The Integration of Nations

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The European Union is both apolitical and economic organization of countries that seeks to enhance regional integration. It has its office in Europe with a total of 27 member states. It has developed a standardized single market that has similar laws applying to member states. It has a common currency of the euro under which it ensures free movement of people, goods and ser vices while enhancing common policies on trade and promoting regional development. The member states are responsible for their own territorial defense while providing humanitarian help to developing nations. The European Union thus goes a long way in ensuring the progress of its member states. This essay shall focus on the advantages and disadvantages of regional integration. It shall also focus on relating the stage of economic development of the economically integrated nations to the potential business opportunities.

Integration of Nations


Integration of Nations

The integration of nations dates back in history as nations seek to benefit from each other while creating a conducive trade environment. The nations that integrate, always aim at benefiting from the union. Basically though, the nations benefit but also sacrifice for the sake of the union. This essay shall seek to unveil the advantages of integration of nations. It shall also seek to discuss the disadvantages of this integration. In the end, it shall seek to relate the stages of economic development of the integrated nations to the business opportunities.

Advantages of Integration of Nations

Integration of nations is mainly aimed at enhancing the economic and political conditions of member states. The main advantage of this integration to nations is that it allows developing nations to benefit from realizing economies of scale. These nations are able to get a market for their goods while maintaining reasonable trade policies.

National integration enables the nations involved to pull their resources together thus availing for themselves institutional and human resources. This creates efficiency and lowers the costs that businesses encounter in their operations. In addition to this pooling of resource together, it provides competence to member states in the administrative and technical aspects. This gives them a competitive advantage over the other nations. It helps these nations to thus improve production by lowering the costs involved and improving the efficiency levels. (Aiginger, 2006)

Integration of nations provides strategies that allow for bigger distribution systems with greater economies of scale, wider brand exploitation, reduction of bureaucratic costs of running organizations especially for regional companies. They benefit from exchange rates balances, tax benefits, shifting of funds and other local characteristics.(Rugman, 2003) Integrated nations are able to create barriers of entry to other nations giving them monopolistic powers.

Integration of Nations

Disadvantages of Integration of Nations

Although integration of nations provides benefits to member states, the disadvantages cannot be overruled. The process of national integration is a complex one. It poses both political and economic risks to member states. This is because the nations may be involved in political and economic crises that hinder the effectiveness of the integration. In addition to this, the trade barriers created lower the competitiveness of member states. The barriers created may limit progress with some nations benefiting while others suffer losses. This is affected by the fact that member states are responsible for their own defense.(Rugman, 2003)

Integration of nations seeks to provide a common market for goods and services. Developing nations suffer most in this case. This is because the union lowers the amounts of gains the products could have fetched if sold to other nations. This also leads to a dictatorial relationship with some nations benefiting more.

Developing nations also face the aspects of not being able to develop their products to meet global standards. The issues of trade wars with some nations retaliating from the union are common problems. In addition to this the level of technological advancement in nations involved poses a challenge. It may lower the potential capacity of some while the technological costs involved lowering the benefits. Entrepreneurs are affected by these aspects since they are the driving forces of the economies of their nations. This lowers their benefits and economic growth is not maximally achieved.(Aiginger, 2006)

Relating the Stage of Economic Development to the Potential Business Opportunities

The level of economic development of integrating nations provides an opportunity for the nations to benefit from the business opportunities available. The integration between developed and developing nations is usually inefficient. The efficiency and strength of unions provides an opportunity for global improvements. The integrating nations need to assess the potential growth so as to maintain equal partnerships. The level of regional dynamism and openness to

Integration of Nations

improvement is vital. Integrating nations create a balanced exchange rate system. This usually calls for an opportunity of benefiting from the same. This is because nations have the role of ensuring balance of payments to foster economic growth.(Rugman, 2003)


The regional integration of nations still remains key in ensuring global economic growth. There is need to balance the same for the member states. This is by ensuring that nations the advantages from the same outweigh the disadvantages. In addition, developing nations have to develop efficient macro economic policies that give them equal competitive advantage in the global markets. The global social, economic and political changes have to be examined also. All these will play key roles in ensuring that integration of nations is globally efficient.


Aiginger, K. (2006) Competitiveness: From a dangerous obsession to a welfare creating ability with positive externalities, Journal of industry and competition. Vol 6(2) pp 160-178

Rugman, A. (2003). The handbook of international economics and business. New York: Oxford printing press