Global systems

Question 1

Trade Agreements

Answer 1

There are various forms that trade groupings might take, including free tarde areas, custom unions, commons markets and economic/monetary unions such as the EU.

Question 2

OPEC

Answer 2

Organisation of Petroleum Exporting Countries

- aims to standardise price to prevent countries undertaking one another with cheaper price

Question 3

OECD

Answer 3

Organisation for Economic Co-operation and Development

- a global think tank for 30 of the world’s wealthiest nation

Question 4

Global advantages to nations which group together

Answer 4

• they encourage close global integration

- they tend to create big TNC’s, who are then big enough to operate around the world spreading culture

Question 5

Regional advantages to nations which group together

Answer 5

• free trade
• free movement
• allies - in times of war
• encourages wider flows of people/goods/capital between member nations

Question 6

Disadvantages to nations which group together

Answer 6

• they can reduce trade outside of the trade bloc
• slowing down global flows and leading to poorer nations being isolated
• they can lead to trade wars between trade blocs reducing global flows

Question 7

NAFTA

Answer 7

North American Free Trade Agreement

• established in Jan 1994 to eliminate tariffs
• from US point of view all countries would be better with free trade as they specialise in what they are good at
• visible trade with USA increased by 80% during the first 5 years.