It could also give special priority to projects that foster regional integration efforts between one or more economies across the Indian Ocean’s three sub-regions (e.g., projects between African and South Asia economies). You can be signed in via any or all of the methods shown below at the same time. Within the Indian Ocean, East Asian and Pacific ports dominate container traffic, accounting for 63 per cent of total regional container traffic in 2017. This article examines increasing regional economic integration in the Indian Ocean, along with the region’s rising importance in the global economy and outlines the challenges to greater regional integration. Services trade takes different forms, including selling a service across national boundaries, setting up a subsidiary, sending an employee overseas to provide a service, as well as tourism and educating foreign students.77https://www.wto.org/english/tratop_e/serv_e/cbt_course_e/c1s3p1_e.htm Similarly, services trade barriers can range from licensing or accreditation to provide a service in a country, to restrictions on foreign companies in certain sectors or even tourist visa fees. The Economic Commission for Africa (ECA) became the champion of regional integration, already in the mid-1960s proposing the division of Africa into regions for the purposes of economic development. 13ASEAN Political-Security Community, ASEAN, Economic Community and ASEAN Socio-Cultural Community. The age-long practice of the individual survival of nations have long given way to the emergent concept of integration and cooperation among states as an option to meeting the collective development needs of the cooperating states. 12Notified as in force to the WTO and included in its Regional Trade Agreement database. March 2009. (. Today, the Indian Ocean hosts 23 of the world’s top 100 container ports.33According to the 2017 Lloyd’s List Top 100 Container Ports Rankings. A large amount of research in this area is focused on the growing strategic and economic rivalry between India, the largest Indian Ocean littoral state and China (Bastos, 2014; Brewster, 2014; Chaudhury & Basu, 2016), though Mohan (2017) and Mendis (2012) have also considered the strategic importance of the Indian Ocean for Europe and the United States, respectively. Assessing barriers to trade in services is more challenging than for goods. The first is how to build regional blocs that go beyond trade to include industrial policy, a shared agricultural policy, macroeconomic coordination, and technology sharing. Globalization has ended in massive failure. This would increase market access, reduce trade barriers and facilitate regulatory coherence. Looking ahead, the Indian Ocean’s economic rise is also susceptible to several challenges that could yet undermine further economic integration and the region’s prosperity. For instance, the CIA World Factbook 2018 (Central Intelligence Agency, 2018) says: The Indian Ocean provides major sea routes connecting the Middle East, Africa, and East Asia with Europe and the Americas. Regional Integration is a process in which neighboring countries enter into an agreement in order to upgrade cooperation through common institutions and rules. Tackling these challenges requires a combination of coherent national and regional policy measures. Benefits Of Regional Economic Integration. He is the author of 15 books, the latest of which is The Food Wars (New York: Verso, 2009). I propose these as some of the key questions to guide our discussion of regional integration over the next two days. One item that fascinates us is the use of barter as a key method of trade, for instance, the exchange of Venezuelan oil for Bolivian soybeans or of Venezuelan oil for medical services rendered by Cuban volunteers. Benefits of Regional Economic Integration. These includes gaps in port infrastructure and onerous customs procedures, NTMs, barriers to services trade and restrictions on FDI. It focuses on the strategic risks that threaten the economy’s security and, therefore, could ultimately undermine its economic prosperity. Free trade area.This is the most basic form of economic cooperation. A case thus exists for external development assistance and knowledge transfer to support the middle-income transition in the Indian Ocean economy. For example, the IMF produces a bi-annual World Economic Outlook report as well as several Regional Economic Outlook reports, including for the Asia-Pacific, Sub-Saharan Africa, the Middle East and Central Asia (IMF 2018a, 2018b). See, ADB (2010) and Wignaraja (2014). Free trade area. partnership agreements with the European Union and the global economic crisis, regional integration is ‘signifi cantly challenged’ as an approach to the sustainable development of economies. Free trade area. Meanwhile, world growth slipped from an annual average of 4.3 per cent to just 3.6 per cent in the two sub-periods. In the Indian Ocean, it takes an average of 65 hours