Question

If you are hired as an advisor for countries interested in regional integration, what would be your recomendable for the appropriate approach for these countries?

Answer 1

Regional integration -- what should be kept in mind

1. Geographies and associated regional connectivity – roads, rails port, air connectivity must be enhanced and promote swift movement of goods and people. These connectivity planning will in turn depend on geographies and geologies of the member countries. For example – if countries share more of land borders then it will be optimal to develop roads, rails, and inland waterways rather than more sea ports.
2. Economies – different member countries could have different type of economy such as capitalist, socialist, and mixed ones. In such as cases proper framework should be designed in order to accommodate concerns of each of the economies.
3. Intra-regional trade as a driver of growth. – appropriate measures must be taken to enhance intra-regional trade as it will expand markets, create new avenues for investments, promote division of labor and specialization in member economies and thus help in combined growth of the economies.
4. Political scenarios/stability in the member countries + regular meetings among member countries and trust building exercises.
5. Tariff reduction and free trade agreements roadmap. à incremental steps should be taken to reduce tariffs on various goods/services maong member countries which should soon culminate into free trade area. If member countries find it suitable they can further integrate themselves towards an economic union or even monetary union.
6. Promotion of co-operation and joint ventures among private/public companies in the member countries à will increase intra-regional capital flows, technology flows and sharing of best practices. à utilization of idle physical, human, and natural capital in member countries
7. It should be kept in mind that how increased co-operation can help member countries to stand together in international issues.
8. Environmental issues should also be addressed à no dumping of old technologies/polluting technologies/hazardous technologies by a more developed member to a less developed member country.
9. Appropriate measures should also be taken to prevent balance of payments going heavily in favor of a few members vis-à-vis other members.
10. Energy security – As energy is one of the most important factor for growth of economies, in regional integration it should also try to ensure energy security among the member countries. Intra-regional trade in energy raw materials and electricity should be promoted. Avenues for energy grid among member countries can also be explored.