European Union Influence in International Political Economy - Essay Example

European Union Influence in International Political Economy Department Can the EU become an influential player in international political economy? Introduction International political economy is a field that tries to understand global and international problems through an electric interdisciplinary array of theoretical perspectives and analytical tool. It encompasses analysis of political economy in the global trade, international finance, multinational corporations, and hegemony and North-South relations. Multilateral institutions such as International Monetary Funds, World Trade Organization, United Nations and European Union tend to play significant roles in influencing international political economy (Galindo & Nissan, 2010, pp. 24). This paper will discuss EU and how it is an influential player in international political economy. European Union is a multinational government that is changing the initial role of the nation-state and sovereignty in the entire Europe. EU was formed willingly by several states that had similar goals and is unique in its design and idea to the European continent (Breherton & Vogler, 2002, pp. 213). EU is a unique economic and political partnership between twenty-eight countries that occupy much of the continent. The initial mission of the European Union was to encourage cooperation among the countries after the World War II and was presumed that the countries that were trading together were unlikely to attack each other. Advantages to the Member States European Union has brought about so many advantages to the states that are members. The economic advantages include enabling the member states move capital and goods from place to place within the EU (Arull, 2004, pp. 505). In addition, the Entrepreneurs are free to give their services anywhere within the European Union, which is made possible since the European Union operates under a unified set of economic laws. These advantages have been designed to create a competitive marketplace and reduce the prices for the consumer especially those within the member states. European Union came up with one currency that is common in all the states; Euro, hence making it possible for the trade to take place between the countries. The European Union takes a step further and provides its members with protection against the challenges of volatility and inflation in the monetary market (Lucarelli & Fioramonti, 2010, pp. 64-68). Being part of the European Union also encompasses political advantages for the member states. As a member of the multinational organization, the countries are able to wield more influence on the world stage. The workers are protected from exploitive practices through the working tie directive that is controlled by the European Union. The European health insurance card enables a person access the same medical care provided it be within the member states. The European Union ensures that security and safety is a benefit due to the greater cooperation on the issue regarding national security that encompasses cyber crime and drug trafficking. On social benefits to the member states, European Union adopted standards related to health, employment safety, and individual safety of citizens, education information and the overall better quality of life (Breherton & Vogler, 2002, pp. 218). A Brief history of Economic Policies within the European Union It is important to remember that both economic and political motives were at work when EU was founded. The issue of making war impossible within countries by integrating industrial bases was a significant element of the European strategy to create the European Union. The ideas laid a platform for rhetorical appeal ad ideological justification concerning the European integration that economics calculations alone would not have had. Except for the creation of trade zones that were free and a common agricultural policy, in the mid-1980’s the European Union had less to show for almost three decades in existence. Without a political purpose that motivated the member states to continue to push greater integration, it would not have become an economic power it is currently. On the political field, the members agreed to a rebate for Britain since it had held up all other businesses until the time it achieved a compromise regarding its European Union contributions (White & Elliot, 2014). By the late 1990s, the European Union had achieved its aim of becoming the largest single market and its policies implemented to stabilize economic production within the member states (Lucarelli & Fioramonti, 2010, pp. 73). There was much product harmonization with increase in the levels of intra-EU trade. At this period, the European Union was more proactive in issues related to shaping the international competition and institutions. There was a problem of miss representation since the EU’s external representation was not cohesive but it was able to incorporate its preferences within the international regimes and control the global competition to be consistent with reference to its firm’s preferences (Meunier & Nicolaidis, 2006). Succession countries should consider weighing their options before plunging into the European Union since the benefits outweigh the losses by far. The member states get support and funding that assist them to grow their economy and carry out their operations swiftly. The market offers it members a diverse and great trading environment that comes with increased market of consumers since the market population drastically multiplies concerning the open market. Membership in EU further comes with other factors that contribute to economic growth such as foreign direct investment that is seen in the foreign currency and the profits ploughed back (Milner, 1998). This open trade zones have played a significant role in removing the barriers to foreign direct investment and further relaxed taxes on such bilateral ventures into foreign markets. European Union has in addition encouraged political stability within the region as the member states work and operate collectively. Political stability is one determinant of economic growth since it attracts both the local and foreign investors. At this stage, the national monopolies