Skip to main content
Select Source:

European Union

European Union

The European Union (EU) is an economic and political federation consisting of twenty-seven member countries that make common policy in several areas. The EU was created in 1993 with the signing of the Treaty on European Union, commonly referred to as the Maastricht Treaty, but it was preceded by various European organizations that contributed to the development of the EU. The EU represents the latest and most successful in a series of efforts to unify Europe, including many attempts to achieve unity through force of arms, such as those seen in the campaigns of Napoleon Bonaparte and World War II.

STEPS TOWARDS THE MAASTRICHT TREATY

In the wake of the Second World War, which devastated the European infrastructure and economies, efforts began to forge political union through increasing economic interdependence. In 1951 the European Coal and Steel Community (ECSC) was formed to coordinate the production and trading of coal and steel within Europe. In 1957 the member states of the ECSC ratified two treaties creating the European Atomic Energy Community (Euratom) for the collaborative development of commercial nuclear power and the European Economic Community (EEC), an international trade body whose role was to gradually eliminate national tariffs and other barriers to international trade involving member countries. Initially the EEC, or, as it was more frequently referred to at the time, the Common Market, called for a twelve- to fifteen-year period for the institution of a common external tariff among its members, but the timetable was accelerated and a common tariff was instituted in 1967.

Despite this initial success, participation in the EEC was limited to Belgium, France, Germany, Italy, Luxembourg, and the Netherlands. Immediately following the creation of the EEC a rival trade confederation known as the European Free Trade Association (EFTA) was created by Austria, Britain, Denmark, Finland, Norway, Portugal, Sweden, and Switzerland. Although its goals were less comprehensive than those of the EEC, the existence of the EFTA delayed European economic and political unity.

By 1961 the United Kingdom indicated its willingness to join the Common Market if allowed to retain certain tariff structures which favored trade between Britain and its Commonwealth. Negotiations between the EEC and the United Kingdom began, but insurmountable differences arose and Britain was denied access to the Common Market in 1963. Following this setback, however, the Common Market countries worked to strengthen the ties between themselves, culminating in the merger of the ECSC, EEC, and Euratom to form the European Community (EC) in 1967. In the interim the importance of the Commonwealth to the British economy waned considerably and by 1973 Britain, Denmark, and the Republic of Ireland had joined the EC. Greece followed suit in 1981, followed by Portugal and Spain in 1986 and Austria, Finland, and Sweden in 1995.

Even as it expanded, the EC worked to strengthen the economic integration of its membership, establishing a European Monetary System (EMS) featuring the European Currency Unit (ECU, later known as the Euro) in 1979. The EC then passed the Single European Act, which strengthened the EC's ability to regulate the economic, social, and foreign policies of its members, in 1987. The EC took its largest step to date toward true economic integration among its members with the 1992 ratification of the Maastricht Treaty, after which the EC changed its name to the European Union (EU). The Maastricht Treaty also created a central banking system for EU members, established the mechanisms and timetable for the adoption of the Euro as the common currency among members, and further strengthened the EU's ability to influence the public and foreign policies of its members.

EXPANSION SINCE 1993

The EU originally had twelve member nations: Belgium, Denmark, France, Germany, Greece, Italy, Luxembourg, the Netherlands, Portugal, the Republic of Ireland, Spain, and the United Kingdom. In 1993, the European Council, meeting in Copenhagen, Denmark, determined the criteria for joining the EU. These requirements, known as the Copenhagen criteria, included: (1) a stable democracy which respects human rights and the rule of law; (2) a functioning market economy capable of competition within the EU; and (3) the acceptance of the obligations of membership, including EU law. The European Council has the responsibility for evaluating a country's fulfillment of these criteria.

The EU has enlarged three times since its creation. In 1995, three new members were added: Austria, Finland, and Sweden. In 2004, ten new members were added, mostly from the former Soviet bloc: Czech Republic, Cyprus, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia. In 2007, Romania and Bulgaria, who were not ready to join in 2004, were admitted. As of 2008, there were three official candidates for membershipCroatia, Macedonia, and Turkeyand five nations officially recognized as potential candidatesAlbania, Bosnia and Herzegovina, Kosovo, Montenegro, and Serbia.

THE EURO

One of the goals of the EU is economic integration and a common European currency. EU leaders expect great benefits from the adoption of a single currency. International trade within the single currency area will be greatly facilitated by the establishment of what amounts to a single market, complete with uniform pricing and regulation, in place of separate national markets. The creation of a single market is also expected to spur increased competition and the development of more niche products, and ease the acquisition of corporate financing, particularly in what would formerly have been international trade among members of the single currency area. Finally, in the long term, the establishment of the single currency area should simplify European corporate structures, since in time nearly all regulatory statutes within the single currency area should become uniform.

The Maastricht Treaty established conditions that EU member nations would be expected to meet before they would be allowed to participate in the introduction of the single European currency. These conditions were designed to create a convergence among the various national economies of Europe to ease the transition to a single currency and ensure that no single country would benefit or be harmed unduly by its introduction. Such a convergence would also create greater uniformity among the various national economies of the EU, making administration of economic activity within the single-currency area more feasible. The conditions set for participation in the introduction of the Euro and inclusion in the single-currency area included the following:

  • Maintaining international currency exchange rates within a specified range (called the Exchange Rate Mechanism or ERM) for at least two years prior to the introduction of the Euro.
  • Maintaining long-term interest rates within 2 percent of the national inflation rate and within 1.5 percent of the three best-performing EU member states in terms of price stability.
  • Maintaining public debt at no more than 3 percent of the gross domestic product.
  • Maintaining total government debt at no more than 60 percent of gross domestic product.

Despite difficulties faced by some members in meeting these conditions, implementation of the Euro went ahead on schedule through the three phases set forth at Maastricht. Phase one began in 1998 with an EU summit in Brussels, Belgium, that determined which of the fifteen member states had achieved sufficient convergence to participate in the introduction of the Euro. The selected participants were Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal, and Spain (exceptions were Demark, Greece, Sweden and the UK). Phase two, which commenced on 1 January 1999, introduced the Euro as legal tender within the eleven selected countries, referred to as the single-currency area, although the new currency would only exist as a currency of account, that is, it would exist only on paper or for electronic transactions, as no Euro notes or coins were yet in circulation. Instead, the existing currencies of the participating countries functioned as fixed denominations of the Euro. Phase two also included the subordination of the eleven national banks in the single-currency area to the European Central Bank.

Phase three, which began on 1 January 2002, set the Euro banknotes and coins into circulation and by July 2002, it became the legal tender of the countries, replacing their national currencies. At the time of introduction there were twelve countries in the area using the Euro, known as the Eurozone: Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, and Greece. Denmark, Sweden and the UK chose not to use the Euro. By the beginning of 2008, the Eurozone had expanded to include fifteen member nations, with Cyprus, Malta, and Slovenia having joined the original members. Nine of the new EU member states were still operating with a currency other than the Euro. The Accession Treaties signed by all of

these countries requires them to join the Euro; some have already joined the ERM and others have set themselves the goal of joining the Euro as follows:

  • Slovakia: January 1, 2009
  • Lithuania: January 1, 2010
  • Estonia: January 1, 2011
  • Bulgaria, Czech Republic, Hungary, Latvia, Poland, and Romania: January 1, 2012 or later.

The initial introduction of the Euro as a currency of account began with a resounding success, as the new currency rose immediately to an exchange rate of 1.17 U.S. dollars to the Euro. Uncertainties about the further progress of European Union raised by conflicts in the Balkans in 1999 soon dampened investor interest in the Euro, however, and its value fell to 1.04 U.S. dollars per Euro by the summer of that year. The Euro continued to slip, and by late 2000, it had fallen to a record low of $0.83. Since 2003, however, the Euro has steadily risen against the dollar, gaining strength in 2007 as the U.S. economy began slipping towards recession; by mid 2008, the Euro was holding steady in the mid $1.50s.

STRUCTURE

The EU maintains four administrative bodies dealing with specific areas of economic and political activity.

Council of Ministers. The Council of Ministers comprises representatives, usually the foreign ministers, of member states. The presidency of the council rotates between the members on a semiannual basis. When issues of particular concern arise, members may send their heads of state to sit on the council. At such times the council is known as the European Council, and has final authority on all issues not specifically covered in the various treaties creating the EU and its predecessor organizations. The Council of Ministers also maintains the Committee of Permanent Representatives (COREPER), with permanent headquarters in Brussels, Belgium, to sit during the intervals between the council's meetings; and operates an extensive secretariat monitoring economic and political activities within the EU. The Council of Ministers and European Council decide matters involving relations between member states in areas including administration, agriculture and fisheries, internal market and industrial policy, research, energy, transportation, environmental protection, and economic and social affairs. Members of the Council of Ministers or European Council are expected to represent the particular interests of their home country before the EU as a whole.

European Commission. The European Commission serves as the executive organization of the EU. Currently each country has one commissioner except for the five largest countries that have two. The Commission enlarges as more countries join. The European Commission seeks to serve the interests of Europe as a whole in matters including external relations, economic affairs, finance, industrial affairs, and agricultural policies. The European Commission maintains twenty-three directorates general to oversee specific areas of administration and commerce within the EU. It also retains a large staff to translate all EU documents into each of the EU's twenty official languages. Representatives sitting on the European Commission are expected to remain impartial and view the interests of the EU as a whole rather than the particular interests of their home countries.

European Parliament. The European Parliament comprises representatives of the EU member nations who are selected by direct election in their home countries. Although it serves as a forum for the discussion of issues of interest to the individual member states and the EU as a whole, the European Parliament has no power to create or implement legislation. It does, however, have some control over the EU budget, and can pose questions for the consideration of either the Council of Ministers or the European Commission.

Court of Justice. The Court of Justice comprises thirteen judges and six advocates general appointed by EU member governments. Its function is to interpret EU laws and regulations, and its decisions are binding on the EU, its member governments, and firms and individuals in EU member states.

IMPORTANT PROGRAMS

From its creation the EU has maintained the Economic and Social Committee (ESC), an appointed advisory body representing the interests of employers, labor, and consumers before the EU as a whole. Although many of the ESC's responsibilities are now duplicated by the European Parliament, the committee still serves as an advocacy forum for labor unions, industrial and commercial agricultural organizations, and other interest groups.