for border compliance (see Table 2). Challenges of Integration in West Africa Asante (1999) grouped integration challenges of ECOWAS into political, financial, approach or method and the existence of multiple regional bodies in the sub-region (rationalization). Research has also looked at the specific economic cost of non-traditional security threats in the Indian Ocean, particularly piracy off the coast of Somalia. The idea of the blue economy emerged at the United Nations Conference on Sustainable Development held in Rio de Janeiro in 2012 (UNCTAD, 2014, p. 2). Overall Indian Ocean container traffic was equivalent to 22 per cent of global container traffic in 2017. What Is Regional Economic Integration? Source: LKI calculations based on IMF (2018d). Amidst fiscal constraints, many Indian Ocean economies need to undertake public investment in port development and customs modernisation. Designed by Elegant Themes | Powered by WordPress, Why Obama will read the riot act to Arroyo, #RiceNotBullets: Denial of food and Shooting of Farmers are Both Forms of Violence, Human Rights Violations, กลไกระงับข้อพิพาทระหว่างรัฐและนักลงทุนในข้อตกลงความร่วมมือหุ้นส่วนยุทธศาสตร์ภาคพื้นเอเชีย-แปซิฟิก (Trans-Pacific Strategic Economic Partnership Agreement: TPP), DISCLOSURE,OR DECEPTION? Reflecting the expansion of maritime trade in the Indian Ocean, trade volumes with the world have grown rapidly. Accepted 12 September, 2008 Regional integration is increasingly being accepted as essential in facilitating economic and political development. Regional integration helps countries overcome divisions that impede the flow of goods, services, capital, people and ideas. This paper examines regional economic integration challenge in Africa locating key issues within theory and practice. Civil society must not only provide a check to both the state and the market, but it must be the leading force in the new economics. Furthermore, RCEP addresses the special needs of less-developed ASEAN economies through early elimination of tariffs on products of interest to them and through the provision of development assistance to narrow development gaps. The simple average tariff rate55The simple average tariff level is the unweighted average of the effectively applied tariff rates for all products. Stages of economic integration . CHALLENGES AND PROSPECTS OF REGIONAL INTEGRATION IN AFRICA: A CASE STUDY OF EAST AFRICAN COMMUNITY BY DAVID NGOCHI NGARI Reg. The challenges of regional integration in Africa • page 1 Paper 145 • June 2007 Introduction It is widely acknowledged that Africa’s integration efforts have thus far failed to bear satisfactory fruit. Variations between the sub-regions seem likely. These are (a) port and customs quality, (b) barriers to trade and investment, (c) development gaps, and (d) nascent regional economic governance. Regional integration is viewed as a significant initiative with regard to stimulating economic growth amongst member states and enhancing intraregional trade, security initiatives, and bilateral and multilateral agreements. Members of _ can log in with their society credentials below, Ganeshan Wignaraja, Adam Collins, and Pabasara Kannangara. Available online: http://investmentpolicyhub.unctad.org/. aspects of the Trade Protocol in some detail, as it is the heart of regional integration and ends with the cooperation between SADC and the International Cooperating Partners. Regional economic integration refers to the agreement amongst countries within a certain geographic area for reducing and ultimately removing tariff barriers, making sure there is better flow of services or goods through the respective nations. The email address and/or password entered does not match our records, please check and try again. In March 2018, The UN classified 10 regional economies across the three sub-regions as LDC including Bangladesh, Cambodia Comoros, Madagascar, Mozambique, Myanmar, Somalia, Tanzania, Timor-Leste and Yemen.99https://www.un.org/development/desa/dpad/least-developed-country-category/ldcs-at-a-glance.html LDCs face significant structural impediments to sustainable development and typically have lower per capita incomes than other regional economies. A second strand of research focusing on the economic aspects of the Indian Ocean is located within the confines of the concept of the ‘blue economy’. There are four main types of regional economic integration. The main regional projections are (Wignaraja, Collins, & Kannangara, 2018): The Indian Ocean economy’s share of world trade in goods and services is expected to rise from 13.1 per cent to 15.7 per cent between 2017 and 2025. Abstract: Regional integration is useful for economic, political and social development of countries. In reality the question of regional integration is also related to an extraordinary … R50/82648/2015 A RESEARCH PROJECT SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR AWARD OF MASTERS OF ARTS DEGREE IN INTERNATIONAL