and their privatization are broken, and mobility of labor within the European Union boosts the workforce of the succession countries that have joined the Union. For Instance, After Ireland joined the European Union; there were numerous advantages such as trade and economy as they benefited from foreign direct investment. Its location and position within the European continent has been an avenue for several multinational companies to locate and invest hence gaining access to many people (Arull, 2004, pp. 505). Many succession countries practice agriculture as the key driver of their economy. The European Union agricultural policy has been implemented to ensure that fair living standards for the farmers are achieved and ability to provide constant food supply to the consumers at affordable prices. The agricultural policy was incepted in 1962. International Influence The European Union protects its members from any forms of unfair competition tactics that are imposed by other nations. The Union’s economic power is such that it can act in such as way to greater effect than another nation would have individually. For instance, the voice of the European Union would be more successful and effective against the United States that would be the voice of a nation like Romania. Such protection allows the weak member states of the European Union to achieve a remarkable and faster rate of economic growth that they would do as a single nation and to compete on terms that are larger and more realistic. Globally, the European Union has formed basis with powers that can compete internationally in line with superpowers such as China and United States. Without such a Union, the United States would hold the highest position in world trade. Such type of dominance would lead to a state of unfair trading since there would be less or no realistic competition. The organization also provides a sizeable competitor for the trade that is emanating from the Far East with nations like China that are currently achieving rapid growth. The European Union members would not be individually capable of competing fairly with larger members and have a say in the international political economy. The European has provided a platform for international trade (Breherton & Vogler, 2002, pp. 234). Over the past five decades, Japan and Europe have emerged as the world’s leading economic powers. Their combined population consists of more than six hundred million people that is ten percent of the world’s population, but has a GDP of over forty percent. Such prominence has brought an increase in global responsibilities related to promoting and maintaining security and stability both in the region and globally. The European Union and Japan are focused to building and reinforcing ties to create a true cooperative global partnership in regions that go beyond their mutual economic and trade relationship. In the Asian region, Japan is the most important partner for Europe. The European is the centre of stability and growth globally. Japan changed over to use of Euro in 2002, and this has brought about so many benefits and strengthened the importance of the Japan-European Union dialogue to present opportunities and build stronger ties (Milner, 1998). Internally, the European Union has adopted a common currency and abolished trade barriers and further striving towards convergence of living standards. Internationally, the main aim of the European Union is to bolster Europe’s trade position and its economic and political weight. Because of the significant differences in per capita income between the member states and in national attitudes regarding issues such as debt, foreign trade and inflation, the European Union faces challenges in enforcing and devising common policies. Compared to its size and location, the European Union is one of the most global outward-oriented economies. European trades in services and goods accounts for fifteen percent of EU GDP. That is three points more than Japan or the United States. The share for industrial exports in the sectors of industries has benefit to the European Union economy more than double. The EU is the first exporter of services and goods and the first investor abroad. The European Union’s openness to trade and investment has improved its growth over the past two decades. Trade by itself explains more than quarter of the productivity gains that have been experienced across Europe through better specialization and innovation and greater competition (Kanter, 2014). A fair and open international trading system is one of the elements of Europe’s competitiveness. When tariff or non-tariff barriers prevent the flow of goods into the European Union region or access to European companies to markets outside, the competitiveness suffers a blow. At times when anti-competitive practices undermine or rather distorts resulting trade; the Europe competitiveness suffers twice (Milner, 1998). Competitive means open globally and the globe opens to us. The EU market must be open to cheap supplies of intermediary raw materials and goods for the producers of value added products in European Union. Restricting the flow of goods is capable of raising the costs of operation for European companies hence making them less competitive. The European Union has consistently done away with these barriers to its own economy. It is currently having one of the most open markets globally. Addressing barriers to the European Union exports in the third world countries, accounts for the bulk of its ability to improve the competitive position within the industry. Its main trading partners are less open and free than the European Union. The EU stands to benefit from the more expansion and opening of the markets globally. Through negotiating the removal of tariff barriers and non-tariff barriers, the European Union can open markets to its potential exporters. In addition, it can open markets for the exporters by ensuring that the regulations converge with that of their trading partners. The European Union is able to do this through the WTO and multilateral trade negotiations through its bilateral trade relations with other countries. Moreover, this is being made possible through a market access strategy that is designed to target and remove the individual barriers