Date Posted: 11/24/2012 11:59:03 PM
Posted By: saucer Membership Level: Gold Total Points: 4885
1. Homogeneity of the goods produced among the member states can hinder trade. If countries produce the same goods there is no need to trade amongst each other. This situation is seen among East African countries which produce almost the same agricultural products such as maize, sugar etc. this undermines trade among them.2. Some countries may not have experience a shortage in foreign exchange. They may not have enough foreign money to trade and buy from other countries. This may be because they do not earn enough from their exports.3. Countries may have different ideologies. They may not be comfortable with their cultures or opinions. This makes it difficult to synchronize their economic strategies. 4. In the trading blocks, trade is undermined by poor transport and communication. This is experienced mainly in developing countries. This makes it difficult to trade and move from one country to another.5. For business to flourish there must be a peaceful environment. Therefore if a member state is experiencing political instability, it will affect trading relations in the whole block. This undermines trade among the member states.6. Some countries have trading partners who are not in the trading block. They prefer to trade with them rather than the member states of the block. These outside partner could be former colonial master which member states have closer trading ties with.7. Member states could experience lack of funds or capital. They are unable to pay for goods ordered. This interferes with the functionality of the trading block.8. Member states may not use the same language. There will be a language barrier among them making it difficult to communicate. This will make trading in the block more difficult and hinder economic integration.9. Countries in the block may have different levels of development. Countries that are more developed will benefit more from the common market. The less developed countries will feel unfair trading practices against them.10. In trading blocks especially Africa, the member countries sell unprocessed primary goods. This limits trade because there are limited manufactured goods in the market.11. There is interference from developed countries that are not in the trading block. They impose conditions that limit trade among the member states. This will undermine the union.
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