One ongoing area of contention among the members of the EU is agricultural policy. Each European nation has in place a series of incentives and subsidies designed to benefit its own farmers and ensure a domestically grown food supply. Often these policies are decidedly not beneficial to the EU as a whole, and lead to conflict between rival national organizations representing agricultural and fisheries industries. The degree of contention on agricultural and fisheries issues within the EU can be seen in the

fact that nearly 70 percent of EU expenditures are made to address agricultural issues, even though agriculture employs less than 8 percent of the EU workforce. In an attempt to reduce conflict between national agricultural industries while still supporting European farmers, the EU adopted a Common Agricultural Policy (CAP) as part of the Treaty on European Union.

The CAP seeks to increase agricultural productivity, ensure livable wages for agricultural workers, stabilize agricultural markets, and assure availability of affordable produce throughout the EU. Although the CAP has reduced conflicts within the EU, it has also led to the overproduction of many commodities, including butter, wine, and sugar, and has led to disagreements involving the EU and agricultural exporting nations including the United States and Australia.

The European Social Fund (ESF) and the European Regional Development Fund (ERDF) were established to facilitate the harmonization of social policies within EU member states. The ESF focuses on training and retraining workers to ensure their employability in a changing economic environment, while the ERDF concentrates on building economic infrastructure in the less-developed countries of the EU.

The European Investment Bank (EIB) receives capital contributions from the EU member states, and borrows from international capital markets to fund approved projects. EIB funding may be granted only to those projects of common interest to EU members that are designed to improve the overall international competitiveness of EU industries. EIB loans are also sometimes given to infrastructure development programs operating in less-developed areas of the EU.

OBSTACLES FACING THE EU

Although the EU has accomplished a great deal in its first two decades, many hurdles must still be crossed before true European unity can be achieved. Many EU nations experienced great difficulty in meeting the provisions required by the EU for joining the EMS, although eleven countries met them by the 1 January 1999 deadline. Meeting these provisions forced several EU members, including Italy and Spain, to adopt politically unpopular domestic economic policies. Others, such as the United Kingdom, chose not to take politically unpopular action and thus failed to qualify for participation. Even though the Euro was introduced according to schedule, economic unity has far outstripped political cooperation among EU members to date and real and potential political disagreements within the EU remain a threat to its further development. Although the Eurozone represents a formidable force in international trade, the EU faces several grave challenges as it strives to form an ever closer linkage of its national constituents.

Despite the fact that the Treaty on European Union created a central bank to supercede the national banks of its members, responsibility for the creation of fiscal policies remains in the hands of each national government. As such, there is great potential for the central authority and national economic policy making agencies to adopt conflicting programs. Furthermore, national political institutions within the EU are likely to be more responsive to the desires of their national constituencies than to the well being of the Eurozone as a whole, especially in times of economic instability. It is difficult to see how voters in the nations of the EU will be able to put the good of Europe ahead of their own particular interests.

This difficulty is particularly troublesome as political integration has progressed much more slowly than economic integration, and further political integration has recently suffered several potentially insurmountable setbacks. In 2004, the Treaty establishing a European Constitution (TCE) was signed by the representatives of all twenty-seven member nations, but the treaty failed to be ratified by all of the members. Most members did in fact ratify the TCE by parliamentary measure or popular referendum, but France and the Netherlands both rejected it in referendums. These failures led other members to postpone or call off their ratification procedures. As a result, the European Council called for a period of reflection, which subsequently led to negotiations over a new constitutional treaty, known as the Lisbon Treaty. The Treaty of Lisbon, signed on 13 December 2007, was in the process of being ratified by member nations when the Irish electorate rejected the treaty in June 2008, creating uncertainty as to the future ratification of this version of a European constitution.

Another problem also arises out of the composition of the Eurozone. According to the optimal currency theory first posed by American Robert Mundell in 1961, in order for a single currency to succeed in a multinational area several conditions must be met. There should be no barriers to the movement of labor forces across national, cultural, or linguistic borders within the single-currency area; there should be wage stability throughout the single currency area; and an area-wide system should exist to stabilize imbalanced transfers of labor, goods, or capital within the single-currency area. These conditions do not exist in present-day Europe, where labor mobility is small, largely because of language barriers, and wages vary widely among EU member countries, particularly between those in the West and in the East. Furthermore, the present administrative structure of the EU is not powerful enough to redress imbalanced transfers, which are bound to occur periodically. Such imbalances would engage the sort of

political response discussed previously, to the detriment of the EU as a whole.

Optimal currency theory also holds that for a single currency area to be viable it must not be prone to asymmetric shocks, that is, economic events that lead to imbalanced transfers. Ideally, a single-currency area should comprise similar economies that are likely to be on similar cycles, thus minimizing imbalances. Similarly, the need for a freely transferable labor force within the single-currency area is also necessary to minimize imbalances, since each national member of the area must be able to respond flexibly to changes in wage and price structures.

ANALYSIS AND PROSPECTS

The EU has made remarkable progress during its first two decades. Although there are significant obstacles in the way of further strengthening of the EU, especially in political matters, the continued enhancement of economic ties binding members is likely to increase the political unity of EU members over time. That this is feasible is evidenced by the efforts of EU nations to conform to the stipulations of the Maastricht Agreement. Maintaining stable currency exchange rates, reducing public and overall government debt, and controlling long-term interest rates are all areas in which national governments and fiscal agencies had exercised complete autonomy in the past. Before the implementation of the Euro's second phase, many doubted that the EU member states could put aside their own internal interests to meet the Maastricht provisions; however, eleven of the fifteen managed to do so, and currently over half of the EU members belong to the Eurozone. Significantly, many had to experience economic slowdowns and increased unemployment in order to do so. Such resolve bodes well for continued strengthening of European unification in both political and economic areas. In fact, the history of the EU to date has been one of overcoming obstacles similar to those faced during the first two phases of the introduction of the Euro, and a unified Europe is and will remain a fact of international economic life for the foreseeable future.

SEE ALSO Free Trade Agreements and Trading Blocs; International Business; International Management

BIBLIOGRAPHY

Alesian, A., and R. Rerotti. The European Union: A Politically Incorrect View. Journal of Economic Perspectives 18, no. 4 (2004): 2748.

Blair, Alasdair. The European Union Since 1945. New York: Longman, 2005.

Europe Ten Years from Now. International Economy 18, no. 3 (2004): 3439.

European Union in the U.S. Available from: http://www.eurunion.org.

McCormick, J. Understanding the European Union: A Concise Introduction. 3rd ed. New York: Palgrave, 2005.

Phinnemore, D., and L. McGowan. A Dictionary of the European Union. 3rd ed. London and Chicago: Europa, 2006.

Pinder, John and Simon Usherwood. The European Union: A Very Short Introduction. 2nd ed. New York: Oxford University Press, 2008.

Reid, T.R. The United States of Europe: The New Superpower and the End of American Supremacy. New York: Penguin Press, 2004.

Vanthoor, W.F.V. A Chronological History of the European Union, 19462001. 2nd ed. Northampton, MA: Edward Elgar, 2002.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Encyclopedia of Management. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Encyclopedia of Management. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/management/encyclopedias-almanacs-transcripts-and-maps/european-union

"European Union." Encyclopedia of Management. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/management/encyclopedias-almanacs-transcripts-and-maps/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

EUROPEAN UNION

EUROPEAN UNION (European Community). On 1 November 1993 the European Community (EC), a political and economic confederation of European countries, officially became the European Union (EU). The EU consists of three institutions: the European Coal and Steel Community (ECSC), the European Atomic Energy Community (EURATOM), and the European Economic Community (EEC). Its fifteen members are France, Germany, Italy, Belgium, the Netherlands, and Luxembourg (the original "Six" from the 1950s); Great Britain, Denmark, and Ireland (joined 1973); Greece (1981); Portugal and Spain (1986); and Austria, Finland, and Sweden (1995).

The EU's total area is about one-third the size of the United States, but its population in 2000 was 377.6 million, compared to 284.2 million for the United States. Their economies are of roughly comparable size. In 2000 the EU accounted for 18.2 percent of world imports and 17.2 percent of world exports, while its GDP totaled $7.8 trillion. The American figures were 23.9 percent and 15.7 percent with a GDP of $9.9 trillion. Both are also important economic partners. In 2000 the EU's trade with the United States was valued at $394.8 billion and made up 19.2 percent of its total imports and 24.7 percent of its total exports, while American trade with the EU was worth $385.2 billion and accounted for 18.1 and 21.1 percent, respectively. During the same year the EU also made $802.7 billion in direct investments in the United States and received $573.4 billion in return.

Institutions

The EU has four major governing organs. The European Commission, located in Brussels, proposes policies and legislation, is responsible for administration, and enforces both decisions made by European institutions and the provisions of European treaties. Including the commission president, twenty commissioners with individual portfolios serve five-year terms. They are appointed by the national governments but act independently of them. The Council of the European Union, consisting of ministers from each member state, coordinates intergovernmental policies and enacts binding legislation. Depending on the agenda, different types of national minister will attend each council meeting. Most decisions within it take place as a result of a majority vote (normally weighted to reflect the size and importance of the member state), although some issues, such as foreign policy, taxation, and the environment, still require unanimity. The council has a rotating presidency with a six-month term that ends with a meeting of all fifteen heads of state or government. It holds most of its meetings in the country that has the EU presidency. The European Parliament, which meets in Strasbourg, currently consists of 626 members elected for five-year terms. Members are seated by party group (such as Socialist, Christian Democrat, and Green) and since 1979 have been chosen in direct elections. The Parliament's key powers include approving or amending the EU budget submitted by the commission and publicly debating the work of the other governing organs. It may also censure the commission. The Court of Justice, which is located in Luxembourg and has fifteen judges, determines whether treaties in the European Union are being implemented and are in accordance with Union law. Both its judgments and EU law as a whole are binding on all member states.