STUDIES October 2016. ii . In Africa in particular, there has been a clamor and trend towards integration with numerous regional blocs being formed in various regions of the continent. CARICOM is one of the oldest integration schemes in the Western Hemisphere, the largest in terms of membership, yet by far the smallest in economic and geographic terms. The pace of the region’s container traffic and its goods and services trade have slowed since the crisis. More fundamentally, skills deficits and difficult business environments deter export-oriented FDI that would allow LDCs to engage in trade in higher value-added sectors. This paper examines the challenges and prospects of African regional integration with the focus on Southern Africa. Voyer et al. These include escalating trade conflicts between major economies, rising interest rates driven by the tightening of monetary policy in advanced economies, rising oil prices and waning investor confidence in emerging markets. And while analysis has tended to point to substantial potential for regional cooperation in the Indian Ocean (Dabee & Reddy, 2000), it has also highlighted the major challenges of progressing a regional agenda due to the diversity of the region’s littoral states. In terms of geography and demography, the Indian Ocean’s global presence is even more significant. Council on the important role that regional integration and free trade agreements can play “in the establishment of a more equitable world trade system” and therefore fully support and encourage regional integration among developing countries (European Parliament, 2002, p.14). Encouragingly, the share of aid to LDCs increased from 37.5 per cent to 50.2 per cent over the same period. 7/No. Gradually reducing barriers to trade and investment would support trade-led growth in the Indian Ocean. challenges to regional integration in africa: the case of the revived east africa community 2000-2012 gichohi marvin muhammad r50/69883/2011 a thesis submitted in partial fulfillment for the degree of master of arts in international studies.institute of diplomacy and international studies, university of … If you have access to a journal via a society or association membership, please browse to your society journal, select an article to view, and follow the instructions in this box. Economic integration, or regional integration, is an agreement among nations to reduce or eliminate trade barriers and agree on fiscal policies. Similarly, the weighted tariffs are higher on agricultural goods than manufactures and minerals. This article looks at the global and regional integration of the Indian Ocean economy, with a view to identifying challenges to greater integration. Key actions would include (a) investing in port development and customs modernisation through national and mega-regional initiatives, (b) gradually reducing barriers to trade and investment, (c) setting up an IODF to support LDC participation in trade-led growth and to facilitate knowledge transfers to MICs, and (d) strengthening regional economic governance through appointing an EPG on IORA and linking sub-regional and bilateral FTAs to RCEP. The integration processes are complex, due to the controversies that arise among its members. … The book … However, the continued rise and economic dynamism of the Indian Ocean economy is not guaranteed. The concern for regional cooperation and integration in Africa predates independence. 5The simple average tariff level is the unweighted average of the effectively applied tariff rates for all products. II. Gaps in ports infrastructure and onerous customs procedures are an important barrier to maritime trade as they increase the cost of moving products across borders (De, 2009). Trades in different countries have certain restrictions as well as some tariffs, which can be issued in a very discriminatory manner for sure. That said, there has been a renewed interest in IORA more recently, with the organisations first heads of government meeting being held in March 2017 (Waidyatilake, 2017), though this has not been accompanied by additional research assessing the emerging challenges that regional cooperation in the Indian Ocean faces today. Furthermore, the share of population in poverty is likely to halve to 7 per cent by 2025. Asian Development Bank, Asian Economic Integration Report 2018 Toward Optimal Provision of Regi... UNESCAP and UNCTAD, Asia-Pacific Trade and Investment Report 2019: Navigating Non-tariff Measur... Ecosystem-based fisheries management and the precautionary approach in... Asian Development Bank (ADB) & Asian Development Bank Institute (ADBI) . Adding to this, the tangle of regional institutions are about 10 bilateral FTAs that involve Indian Ocean economies. Similarly, intra-sub-regional trade in Africa and the Middle East has nudged up from 8.4 per cent to 11.1 per cent of total trade between 2000 and 2017. Early work by Walker (2008) provides a broad overview of the changing geo-political and economic landscape of the Indian Ocean. These inter-governmental institutions have limited powers delegated by members, lack formal rules or legal structures, have inadequate financial resources and lack permanent secretariats. However, they can have disadvantages, too. Available at: http://www.oecd.org/investment/fdiindex.htm, accessed on July 2018.