What is a Custom Union?
 

Dear student,

A custom union is generally defined as a type of trade bloc which is composed of a free trade area with a common external tariff. Customs unions are established through trade pacts where the participant countries set up common external trade policy.
The purpose of a customs union is to make it easier for member countries to trade freely with each other. The union reduces the administrative and financial burden of barrier trading and fosters economic cooperation among nations. However, member countries are not given the freedom to form their own trade deals.

Regards.

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