European and American Perspectives on Integration

Although proposals for European integration go back as far as the Middle Ages, the origins of the present EU date from World War II. Many Europeans believed that for their continent to experience a political and economic revival, the national rivalries that characterized the past had to give way to greater international cooperation. However, ever since the 1940s there has been disagreement on what methods to utilize. "Federalists" like the Italian politician Altiero Spinelli advocated creating a unified European state as soon as possible. The Frenchman Jean Monnet and other "(neo)functionalists" believed that the consolidation of important industrial sectors across national lines would promote integration in all fields. Still another perspective, traditionally strong in Great Britain and Scandinavia but universally evident, advocated greater intergovernmental cooperation but remained wary about supranational organizations that would limit sovereignty. These divergent opinions have ensured that a mélange of approaches has characterized the road to the EU.

Since 1945 American policymakers have consistently supported European integration both publicly and privately, even if their active interest in promoting it waned dramatically starting in the 1960s. According to Geir Lundestad, several considerations informed their thinking. These include the belief that the new European institutions represented a healthy attempt to emulate the "American model" based around federalism, democracy, and free markets and also the idea that integration would promote a modernized Europe that was more efficient economically and less troubled by nationalist rivalries. More concretely, integration would reduce the burden of American military and economic commitments to Europe. Above all, a unified (Western) Europe could play an important role in containing both the Soviet Union and Germany. The United States also has promoted European integration for so long now that to some extent this policy has become traditional, irrespective of other considerations. Furthermore, the desire of Europeans themselves to work toward unity has been a tremendous influence on American policy as well.

American Support for European Integration during the 1940s and 1950s

During World War II, the Roosevelt administration feared that any moves toward European integration would contribute to a division of the world into political and economic blocs. However, the onset of the Cold War dramatically changed the official American attitude. Fear that communists might come to power in Western European countries due to postwar economic hardship led the Truman administration to propose the Marshall Plan in 1947. This initiative led to some modest steps toward European integration, especially the establishment of the Organization for European Economic Cooperation (OEEC) to administer Marshall aid and work for the reduction of tariffs. The Marshall Plan also helped to determine the geographic limits of integration until the 1990s since the negative Soviet reaction cemented the division of the continent. To the Truman administration's frustration, little further progress came until 1950, despite the intensification of the Cold War. The major reason was that Great Britain, at the time the most important state in Western Europe politically and economically, opposed all plans for supranational organizations.

The creation of the Federal Republic of Germany in 1949 made integration seem more urgent than ever. Under pressure from Washington but also motivated by its own interests, the French government and its unofficial advisor Monnet now assumed a leading role. The "Schuman Plan" for a European Coal and Steel Community (ECSC), developed by Monnet and announced by Foreign Minister Robert Schuman on 9 May 1950, ensured that German heavy industry would be used only for peaceful purposes, significantly upgraded the international status of the Federal Republic, and marked the start of postwar Franco-German cooperation. The Truman administration greeted it with enthusiasm. The ECSC, which came into existence in 1952, also set the pattern for further initiatives. It brought together for the first time the "Six" and created the four basic governing organs that characterized later integration. After initial hesitations, the Truman administration also gave its support to Monnet's plan for a "European Defense Community" (EDC) that would prevent the creation of an independent West German army. Although in December 1953 Secretary of State John Foster Dulles even threatened an "agonizing reappraisal" of the American security commitment to Western Europe if the EDC Treaty were not ratified, the French National Assembly rejected it on 30 August 1954, largely because of misgivings about surrendering the national army. The Eisenhower administration later gave its support to the creation of the European Economic Community (EEC) and the European Atomic Energy Community (EURATOM) in 1958. These two institutions and the ECSC, at first collectively called the "European Economic Community," were officially fused into the EC in 1967. They went a long way toward fulfilling Washington's desire for integrated Western European structures that would help contain the Soviet Union and safely incorporate the Federal Republic.

Troubled Relations between the United States and the European Economic Community

Nonetheless, doubts soon arose about whether European integration was compatible with American leadership in Western Europe. Starting in 1958 French President Charles de Gaulle challenged United States political predominance by demanding a coequal role for France with it and Britain within the North Atlantic Treaty Organization (NATO). He also pursued an increasingly independent policy on issues like Berlin, the Vietnam War, relations with communist states, nuclear weapons, and British membership in the European Economic Community (which to the chagrin of American policymakers he vetoed in 1963). American leaders tried to accommodate de Gaulle while rejecting his aspirations to leadership, but already during the Kennedy administration they began to stress the Atlantic character of European-American relations. Moreover, starting in the late 1950s negative American payment balances (at first due to high levels of American foreign investment and military aid but by the late 1960s also involving trade deficits) led to increasing worries about economic competition from the "Six." Washington responded by intensifying the process of reducing tariffs between industrialized states within the General Agreement on Tariffs and Trade and in 1961 helped create an Organization for Economic Cooperation and Development with American and Canadian membership to replace the OEEC. Since the mid-1960s, the United States and the EU have been involved periodically in trade disputes involving a variety of agricultural and industrial products.

Even though National Security Advisor Henry Kissinger proclaimed 1973 the "Year of Europe," the Nixon administration reevaluated the traditional policy of American support for European integration in light of these political and economic challenges. Henceforth the United States would no longer actively promote new initiatives for supranational integration, although it would not oppose further efforts by the Europeans themselves. Although Jimmy Carter criticized the Nixon and Ford administrations' neglect of the European allies and in January 1978 became the first president to visit the European Commission in Brussels, in practice the United States' main priority had become protecting its own national interests. This became quite clear during the 1980s, when the process of European integration revived after the relative stagnation of the previous decade. The negotiations on the "Single European Act" in 1985–1986, which aimed at the creation of a fully integrated European market by 1992, led to worried speculation in the United States about a "Fortress Europe." In addition, the Reagan administration became involved in a series of disputes over commercial policy with the EC, with which the United States had run a trade deficit starting in 1984.

Relations since 1989

By 1989 an improvement in relations was in sight, however. The end of the Cold War and the reunification of Germany made expanded European structures seem the best way of providing stability for the entire continent. In addition, by 1990 the United States had a positive trade balance with the EC again but was becoming worried about economic relations with both Japan and China. President George H. W. Bush gave increased attention to the American relationship with the EC. The 1990 Transatlantic Declaration set up a mechanism for regular consultations and reaffirmed the desire of both sides to strengthen their partnership. The Bush administration reached compromises on many of the economic disputes that had arisen as a result of the Single European Act. Moreover, it strongly supported the 1992 Maastricht Treaty that created the EU in 1993 with both an Economic and Monetary Union (EMU) and a Common Foreign and Security Policy (CFSP) among its future goals. In 1995 the United States and the EU agreed on a "New Transatlantic Agenda" that committed them to active cooperation in roughly a hundred policy areas. The EMU was realized with the introduction of a common currency, the euro, on 1 January 1999, at first on an accounting basis only. Although Denmark, Great Britain, and Sweden chose not to participate for the time being, the other twelve EU states replaced their national currencies with euro bank-notes and coins on 1 January 2002. The euro has the potential to rival the dollar as an international reserve currency. The United States remains sensitive to any developments toward a CFSP that might call NATO's preeminence into question, but the EU for some time will not have any capacity to conduct significant military operations outside of that alliance and also has signaled its continued desire to work within it. Moreover, the EU's attention during the first part of the twenty-first century will be devoted to its expansion into eastern Europe. In 1998 it began negotiations with six new candidates for admission (the Czech Republic, Cyprus, Estonia, Hungary, Poland, and Slovenia), with enlargement from this group not expected before the end of 2002. On 15 January 2000 it also initiated talks with six further applicants (Bulgaria, Latvia, Lithuania, Malta, Romania, and Slovakia). Ten of the twelve candidates should join around mid-decade, with Bulgarian and Romanian accession by 2009.

BIBLIOGRAPHY

Lundestad, Geir. "Empire" by Integration: The United States and European Integration, 1945–1997. Oxford: Oxford University Press, 1998. The standard work; also provocative with its thesis of an American "empire."

Nugent, Neill. The Government and Politics of the European Union. 4th ed. Durham, N.C.: Duke University Press, 1999. The standard work on how the EU functions and its policies.

Pond, Elizabeth. The Rebirth of Europe. Rev. ed. Washington, D.C.: Brookings Institution Press, 1999. An excellent overview of European integration and its prospects and problems since 1989.

Stirk, Peter M. R. A History of European Integration since 1914. London: Continuum, 1996.

Urwin, Derek W. The Community of Europe: A History of European Integration since 1945. 2d ed. London: Longman, 1995. Both Stirk and Urwin are good general histories, with the former paying more attention to both the Atlantic framework and the Cold War as influences on the integration process.

ThomasMaulucci

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Dictionary of American History. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Dictionary of American History. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/history/dictionaries-thesauruses-pictures-and-press-releases/european-union

"European Union." Dictionary of American History. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/history/dictionaries-thesauruses-pictures-and-press-releases/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union

FORMATION OF THE EU

EU INSTITUTIONS

HOW IT WORKS

THE FUTURE OF THE EU

BIBLIOGRAPHY

The European Union (EU) is a cooperative entity that has qualities of both a federal nation-state and an international organization. It is neither, but falls somewhere in between. The EU is comprised of twenty-five member-states with around 460 million citizens. All member-states are democratic countries, which have agreed to cede some of their sovereignty to the institutions of the EU by participating in the common market, making their domestic laws conform to EU laws, adopting the Euro as a common currency, and allowing free movement of goods, capital, and persons, among other things. Social scientists attempt to explain why the EU came about, the role of its institutions in promoting cooperation, and its future trajectory. Will it continue to become more federal or will it reach policy gridlock? Will it continue to enlarge or will it reach its absorption capacity?

FORMATION OF THE EU

The earliest precursor to the EU was the European Coal and Steel Community (ECSC), formed in the wake of World War II as European countries sought a way to prevent such destruction from happening again. They believed if they became economically interdependent, they would be less likely to repeat the mistakes of the past. In addition, ECSC would make economic recovery and industrial modernization possible. For West Germany in particular, Chancellor Konrad Adenauer saw it as an opportunity for rapprochement with France and new ties with the West.

