Regional Trading Blocs : The Eu And Asean ( Association Of Southeast Asian Nations )

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The purpose of this report is to compare and contrast two regional trading blocs: the EU and ASEAN (Association of Southeast Asian Nations) and also to discuss and analyse the implications for the marketing managers that operate in these blocs. Schott (1991) defines a trading block as a type of intergovernmental agreement that aims to reduce regional barriers to trade for the participating states. This report will look at the similarities and differences between the two blocs in the first part, with the second part looking at the implications for marketing managers and the advantages and disadvantages that they have in both trading blocs. Background information for EU and ASEAN will be considered in this report along with the role of WTO…show more content…
According to IMF World Economic Outlook Database from April 2015, the GDP in the EU is estimated at $16.44 trillion and the GDP per capita of $32498(at the time of access) and it sports an increase in the Human Development Index( the figures mentioned above don’t include the newest member Lithuania who joined the EU in 2015). ASEAN (The Association of Southeast Asian Nations), just like the EU is a political and economic organisation formed in 1967 after the signing of the ASEAN Declaration (also known as the Bangkok Treaty) in Thailand. It started with only five members but at the moment it has ten members and it aims to achieve economic growth, peace and stability in the region, social progress and sociocultural evolution. (Long, 2014) In 1990, Malaysia tried to create the East Asia Economic Caucus. It supposed to be composed of the ASEAN members plus China, Japan and South Korea but it failed after suffering heavy opposition from US and Japan. ASEAN has a nuclear free zone treaty signed in 1995. The treaty became fully effective in 2001 and it bans all nuclear weapons in the area. In order to better integrate the region, in 1997 ASEAN created and organisation known as ASEAN plus Three to improve its existing ties with China, Japan and South Korea. (asean.org) IMF estimates ASEAN’s total nominal GDP at $2.40 trillion and the GDP per capita at $3909 in 2013. Unlike the EU, ASEAN has ten currencies instead of one, with each member
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