An Overview of European Union - Essay Example

The European Union List of Topics I.Organization II. Number of Members III. Economic Total Value of Trade IV.Euro-Who's on Euro V. What's European Union VI. Current challenges faced by the European Union Today I. Organization The European Union (EU) is a union of twenty-seven independent states based on the European Communities and it was founded on November 1993 with the objective of enhancing the political, economic and social co-operation among the states. It is previously known as the European Community (EC) or the European Economic Community. The Commission resembles the executive branch of a national government. Its principles of specialization are those of purpose and function such as the Directorates General (DG) of Transport, Energy and Administration. The relationships between the Commissioners and the DGs are harmonious. A Commissioner can be responsible for policy areas that belong to different DGs. Cabinet portfolios are basically function-based. National officials are invited by the Commission to participate on expert and advisory committees in the preparatory stages of a policy process. They attend as area experts, and do not formally represent their governments (Docksey and Williams, 1997, p. 141). Interest group participation is functionally based. The geographical principle is apparent in several respects. At the apex of the organization, the College of Commissioners is comprised of persons proposed by the member governments. They are served by personal secretariats that are composed of compatriots of the respective commissioners. For the Commission services, the recruitment of officials is drawn from national quotas but merit criteria is also applied. II. Number of Members The EU has 27 member countries. The EU member countries and their respective year of membership are as follows: Austria (since 1995-01-01) (European Union Region), Belgium (EUR), Bulgaria (since 2007-01-01), Cyprus (Greek part) (since 2004-05-01) (EUR: 2008-01-01), Czech Republic (since 2004-05-01), Denmark (EUR), Estonia (since 2004-05-01), Finland (since 1995-01-01) (EUR) , France (EUR), Germany (EUR), Greece (EUR), Hungary (since 2004-05-01), Ireland (EUR), Italy (EUR), Latvia (since 2004-05-01), Lithuania (since 2004-05-01), Luxembourg (EUR), Malta (since 2004-05-01) (EUR: 2008-01-01), the Netherlands (EUR), Poland (since 2004-05-01),Portugal (EUR), Romania (since 2007-01-01),Slovakia (since 2004-05-01) (EUR: 2009-01-01), Slovenia (since 2004-05-01) (EUR) , Spain (EUR), Sweden (since 1995-01-01) and the United Kingdom of Great Britain and Northern Ireland. III. Economic Total Value of Trade The EU has a tremendous trading partnership with various countries in Africa, the Caribbean and the Pacific (ACP). The total value of EU trade with the ACP countries reached approximately 80 billion for 2007. The breakdown of trade transactions reflected figures of EU importation worth 40.2 billion and EU export figures of 39.7 billion. For the African countries, the EU is their largest trading partner. In terms of trade composition, the profile of key products which are currently traded are as follows: the ACP countries export petroleum (42% of total exports), cocoa beans, (5%) and diamonds (5%). The EU exports machinery (22%), oil (11%), vehicles (7%), boats (7%), and medicines (3%). The EU also poured considerable foreign direct investment to the ACP countries which had increased from 1,922 million in 1996 to 4,319 million in 2002. This value of investment represents approximately 3.3% share out of the total investment outflows of the EU. In terms of foreign direct investment breakdown, foreign dirext investment flows to ACP Africa peaked from 1,532 million in 1995 to 2,799 million in 2002. Hence, the ACP has increasingly become a destination for investment by the EU. According to EU Trade Commissioner Peter Mandelson (2008), the continued prosperity of Europe hinges on business certainty, tariff predictability, economic stability, and a stable access to fast-growing market. Based on the ongoing Geneva trade negotiations, the thorny issue is the balance between agriculture in which the tariff and subsidy regime showed that the EU is more defensive. The industrial sector of the EU also needs to expand to international markets. In agriculture, the current negotiations have progressed well. The main issues revolve around the Green Box and Sensitive Products. An acceptable solution are to Green Box are visible. More work is needed on the sub allocation of tariff rate quotas. The EU is still currently negotiating regarding the various tropical products with key Latin American trading partners. On the cotton issue, the trade negotiations between the EU and the ACP countries are still ongoing with respect to the trade subsidies that EU has given to all of its the cotton producers. However, significant reform efforts in the industry have been done. IV. Euro-Who's on Euro The Eurozone countries pertain to the 27 countries which use the euro currency. The respective government authorities will withdraw the old national currency of each member of the euro zone and replace with euro. Conversion into euros is governed by a law passed at European Union level in 1997. The law has fixed the rate for each national currency unit on 1 January 1999 which was used to convert into euros. The Eurozone has its own governing economic and monetary union which shares the same monetary policy and currency. The EMU started on 1 January 1999 when the euro became a legal currency and the national currencies of the first 12 participating countries became part of it. The European Central Bank (ECB) which was established on 1 June 1998, forms part of the European System of Central Banks together with the EU's 27 national central banks. The ECB is mandated to maintain price stability within the eurozone. Its crucial tasks cover the establishment and implementation of monetary policy, the conduct of foreign exchange operations and the