It was the 1950 Schuman Declaration that unveiled Jean Monnets idea of the ECSC. Six member-states (Italy, France, Belgium, Luxembourg, The Netherlands, and West Germany) signed it into being with the 1951 Treaty of Paris. The ECSC was so successful in the early 1950s that it led to the 1957 Treaties of Rome, establishing the European Economic Community (EEC), which was a customs union, and the European Atomic Energy Community (Euratom). The 1967 Merger Treaty merged the executive bodies of the three treaties, thereby creating the institutions that continue to exist in the twenty-first century. In addition, ECSC, EEC (later EC), and Euratom became known together as the European Communities. The 1987 Single European Act replaced the Treaty of Paris and the Treaties of Rome as the ECs policy domain grew into new areas not encompassed by the original treaties. It remained the European Communities until member-states signed and ratified the 1992 Maastricht Treaty, officially creating the European Union, which established the economic, monetary, and political union.

The basic evolution of these treaties embodies not only structural and institutional changes, but an increasing recognition of Europeans common values, goals, and even identity, as well as a willingness to vest more authority in EU institutions. Besides economic integrationthe largest area of common jurisdictionthere are common policies on agriculture, culture, energy, the environment, transportation, crime, and defense, among other things. Moreover, the EU has become increasingly political over time. In addition to increasing areas of jurisdiction, the EU has experienced successive enlargements, and the treaties have also attempted to accommodate its growing size. Membership in the EU has been so attractive that many European countries have voluntarily undergone extensive measures to democratize and develop economically so that they meet the criteria to begin accession negotiations.

EU INSTITUTIONS

At the core of the EU are its institutions, which are located in Brussels, Strasbourg, and Luxembourg. The European Parliament is the only representative institution as its members are directly elected, and belong to European political parties of which there are seven. It shares some decision-making authority with the Council of the European Union, which is an intergovernmental institution comprised of ministers and ambassadors from the member-states. The Council presidency, which sets the agenda for the EU, rotates every six months. Through the co-decision procedure, the Parliament and Council together take policy decisions, pass laws, and approve the EUs 100 billion annual budget. However, it is only the European Commission that can initiate new laws. The Commission, unlike the Council, represents EU interests as a whole, rather than the interests of individual member-states. Commissioners are required to swear an oath of loyalty to this effect. There is one Commissioner from every member-state, chosen by their national governments, and only the European Parliament has the ability to approve the College of Commissioners or dissolve it. Still, the parliament is rather weak compared to the Council and Commission, and this is problematic given that it is the only directly elected body.

Besides these three major EU institutions, the European Court of Justice (ECJ) has played a significant role in the operations of the EU, and in pushing integration forward. The ECJ is comprised of one judge from each member-state, and its primary role is to ensure that national law is compatible with EU law. In their 1993 article Europe before the Court: A Political Theory of Legal Integration Anne-Marie Burley and Walter Mattli argue that the judicial legitimacy of the ECJ has enabled it to take on more jurisdiction than had been intended, and to create precedents that assert the primacy of EU law over domestic law. Consequently, many individuals and local judges bring cases directly to the ECJ instead of to their national courts. Other important institutions are the European Central Bank, Court of Auditors, the European Economic and Social Committee, and the Committee of the Regions.

HOW IT WORKS

Besides the business of initiating and approving new laws, the EU has undergone major changes to its treaties. Member-states have willingly ceded increasing levels of sovereignty in numerous policy areas, but their control of the treaties is fundamentally intergovernmental. In order to change the jurisdiction of the EU fundamentally, statesmen must negotiate a new treaty at an Intergovernmental Conference (IGC). However, as argued in Maia K. Davis Crosss The European Diplomatic Corps (2007), the process of negotiation is much more complex than just the IGC summit, which is typically a highly publicized two-day event. Personal representatives of the statesmen, who are usually ambassadors based in Brussels, take years to prepare a draft treaty in advance of the IGC. Ultimately, agreement must be unanimous, and member-states can choose their own method of ratification, either through a parliamentary vote or popular referendum.

The last extensive revision to the EU was the 1992 Maastricht Treaty, which created the so-called pillar system. All of the policy areas that used to fall under the EC became the first pillar, which is governed by the community method. That is, in these policy areas the EU has full control at the supranational level, above the level of national governments. The second two pillars are intergovernmental, with the Common Foreign and Security Policy as the second pillar, and Justice and Home Affairs as the third.

A major part of the first pillar is the Single Market, which removed trade barriers among member-states, as well as establishing free movement of goods and a common tariff for imports from outside of the EU. The Single Market was part of the Treaty of Rome, but it was not fully completed until 1993. The Maastricht Treaty introduced the single currency, the Euro, which went into circulation on January 1, 2002. The benefits of a single currency are that it makes economic transactions easier, encourages investment, and completely eliminates exchange rate fluctuations. All member-states, including the ten new ones, have adopted the Euro, with the exception of the United Kingdom, Denmark, and Sweden. The European Central Bank, established in 1993, is completely independent of member-states and interests groups, and is charged with managing the Euro and Single Market, setting the EUs external exchange rate policy, and ensuring price stability and low inflation within the EU.

In addition to free movement of goods, the Maastricht Treaty also established free movement of persons, capital, and services, although certain restrictions still apply. Free labor mobility is of particular importance as it clearly distinguishes the EU from other free trade areas like the North American Free Trade Agreement (NAFTA). Europeans actually have citizenship in the EU, and can move, study, travel, and work within an internally borderless EU.

The Treaty Establishing a Constitution for Europenegotiated between June and October 2004 and signed by all EU governments on October 29was an attempt to revise the EU Treaty. But the ongoing national ratification process resulted in failure when the French and Dutch referenda in May and June 2005 rejected it. Nevertheless, the ratification process continued in 2006 even as efforts were underway to devise a new version.

THE FUTURE OF THE EU

There are numerous scholarly debates over why the EU has continued to deepen its policies, and what its future holds. Functionalists have argued that the process of EU integration has proceeded based on functional need, and on an ad-hoc basis. Neo-functionalists have argued that once the six member-states founded the ECSC a spillover effect ensued, in which one policy area necessitated integration in other, related policy areas. For example, economic cooperation spilled over into political cooperation.

Since the 1990s the major debate has typically been between rationalists and constructivists. Rationalists argue that integration proceeded based on cost-benefit calculations. At each juncture, leaders only agreed to more integration if it directly benefited their own states economic and power interests. Rationalists deny that any significant political integration can ever take place. On the other hand, the constructivist approach argues that the EU is a product of shared norms, which grow over time through deliberation, persuasion, and socialization. There is a certain idea of Europe that many Europeans believe is a worthwhile goal, and they comply with EU rules because they know it is in the long-term benefit of everyone. Depending on the approach, predictions about the future of the EU vary.

The question of how far enlargement can continue is also an area of attention. With the addition of ten new member-states in 2004, many scholars and politicians argue that the EU has reached its absorption capacity in the near term, and will have to wait many years before it is ready to undergo further enlargement. If the EU enlarges too quickly, it may be impossible for Europeans to continue to deepen integration, or deal with problems of democratic accountability at the supranational level.

Finally, scholars and policy practitioners debate the future role of the EU as an international actor. The strength and cohesion of the EU internally has a direct impact on its relations with the United States, its growing global security role, and its ability to be economically competitive. The EU has played a strong role in facilitating the ongoing Middle East peace process. Its policy is to favor the creation of two states to resolve the Israel-Palestinian conflict, and to find a solution to the Palestinian refugee crisis. The EU participates in numerous diplomatic and humanitarian assistance efforts to ensure the success of the roadmap to peace. The EU is the largest trading, scientific, and research partner with Israel, and provides the greatest amount of aid to the Palestinians and United Nations Relief and Works Agency. The EU responded to the 2006 crisis in Lebanon with numerous high-level diplomatic meetings with both Lebanese and Israel governments, the international community, and the United States. It also devised evacuation and humanitarian corridors to assist victims in escaping the violence, or to get supplies into the region.

Besides extensive aid to the Middle East, EU member-states as a whole give about $30 billion per year in development cooperation or aid to the third world more generally. Recipient countries include seventy-seven African, Caribbean, and Pacific countries. The EU seeks to reduce poverty in the third world by slowing the spread of HIV/AIDS, increasing education, providing debt relief, and improving the coherence between development and trade policies. To that end, the EU supports a number of associated territories, giving them preferential treatment and access to the European Development Fund for financing projects.

Overall, the EU leads the world in environmental protection and humanitarian aid, its economy is roughly the same size as that of the United States, and it has a high level of soft power or influence. While there are many areas of controversy and hurdles to cooperation in the foreseeable future, the EU has repeatedly proven itself to be a viable world player with much potential.

SEE ALSO Euro, The

BIBLIOGRAPHY

Burley, Anne-Marie, and Walter Mattli. 1993. Europe before the Court: A Political Theory of Legal Integration. International Organization 47 (1): 4176.

Cross, Maia K. Davis. 2007 The European Diplomatic Corps: Diplomats and International Cooperation from Westphalia to Maastricht. Houndmills: Palgrave.

Dinan, Desmond. 2003. Ever Closer Union: An Introduction to European Integration. Boulder, CO: Lynne Rienner Publishers.

McCormick, John. Understanding the European Union. New York: Palgrave Macmillan.

Moravcsik, Andrew. 1999. A New Statecraft? Supranational Entrepreneurs and International Cooperation. International Organization 53 (2): 267303.

Nelson, Brent F., and Alexander Stubb. 2003. The European Union: Readings on the Theory and Practice of European Integration. New York: Palgrave Macmillan.

Maia K. Davis Cross

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." International Encyclopedia of the Social Sciences. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." International Encyclopedia of the Social Sciences. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/social-sciences/applied-and-social-sciences-magazines/european-union

"European Union." International Encyclopedia of the Social Sciences. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/social-sciences/applied-and-social-sciences-magazines/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the European Community (EC), an economic and political confederation of European nations, and other organizations (with the same member nations) that are responsible for a common foreign and security policy and for cooperation on justice and home affairs. In Dec., 2009, following the ratification of the Treaty of Lisbon, the EU officially replaced and succeeded the EC. Twenty-eight countries—Austria, Belgium, Bulgaria, Croatia, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany (originally West Germany), Great Britain, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, and Sweden—are full members of the organizations of the EU.

