The EU as a Trading Partner

The EU as a Trade Partner

The EU in Retrospect Unique partnership between 28 European countries Created after WWII 1958: creation of EEC 1993: creation of EU Focus on improving human rights and increasing economy

The EU in Trade One single authority to handle matters dealing with trade agreements. 2014 GDP totaled 13,920,541 EUR Member of the WTO since 1995 Strives to reduce trade barriers and supports Trade for All Strong player that dominates as the largest exports of services and manufactured goods around the world 50% of the EU’s GDP Tries to trade with as many people as possible.

Advantages of the EU as a Trade Partner

Euro and Economic Integration Positive influence on the unification and cooperations between EU members. Creation of the Eurozone to facilitate interactions, further economic prosperity, allow free movement of goods and services, stabilization of interest rates, and elimination of exchange rates. Better trade relations with foreign investors and international corporations Allows Less developed countries to trade with more countries because they act as a single market

Economic Growth Increased globalization means there is an increase in traded goods in the interconnected global community. Focus on outward-oriented economy in hope sto become the biggest trading partner in the world Advantage of lower prices and increased price diversity Single Market Act to standardized practices across the entire EU

Employment Opportunities EU export industry accounts for 31 million jobs for Europeans 14% of jobs in EU EU services industry accounts for 36% of jobs in EU As trade increases, so does the need for jobs which means that people from other EU countries can freely move to fill employment gaps Equal opportunity for all europeans to move freely between borders should they want work in another country and reside in another country if they are employed there. Encouragement for citizens to enforce their rights o work in EU states. Reduction of discrimination and increase transparency

Securing Economic Ties Between Nations EU likes to increase the amount of trading partners it does business which secures economic ties. Lowering/removing trade barriers, allows for more countries to have access to the European market Strong alliance with the US means that many jobs are provided by US owned companies Dedicated to developing nearly perfect trading relations EU and Canada trade agreement of 0 tariffs between countries Success of one country is the success or the other EU countries betcause they act a sinlge market.

Reduces Poverty LDC’s can strengthen their economies through increased trade with the EU Reduced barriers between poorer countries to encourage investment in trading opportunities EU engages in a lot of initiatives to improve the conditions of trade with LDCs Online Helpdesks Education of rules and regulations of trade AID FOR TRADE Provides infrastructure to ameliorate trade conditions Improved ports Assistance reaching safety standards Assisting LDC’s creates opportunities to grow

Disadvantages of the EU as a Trade Partner

Loss of Power EU judicial system overruling member state’s laws or legal decisions Loss of border control Loss of financial control No complete individual power anymore

Cost of the EU Members pay a percentage of yearly national income to EU In return, EU promises many advantages Richer countries turn out to pay a lot to save the poorer countries For richer countries, the EU membership costs more than it brings

International Flow of Workers Citizens have the right to work and travel in all of the member states Members are obliged to treat every guest from other country, the same as they would treat their own citizens Too large difference between income in poorer and richer countries in EU. Workers flow to richer countries for higher wages Employers only want cheaper workers Jobs are taken, many people jobless at home

Implementation of the Euro Implementation of Euro has cost a lot Prices have risen a lot since the Euro Due to bad exchange rates the population has become poorer Higher prices and less money → People cannot pay bills anymore

Growth of the EU More and more countries entering EU EU focuses on growth First only stable and wealthy economies Later more unstable economies entered as well, dragging down the economy Rich countries need to pay in order to rise the bad economies Entering more unstable/unhealthy economies will only bring the EU economy more down Also Majority Voting becomes harder with more members

EU as a Trade Bloc EU only stimulates trade between member countries, but forget about rest of the world EU has created many non-tariff barriers in order to protect its own economy at cost of other countries in the world

Current Situations

Europe: 2020 Strategy New economic strategy for the decade of 2010 - 2020 that will help the EU recover after the failure of the Lisbon Treaty Originated after the 2008 economic crisis Priorities of the Strategy: Smart, Sustainable, Inclusive growth Targets: Raise investments on R&D, Increase educational opportunities, Lower greenhouse gases and increase energy efficiency, address current employment struggles, reduce poverty Flagship Initiatives: Digital agenda, innovation union, youth on the move, resource efficient Europe, industrial policy for the globalisation era, agenda for new skills and jobs, european platform against poverty

Trade for All - New EU Trade and Investment Strategy Make trade agreements more effective Create more opportunities and more jobs in Europe More transparency Agreement will generate benefits for: Workers in EU Citizens of the EU Small and Medium-sized enterprises And for people in developing countries

Conclusion The EU is a very successful trading partner, and continuously trying to improve itself