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60
Chapter 9
Regionalism and the Global Trade Regime
Multiple-Choice
1) In some respects FTAs are more trade diverting than CUs because
a) FTA members usually raise their tariffs when they form the FTA.
b) FTAs are less unified than CUs, and this contributes to more trade
diversion
c) FTAs tend to have higher countervailing duties.
d) FTAs tend to have more restrictive rules of origin
2) The Eurasian Economic Union provides an example of
a) supranationalism.
b) plutocracy.
c) neofunctionalism.
d) liberal intergovernmentalism.
3) GATT working parties
a) agreed only a small number of times that an RTA met Article 24
requirements.
b) never reached a consensus that an RTA met Article 24
requirements.
c) usually reluctantly agreed that RTAs met Article 24 requirements.
d) agreed only a small number of times that an RTA did not meet
Article 24 requirements.
supranational institutions?
a) institutional liberals.
b) liberal intergovernmentalists.
c) neofunctionalists.
d) constructivists.
5) The United States and Canada were able to negotiate an FTA in 1988
because
a) The United States actively sought negotiations with Canada to form
an FTA.
b) The United States began to favor RTAs over multilateral
agreements.
c) The United States viewed greater access to the Canadian market as
a means of decreasing its growing balance of trade deficits.
d) The United States reversed its policy on RTAs.
sovereign prerogative to levy its own ADDs and CVDs?
a) United States.
b) Mexico.
c) Canada.
d) All three countries.
7) The theorists most likely to view small states as benefiting more than
large states from open regional trade agreements (RTAs) are
a) liberals.
b) historical materialists.
c) neomercantilists.
d) none of the above.
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8) RTAs in the South in the 1960s were designed mainly to
a) promote free trade among the member states.
b) attract more foreign investment from the North.
c) increase their exports to the North.
d) promote import substitution at the regional level.
9) RTAs in the first wave (the 1950s-60s) included
a) some RTAs with members from different geographic regions.
b) a few RTAs between DCs and LDCs.
c) only members from the same geographic region.
b) both plurilateral and bilateral groupings.
10) The main legal basis permitting LDCs to form RTAs that do not meet
GATT Article 24 requirements today is
a) the generalized system of preferences.
b) GATT Part IV on trade and development.
c) the enabling clause.
d) the LDCs renewable waiver from the MFN clause.
11) If members of an RTA eliminate tariffs and have a common external
tariff, they have formed
a) an economic union.
b) a customs union.
c) a common market.
d) a free trade area.
12) CUs are more trade diverting than FTAs in some respects because
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a) CUs are at a higher stage of integration than FTAs.
limit imports to the entire CU region.
c) CUs usually have more restrictive rules of origin than FTAs.
d) CUs tend to increase their external tariff when they are formed.
13) NAFTA
a) as a more open FTA, has liberal rules of origin.
b) has a negative list approach to national treatment for trade in
services.
c) was formed when the United States sought negotiations with
Canada and Mexico.
d) has a positive list approach to national treatment for trade in
services.
14) Which of the following does not give special treatment to LDCs?
a) the Lomé Convention.
b) Part IV of GATT.
c) NAFTA.
d) the enabling clause.
15) The first significant trade agreement to include an environmental side
agreement was the
a) European Union.
b) European Community.
c) NAFTA.
d) Canada-U.S. Free Trade Agreement.
True-False
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1) The Schengen Agreement led to the abolition of border checks among all
EU members.
2) GATT never explicitly concluded that an RTA did not meet GATT
3) The United States and Canada first had an agreement providing for free
trade in natural products in the 1980s.
4) Although liberals tend to view RTAs as a second-best option, they
generally agree that RTAs do not pose a threat to the global trade regime.
5) In the first wave of regionalism (the 1950s-60s), the United States
opposed all RTAs and would not join them.
6) NAFTA was the first reciprocal RTA with both DC and LDC members.
7) There is an inherent contradiction between GATT Article 1
(unconditional MFN treatment), and GATT Article 24 (permitting states to
form RTAs).
Fill in the Blank
1) If Congress grants _________________________ to the U.S. President,
the Congress can then only approve or reject trade agreements without
amending them.
posits that the EU
rests on a series of bargains between member states that are self-interested
and rational in pursuing their economic interests.
3) The large movement of refugees and other migrants from Syria, Iraq and
elsewhere to Europe in 2015 have raised questions about the long-term
viability of the ____________________.
4) The ____________________ states that ACP-EU reciprocal economic
partnership agreements will gradually replace the nonreciprocal preferences.
5) states that international
socio-economic cooperation is necessary for resolving political conflicts and
eliminating war.
6) If a group of countries eliminate tariffs on substantially all trade with each
other, institute a common external tariff, and have free mobility of labor and
capital, they have formed a ___________________.
7) GATT Article 24 permits countries to form FTAs and customs unions that
do not adhere to _______________ if the agreements meet conditions that
make them more trade creating than trade diverting.
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Essay
1) Liberals disagree among themselves as to whether or not RTAs today
present a serious threat to the multilateral trade regime. Discuss the
arguments of both sides in this
you find most convincing.
2) What special problems do FTAs among LDCs such as Mercosur have in
achieving regional integration? How are politics and economics intertwined
in Mercosur?
3) In what ways do LDCs receive special treatment as members and
associate members of RTAs? Discuss the enabling clause, and the EU in
your answer. Does Mexico receive special treatment in NAFTA?
4) How do neomercantilists, liberals, and historical materialists explain the
rise of regional integration?
5) Discuss the efforts to create a Trans-Pacific Partnership (TPP)
Agreement, the potential importance of the TPP, and possible obstacles to
the final approval of the agreement.
6) What are the similarities and differences between a customs union, a free
trade area, an economic union, and a common market? Do RTAs usually fit
completely within one of these stages of integration?
7) In what ways can RTAs be trade creating and trade diverting? Which of
these effects of RTAs do you think is more important and why?
8) What conditions does GATT Article 24 impose on RTAs? How
successful has the GATT/WTO been in regulating RTAs, and why?
9) What are the neofunctionalist, liberal intergovernmentalist, and
constructivist theoretical approaches to economic integration, and why are
they applied mainly to the EU today? What is the theory of plutocratic
delegation (or plutocracy)?
10) What are some of the accomplishments and shortcomings of NAFTA as
an RTA today?