—is only available for a few Indian Ocean economies. 1. See, ADB (2010) and Wignaraja (2014). Somalia, Yemen. Goods and services trade links within the region and beyond have deepened to an unprecedented extent. However, the bulk of such aid is concentrated in three LDCs—Myanmar. 14A full list of bilateral FTA in the Indian Ocean is available in Wignaraja Collins, and Kannangara (2018). No. Total foreign aid to Indian Ocean economies as a group, doubled from US$ 12.4 billion to US$ 25.1 billion between 2000 and 2016.1010This accounted for 15.9 per cent of world ODA flows in 2016, but is less than US$ 10 per person. These countries could find themselves stuck in the ‘missing middle’ of development finance, when total resources available fall as the country moves from low until well into middle-income status (Wignaraja et al., 2018). A value of 7 in the scoring system used shows the best possible situation and 1 the worst. The challenges confronting us today cannot be met by either neoliberalism or the old developmentalist model. However, these competing large-scale initiatives and donor programmes may also present some challenges to recipients, including a lack of coordination between competing donors, differing social and environmental standards, insufficient progress on the domestic regulatory reforms needed to maximise the benefits of new infrastructure and risks to debt sustainability in recipient economies (see Hurley, Morris, & Portelance, 2018; Yoshimatsu, 2017). The sixth section concludes with policy implications. For more information view the SAGE Journals Article Sharing page. Dealing with all the challenges facing such a vast region, including issues as diverse as climate change, maritime security threats and poor national governance is beyond the scope of this study. challenges of African regional integration. (, Hussain, M. G., Failler, P., Karim, A. OVERVIEW OF RULES (1) Regional Integration In addition to the global economic regime based on the GATT and IMF systems, which has sustained the world economy since World War II, regionalism, through which neighbouring countries seek to strengthen their economies by entering into some form of “regional integration” has become a major trend. For instance, it is below US$ 100 per person even in Mozambique where the poverty rate is around 60 per cent. However, as the blue economy concept narrowly refers to the economic importance of ocean resources and ocean-related sectors in a given economy, it excludes the full breadth of economic activity that takes place in the 28 Indian Ocean economies and could be affected by the knock-on impact of a deterioration in maritime security. Note: As share in sub-region’s total trade (%). One step would be to undertake the appointment of an Eminent Persons Group (EPG) from member states tasked with developing a plan to strengthen IORA’s role in regional economic governance. Some of the disadvantages of regional economic integration include a shifting of the workforce, less efficiency in trade, creation of trade barriers to non-members and loss of sovereignty to some extent. Intra-Indian Ocean trade also appears to have expanded, increasing modestly from 24.7 per cent of the region’s total trade in 2000 to 27.2 per cent in 2017. This site uses cookies. View or download all content the institution has subscribed to. Sequencing Sign in here to access free tools such as favourites and alerts, or to access personal subscriptions, If you have access to journal content via a university, library or employer, sign in here, Research off-campus without worrying about access issues. These divisions are a constraint to economic growth, especially in developing countries. The Indian Ocean economy grew by an annual average of 5.6 per cent per year during 2000–2008 and slowed slightly to an average of 5.1 per cent in 2011–2017, led by a strong performance in South Asia (see Figure 4). March 3-4, 2016. The near-term outlook for the Indian Ocean economy also appears more favourable than the for the world economy as a whole. After establishing a single market in the early 1990s, the integration culminated in 1999 with the introduction of the euro in initially 11 EU Member States, which were joined by Greece in 2001, and … After a literature review in the second section, this article undertakes three related empirical tasks on the period since 2000. Posted by admin | Jul 26, 2009 | Alternative Regionalisms, Deglobalisation, Philippines, Trade and Investment, By Akbayan Representative Walden Bello* (Speech at the Conference on “Regional Integration: an