Organizational Structure

The former EC, which formed the core of the EU, originally referred to the group of Western European nations that belonged to each of three treaty organizations—the European Coal and Steel Community (ECSC), the European Economic Community (EEC), and the European Atomic Energy Community (Euratom). In 1967 these organizations were consolidated under a comprehensive governing body composed of representatives from the member nations; further modifications since then have established the institutions of the EU as the European Parliament, the European Council, the Council of the European Union, the European Commission, and the Court of Justice of the European Union, the European Central Bank (see European Monetary System), and the Court of Auditors.

Although the EU has no single seat of government, many of its most important offices are in Brussels, Belgium. The European Commission is headquartered there, as is the European Council and the Council of the European Union; it is also where the various committees of the European Parliament generally meet to prepare for the monthly sessions in Strasbourg, France. The European Central Bank is in Frankfurt, Germany; the Court of Justice and the Court of Auditors are in Luxembourg, Luxembourg.

Evolution

The history of the EU began shortly after World War II, when there developed in Europe a strong revulsion against national rivalries and parochial loyalties. While postwar recovery was stimulated by the Marshall Plan, the idea of a united Europe was held up as the basis for European strength and security and the best way of preventing another European war. (This last motivation in particular informed the awarding of the 2012 Nobel Peace Prize to the European Union, which also mentioned the EU's fostering of democracy in its member nations.) In 1950 Robert Schuman, France's foreign minister, proposed that the coal and steel industries of France and West Germany be coordinated under a single supranational authority. France and West Germany were soon joined by four other countries—Belgium, Luxembourg, the Netherlands, and Italy—in forming (1952) the ECSC. The EEC (until the late 1980s it was known informally as the Common Market) and Euratom were established by the Treaty of Rome in 1958. The EEC, working on a large scale to promote the convergence of national economies into a single European economy, soon emerged as the most significant of the three treaty organizations.

The Brussels Treaty (1965) provided for the merger of the organizations into what came to be known as the EC and later the EU. Under Charles de Gaulle, France vetoed (1963) Britain's initial application for membership in the Common Market, five years after vetoing a British proposal that the Common Market be expanded into a transatlantic free-trade area. In the interim, Britain had engineered the formation (1959) of the European Free Trade Association. In 1973 the EC expanded, as Great Britain, Ireland, and Denmark joined. Greece joined in 1981, and Spain and Portugal in 1986. With German reunification in 1990, the former East Germany also was absorbed into the Community.

The Single European Act (1987) amended the EC's treaties so as to strengthen the organization's ability to create a single internal market. The Treaty of European Union, signed in Maastricht, the Netherlands, in 1992 and ratified in 1993, provided for a central banking system, a common currency to replace the national currencies (the euro), a legal definition of the EU, and a framework for expanding the EU's political role, particularly in the area of foreign and security policy. The member countries completed their move toward a single market in 1993 and agreed to participate in a larger common market, the European Economic Area (est. 1994), with most of the European Free Trade Association (EFTA) nations. In 1995, Austria, Finland, and Sweden, all former EFTA members, joined the EU, but Norway did not, having rejected membership for the second time in 1994.

A crisis within the EU was precipitated in 1996 when sales of British beef were banned because of "mad cow disease" (see prion). Britain retaliated by vowing to paralyze EU business until the ban was lifted, but that crisis eased when a British plan for eradicating the disease was approved. The ban was lifted in 1999, but French refusal to permit the sale of British beef resulted in new strains within the EU. In 1998, as a prelude to their 1999 adoption of the euro, 11 EU nations established the European Central Bank. The euro was introduced into circulation in 2002 by 12 EU nations; additional EU nations have since adopted it.

The EU was rocked by charges of corruption and mismanagement in its executive body, the European Commission (EC), in 1999. In response the EC's executive commission including its president, Jacques Santer, resigned, and a new group of commissioners headed by Romano Prodi was soon installed. In actions taken later that year the EU agreed to absorb the functions of the Western European Union, a comparatively dormant European defense alliance, thus moving toward making the EU a military power with defensive and peacekeeping capabilities.

The installation in Feb., 2000, of a conservative Austrian government that included the right-wing Freedom party, whose leaders had made xenophobic, racist, and anti-Semitic pronouncements, led the other EU members to impose a number of sanctions on Austria that limited high-level contacts with the Austrian government. Enthusiasm for the sanctions soon waned, however, among smaller EU nations, and the issue threatened to divide the EU. A face-saving fact-finding commission recommended ending the sanctions, stating that the Austrian government had worked to protect human rights, and the sanctions were ended in September.

In 2003 the EU and ten non-EU European nations (Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia, Hungary, Slovenia, Cyprus, and Malta) signed treaties that resulted in the largest expansion of the EU the following year, increasing the its population by 20% and its land area by 23%. Most of the newer members were significantly poorer than the largely W European older members. The old and new member nations at first failed to agree on a constitution for the organization; the main stumbling block concerned voting, with Spain and Poland reluctant to give up a weighted system of voting scheduled for 2006 that would give them a disproportionate influence in the EU relative to their populations. In Oct., 2004, however, EU nations signed a constitution with a provision requiring a supermajority of nations to pass legislation. The constitution, which needed to be ratified by all members to come into effect, was rejected by voters in France and the Netherlands in 2005, leading EU leaders to pause in their push for its ratification.

Meanwhile, in 2003 the EU embarked, in minor ways, on its first official military missions when EU peacekeeping forces replaced the NATO force in Macedonia and were sent by the United Nations to Congo (Kinshasa); the following year the EU assumed responsibility for overseeing the peacekeepers in Bosnia. EU members also took steps toward developing a common defense strategy independent of NATO, and agreed in 2004 to admit Bulgaria and Romania in 2007. José Manuel Barroso succeeded Prodi as president of the European Commission late in 2004. Accession talks with Turkey were partially suspended in Dec., 2006, over the issue of Turkish relations with Cyprus because Turkey was unwilling to open its ports to Cypriot trade unless the EU eased its trade restrictions on North Cyprus.

The EU opted for incremental reforms over a new constitution in 2007, when member nations signed the Lisbon Treaty. The treaty reorganized the European Council, established an elected president of the European Council and a single EU foreign policy official, and reformed the EU's system of voting, among other changes. (The reforms will be phased in through 2017.) In June, 2008, however, Irish voters—the only national electorate given the opportunity to ratify the treaty—rejected it in a referendum, a potentially fatal setback. A year later, however, EU nations agreed on a number of guarantees to the Irish Republic that were designed to lead to a new Irish referendum on the treaty (several other nations also received various exemptions). Irish voters approved the treaty in a revote in Oct., 2009; ratification was completed the following month; and the treaty came into force in Dec., 2009.

Weaknesses in an EU system in which economic and monetary integration was not bolstered by political unity were revealed by the economic crisis of 2008, when measures such as bank-deposit guarantees adopted by some euro nations forced most EU nations to adopt similar measures in order to avoid bank runs. Eurozone nations were unable to agree on a common approach to the crisis and resulting recession, and subsequent high budget deficits in Greece and some other eurozone countries strained the monetary union and forced eurozone nations to adopt sometimes stringent austerity programs. At the same time, however, many non-euro European nations, whether members of the EU or not, found their financial systems stressed, at least initially, to a greater degree by the crisis than many euro nations did. In 2010 the effects of the crisis forced EU nations and the IMF to adopt a $950 billion package to aid financially troubled eurozone nations and support the euro; additional measures were adopted and additional funds set aside in 2011 and 2012, and in Oct., 2012, the eurozone's permanent European Statility Mechanism was established

By 2011 Greece, then Ireland, and later Portugal had been forced to accept international rescue packages, and they and some other EU nations were forced to adopt significant austerity budgets that led in many cases to economic recession, increased unemployment, and further budget deficits. In Mar., 2012, all but two EU nations (Britain and the Czech Republic) signed an agreement intended prevent future budget crises, though many criticized the accord for emphasizing budgetary discipline without consideration for its relationship to economic growth. Spain and Cyprus subsequently also sought international financial aid. At the same time, however, there was increasing public resistance to additional austerity measures in many hard-hit EU nations, and in the EU as a whole unemployment increased to record levels. In July, 2013, Croatia joined the EU.

In the 2014 elections for the European parliament, a number of parties on the far right and left that were strongly opposed to various aspects of the EU made significant gains, primarily in Great Britain, France, and Greece. Although pro-EU parties nonetheless won a significant majority of the seats, the vote was seen as a sign of increasing unhappiness with the EU within some of its member nations. The subsequent nomination of Jean-Claude Juncker to succeed Barroso as president of the European Commission was strongly opposed by Great Britain, who called for choosing someone less identified with increased EU integration, but nearly all EU nations supported his nomination, and he was easily elected to the post. Negotiations in 2015 over Greece's ongoing economic difficulties and debt produced divisions in the European Union, most notably between Germany and France (with France unsuccessfully favoring a less hardline approach), that combined with economic divisions reinforced national political agendas and undermined the sense of common European purpose and integration.

Bibliography

See W. Diebold, The Schuman Plan (1959); R. L. Heilbroner, Forging a United Europe (Public Affairs Pamphlet, 1961); B. Morris and K. Boehm, ed., The European Community (1986); H. Wallace and A. Ridley, Europe: The Challenge of Diversity (1986); M. Burgess, Federalism and European Union (1989); J. Roy, A Historical Dictionary of the European Union (2006); H. James, Making the European Monetary Union (2012).

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." The Columbia Encyclopedia, 6th ed.. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." The Columbia Encyclopedia, 6th ed.. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/reference/encyclopedias-almanacs-transcripts-and-maps/european-union

"European Union." The Columbia Encyclopedia, 6th ed.. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/reference/encyclopedias-almanacs-transcripts-and-maps/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union

ADRIENNE WILMOTH LERNER

The European Union (EU) is a long-standing political and economic federation of autonomous European nations. With the consent of member states, the EU legislates a variety of issues by treaty, including trade, customs, travel, currency, and defense. Members choose to participate in various EU institutions, delegating sovereignty in order to achieve common goals.

