preferential zone is created, characterized by the presence in it of conditions for free from tariff and quantitative restrictions of international trade in goods and services. Agreements on free trade zones are in line with modern international foreign economic practice and the concept of the World Trade Organization aimed at liberalization foreign trade and stabilization of the trade policy of the participating countries.
Agreements on free trade zones usually provide for the obligations of partners not to unilaterally increase customs duties and not to erect new trade barriers, i.e. adhere to the principle of mutual moratorium on the restriction and deterioration of the terms of foreign trade. At the same time, free trade zone agreements may provide for special cases in which the contracting parties may extend for a certain period, under mutually agreed circumstances, the scope of protective measures, including an increase in customs duties to the agreed amount. In the legal aspect, international agreements on free trade zones have a preferential status in relation to domestic legislative acts countries participating in the agreement.
Participation in free trade zones can complicate the position of producer countries, since the liberalization of imports creates favorable conditions for rivals from among the countries participating in the agreement, whose products may be more High Quality and technical level. Increased competition threatens bankruptcy for national producers who have not been able to compete with foreign suppliers of goods and services.
A form of closer cooperation is the customs union.
Along with the abolition of foreign trade restrictions within the integration association, it is characterized by the establishment of a single customs tariff and the implementation of a single foreign trade policy in relation to third countries. In a number of cases, the customs union is complemented by a payment union that provides for mutual convertibility of currencies and the operation of a single settlement monetary system.
Within the framework of the customs union, which is an integration structure more advanced than free trade zones, the participating countries are pursuing a coordinated foreign trade policy, mainly in the field of customs and tariff rules and procedures. This gives them the opportunity to regulate commodity flows in the interests of developing production, exports and better satisfying the import demand of the countries participating in the customs union. Practice shows that the customs union creates more attractive conditions for foreign investors, which also has a positive effect on the economic development of the participating countries.
If the tariff set at the external borders of the member countries of the customs union for any product becomes higher than the weighted average tariff that existed before the creation of the integration grouping, then the member countries limit external sources supplies in order to develop intra-union resources. Then it is possible joint development natural resources, new materials, technologies, science-intensive products to reduce dependency on imports. In the event that the level of the external tariff is set below the weighted average for the countries participating in the customs union, the latter are oriented towards the markets of third countries and, therefore, take measures to increase competition between domestic and foreign producers in order to create incentives for
domestic manufacturers to manufacture competitive products.
With further development, the process of integration of countries - members of the group reaches the form of a common market. It is marked by the signing of an agreement covering the "four freedoms" of crossing state borders - for goods, services, capital and people. In this case, the course of the integration process is determined by the level of development of factors of production and, to some extent, the coordination of foreign economic policy. In addition, the creation of a common market requires the harmonization of many industrial standards and regulations. At the same time, special attention is paid to the system of measures that prevent violations of norms and regulate competition.
The experience of the European Union (EU), which has implemented the common market stage, shows that the implementation of policies within this stage should be subject to mandatory compliance by the participating countries with mutually agreed regulations (on the basis of their national laws). At the same time, directives addressed to member states are also binding, but each country is given the freedom to choose the forms and methods of their implementation.
These three forms of international economic integration cover mainly the sphere of exchange, formally creating equal conditions for the participating countries for the development of trade and mutual financial settlements.
The most complex form of international economic integration with highly developed, strong, long-term foreign economic and political ties is an economic and monetary union. Upon reaching it, agreements on a free trade zone, customs union and the common market are supplemented by agreements on the conduct of a common economic and monetary policy. The consequence of the economic and monetary union is the introduction of supranational institutions for managing the integration community - the council of heads of state, the council of ministers, the central bank, etc.
At a certain stage in the formation of an economic and monetary union, it is envisaged to carry out a single monetary policy and introduce a single currency. These events are envisaged with the active participation of a single Central Bank. The practical experience of the functioning of the economic and monetary union is still very limited. The European Union switched to the use of the single currency "Euro" in non-cash payments in 1999. Since 2001, European countries have been switching to cash payments in the "Euro"
Further development and improvement of the forms of international economic integration can lead to the transformation of an integration association into a political union, i.e. to the formation of a confederal state with all the ensuing consequences, including the transformation of supranational governments into central governments with even greater powers and power. The Swiss Confederation of Cantons can serve as a prototype of a political union.
By the end of the 20th century, several dozen economic integration groupings emerged in the world: free trade zones, customs unions, currency and economic unions. The vast majority of them cannot realize the benefits of international economic integration due to the insufficiently high degree of development of economic and political relations, the primitiveness and structural non-differentiation of national economies, and the immaturity of market and financial structures.
