Are regionalism and globalisation compatible or contradictory trends?

Résumé du document

Nowadays, it is paradoxical to see the development, in a global world, of several types of regions. This process began after the Second World War, with the development of the international trade flows between economies. The creation in 1957 of the European Economic Community, by the Treaty of Rome, has launched this phenomenon. In response to this trend, other countries in the world, seeing the creation of this bloc, have created free trade areas, customs unions or common markets. Thus, we have seen the creation of the American Common market in 1960, the African Common Market in 1962 and other forms of regional protectionist unions. This phenomenon can be assimilated as the ‘Old Regionalism', which had a tendency to create regional integration agreements and further the form of defensive protectionism.

Extraits

[...] This form of protectionism has been seen as a new opportunity to build a new basis of liberalization in the world trading system. The Regionalism' is a concept aiming to balance the nation state decreasing power and the uncontrollable liberalization of the economic trading flows. Nevertheless, we can wonder if regionalism and globalization are contradictory or compatible. Furthermore, is regionalism an inevitable step to enter into globalization? Or is the increasing regionalization a hindrance to the development of globalization? There are many questions that need answering in order to understand the process of regionalization in the globalization environment. [...]

[...] Regionalism goes against the power leaking and sovereignty loss phenomenon by creating union of nation-states in the same area. These unions are based on free trade agreements, regional integration agreements and tariff policies, giving back some sovereignty to the members and indirectly to the involved nation-states. To summarize, the nation-states cluster into a larger region to keep and retain their lost economic and political sovereignty. The following figure (Figure 1.1 ) shows that there is an increasing number of regional integration agreements and proves that regionalism is an ongoing and growing trend. [...]

[...] The regionalism process often goes hand in hand with the creation of several institutions. For example, the creation of the European Union has been followed by the creation of several institutions such as the European Central Bank, the European Council, the European Commission, etc. These institutions control the mechanism of the European Union and they also represent its member in WTO negotiations. Without this system, every country could go and bargain independently. Regionalism simplifies the decision making process and makes things happen faster. [...]

[...] In following these arguments, regionalization appears to be travelling down the same trend as globalization and supporting its development. Countries are included in a global environment, meaning that all the political, social and economic policies are integrated and influenced by the globalization process, which is in turn regulated by the supranational World Trade Organization. In this environment, the power of nation-states is more and more limited; it implies that nation-states are losing sovereignty and autonomy in front of the globalization trend. [...]

[...] Countries have a greater reliance on bilateralism than on the regional approach to trade but long-term result of bilateralism could be a deterioration of the world trading system into competing, discriminatory regional trading blocs, thereby stifling world trade” To conclude, regionalization can be seen as an inevitable process operating alongside globalization by supporting the weakest economies and by allowing them a greater chance of integration into the world trading system. Regionalization can be considered a step toward globalization and to the liberalization of trading. Even in some cases, it can be assimilated as a form of protectionism that can, in the long run, threaten globalization. [...]