Types of Economic Integration - SS3 Economics Past Questions and Answers - page 1

A Free Trade Area (FTA) involves the removal of tariffs and trade barriers between member countries while maintaining their own external trade policies, whereas a Customs Union involves the removal of trade barriers between member countries and the adoption of a common external trade policy with other countries or regions.

An Economic Union involves the removal of trade barriers, adoption of a common external trade policy, free movement of goods, services, capital, and people between member countries, and coordination of economic policies such as taxation and social welfare. A Political Union involves the formation of a single political entity, with a common government, legal system, and foreign policy.