The organization embraces democracy and the rule of law, requiring member states to possess some form of representative government, elected by universal adult suffrage of the adult citizenry. The mission of the EU is to promote economic growth in Europe, create a strong international market, lobby for European interests in the international community, raise standards of living, and promote peace.

History. European integration, the process that eventually yielded the EU, began on May 9, 1950, when France proposed to create a European trade organization. Two years later, France and Germany established the European Coal and Steel Community. Both nations sought to solve disputes over coal mining territories and industry competition unresolved since the end of the Second World War. Belgium later joined France and Germany, uniting most of Western Europe's continental coal and steel industry.

Continued success of the European Coal and Steel Community prompted its president to lobby European governments for the establishment of a large-scale economic and trade union. In 1957, six nations (France, Germany, Belgium, the Netherlands, Luxembourg, and Italy) signed the Treaty of Rome, establishing the European Economic Community (EEC). The EEC standardized some tariffs, opened borders to free trade, promoted industry cooperation, regulated industry standards, and synchronized export practices.

In 1967, the member nations brought the European Coal and Steel Community and the European Atomic Energy Community (Euratom) into the fold of the EEC. The new unified organization was officially named the European Community (EC), though many continued to use to older designation, EEC, to refer to the new union.

Several nations in Europe chose not to join the original EEC, the most prominent of which was Great Britain. In January 1960, Britain formed a more loosely regulated economic union to rival the EC. The European Free Trade Association (EFTA), known colloquially as the "Seven," included Britain, Austria, Denmark, Norway, Portugal, Sweden, and Switzerland. A year later, Britain applied for membership in the EC, but France rejected their proposal to join the organization. The French government subsequently vetoed Britain's second application for membership in 1964.

Britain, along with Ireland, Denmark, and Norway, became members of the EC in 1973. In a series of accessions, six more nations joined the EC before 1995. The organization adopted a more ambitious mandate in the 1990s, establishing government and judiciary organizations in an attempt to closely unite European interests. Adoption of the new mandate by member states established the European Union.

Organization. Today's EU mission encompasses more than economic goals. The principal objectives of the EU are to establish European citizenship, ensure civil rights of European citizens, promote social progress, protect European security, and ensure justice. To these ends, the European Union maintains its own government and supporting agencies. These institutions are granted sovereignty by the member states to legislate European affairs and create international law. Final adoption of EU policy, however, is left to the individual member states.

Five primary institutions comprise the government of the EU. Its overall structure embraces the three-branch democratic model of government, with executive, legislative, and judicial bodies. The European Commission is the primary institution of the executive branch. Members are elected or appointed by the European Parliament. The Council of the Union is composed of representatives from the governments of the member states. The Council governs the EU as a collective, requiring majority support to set or endorse policy.

The European Parliament, the legislative body, is elected by the people of the member states. Committees within the European Parliament address specific concerns, such as health care, preservation of the environment, and trade regulation. The Court of Auditors, the committee responsible for overseeing and managing the EU budget, remains separate from every branch of the EU government, but works closely with the Parliament to appropriately allocate funds and resources.

The EU judiciary is the Court of Justice. The jurisdiction of the European court is somewhat dubious, and member states recognize its authority to varying degrees. The court is similar in structure and function to those of the United Nations, but is permitted to pursue only cases that affect member states.

A myriad of committees and support institutions comprise the rest of the EU government. The EU maintains its own central finance system, including the European Central Bank and the European Investment Bank. These contain funds used by the EU or granted to individual member states for various joint projects. In 1999, nine nations adopted a standard European currency, the Euro.

Membership. Fifteen member states currently comprise the European Union: Austria, Belgium, Denmark, Germany, Greece, Finland, France, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom of Great Britain and Northern Ireland. These member nations participate in the EU to varying degrees. For example, Britain participates in EU economic and trade associations, but uses its national currency, the pound, instead of the euro.

In 1998, the EU began negotiations with several eastern and southern European nations regarding EU expansion. Still recovering from decades of Soviet Communist domination, many of these nations possess fledgling free market economies. Introduction of former Eastern Block nations into the EU holds the potential for economic growth and expanded investment opportunities for European industry. However, expansion also poses liabilities to more economically robust EU nations.

The EU granted admission to the following candidate nations in 2002: Czech Republic, Cyprus, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovenia, and Slovakia. These nations officially join the EU on May 1, 2004, assuming that they ratify membership in a national, public referendum. Bulgaria and Romania are scheduled join the EU in 2007. Some negotiations on expansion proved contentious. The EU denied Turkey's application to join the organization, despite the nation's numerous economic and trade associations with Europe. The EU will review Turkey's application again in 2004, if the nation furnishes evidence that it has met EU demands to improve human rights and maintain a stable democratic government. The nation of Cyprus, divided between Grecian southern Cyprus and nationalist Turkish Cypriots, failed to reunify before the EU accepted the national proposal to join the EU. Therefore, only the independent half of the nation will join the EU in 2004.

Some nations in Western Europe have chosen to remain outside of the European Union. Switzerland, and EFTA members, did not join the union on the grounds that membership in the EU threatened its national policy of declared neutrality. Norway also chose to exclude itself from EU membership.

Common defense and security: the future of the EU. A series of treaties in the 1980s and 1990s expanded the political, defense, and military role of the European Union. Formerly an instrument of economic and social policy, the EU adopted the Common Foreign and Security Policy (CFSP) in response to global instability and the rise or terrorism. The creation of the European Security and Defense Policy (ESDP) followed, outlining the EU's international responsibilities to defend European territory and interests while cooperating with organizations such as the North Atlantic Treaty Organization (NATO) and the United Nations.

Defense and security strategy remains one of the most contentious aspects of European Union policy. Some member states prefer to rely on their connections to NATO, or their own defenses, for protection. Others are wary of creating an EU military force under international command.

The EU established several crisis management tasks, known as the Petersberg Tasks, a foreign policy priority. For the purpose of humanitarian aid and rescue, peacekeeping, and crisis management, the EU created a military task force of 60,000 reserve troops. Member states can choose to contribute and deploy national military troops to EU operations on a case-by-case basis.

The EDSP launched its first operation, a police mission in Bosnia and Herzegovina, in January 2003. The first EU military operation commenced in Macedonia two months later.

With the aid of ESDP liaisons in 2002, the EU candidate nations signed a declaration warning Iraqi leader Saddam Hussein that military action was justified if United Nations weapons inspections were not permitted to freely proceed. The statement angered several EU members, causing a rift in EU foreign policy. Although the EU did not formally support the subsequent United States led action in Iraq, several member and candidate nations supported the Coalition military action. Some of the most influential EU nations, such as France and Germany, voiced strong opposition to the 2003 war in Iraq.

FURTHER READING:

ELECTRONIC:

European Union. <http://www.europa.eu.int> (May 9, 2003).

SEE ALSO

NATO (North Atlantic Treaty Organization)
United Nations Security Council

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Encyclopedia of Espionage, Intelligence, and Security. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Encyclopedia of Espionage, Intelligence, and Security. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/politics/encyclopedias-almanacs-transcripts-and-maps/european-union

"European Union." Encyclopedia of Espionage, Intelligence, and Security. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/politics/encyclopedias-almanacs-transcripts-and-maps/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

EUROPEAN UNION

The European Union is a rapidly changing economic and political union of mostly western European nations that arose out of the European Community in 1993. This international organization is not meant to replace the sovereignty of the individual countries but rather to unify them under a common currency and economic structure, as well as under some shared principles of law and human rights. One of the cornerstones of the European Union has been the new currency, known as the euro, and the creation of a new European Central Bank. This new group of nations is to rival the United States and to increase trade among its member nations. This is no easy feat because of the strong national identities of these nations, including language barriers and long-standing cultural disputes.

HISTORY

The beginnings of the European Union were cultivated soon after the end of World War II (19391945), when it appeared that Europe would once again be a battleground between the United States and the Union of Soviet Socialist Republics. On May 9, 1950, the French foreign minister, Robert Schuman, proposed the first agreement to pool coal and steel resources. In 1952 the European Coal and Steel Community was established, and it included Belgium, France, Italy, Luxembourg, the Netherlands, and West Germany. It was hoped that this new spirit of cooperation would not only prevent war from breaking out between member nations but also present a strong economic face to the United States.

With this newfound success, the European Coal and Steel Community evolved in 1958 to become the European Economic Community. This was an attempt to integrate further other parts of these varied economies in order to remove other trade barriers. The Treaty of Maastricht in 1992 continued the evolution by introducing new areas of cooperation including defense, justice, and home affairs. These combined areas created the "community" relationship that exists today. Also in 1992, twelve of the fifteen nations agreed to a single European currency, called the euro, which was to have been managed by the new European Central Bank.

In 2005 the members of the European Union included: Austria, Belgium, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom. The candidate countries were Bulgaria, Croatia, Romania, and Turkey. Macedonia, formerly a part of Yugoslavia, had a pending application. A new constitution was being proposed for 2006, but by 2005 France and Belgium had turned it down. The United Kingdom delayed the vote in that country pending a hearing to determine what the possible ramifications of the failure could be.

GOVERNMENT MAKEUP

Three main institutions make up this union of nations. The first one is the Council of the European Union. This body represents the individual member states. The second body is the European Parliament meant to represent the citizens of the European Union. The third body is the European Commission, which is to represent the common interests of the continent of Europe. These three parts are to represent all parts of the constituency of Europe.

The Council of the European Union is the main decision-making body in which the control of the body rotates every six months to another member nation. Depending on what the agenda is for particular meetings determines which minister from each nation attends. For instance, if there is a meeting on agriculture, the agriculture ministers from each nation would attend. There are nine different policy areas that the council considers. The General Secretariat is the administrative part of the council, and it is based in Brussels. The ambassadors of the member nations determine the agenda for the council.

The council and the European Parliament share legislative authority and responsibility for the budget. On important events such as amending treaties, a unanimous decision must be met; on other votes, however, only a qualified majority of 232 votes is required. Voting rights are based on the size of the population of the member state.

The European Parliament is the representative arm of the European Union. Every five years the people of Europe elect the membership in a direct election. In 2005 the European Parliament had 732 members, which was expected to be increased to 786 in 2007. The European Parliament is also the body responsible for open debate. It has become the area where the people's opinion meets the democratic process, creating some of the most innovative


policies. Because of its representative nature, the Parliament most accurately reflects the ideals and opinions of its people.