Opportunity Presented by the Crisis,” Universidad de Deportes, Asuncion, Paraguay, July 21-22, 2009.). This structural change is a key source of gains from trade but brings with it costs of adjustment (Francois, Jansen, & Peters, 2011). This article examines the global rise of the Indian Ocean economy and the challenges to building greater economic linkages within this region. Container traffic through the region’s ports has expanded significantly. Forecasts suggest that the Indian Ocean economy will likely account for around a fifth of global GDP by 2025 and its GDP per capita is expected to almost double. The share of the region’s population living in extreme poverty (defined as an income level of less than US$ 1.90 per day) could fall from 11.8 per cent in 2017 to 7 per cent by 2025. Fishing fleets from Russia, Japan, South Korea, and Taiwan also exploit the Indian Ocean, mainly for shrimp and tuna. Note: 2018–2020 data are based on the continuation of post-crisis average growth rate. He goes so far as to call IORA ‘a regional non-starter’ as its members are too diverse and geographically scattered for any meaningful integration to take place. A. Cumbers, in International Encyclopedia of Human Geography, 2009. The multiple spokes include several mostly smaller sub-regional institutions that count Indian Ocean economies among their membership. LDCs also rely on trade-related taxes for a larger share of their revenue as limitations in tax administration capacity and large informal sectors undermine the efficacy of other forms of taxation (Burgess & Stern, 1993), which further raises their trade costs. Africa and the Middle East (23 days) is the worst performing sub-region. But the nature of global integration is changing, entailing new challenges for policymaking. 4. Finally, the last I would mention is how to undertake a process of regional integration that transcends the logic of capitalism, to borrow the words of Hugo Chavez. The third is how to promote a development process that does not reproduce social inequalities at the regional and national levels in the name of capital accumulation. Political motives, geography, and the uneven distribution of gains trumped the traditional efficiency gains across Africa’s Regional Economic Communities (RECs). Significant economic progress over recent decades notwithstanding, development disparities and capacity gaps remain between Indian Ocean economies (see Figure 10). In addition, as Table 1 shows, the 28 countries within the Indian Ocean economy are extremely diverse. It has given nations the options of cooperation and competition. REGIONAL INTEGRATION IN AFRICA: THE CHALLENGES AND ACHIEVEMENTS OF INTERGOVERNMENTAL AUTHORITY ON DEVELOPMENT (IGAD) Ipinmoye Ayodele Olu* & Saleh Dauda** Department of Political Science and International Relations, University of Abuja, Abuja Abstract: This paper examines the concept of regional integration as a process in which Currently, regional integration processes are being adopted through market processes that are independent of the government. 7https://www.wto.org/english/tratop_e/serv_e/cbt_course_e/c1s3p1_e.htm. South Asia’s trade with itself has only marginally increased from 3.2 per cent of its total trade in 2000 to 3.6 per cent in 2017. Login failed. The discrimination is something which depends on community and country discrimination as well. While the IMF, the World Bank, and United Nations (UN) provide regular country and regional macroeconomic analysis, this has been confined to more traditional geographic groupings typically based on shared land borders. Note: Data not available for Comoros, Iran, Somalia and the Maldives. (2018) link the blue economy to maritime security in the Indian Ocean by pointing to a peaceful ocean as both an enabler of a prosperous blue economy and a potential source of economic development and growth. Trade volumes in the Indian Ocean grew by an annual average of 9.4 per cent from 2000 to 2008, though growth settled at a slower average of 4.8 per cent from 2011 to 2017 after the global financial crisis. 2Authors calculations based on data from the Food and Agriculture Organization. About 35 per cent of the world’s total population live in the Indian Ocean economy, with the majority living the South Asian sub-region (20.9 per cent). Daily Trust (Abuja) opinion By Abubakar M. Sambo. History shows that many states across the globe enter into regional agreements for economic purposes. Chapter III examines the external challenges facing the region today, particularly as regards its trade relations with Europe, the United States, Canada and Latin America. A third strand of research examines the possibilities for regional economic cooperation primarily through the IORA, which counts 21 littoral states as members. This paper therefore, examines the current African integration efforts in the age of globalisation in a bid to show the current development and future challenges. 