Table 7-3. Important Regional Trade Agreements Region Name Acronym Europe European Union EU European Free Trade Association EFTA North America North American Free Trade Agreement NAFTA Latin America and the Caribbean Latin American Integration Association LAIA Andean Common Market ANCOM Central American Common Market CACM Southern Cone Common Market Mercosur Caribbean Community CARICOM Africa Arab Maghreb Union UMA Economic Community of Central African States ECCAS Central African Customs and Economic Union CACEU Economic Community of West African States ECOWAS West African Economic Community CEAO Southern African Development Community SADC Asia Association of South-East Asian Nations ASEAN Asia Pacific Economic Cooperation APEC Economic Cooperation Organization ECO South Asian Association for Regional Cooperation SAARC Middle East Gulf Cooperation Council GCC
1957 Treaty of Rome created the European Economic Community (6 members)
Current number of members = 27
Creation of the Unified Market under the Maastricht Treaty of 1992
Creation of the Euro in 1999
Passports abolished under the Schengen agreement
Members of the EU 1952 Belgium, France, Germany, Italy, Luxembourg, Netherlands 1973 Denmark, Ireland, United Kingdom 1981 Greece 1986 Portugal, Spain 1995 Austria, Finland, Sweden 2004 Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, Slovenia 2007 Bulgaria, Romania
Market power that derives from ownership of special knowledge Advantages of a particular foreign location Firm must prefer FDI to other ways of conducting foreign business (e.g., exports, licensing) Source: Various works by John Dunning .
Product-Cycle Theory Maturity Growth Decline Time Sales Source: Raymond Vernon.
An investment made to acquire control over enterprises operating outside of the economy of the investor. Control means owning 10% or more of the ordinary shares or voting power of a firm or its equivalent; lower ownership shares are known as portfolio investment .
Outflows of FDI from Developed and Developing Nations, in Billions of Current Dollars, 1970-2010 Source: United Nations Conference on Trade and Development, World Investment Report .
Inflows of FDI into Developed and Developing Nations, in Billions of Current Dollars, 1970-2010 Source: United Nations Conference on Trade and Development, World Investment Report .
Figure 4-1. Outward Stock of Direct Foreign Investment in Billions of Dollars, 1960-2006 Sources: UNCTC, Transnational Corporations in World Development (New York: UN, 1988); UNCTAD, World Investment Report (Geneva: UNCTAD, 1999 and 2007).
Figure 4-5. Inflows of FDI into the Big Five Industrialized Countries, in Billions of Current Dollars, 1965-2006 Source: World Bank, World Data 1994 CD-ROM (Washington, D.C.: World Bank, 1994); UNCTAD, World Investment Report (Geneva: UNCTAD, 2007).
Figure 4-7. FDI Inflows into Developing and Transition Economies by Region, in Billions of Dollars, 1970-2006 Source: UNCTAD, World Investment Report 2007 (Geneva: UNCTAD, 2007).
Number of MNCS from Developed and Developing Economies