The European Commission is an independent political body meant to act upon the interests of the European Union as a whole. The commission is made up of one person from each nation. It is also the executive arm of the European Union and follows through with the decisions made by the council. In the event of censure by the Parliament, the entire body must resign. Censure requires a two-thirds vote by the Parliament in order to be passed and is an effective check on the balance of power within the European Union.

The judicial branch is known as the Court of Justice of the European Union. It meets in Luxembourg and is made up of one judge from each country serving an initial term of six years with additional terms of three years. The role of the Court of Justice is not only to make sure the laws created are fair and just, but also to guarantee that member nations fulfill their European Union obligations.

MONETARY POLICY

The primary strength of the European Union lies within its strong currency known as the euro. It has become the second most important currency along with the U.S. dollar. While the U.S. dollar has become less important because of world events such as stock market scandals and terrorist attacks, the euro has become more widely sought after. The euro began circulation in January 2002, replacing the individual currencies being used at the time in twelve nations. What is remarkable about the new currency is that it not only replaced the currencies of these nations, but also replaced icons of national and cultural symbols. This contributed to the new "European identity." One of the other benefits was the ability to travel within member nations without having to exchange currencies.

The process of bringing member nations on board with the single currency was not easy or painless. The new currency requires economic discipline by reducing budget deficits, curbing inflation, curbing interest rates, and reducing public borrowing to below 60 percent of gross domestic product to ensure the stability of the new currency. In order to make this happen, the European Central Bank was created in 1999. The bank set was ordered to set and maintain the value of the euro interest rates, and develop sound fiscal policy. One of the tenets of the fiscal policy is to maintain budget discipline in order to remain vigilant over the budget deficits of other member nations. A second tenet of the European Central Bank is that employment be a priority of the bank. Not all nations agreed to take on the euro as its national currency. Some nations such as the United Kingdom, Denmark, and Sweden did not accept the currency until they gave it much thought and discussion.

AREAS OF DISAGREEMENT

The goals of the European Union include banishing trade barriers detrimental to free trade among member nations while at the same time supporting the people of these individual countries in their everyday lives. Difficulties arise when differing cultures must cooperate and make joint decisions. The areas of agriculture and immigration are of particular concern. Some nations have long histories of protectionist philosophies for their food as well as with the issue of illegal immigrants.

In agriculture there have been other questions concerning issues that have to do with monetary policy, language barriers, and long-standing feuds. Of particular importance are the addition of the former Eastern European nations into the European Central Bank and the management of the euro in the global economy. Significant concerns include whether these nations can appropriately manage their economies to qualify for inclusion into the European Central bank and if they can, whether they will be able to maintain economic discipline. If they cannot, the concern is that their collective economies could sabotage what the European Union has worked so hard to establish since the mid-twentieth century.

Other concerns are how the roles of terrorism, the rising demand for oil, and the rise of other large economies such as China may affect the stability of the currency and the world economy in general. These challenges are indeed unique and will present a future of cooperative communication.

see also Trading Blocs

bibliography

Fontaine, Pascal (2003, October). Europe in 12 lessons. Europa. Retrieved November 2, 2005, from http://europa.eu.int/abc/12lessons/index2_en.htm

European Union. http://www.answers.com/topic/european&20union

Kagan, R. (2003). Of paradise and Power: America and Europe in the new world order. New York: Knopf.

Smith, N. (ed) (2005). The European Union. Bronx, NY.

Lawrence F. Peters, Jr.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Encyclopedia of Business and Finance, 2nd ed.. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Encyclopedia of Business and Finance, 2nd ed.. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/finance/finance-and-accounting-magazines/european-union

"European Union." Encyclopedia of Business and Finance, 2nd ed.. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/finance/finance-and-accounting-magazines/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union (EU)

European Union (EU)

The European Union (EU), formerly known as the European Community (EC), was formed in the 1950s to encourage and oversee political and economic cooperation between numerous European nations. In the nearly half-century since it was formed, the EU has gradually succeeded in becoming the dominant governing economic body in Europe, and it now affects every aspect of business in its member states.

HISTORY

The EU had its origins in an upsurge of warfare which began in 1870 with the Franco-Prussian war and then continued through two world wars. World War II barely over, Winston Churchill, in a speech at Zurich University given in September 1946 called for "a kind of United States of Europe." Churchill's was a prominent voice but he expressed what many other leaders in Europe were feeling at the time. Two years later Belgium, France, Luxembourg, the Netherlands and the United Kingdom formed the West European Union aimed at mutual defense; that same year 16 other nations joined to form the Organization for European Economic Cooperation (OEEC) to oversee implementation of the U.S.-created Marshall Plan. OEEC later evolved into OECD (Organization for Economic Cooperation and Development), with the U.S. and Japan joining as well.

Communities: Coal, Atomic Energy, Economics

In 1951 Belgium, West Germany, Luxembourg, France, Italy, and the Netherlands established the European Coal and Steel Community (ECSC) empowered to make decisions about these industries for the group as a whole. Jean Monnet, who had given an influential speech about this subject in 1950 was named as the ECSC president. ECSC was a great success. In 1957 the same six countries created the European Atomic Energy Community (EURATOM) and the European Economic Community (EEC) to handle atomics and economic development in the same way, principally by removing trade barriers and creating a "common market." These "communities," focused on specific areas, were a step toward a greater union.

Maastricht

Milestones along the way were the merger, in 1967, of the three "communities" under a single Commission alongside a Council of Ministers and a European Parliament. In 1979 member countries' populations participated in direct elections of members of this parliament. Elections have been held at five-year intervals since. The Treaty of Maastricht, signed in 1992, created the European Union itself in 1992 by enabling member states to cooperate in defense and in the areas of justice and home affairs as well.

Common Policies and Marketand a Single Currency

The collective aim of these arrangements had always been greater efficiency and the achievement of economic power on a larger and more coordinated scale. Removal of trade barriers, common policies in many fields (agriculture, culture, energy, food purity, transportation, trade, etc.), and a common point for negotiating trade and aid agreements have been aims. The EU formed an economic and monetary union in EMU in part to implement some of these goals; it created the European Central Bank and projected the use of a single currency, the euro. The euro became the official currency in 2002 of 12 of the then 15 members: Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal, and Finland. Denmark, Sweden, and the U.K retained their own currencies. Since 2002 the euro has become an important global currency.

Expansion and Consolidation

In 2002 the EU voted to admit ten additional countries, most of them formerly communist states. In consequence, in 2003, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia joined the EU. The Treaty of Nice, which came into force on February 1, 2003 was intended to regulate the newly enlarged union. An EU constitution was framed and will replace Treaty of Nice regulations if all EU member nations approve it in 2006.

STRUCTURE

The EU's several governing bodies oversee different aspects of the union's operations. In addition, each country in the union takes turn acting as chairman; the position changes hands every six months. The European Commission (EC) is perhaps the most important of the governing bodies: it proposes policies and is the only body authorized to propose legislation (besides the national governments of each state). It also oversees the day-to-day operations of the union and ensures that treaties are being carried out as intended. The commission is comprised of 20 commissioners, including a president, all appointed by member states and approved by the parliament.

Once legislation is passed, it is administered by the European Council. The council is comprised of ministers who represent the national governments of the 25 members of the union. Actions of the European Council are approved on a majority vote of 13 of 25 commissioners.

Members of the European Parliament are directly elected by the people of each nation, and members serve five-year terms. While the parliament did gain some legislative power from the Maastricht Treaty, it mainly serves as the public forum of the EU, holding open debates on important issues and overseeing the activities of the council and the commission. The Court of Justice oversees EU laws and regulations and issues rulings when conflicts arise. The court sits as a "Grand Chamber" of 13 judges or in chambers of three or five judges. Decisions issued by the court are binding on member states.

Important but specialized activities of the EU are managed by nine additional bodies:

  • European Economic and Social Committee (civil society, employers, and employees).
  • Committee of the Regions (represents regional and local authorities).
  • European Investment Bank (finances projects and helps small business by means of the European Investment Fund).
  • European Central Bank (monetary policy, especially in euro-based countries).
  • European Ombudsman (investigates complaints).
  • European Data Protection Supervisor (concerned with data privacy).
  • Office of Official Publications of the European Communities.
  • European Personnel Selection office (recruitment).
  • European Administrative School (staff training).

A "UNITED STATES OF EUROPE"?

Is the EU a sovereign entity comparable to the United States? The answer is nobut with the provision that the EU may in the future gradually evolve in that direction if historical forces favor that development. William Underhill wrote in Newsweek International, reviewing a book by Boris Johnson (The Dream of Rome, HarperCollins): "To Johnson, the idea of Rome is lodged in European folk memory. Deep down, he argues, the continent yearns to re-create an Augustan Age, when 80 million people from Syria to Scotland enjoyed the benefits of Pax Romana." But Johnson evidently doubts the possibility that the old Romanor the later Holy Romanempire could be rebuilt, basing his views on the great cultural diversity and fierce national loyalties that the patchwork of nations in Europe represents. The EU was and largely remains an economic venture aiming to present to the world a single, large market (like that of the United States). This emerges from its proposed and still pending (2006) constitution. For those in business dealing with European customers, however, the EU is a much easier entity to deal with than 25 separate states, each with specific rulesno doubt one reason why the EU is successful despite continuing and chronic disagreements among its members.

BIBLIOGRAPHY

European Union. "The History of the European Union." Available from http://europa.eu.int/abc/history/index_en.htm. Retrieved on 26 March 2006.

The European Union in the United States. Available. from http://www.eurunion.org/states/home.htm. Retrieved on 26 March 2006.

Europe's Unreformed Economies. Global Agenda. 24 March 2006.

Underhill, William. "The Lessons of History: In a new book, British M.P. Boris Johnson wonders: why can't the EU be more like the Roman Empire?" Newsweek International. 20 March 2006.

Weidenfeld, Werner. Europe from A to Z: A Guide to European Integration. Office for Official Publications of the European Communities, 1997.

