Customs unions and free trade areas are identical in the manner in which member countries treat imports from nonmember countries.

Question

Quizplus · Accepted Answer

While customs unions and free trade areas both involve the elimination or reduction of tariffs and other trade barriers between member countries, they differ in the way they treat imports from nonmember countries. In a customs union, member countries adopt a common external tariff and trade policy towards nonmember countries, while in a free trade area, member countries maintain separate trade policies towards nonmember countries.

Customs Unions and Free Trade Areas Are Identical in the Manner