Государственное бюджетное профессиональное образовательное учреждение Краснодарского края
«Новороссийский социально – педагогический колледж»
по английскому языку
« TRADING BLOCS»
The world economy seems to have been increasingly forming into a series of trade blocs, based upon regional groupings of countries: a European region centered on the European Union, an Asian region on Japan, and a North American region on the United States. Although such trade blocs clearly encourage trade between their members (intra-regional trade has been growing significantly faster than trade between regions), there was growing fear that they would become ‘trade fortresses’. Many countries outside these blocs complain that they benefit the members at the expense of the rest of the world. For many developing economies, in need of access to the most prosperous nations in the world, this represents a significant check on their ability to grow and develop.
If a group of countries wish to become more open and trade more freely with each other, but do not want the vulnerability of facing unbridled global competition, they might attempt to remove trade restrictions between themselves, but maintain them with the rest of the world.
There are three possible forms that such trading arrangements might take.
Free trade areas. A free trade area is where member countries remove tariffs and quotas between themselves, but retain whatever restrictions each member chooses with non-member countries. Some provisions will have to be made to prevent imports from outside coming into the area via the country with the lowest external tariff.
Customs unions. A customs union is like a free trade area, but in addition members must adopt common external tariffs and quotas with non-member countries.
Common markets. A common market is where member countries operate as a single market. Like a customs union there are no tariffs and quotas between member countries and there are common external tariffs and quotas. But a common market goes further than this. A full common market is characterised by 1) a common system of taxation, 2) a common system of laws and regulations governing production, employment and trade, 3) free movement of labour, capital and materials as well as goods and services, 4) the absence of special treatment by member governments of their own domestic industries.
Preferential trading in practice
Preferential trading has the greatest potential to benefit countries whose domestic market is too small, taken on its own, to enable them to benefit from economies of scale, and where they face substantial barriers to their exports. Most developing countries fall into this category and as a result many have attemped to form preferential trading arrangements.
Examples in Latin America include the Latin American Integration Association (LAIA), the Andian Pact and the Central American Common Market (CACM). A Southern Common Market (MerCoSur) was formed in 1995, consisting of Argentina, Brazil, Paraguay, and Uruguay. It has a common external tariff and most of its internal trade is free of tariffs.
In 1993 the Asian Free Trade Area (AFTA) was formed. This plans to achieve a reduction in internal tariffs to a maximum of a 5 per cent by 2008, with many products being tariff free. In Africa the Economic Community of West African States (ECOWAS) has been attempting to create a common market between its members.
The most significant and advanced trade blocs, however, are to be found not in the developing world but in the developed, notably in Europe and North America.
North American Free Trade Association (NAFTA)
Along with the EU, NAFTA is one of the two most powerful trading blocs in the world. It was formed in 1993 and consists of the USA, Canada and Mexico. These three countries have agreed to abolish tariffs between themselves in the hope that increased trade and co-operation will follow. Tariffs between the USA and Canada had been phased out by 1999 and between Mexico and the other two countries they will disappear by 2009. New non-tariff restrictions will not be permitted either, but many existing ones can remain in force, thus preventing the development of true free trade between the members. Indeed, some industries, such as textiles and agriculture will continue to have major non-tariff restriction.
NAFTA members hope that, with a market similar in size to the EU (a combined GDP of $7 trillion and over 360 million consumers), they will be able to rival the EU’s economic power in world trade. Other countries may join in the future, so NAFTA may eventually develop into a Western Hemisphere free trade association.
NAFTA is, however, at most only a free trade area and not a common market. Unlike the EU, it does not seek to harmonise laws and regulations, except in very specific areas such as environmental management and labour standards.
The European Union
The European Economic Community (EEC) was formed by the signing of the Treaty of Rome in 1957 and came into operation on 1 January 1958.
The original six member countries of the EEC (Belgium, France, Italy, Luxembourg, Netherlands and West Germany) had already made a move toward integration with the formation of the European Coal and Steel Community in 1952. This had removed all restrictions on trade in coal, steel and iron ore between the six countries. The aim had been to gain economies of scale and allow more effective competition with the USA and other foreign producers.
The EEU extended this principle and aimed eventually to be a full common market with completely free trade between members in all products, and with completely free movement of labour, enterprise and capital. By uniting many of the countries of Western Europe, it was hoped too that the conflicts of the two world wars would never be repeated, and that acting together the countries of the EEC could be an effective political and economic force in a world dominated by political giants such as the USA and the USSR, and economic giants such as the USA (and later Japan).
All internal tariffs between the six members had been abolished and common external tariffs established by 1968. But this still only made the EEC a customs union, since a number of restrictions on internal trade remained (legal, administrative, fiscal, etc.). Nevertheless the aim was eventually to create a full common market.
In 1973 the UK, Denmark and Ireland joined the EEC. Greece joined in 1981, Spain and Portugal in 1986 and Sweden, Austria and Finland in 1995.
