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The 1990s witnessed the parallel forces of globalization and regionalization strongly at work. While seemingly contradictory, they are in fact complementary dimensions of market development. This background paper will focus on the latter, and its special dimension of regionalism; i.e., policy driven regional cooperation. Particular attention will be given to the recent advances and challenges in two crucial dimensions of regionalism: regional trade and financial cooperation. The other important area of concern of the paper is how regional development banks are supporting regional initiatives and identifying emerging issues which they should be preparing to deal with. The first section clarifies some basic concepts and the underlying development objectives of the regionalism emerging out of the 1990s. This is followed by a review of advances in regional integration and other forms of regional cooperation in Africa, Asia and Latin America and the Caribbean. After this, there is a review of the emerging new challenges in regional integration and the role of regional development banks in supporting the processes. The last section formulates conclusions and some basic questions about the preparedness of the banks to respond to members’ demands for support of their regional initiatives.
Commentary Type