in the main export markets. It includes a tough new approach regarding the intellectual property rights that are important for European competitiveness. The European Union has further increased focus on barriers that are related to services trade, which is a significant comparative advantage for the European Union and the issue of investment. It is the central to the ability of the European Union companies to operate effectively and successfully in regional and global markets (Lucarelli & Fioramonti, 2010, pp. 78). Since the European Union was incepted, it has developed a network of bilateral and multilateral agreements with many regions and countries. This has seen it expand and deepen relations with its global partners. Since it is a major global actor as demonstrated by the various roles as the largest single market globally, its deep relations with countries and its outstanding commitment to development aid, the European Union is at the front line in promoting sustainable development, democracy, freedom and fight against poverty (Breherton & Vogler, 2002, pp. 250). In addition, the European Union plays a role in world affairs as seen with the establishment of CFSP (Common foreign and Security Policy) and the ESDP (European Security and Defense policy). These two allow for better response regarding the far reaching economic and political changes that are experienced on the European Union doorstep and also other parts of the world that need coherent European action. The European Union holds summit meetings with partners such as Japan, the United States, Canada and more recently with India, China, Russia and Ukraine. The Union holds various dialogues within regions with other countries in Asia, the middle East, Latin America and the Mediterranean. These relationships whose main focus is trade issues, have expanded over the years to cover investment, finance, economic cooperation, energy, environmental protection, science and technology and also efforts on war on international crime, terror, human rights and drug trafficking. Conclusion There is no real dispute regarding the fact that in international relations, size matters. Thus, regardless of the European Union being not cohesive, large sovereign state when it comes to international affairs, it is one in economic and commercial matters and it has proved as a powerful actor in the international political economy as a result (Press, 2014). The European Union is a model for other regional institutions for the reason that a large market has more power in relation to the international sphere than many of the individual states. The European Union success in creating the corporation among its member states was because of the political agenda. A certain level of willingness and trust to forgo the short-term benefits was a driving force for the European Union ability to create the current economic power. European Union has put in place different law systems, financing of businesses and labor relations hence resulting to ability to harmonize the nonessential aspects to advantaging one system over the other, while leaving in place those aspects that bring about national synergies. The role of the European Union seems like a gentlemen’s club in where economic compromises are made as opposed to a powerful supranational institution, which can ride roughshod over the member states’ wishes regarding economic matters. According to critics, the individual member states would not have liberalized their capital amounts, make cuts on their welfare spending, subsidize their industries and cease protecting their industries had the EU not forced them. This claim is difficult to confirm as seen with the non-EU countries that show that the countries did not resist globalization any better in comparison to the European Union member states (Heisenberg, 2006, 21). It is important to note that most of the neoliberal policies that the European Union is for are mainly stymied in agreement of legislation by the member states. Majority of the European citizens think that they benefit personally from the international trade and the European Union benefits from the international trade (Blaas & Becker, 2007 pp. 343). In addition, people think that European products are produced with high standards and are sufficiently able to compete with other products that are from outside the European Union. Through this, it has been able to become a model for several regions globally since it has developed economic and further political clout. There are so many regions globally aspiring to become like the European Union such as the ASEAN and Mercosur. As this paper has illustrated, there are many benefits associated with the European Union ranging from political and legal benefits, economic and environmental benefits to labor and free movement of people. To ensure their influence on the international political economy, the EU has taken several measures linked to making it easier for countries to operate trade within each other. These measures include reducing paper work, introducing the euro in order to allow a single currency of trade, harmonizing standards through safety and technical standards and enforcing the movement of people through allowing the member state citizens to have free movement within the other countries. There can be no doubt that the EU is having a good share of influence on the international political economy. References Arnull, A. (2004). The Member States of the European Union and Giscards blueprint for its future. Fordham International Law Journal. 27, 503-543. Blaas, W., & Becker, J. (2007). Strategic arena switching in international trade negotiations. Aldershot, England, Ashgate Pub. Pp 298- 369. Bretherton, C., & Vogler, J. (2002). The European Union as a global actor. London, Routledge. Pp 206- 256. Galindo Martin, M.-A., & Nissan, E. (2010). International political economy. Hauppauge, NY, Nova Science Publishers. Heisenberg, D. (2006). Can The European Union Control The Agenda Of Globalization? Contemporary Studies In Economic And Financial Analysis. 88, 19-40. Lucarelli, S., & Fioramonti, L. (2010). External perceptions of the European Union as a global actor. London, Routledge. Pp 23-103. Kanter, J. (2014, November 4). 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