The European Union is clearly a customs union. It has common external tariffs and no internal tariffs. But is it also a common market? For years there have been certain common economic policies. In other respects the Community of the 1970s and 1980s was far from a true common market: there were all sorts of non-tariff barriers. The Single European Act sought to remove these barriers and to form a genuine common market by the end of 1992.
I. Study the following vocabulary list:
- концентрировать, сосредоточивать
center one’s hopes on
- возлагать все надежды
- преуспевать, благоприятствовать
- процветающий, состоятельный
- процветание, преуспевание
- n 1) проверка, 2) препятствие
v 1) проверять, контролировать,
2) препятствовать, сдерживать
- уязвимый, ранимый
- уязвимость, ранимость
- обуздывать, сдерживать
- необузданный, распущенный
free trade area
- зона свободной торговли
- сохранять, поддерживать
- положение, условие договора, постановление
to make provisions
- предусматривать, постановлять
- таможенный союз
- общий рынок
- прекращать, снимать, постепенно сокращать
- n соперник, конкурент
v соперничать, конкурировать
without a rival
- вне конкуренции
- соперничество, конкуренция
- кончаться, являться результатом
- окончательный, возможный
- в конечном счете, со временем
- возможность, случайность
- юридический, законный
- законность, легальность
- подлинный, настоящий
- искренне, неподдельно
increasingly, European, prosperous, vulnerability, unbriddled, via, characterised, Southern, Argentina, Paraguay, notably, textile, rival, eventually, harmonise, Belgium, Luxembourg, Netherlands, giant, Portugal, genuine.
III. Couple the words with their synonyms in brackets:
legal, to rival, to centre on, to encourage, check, to prosper, to remove, true
(to eliminate, to stimulate, to flourish, genuine, to compete, juridical, to concentrate, obstacle)
IV. Find the following word-combinations in the text and translate them into Russian:
trading blocs, to centre on the EU, intra-regional trade, “trade fortresses”, to benefit the members, in need of access, a significant check on the ability, preferential trading, to force unbridled competition, a free trade area, to retain tariffs and quotas, provisions, a customs union, a common market, a special treatment, to fall into a category, to achieve reduction in tariffs, tariff free, notably, to phase out, a combined GDP, to rival the EU’s economic power, to come into operation, a genuine common market
V. Find in the text the English equivalents for the following word-combinations:
региональные группировки, поощрять торговлю между странами, жаловаться, за счет кого-либо, процветающие страны, снимать торговые ограничения, принимать общие внешние тарифы и квоты, единый рынок, налогообложение, общая система законов и правил, сталкиваться со значительными барьерами, увеличивать сотрудничество, отменять тарифы, оставаться в силе, подписывать договор, свободное движение капитала и рабочей силы
VI. Give English equivalents for the following. Consult the dictionary.
влиять на рынок; распространяться на новый рынок; появиться на рынке; воздействовать на рыночную ситуацию; вытеснить с рынка; господствовать на рынке; оживленный рынок; рынок товаров; конкурентный рынок; выбор рынка; внешний рынок; рынок сырьевых товаров; рынок недвижимости; неустойчивый рынок; единый рынок; мировой рынок
сельская община; деловые круги; рабочий поселок; международное сообщество; профессиональное общество; научно-технические круги; города, поселки городского типа; общность интересов
политика сдерживания и уравновешивания; политика регулирования; политика распределения ресурсов; антикризисная политика; политика жесткой экономии; политика по регулированию платежного баланса; деловая политика; финансово-бюджетная (фискальная) политика; политика взаимных уступок; внутренняя политика; внешняя политика; политика поощрения отечественного производства с целью замещения импорта; валютная политика; политика государственного невмешательства в экономику; недальновидная политика; кадровая политика; демографическая политика; государственная политика; стратегия продажи (сбыта); выжидательная политика
VII. Match the following terms with the correct definitions:
- the absence of trade restrictions
economies of scale
- a market that operates under conditions of perfect
- decrease in the unit cost of a product or service as
a result of large-scale production
free trade association
- market dominated by a few large firms
- the rivalry among buyers and among sellers in the
purchase and sale of resources and products
- agreement among countries to remove trade
restrictions among themselves
VIII. Match the following words and phrases to make complete expressions from the text:
on the ability
IX. Complete the blank spaces with prepositions where necessary:
1. Trade blocs benefit the members .... the expense .... the rest of the world.
2. Many developing countries are ... need .... access .... the most prosperous
3. Countries remove restrictions .... themselves, but maintain them .... the rest
of the world.
4. Such countries benefit .... economies of trade and face .... substantial barriers
to their exports.
5. These countries abolished tariffs between themselves .... the hope that
increased trade will follow. Tariffs between the USA and Canada had been
phased .... .... 1999.
6. The EU was formed .... the signing of the Treaty.... Rome and came ....
operation in 1958.
7. The six member countries of the EEC had already made a move ....
integration .... the formation of the European Coal and Steel Community.
