Aneconomic union is a type of trade bloc which is composed of a common market with a customs union.[1] The participant countries have both common policies on product regulation, freedom of movementofgoods, services and the factors of production (capital and labour) as well as a common external trade policy. When an economic union involves unifying currency, it becomes an economic and monetary union.
The purposes for establishing an economic union normally include increasing economic efficiency and establishing closer political and cultural ties between the member countries.
Economic union is established through trade pact.
Note: Every economic and monetary union includes an economic union.
Additionally the autonomous and dependent territories, such as some of the EU member state special territories, are sometimes treated as separate customs territory from their mainland state or have varying arrangements of formal or de facto customs union, common market and currency union (or combinations thereof) with the mainland and in regards to third countries through the trade pacts signed by the mainland state.[6]