A regional trade organization made up of twenty-five European countries.
Created in 1992 by the Maastricht Treaty, the European Union (EU) incorporated and expanded earlier regional economic agreements. In 1951, the Treaty of Paris created the European Coal and Steel Community, while the Rome Treaties of 1957 created the European Economic Community and the European Atomic Energy Community. These early regional economic agreements all established organizations, including ministerial councils, assemblies, courts, and executive agencies known as commissions.
In 1967, all these communities were merged into the European Communities (EC) and administered by the Council of Ministers, the European Commission, the European Assembly, and the European Court (Europa). At its inception, the EC included six countries: Belgium, the Netherlands, Luxembourg, France, Germany, and Italy. In 1972, the United Kingdom, Denmark, and Ireland joined the EC, which grew to twelve members with the accession of Greece in 1981, and Spain and Portugal in 1986.
The twelve-member EC was a customs union within which goods were traded relatively freely. The EC had a common external tariff and before the 1992 Maastricht Treaty, a program aimed at eliminating all remaining trade barriers and creating a common market through the freeing up of factor movements, had been initiated. The Maastricht Treaty added economic and monetary union to the regional economic integration realized by the EC and set out objectives related to common internal security and external defense arrangements for the union.
European Union, 2004 Arguably the most successful and certainly the most integrated trade bloc in modern history, the European Union began modestly in 1957 as a collection of six countries working together to lower tariffs between them. By 2004, the Union included twenty-five states, twelve sharing a common currency in the euro. (Mark Stein Studios)
While the European Union (EU) has been touted by leaders as a means to expand intra-European trade and European economic influence in the world, many Europeans opposed it and for various reasons. “The EU eventually pokes its nose into everything,” says this Danish poster. (© Francis J. Dean/The Image Works)
The EU grew to fifteen with the addition of Sweden, Finland, and Austria and, in 1998, became a monetary union with a common currency and a common central bank. England, Denmark, and Sweden opted out of the monetary union, but the common currency, the euro, was placed in circulation in 2002 in the other countries. The EU has welcomed a number of new members from the former Soviet bloc and elsewhere, but not without adherence to strict requirements. The Czech Republic, Cyprus, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia all became members in 2004. Romania, Bulgaria, and Croatia have been accepted and are likely to be admitted in 2007. Turkey’s admission has been made conditional on improvements in human rights.
The members of the EU have benefited from increased trade and economic growth. The EU is the world’s largest trading bloc, accounting for 36 percent of world merchandise exports and imports in 2000 if trade within the EU is included. If intra-EU trade is excluded, the EU accounts for 17.3 percent of world merchandise exports and 18.3 percent of world merchandise imports, compared to figures of 15.7 percent and 23.9 percent, respectively, for the United States. A similar pat tern holds for the services trade, with the EU accounting for about 40 percent of the total including intra-EU trade. Of total exports valued at $2.25 trillion in 2000, about 62 percent were exported from one EU member to another.
E. Wesley F. Peterson
See also: Trade Organizations.
Europa. “Europe in Ten Points: A Brief History of European Integration” (http://europa.eu.int/comm/dg10/publications/brochure/docu/101econs/text_en.html#1, accessed September 2002).
World Trade Organization. International Trade Statistics 2001. Washington, DC: World Trade Organization, 2001.