8. This had removed all restrictions .... trade .... coal, steel and iron ore.
9. .... other respects the Community of the 1970s and 1980s was far .... a true
X. Complete the text using the words in the box:
policy, trade obstacles, efforts and investment, chronologically, milestone, commissioners, reconstruction, headquarters, financial aid, the Marshall Plan, member nationas, industrial production
In the aftermath of the Second World War, Europe was in shambles as a result of the fighting and the devotion of all ….. to the war. To assist Europeans back to their feet and to encourage strong, friendly governments, US Secretary of State George C. Marshall recommended the United States give ….. to and work with European countries in their ….. .
Thus was born ….., which was immensely successful. It swung into action in 1948, and by the first quarter of 1950 European ….. was already 138 percent ahead of the level reached in the last year of peace, 1938. Europeans achieved this success by working together, and they continued to do so. One ….. in this relationship was the Treaty of Rome. Signed in 1957, it created the European Community (EC), sometimes called the European Economic Community (EEC) or the European Common Market. The first six Common Market members were Belgium, the Federal Republic of Germany, France, Italy, Luxembourg, and the Netherlands …… , the next to sign the treaty were Denmark, Ireland, the United Kingdom, Greece, Portugal, and Spain, making a total of 12 ….. . Then on January 1, 1995, Austria, Finland and Sweden became members and there were 15.
EU objectives were to remove ….. among members and to cooperate in many other ways. Brussels was eastablished as ….. , housing the EU Commission. The 17 ….. are each responsible for a subject area somewhat similar to US cabinet positions: labour, transportation, trade, and so forth.
The policy-setting body of the EU is the Council of Ministers. The prime ministers of the 15 member-nations meet periodically to establish ….. to be executed by the commissioners and the other Eurocrats as the bureaucrats who work in Brussels are called.
XI.Explain what is meant by:
trade bloc; trade fortress; prosperous nation; free trade area; customs union; common market; preferential trading; environmental management
XII. Discuss with your partner:
- a series of trading blocs based upon regional groupings of countries, their
advantages and disadvantages;
- forms of preferential trading arrangements between countries;
- the activity of preferential trading arrangements formed by the developing
- the activity of NAFTA;
- the activity of the EEC.
XIII. Read, translate and summarize the text:
In 1986 members of the Europen Community agreed to eliminate all barriers to the movement of goods, services, people, and capital by 1992. They called their plan Europe 1992. But a single market for goods and services hasn’t been the only goal of the European Community. In 1991 the EC also agreed to create one currency by forming an economic monetary union. Representatives of European countries met in Maastricht, Netherlands, where they developed a plan, the Maastricht Treaty, that would result in a single European currency by 1999.
The citizens of each EC member nation were asked to vote on the treaty. The treaty is controversial because it requires each country to give up some of its sovereignty or independence. Under the Maastricht Treaty, a single European Central Bank replaces individual national currencies and the central banks of EC members. The European Central Bank would make monetary policy for all 12 EC members.
Naturally, some Europeans worried about losing control of their country’s currency and monetary policy. In fact, voters in Denmark rejected the treaty in 1992.
Once the European Community made concessions, Denmark approved the Maastricht treaty in 1993. Still, other events in 1992 and 1993 stalled plans for a single currency in Europe by the end of the century. The European economy was slumping in 1993. The general situation was aggravated by events in Germany. Following the unification of East and West Germany, the German government borrowed large sums of money to rebuild its former neighbour. As a result, interest rates in Germany and neighbouring countries increased. This, in turn, further slowed economic growth in these countries, and Europeans discovered it was very difficult to have both a currency with a fixed value and an effective national monetary policy.
For now, most European countries are spending more energy strengthening their economies than establishing a European currency. In the years ahead, it will be interesting to see if a single currency and the ECU will become a reality.
XIV. Translate into English:
Политические изменения в СССР и странах Восточной Европы в
90-х годах привели к изменению геополитической ситуацию в этих новых условиях осуществление социально-экономических преобразований в России должно было сопровождаться построением новой системы отношений со все более отдаляющимися странами Центральной и Восточной Европы (ЦВЕ), с одной стороны, и со всеми более приближающимися такими традиционно западными структурами, как ОЭСР, НАТО, ЕС, - с другой.
Наибольший интерес в этой связи представляет крупнейшая страна региона - Польша, значимость и приоритетность которой в российско-европейских отношениях подтверждают такие факторы, как объемы взаимной торговли, привязка экономики страны к поставкам из России стратегических товаров, ее транзитное положение на пути из России в Западную Европу, активное участие Польши в интеграционных процессах ЕС и ЦЕФТА, политический момент (участие в НАТО и стремление к политическому и экономическому доминированию в регионе), опыт Польши в реформировании экономики, а также существенная роль России во внешней торговле Польши.
Процесс вступления Польши в ЕС представляет интерес с точки зрения:
- анализа опыта решения проблем, возникающих в ходе приспособления бывшей социалистической экономики к “правилам игры” крупнейшей европейской экономической группировки;
- рассмотрения последствий вступления Польши в ЕС как для самих участников этого процесса, так и для развития экономических отношений России с ЕС и Польшей.
Автор: Чатоева Ольга Михайловна,
преподаватель английского языка
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