Abstract
A Free Trade Area is an area in which tariffs among members have been eliminated, but members keep their external tariffs.
Can evolve in:
A Customs Union (FTA + common external tariffs).
A Common Market (CU + mobility of services, people, and capital within the union).
Complete Economic Integration (Integration on economic and political levels).
1991 : treaty of Asuncion
Mercosur's birth
•Free circulation of the goods
•Common commercial policy
•Coordination of macroeconomy
•Harmonization of legislation
Economy-The better allocation of means of production
•Wider scales of production
•A useful tool to strengthen and deepen the economic reforms intitiated by individual member states
•A higher degree of industrial complementarity
•Greater incentives to foreign investment
•Greater potential for the integration of small and medium-sized business into international trade
•Improve level of consumer welfare