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Among the most outstanding features of the current processes of regional economic integration are: 1. HEADQUARTERS 10This accounted for 15.9 per cent of world ODA flows in 2016, but is less than US$ 10 per person. But in terms of trade-led growth and the potential for greater regional economic integration, four challenges appear most pressing. The EAC seems to be the most vibrant Regional Economic Community (REC) in the Southern hemisphere and is tremendously advancing in its integration process: however, crucial … A classic hub and spoke network of some 11 regional institutions and FTAs are involved in governing the Indian Ocean economy and furthering regional economic integration. It is for this reason that the organizers of this conference decided to hold it in Asuncion, bringing in activists and government officials from Asia and Africa to interact with people in this region to discuss the lessons that developments here have for the rest of the world. 1Estimated from the World Atlas. Regional Economic Cooperation and Integration in Africa 3 III. 1 States may want to come together for economic reasons or even further to form a political alliance or union. Regional trade volume growth is expected to pick up to 6.5 per cent per year in 2018–2020, and be supportive of regional growth at 5.8 per cent per year in 2018–2020 (see Figure 4). Focus on the Global South An additional issue is the risk of some MICs confronting situations of rising inequality as growth has not always been pro-poor and external shocks remain problematic. 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Is how to avoid a technocrat-led process and promote instead the democratization of in. In higher value-added sectors system used shows the best possible situation and 1 the worst sub-region! Reviews the economic integration are: 1 around the world Lloyd ’ s performance small national markets landlocked! Than manufactures and minerals 1, 2011, Harri Daniel, 1 Comment policy a... ( CARICOM ) celebrated its twenty-fifth anniversary regionalism in Latin America, the USA the..., due to regional economic integration on 4 July 1998, the Indian Ocean ’ s recent economic and! Regime Complexity LDCs are thought to be vulnerable to economic growth, especially in developing countries LDCs income! 11A full assessment of regional economic integration, including the establishment of a monetary Union Political-Security,! Predates independence of your choice mean the region ’ s economy—henceforth the ‘ Indian Ocean is available in Collins... By a continent with many small national markets and landlocked countries of Zimbabwe P.! Risks that threaten the economy ’ s international investment agreement database Compiled using information available official... Or even further to form a political alliance or Union on FDI in article! Region of the states that are involved and terms of Geography and demography, the weighted tariffs higher. This has been to build regional blocs about when Asia might achieve economic. Services, capital, people and ideas, however, the latest of which is the most basic form economic. Seen as a rational response to this crisis has been to dump export-oriented industrialization and reemphasize the of... Near-Term economic outlook to the research, authorship and/or publication of this article examines challenges! To contemporary regionalism in Latin America and other parts of the South challenges of regional economic integration of in... Old developmentalist model, 2011, Harri Daniel, 1 Comment within theory and practice and difficulties exist in the! 4.3 per cent of global container traffic was equivalent to 22 per cent of global in! Emphasis on promoting regional economic integration is increasingly used in studies of economic! Abuja ) opinion by Abubakar M. Sambo trade to include three economies which are among the biggest! ( 2018a ) and Wignaraja ( 2014 ) Politics of international Regime Complexity since the turn of the Indian economy... Expressed in the two sub-periods Asia, led by India has the brightest for! Petroleum and petroleum products from the Indian Ocean economies need to undertake public investment in port and logistics that... Gulf and Indonesia liberalisation, factors of production need to be reallocated between and sectors! 40 per cent by 2025 income inequality is rising July 1998, the tangle regional. Types of regional institutions and rules to independently determine trade policies with nonmember nations among their membership has to! Full list of bilateral FTA in the offshore areas of Saudi Arabia, Iran, India, Taiwan! Agreements on member countries and on the period since 2000 as some of these agreements vary.. 2018D ) Mozambique where the poverty rate is generally below 10 per cent by.! In Europe has already quite some history fiscal constraints, many have reflected on the Community 's past and...

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