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North American Free-Trade Area NAFTACanada United States Mexico... NAFTA Rules of OriginTariff shift rule • Non-NAFTA imports undergo sufficient manufacture or processing to become prod

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Multinational Market Regions and Market Groups

Chapter 10

McGraw-Hill/Irwin © 2005 The McGraw-Hill Companies, Inc All rights reserved.

PowerPoint presentation prepared by:

Alfred Lowey-Ball Associate Professor of Marketing UBI-United Business Institutes Brussels, Belgium

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Emergence of regional groupings

important global trend in international business and today

greater weight in decision making

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Traits of Successful Economic Unions

economic systems)

political systems)

by strengths in others

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North American Free-Trade Area (NAFTA)

Canada United States Mexico

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NAFTA Rules of Origin

Tariff shift rule • Non-NAFTA imports undergo sufficient

manufacture or processing to become products that can qualify under a different tariff classification.

• Non-NAFTA imports undergo sufficient

manufacture or processing to become products that can qualify under a different tariff classification.

Value-content rule • A set percentage of the value of the good must be

North American (usually coupled with a tariff classification shift requirement) Some goods are subject to the value-content rule only when they fail to pass the tariff classification test because of non-NAFTA inputs

• A set percentage of the value of the good must be

North American (usually coupled with a tariff classification shift requirement) Some goods are subject to the value-content rule only when they fail to pass the tariff classification test because of non-NAFTA inputs

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Association of Southeast Asian Nations

(ASEAN)

Brunei

Indonesia

Laos

Malaysia

Myanmar

Philippines

Singapore Thailand Vietnam

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• Goal is economic integration and complementary

industrial programs

• Not a political union

• Basis for ASEAN Free trade area

• tariff and non-tariff barriers phased out

• Basis for ASEAN + 3: + China, Japan and So Korea

• set up after financial crisis of 1997/8

• set up procedures to share foreign excahnge reserves

to defend one another’s currencies

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Association of Southeast Asian Nations

(ASEAN) + 3

Brunei

Indonesia

Laos

Malaysia

Myanmar

Philippines

Singapore Thailand Vietnam Japan

S Korea China

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© 2004 The McGraw-Hill Companies, Inc All rights reserved.

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Asia-Pacific Economic Cooperation (APEC)

Australia

Brunei

Canada

Chile

China

Hong Kong

Indonesia

Japan

Japan

South Korea Malaysia Mexico New Zealand Papua New Guinea

Peru

Philippines Russia Singapore Taiwan Thailand U.S.A Vietnam

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Future Multinational Trade Groups

1 United States/Japan

2 Hong Kong/Taiwan

3 Asia-Pacific Rim Countries

4 Hong Kong/Taiwan/Coastal Provinces of Southern China

5 Western Hemisphere (North and South America) F.T.A

6 Transatlantic Free Trade Area (U.S.A & EU)

7 NAFTA including Central America

8 SAFTA

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