Regionalism Vs Multilateralism

Does Regionalism Challenge Globalisation or Build Upon It?

Abstract

Trade globalisation refers to the growing economic interdependence of countries globally. Regional trade refers to the conscious creation of policies to ensure smooth and preferential trade within a region. These ideas can seem opposite to each other but this study aims to prove that this is not so. There are several ways in which regionalism actually promotes globalisation. There is safety for local businesses in regional trade. Regional Free Trade Areas (FTAs) allow small countries to compete with each other before competing globally; which gives them more time to adapt and adjust. Regionalism also enables participation of less-developed countries in making heavyweight regional economic blocs and ensures a passage to deal with bigger economies (like in the case of ASEAN and China). It is often thought that regionalism developed as a response to globalisation when the fact is that regionalism precedes globalisation. These are all pieces of evidence provided in this study to conclusively say that regionalism builds upon globalisation instead of challenging it.