management of the official foreign reserves of the Member States. The euro has been a legal scriptural and written currency in the 27 Member States. The euro is used for all transactions involving cheques, debit cards, bank transfers, credit cards and electronic cards. All companies and businesses need to operate in euros from 1 January 2002. All exchanges with public authorities involving money must be in euros. This also means that the Value-Added Tax (VAT), social security and accounting declarations must be made in euro. V. What's the European Union The European Union's Common Foreign and Security Policy (CFSP) was primarily proclaimed in 1992, in the Treaty of European Union or the Maastricht Treaty. It was expanded in the Amsterdam Treaty signed in 1997, and the Constitutional Treaty signed in 2004. The CFSP is managed by the European Council (heads of governments), the Council of the European Union (ministers), by a system of a unanimous approval by the representatives of member governments. (Elgstrom and Jonsson, 45) This particular system guaranteed that each member, no matter how small or new, retained either a veto or the power to delay. This further means that Member States have the right to stand aside from a particular decision. The EU High Representative and his support staff were established to support foreign policy assessment among Member States. This institution is distinct from the European Commission of Brussels and from the EU Commissioner for External Relations. The foreign and security policy process adopts various levels of decision-making. The EU has consultative and advisory bodies such as the European Council, the Committee of Permanent Representatives, the Political and Security Committee and the High Representative for CFSP. In 2004, ten new members entered the Union: three Baltic States, five Eastern European states, and two Mediterranean island states. The new entrants have expanded EU membership from 15 to 27 and have made the European Union more populous and large in terms of the total Gross Domestic Product (GDP). For the European Union, in the arena of global affairs, the maintenance of a unique diversity remains the rule. Although there are specific variations in the functioning of the European Union as a prime mover in the field of international relations, the changing transatlantic tensions need to be considered as power struggles evolve within Europe as the EU continually enlarges its current membership roster. VI. Current Challenges for the European Union Today Various challenges need to be hurdled by the European Union (EU) Member States today. The European Union enlargement which results in an expansion of membership is a historic development which marks the unification of the continent by peaceful means. The EU poses a strong challenge to the United States for world leadership in the political and economic arenas. One major challenge is that the Europeans want to see a stronger Europe. Those divisions are complicating the EU's efforts to exert greater influence in the world. (Dale, 48) This is the field of international governance in which Europeans will continue to convey their influence in world affairs. The Europeans see the enlargement of the EU as an indication of their increasing international influence. The major goal is to strengthen Europe's world role by streamlining the EU's institutional structure. An important related goal is to endow the EU with a single foreign minister and a stronger president who can manage to represent the EU viewpoint in diplomatic relations with the rest of the world. The second major challenge is that the EU is still struggling to become an international political power. The EU has achieved every important target it has set itself including the establishment of a common commercial policy and economic and monetary policy. The EU has its strongest influence in world affairs in the areas where it has the most closely related national policies. (Dale, 1) In the present world trade negotiations, the EU is as important as the United States. The third major challenge is that the euro has become the world's second most important currency after the dollar. The effort to maintain the stability of the euro is made more important with the presence of small member states which are burdened by growing budget deficits. The fourth major challenge is for the EU to adopt common foreign and defense policies to gain greater influence in international relations. Many Europeans believe the opposite: that the shock will provide the nervous energy required to forge closer political ties. (Dale, 39) The fifth challenge is the transformation of the EU as an international civil-political power which is implemented by means of a multilateral diplomacy. The advantage of the European Union is the success it has achieved in overcoming conflict and national rivalries in its own area of Western Europe, now broadened to Central and Eastern Europe, through patient negotiation and compromise. The EU attempt to spread its own modus operandi internationally is aimed at creating a new framework of world governance. (Dale, 39) The final challenge is that the EU member states want to be partners with the United States. The fundamental interests of the EU and the United States converge. Both states need a peaceful world in which trade and investment flow freely amidst democracy and prosperity among nations. References Docksey, C. and K. Williams (1997) 'The Commission and the execution of Community policy". In G. Edwards and D. Spence (eds.) (1997), The European Commission (London: Cartermill Publishing). Elgstrom, Ole and Christer Jonsson. (2005) European Union Negotiations: Processes, Networks and Institutions.London: Routledge. Dale, Reginald. (2003). European Union, Properly Construed. Policy Review. Issue: 122. Page 39. Mandelson, Peter. (2008) Doha Development Agenda. Remarks by EU Trade Commissioner Mandelson at a Civil Society Dialogue Meeting. 23 June 2008, Brussels. Read More