Role of Regional Economic Groupings in the Devlopment Process
THE ROLE OF REGIONAL ECONOMIC GROUPINGS IN THE DEVLOPMENT PROCESS
DENFORD JERE[1]
REGIONAL ECONOMIC GROUPINGS (REGs) aim to create larger economic units from smaller national economies and for this purpose, they aim to remove trade barriers and establish closer co-ordination and co-operation among the countries involved (Parsons, 2000: 1). They have also been recognized as a means towards expanding trade and investment opportunities, and for promoting economic growth and sustainable development (United Nations, 2007). Such groupings are therefore playing an increasingly influential role in shaping economic futures, mainly in developed countries (Parsons, 2000: 1) and thus the need to explore the potential benefits these trade arrangements hold for developing countries and establish their role in the development process. Regionalism has become part of the global economic environment and thus affects developing countries as well, whether or not they participate in it. Understanding its implications can only help them to better cope with it. Leading writers on international trade such as Appleyard and Field are of the opinion that for developing countries, regional economic integration offers advantages such as larger markets and possible economies of scale (Appleyard and Field, 2001: 357). However, they feel that the ability to take advantage of such benefits lies in countries’ willingness to give up some national economic control and on solving the basic problem of how to distribute the benefits amongst members. To clearly understand how regional economic integration can support the development process of less developed countries, there is great need to first explore the underlying structures and the different forms of regional economic groupings. This would help in understanding how these groupings work as well as their potential benefits. As a matter of study, looking at how well these groupings have done elsewhere, particularly in the regions
DENFORD JERE[1]
REGIONAL ECONOMIC GROUPINGS (REGs) aim to create larger economic units from smaller national economies and for this purpose, they aim to remove trade barriers and establish closer co-ordination and co-operation among the countries involved (Parsons, 2000: 1). They have also been recognized as a means towards expanding trade and investment opportunities, and for promoting economic growth and sustainable development (United Nations, 2007). Such groupings are therefore playing an increasingly influential role in shaping economic futures, mainly in developed countries (Parsons, 2000: 1) and thus the need to explore the potential benefits these trade arrangements hold for developing countries and establish their role in the development process. Regionalism has become part of the global economic environment and thus affects developing countries as well, whether or not they participate in it. Understanding its implications can only help them to better cope with it. Leading writers on international trade such as Appleyard and Field are of the opinion that for developing countries, regional economic integration offers advantages such as larger markets and possible economies of scale (Appleyard and Field, 2001: 357). However, they feel that the ability to take advantage of such benefits lies in countries’ willingness to give up some national economic control and on solving the basic problem of how to distribute the benefits amongst members. To clearly understand how regional economic integration can support the development process of less developed countries, there is great need to first explore the underlying structures and the different forms of regional economic groupings. This would help in understanding how these groupings work as well as their potential benefits. As a matter of study, looking at how well these groupings have done elsewhere, particularly in the regions
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