Any analysis of the economic globalization should be made in the framework of an international system, emerged after the Cold War; because following that period all international issues are looked into from an international perspective which is much different from the past.

New Wave of Regionalization: Major expansive political, economic and technological developments in the world have caused new definitions to be set forth for economic and trade growth which is driven by the attitude to regionalize economic relations among nations.
These developments include “interdependence” at international level; international productivity; end of militarism and the bipolar strategy; emergence of an international tripolar trade system with its centers in Europe, Southeast Asia and America; and the extensive economic and political presence of new industrial nations. After the Cold War, globalization prompted countries to enter into regional groupings in a bid to gain a more economic maneuver power.
The first wave for regionalization of trade and economic relations after the World War II emerged in Europe. The United States fully supported this trend in 1950’s in the framework of the multilateral hegemonic order which it initiated after the War. Since 1980’s and especially in 1990’s a new, growing wave of regionalizing trade and economic relations emerged both in industrial and developing countries in form of NAFTA, APEC and other regional pacts. At a theoretic level, “regionalization” can be viewed in various ways:

1. As a reaction against globalization of economy

2. As a preliminary phase in globalizing foreign trade and economic relations and to accelerate the world economic unification

3. As a strategic choice (for the US) vis-à-vis the problems that international economic development system has created.

Globalization Vs. Regionalization: Some economic and political experts believe that globalization is related to a set of international elements which accelerate the interaction and interdependence between governments and also between civil societies at the politico-economic international system.
Organization for Economic Cooperation and Development (OECD) states that globalization is mainly indicative of a trend which includes the development of international trade and foreign direct investments, growing internationalization of monetary, financial and credit markets and also the growth and development of foreign capital markets.
In this perspective, globalization of economy is referred to as “sectorial economic unification” process which necessitates a deep interpenetration of national economies and also a direct advanced competition between them.
MacEwan states in “Between Globalization and Nationalism, Socialist Register” that the globalization of economy is moving toward development and more expansive, free international distribution without any limitation in trade and economic relations.
However, economist Paul Krugment defines globalization as “opening of the national markets to international trade.”
In order to explain how to benefit from globalization, it is assumed that free transfer of economic resources including capital, labor and also competition will encourage economic and technological cooperation between economic systems of participating countries.

Undermining pluralism in the world economic negotiations and the growing rise of regional trade ties indicate a sort of resistance against globalization

Many definitions have so far been proposed for the process of regionalization of trade and economy. Some authors believe that this process is initiated in a specific geographical area between countries which have accepted common values among themselves and base their foreign economic relations and policies on these accepted values. Seeking a common identity could be another motive for countries which regionalize their economies. These countries have a feature in common: They adopt discriminatory privileges and procedures against non-member countries.

In a general perspective, regional settings are based on the followings:

1. Gaining interest through increasing incomes and more effective regional production system

2. Achieving more political and economic power in negotiating with other regional groupings, and

3. Facilitating economic and political cooperation in the framework of regional unions.

Finally, various forms of regional settings include:

1. Joint ventures in specific manufacturing sectors

2. Free economic zones

3. Customs unions

4. Common markets

5. Economic and political unions

The birth of WTO has been a giant stride toward globalization of economy and trade, but despite this success, many blows have been exerted on the collective and multilateral liberalized trade as basis for free world economy by the new wave of regionalization.
During the 1980’s and especially in 1990’s the growing partnership between countries – both industrial and developing – has played a major role in creation of new regional economic blocs.
It can now be concluded that undermining pluralism and multilateral system in the world economic negotiations and the growing rise of regional economic and trade ties indicate a sort of resistance against globalization. Meanwhile, the interaction between regionalism and globalization are quite obvious, but very complicated. In other words, in spite of the fact that eye-catching progress has been made toward further regionalization of economic ties, the trend of globalization is a much powerful and nonstop preference at international level, specifically in financial and monetary structures as well as manufacturing.

Impact of Globalization on Economic Regionalization: The viewpoints of experts regarding the positive and negative impacts of globalization on regionalization of economic ties are quite mixed. Advocates of globalization argue that this trend can bring the underdeveloped and developing economies in a united trade system in which members are equal and do not sustain any discrimination. Thus globalization can encourage the benefits of trade for both developed and developing countries.
It should not be forgotten that the level of positive effects of globalization by both groups of countries totally depends on the competitiveness and economic power of them, meaning that industrial countries are the first who would get the benefits of globalization while poorer countries may sustain great losses as a result. Therefore, globalization may bring about two completely opposite phenomena: encouraging economic and political unification of countries into an international system and escalation of economic, political and social instability in member countries.
The resistance of vulnerable countries – which are at a lower level in terms of power and competitiveness – would appear in form of regional economic associations.
Advocates of regionalization are seeking to somehow reduce the above-said negative impacts of globalization. Regionalization is aimed at preserving the economic power, national and regional competitiveness of countries which have felt to be threatened by globalization.
Regional resistance movements are especially supported and encouraged by national beneficiary groups and companies which cannot match their foreign rivals in terms of competitiveness.
In another viewpoint, regionalization can be looked at as a strategic choice. In this line the policies for creation or strengthening regional associations are reviewed based on the principle of convergence of interests in the economic, political and trade dimensions between multinational companies and their respective governments.
This alignment of governments and multinational companies’ interests are basically aimed at preserving and encouraging the responsiveness of countries to structural and fundamental developments which occur in the international economic system. This is not limited to developing countries, but occurs in large industrial nations.
On the other hand, pursuing the objective of raising competitiveness of countries in the international system has brought about unsecured economic and manufacturing conditions. These negative impacts could lead to huge economic, social and political crises in developing and less developed countries and even, in a limited form, in industrial countries. The progress of computerized communications and information dissemination has created such conditions under which the economic power depends less on manpower and is instead dependent on exploiting computer information technology properly. This has led to lowering the living standards of labor force especially in developing countries. To combat such poor conditions some countries have decided to protect their domestic industries in resistance against economic globalization.

The objective of regional economic blocs which are the foundation for moving toward regionalizing trade and economic ties, is mainly creating of a sort of harmony among the following opposing objectives:

1. Further expansion of predicted benefits and privileges of flexible specialization

2. Protecting domestic and regional industries which have relatively lower competitive power.

Also, the globalization of economy in some dimensions has led to declining the countries’ political power. In spite of the fact that globalization is a solution to economic, political and environmental problems which necessitate a collective and global management, in some cases it has led to undermining political interests of national governments. Because of such negative impacts of globalization, it is expected that the international politico-economic system would witness conflicts between economic blocs.