Example Of Critical Thinking On Major Trends In Global Business
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This paper will discuss about international trade agreements between the regions of North America with Mexico and will likewise discuss international trade agreements among the six countries in of the Arab States and how these trade agreements benefit them. This research was conducted online using the official websites of the North American Free Trade Agreement (NAFTA) and the official website of The Cooperation Council for the Arab States of the Gulf (GCC). The results of these agreements have been very vital in global marketing. This paper examines the agreements of these two regions in order to understand how these agreements fostered international trades.
We now live in the world of globalization where business is facilitated through the use of modern technology in communication such as the internet and online banking. With the growth in global marketing many countries took advantage of this technology to improve business transactions. One major business trend is the creation of trade agreements among regional states. In North America, the United States and Canada along with Mexico (NAFTA) agreed on a free trade agreement last January 01, 1994. This is now the largest free trade agreement in the world for a particular region. In the Middle East Arab states agreed to go into trade agreement last December 31, 2001 and called the union as The Cooperation Council for the Arab States of the Gulf (GCC).
The NAFTA sets the rules of international trade and investments for the member countries like the United States, Canada and Mexico. It has eliminated the tariff and non-tariff barriers for Canada, the United States and Mexico in doing trade and investments. The NAFTA has established and strengthen the framework for investment. Many investors and business, small and large have benefited in the agreement which resulted in doubling merchandise trades between Canada and the United States while trades between Mexico and the United States has grown leap and bound to more than quadrupled. The combined trades sums up to a gross domestic product of US$16.2 trillion and has benefited 439.8 million people. On the other hand the GCC of the Arab States proudly unified these countries as one big region in trading
The Cooperation Council for the Arab States of the Gulf is principal in coordinating, integrating and interconnecting its six member states namely: The United Emirates, State of Bahrain, Kingdom of Saudi Arabia, Sultanate of Oman, State of Qatar, and the State of Kuwait. Their purpose is to achieve monetary and economic union between members by unifying their investment-related laws and regulations. So, Member States“shall draw their policies and conduct economic relations in a collected fashion in dealing with other countries” (GCC Art.III). For their regional and international aid, Member States shall “coordinate their external policies related to international and regional development aid. To further assist its members, it eliminated all tariff and non-tariff barriersgoods produced in any member States shall be accorded the same treatment as national products. With regard to oil, gas, and natural resources, Article Nine of the agreement states: “Member States shall adopt integrated policies in all phases of oil, gas and minerals industries to achieve optimal exploitation of natural resources, while taking into account environmental considerations and the interests of future generations. Member States shall adopt unified policies for oil and gas, and take common position into this regard towards non-member states and at international and specialized organizations. Furthermore, Member States and oil and gas companies working within them shall cooperate in supporting and developing research I the fields of oil, gas and natural resources and enhance cooperation with universities in these fields”. The world sees them as one Arab bloc or the Oil Petroleum Exporting Countries (OPEC). Thus, when these OPEC countries declare an embargo on oil, it will affect the whole business world.
In order to facilitate investments and trade, the NAFTA and GCC members are into digitalization in their conduct of international trades. Payments or settlement of exported oil becomes easier and faster through online banking which also uses the internet. These two regions will not be able to maximize global marketing of their goods and services without the use of the internet.
North-American-free-trade-agreement-nafta website. Retrieved 02 Feb.2015 https://ustr.gov/trade-agreements/free-trade-
The Cooperation Council for the Arab States of the Gulf website. Retrieved 02 Feb 2015
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