At the same time, it should be noted that there are several progressive integration associations: in developed countries - the European Union (EU) and the North American Free Trade Association (NAFTA), in developing countries - the Common Market of the Southern Cone (MERCOSUR), the Association of Southeast Asian Nations (ASEAN ). Thanks to these really and effectively functioning integration groupings, it can be assumed that in the near future world economic relations will be a set of macroeconomic groupings that use the advantages of economic integration in various combinations of types and forms.
Firms are the driving force behind international economic integration. They are interested in achieving the optimal scale of activities, including through cooperation and cooperation with foreign companies within the region without customs and other restrictions. Firms use the benefits of integration in the following sequence: the expansion of sales markets creates the prerequisites for the revival of international trade; this, in turn, becomes an impetus for the reorganization of the production of goods and services and the revival of the economy. The latter creates incentives for the growth of investment and ultimately leads to higher profits.
At the same time, the corporate structure is being reorganized - as a result of market expansion, strong (but not necessarily large) firms become even more powerful, while weak ones that have found niches and held on to national markets cannot withstand competition in the international market, go bankrupt and are absorbed by stronger ones. With the elimination of borders and the unification of standards for requirements international market only strong dynamic enterprises can adapt.
In the conditions of international economic integration, at the level of participants in foreign trade transactions, the following economic effects are taken into account: no need to maintain trade missions in each country; the growth of the advantages of a narrow specialization of exports due to economies of scale; increasing demand within the region; increase in the degree of price competitiveness due to the elimination of tariff and non-tariff barriers: growing revenues that allow you to successfully master the markets of third countries.
At the macro level, it is taken into account that intra-regional trade becomes more efficient; there are new opportunities for
use of the optimal location of enterprises on the territory of the integration grouping; the costs of production and marketing of goods and services are reduced; Growing market capacity allows for higher R&D spending.
Rapprochement and merging of national economies leads to a significant revision of approaches to the development of many sectors of the national economy in each country and the need to coordinate and adapt domestic markets to the emerging common interests of the countries participating in the integration association. In this regard, there is a need to increase the level of regulation of interstate economic relations by limiting the sovereignty of each state and creating supranational governing bodies, whose functions include the development, coordination and control in certain areas of the economies of the countries participating in integration associations.
Restrictions on the sovereignty of integrating states can cause significant damage to entire industries in these countries. Thus, the terms of the agreement on the customs union, concluded between the European Union and Turkey in 1995, provided for the elimination of barriers (tariffs) in mutual trade. If this agreement was favorable for the Turkish economy as a whole, as it made it possible to receive preferential loans and grants from the EU, then its automotive industry, previously protected by a 40% protectionist tariff, suffered heavy losses from the influx of Western European cars into the country.
An example of protecting their sovereignty in pursuing an independent national policy in the monetary sphere is the refusal of Great Britain, Greece, Denmark and Sweden to join the introduction of a single pan-European currency - the euro - within the framework of the economic and monetary union of the EU member states from January 1, 1999.
The Belarusian leader is convinced of the expediency of "pairing the capabilities of countries with major international projects, primarily with the economic belt of the Silk Road." He reminded the participants of the meeting that his country is already actively participating in it, developing the Chinese-Belarusian industrial park "Great Stone". In addition, Lukashenka is confident that a broad dialogue between the Commonwealth and the Eurasian Economic Union will also contribute to stable relations between the CIS states.
The President of the Republic of Belarus proposed to instruct the CIS Executive Secretary and the Chairman of the Board of the Eurasian Economic Commission to intensify preparations for signing an updated memorandum on deepening cooperation between the EEC and the CIS Executive Committee. "This document will allow the Commonwealth partners to promptly and fully receive information on the development of Eurasian integration, to objectively assess the prospects for increasing cooperation in priority areas," he stated.
Lukashenko urged the CIS leaders to unite and take joint action "against the background of the destruction of the existing system of international trade," stressing that strengthening economic cooperation remains an invariable priority for Minsk in the Commonwealth. At the same time, he noted that world market relations are increasingly losing signs of civilized interaction between countries.
"At the instigation of the West, the system of international trade that has been created for decades is being categorically, unilaterally destroyed. The use of non-legal mechanisms is becoming the norm and puts our economies in a vulnerable position," the speaker noted. "On the one hand, we must join forces to jointly protect interests in the global market. On the other hand, we must intensify mutual trade and investment, expand industrial cooperation. Respond by consolidating and increasing the role of the Commonwealth as a regional player," Lukashenka said.
The President stated with regret that, in his opinion, it was not yet possible to fully formulate a theoretical model and create a practical strategy for economic integration in the CIS. He took the initiative to update the economic bloc in the Concept for the Further Development of the CIS, which, in his words, "may become the ideological basis for a more full use research and production and investment potential within the Commonwealth. It is necessary to reasonably link this with the development of the CIS Economic Development Strategy for the period after 2020."
According to the Belarusian leader, both the concept and the strategy should include modern guidelines and identify common points of economic growth.
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