"What is 'Your EuropeBusiness'?" European Commission. Available from http://europa.eu.int/business/en/advice/theeuro/index.html. Retrieved on 26 March 2006.

                                   Darnay, ECDI

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union (EU)." Encyclopedia of Small Business. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union (EU)." Encyclopedia of Small Business. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/entrepreneurs/encyclopedias-almanacs-transcripts-and-maps/european-union-eu

"European Union (EU)." Encyclopedia of Small Business. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/entrepreneurs/encyclopedias-almanacs-transcripts-and-maps/european-union-eu

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

EUROPEAN UNION

EUROPEAN UNION, short form EU. An association of European countries, until the end of 1994 twelve in number: Belgium, Denmark, France, Germany, Greece, the Irish Republic, Italy, Luxembourg, the Netherlands, Portugal, Spain, and the United Kingdom. Membership now also includes Austria, Cyprus, Czech Republic, Estonia, Finland, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, Slovenia, and Sweden. In 1993, the EU subsumed the European Community (EC), previously known as the European Economic Community (EEC), which came into being in 1967 through the merger of several earlier associations formed after the Second World War. Its headquarters is in Brussels in Belgium, its Parliament mainly in Strasbourg, northern France, with some central institutions in Luxembourg. Its official working languages are ENGLISH and FRENCH, and its official languages DANISH, DUTCH, English, Finnish, French, GERMAN, GREEK, ITALIAN, PORTUGUESE, SPANISH, and Swedish. All eleven are used in EC meetings with simultaneous translation as a matter of course. Official documents must be published in all the official languages. In the period 1982–90, 40m ECUs (European Currency Units) were provided for EUROTRA automatic translation. There are between 30 and 40 minority languages, depending on definition, some of them varieties of official languages (such as Alsatian German in France), some unique (such as Breton in France and Basque in France and Spain). All member countries save Portugal have regional minority languages (such as GAELIC, SCOTS, and WELSH in the UK). The European Bureau for Lesser-Used Languages, set up in 1982 with its headquarters in DUBLIN, represents all such languages but not the ‘trans-European’ minority languages YIDDISH and ROMANY.

English is increasingly the LINGUA FRANCA of the EU. Representatives of smaller countries, such as Denmark and Greece, often give press conferences in English: ‘The Danes are keener to speak English even than the British … .The Spanish on the other hand tend to talk French. On political subjects both languages are used in discussions. The French are very concerned to protect their language. But in more technical sectors—telecommunications or research for example—it is overwhelmingly English, as the technical vocabulary has developed on a more global basis' ( Michael Berendt, The Times, 23 Oct. 1989). In Belgium, a country often disturbed by tensions between speakers of Flemish and French, English is a neutral medium. British television is widely watched along the north-western European coast, and in the Netherlands interviews in English on national television are often not translated. American TV is also widely available by satellite and cable.

While the aim of the Union is harmonization rather than homogenization, there is a strong EU-wide tendency towards greater use of English. Indeed, the results of any drive towards foreign-language learning may strengthen the already most prominent language: English is the first second language in all EU countries, including France.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"EUROPEAN UNION." Concise Oxford Companion to the English Language. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"EUROPEAN UNION." Concise Oxford Companion to the English Language. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/humanities/encyclopedias-almanacs-transcripts-and-maps/european-union

"EUROPEAN UNION." Concise Oxford Companion to the English Language. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/humanities/encyclopedias-almanacs-transcripts-and-maps/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union (EU) Organization of 25 European countries, established in 1993 following the ratification of the Maastricht Treaty (1992). In 1993, there were 15 members: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, United Kingdom. The EU assumed control of the existing framework and institutions of the European Community (EC), such as the European Commission and European Parliament (EP), but extended the role and scope of the EC according to the criteria of the Maastricht Treaty. The member states agreed to greater cooperation, particularly in areas such as foreign and security policies (see Western European Union), and internal and judicial policies. The UK and Denmark ‘opted out’ of the first stage in the creation of a single European currency (the euro). In addition to reforms of existing policies, such as the Common Agricultural Policy (CAP), the EU faces the challenges posed by enlargement. On May 2, 2004 ten new members joined: Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, Slovenia. In addition to the Commission and Parliament, the EU's institutional structure comprises the European Council of Ministers, the Economic and Social Committee (which advises on draft EC legislation), the European Central Bank, and the European Court of Justice. See also European Monetary System (EMS)

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." World Encyclopedia. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." World Encyclopedia. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/environment/encyclopedias-almanacs-transcripts-and-maps/european-union

"European Union." World Encyclopedia. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/environment/encyclopedias-almanacs-transcripts-and-maps/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

EU

EU • abbr. European Union.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"EU." The Oxford Pocket Dictionary of Current English. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"EU." The Oxford Pocket Dictionary of Current English. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/humanities/dictionaries-thesauruses-pictures-and-press-releases/eu-1

"EU." The Oxford Pocket Dictionary of Current English. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/humanities/dictionaries-thesauruses-pictures-and-press-releases/eu-1

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." The Oxford Companion to British History. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." The Oxford Companion to British History. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/history/encyclopedias-almanacs-transcripts-and-maps/european-union

"European Union." The Oxford Companion to British History. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/history/encyclopedias-almanacs-transcripts-and-maps/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

EU ( (European Union))

EU: see European Union.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"EU ( (European Union))." The Columbia Encyclopedia, 6th ed.. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"EU ( (European Union))." The Columbia Encyclopedia, 6th ed.. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/reference/encyclopedias-almanacs-transcripts-and-maps/eu-european-union

"EU ( (European Union))." The Columbia Encyclopedia, 6th ed.. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/reference/encyclopedias-almanacs-transcripts-and-maps/eu-european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union


The European Union (EU) is a political and monetary organization of European nations. Its members as of 2002 were Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom. While member states retain their national governments, the EU promulgates transnational laws and treaties, has a unified agricultural policy, and has removed trade barriers between members. The EU uses a common currency, the euro. The EU represents about a quarter of the global economy, roughly equal to that of the United States.

The European Union developed gradually in the years after World War II. It began in 1957 as the European Economic Community, or EEC, which originally included France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg. The EEC was superceded by the European Community, or EC, in 1967. The principal aim of the EC was to foster free trade among member countries, eliminating tariffs and customs barriers. The EC expanded its role in the 1970s and 1980s. As more states joined, the EC began to strengthen political cooperation among members, holding meetings to coordinate foreign policy and international law. By the mid-1980s, plans were underway to transform the EC into a single European market. This single market would have a central banking system, a transnational currency, and a unified foreign policy. These goals were articulated in the Single European Act of 1987, which also for the first time set out environmental protection as an important goal of European economic development. A treaty written in 1991, called the Maastricht Treaty or the Treaty on European Union, spelled out the future shape of the European Union. All the member states had ratified the treaty by November, 1993, when the European Union officially superceded the EC. The EU went on to launch a new currency, the euro, in 1999. In January 2002 the euro replaced existing EU member currencies.

The EU had incorporated environmental policy into its economic plans beginning in 1987. New members were required to conform to certain environmental standards. And the EU was able to make regional environmental policy, which often made more sense than national laws for problems like air and water pollution that extended across national borders. Environmental regulation in the EU was generally stricter than in the United States, though member states did not always comply with the law. The EU was often quicker than the United States on implementing environmental strategy, such as rules for computer and cell phone disposal. The EU approved the 1997 Kyoto Protocol, an international agreement to reduce the production of socalled greenhouse gases in order to arrest global warming. As details of the implementation of the plan were being worked out over the next five years, EU negotiators remained committed to curtailing European gas emissions even after it became clear that the United States would not sign the Kyoto treaty. Sweden took over the rotating presidency of the EU in 2002, and planned to make environmental policy a high priority. "The environment is more global than anything else except foreign policy," Sweden's environmental minister and EU spokesman told Harper's Bazaar (March 2001). With the EU representing 25% of the global economy, the organization's stance on environmental issues was always significant.

[Angela Woodward ]


RESOURCES

PERIODICALS


Andrews, Edmund L. "Bush Angers Europe by Eroding Pact on Warming"-New York Times, April 1, 2001, 3.

Milmo, Sean. "EU Lacks Industry Support for EU-Wide Emissions Trading System." Chemical Market Reporter 260, no. 5 (July 30, 2001): 6.

Sains, Ariane. "EU News: Sweden's EU Agenda." Harper's Bazaar 134, no. 3472 (March 2001): 287.

Scott, Alex. "EU Mulls Criminal Sanctions for Eco-Crimes." Chemical Week 164, no. 16 (April 17, 2002): 15.

"What Next, Then?" Economist 360, no. 8232 (July 28, 2001): 69.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Environmental Encyclopedia. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Environmental Encyclopedia. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/environment/encyclopedias-almanacs-transcripts-and-maps/european-union-0

"European Union." Environmental Encyclopedia. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/environment/encyclopedias-almanacs-transcripts-and-maps/european-union-0

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union

PROFILE
HISTORY
MAJOR INSTITUTIONS
U.S.-EU RELATIONS
ECONOMY
2007 U.S.-EU SUMMIT

Last Updated: March 2008

Official Name:

European Union (EU)

Editor's note: The information in this article was compiled from Fact Sheets and releases available through the Bureau of European and Eurasian Affairs of the U.S. Department of State 2007 and 2008.

PROFILE

The European Union (EU) is one of the United States’ strongest strategic partners, with the importance of the relationship reflected in our close cooperation on regional crises and conflicts, our extensive collaboration on a wide range of global challenges, from counter-terrorism to nonproliferation, and our deep trade and investment relations.

Geography

Area: 4,326,243 sq km

Cities: Capital—Brussels, Belgium (European Commission, EU Council); Strasbourg, France (most European Parliament plenary sessions); Luxembourg City, Luxembourg (European Court of Justice).

Terrain: mainly flat along the Baltic and Atlantic coasts; mountainous in the central and southern areas.

Climate: cold temperate; potentially subarctic to temperate in the north; mild, wet winters, and hot, dry summers in the south.

People

Nationality: EU (Every person holding the nationality of a Member State is a citizen of the Union. Citizenship of the Union complements and does not replace national citizenship. This provision currently applies to Austrian, Belgian, British, Bulgarian, Cypriot, Czech, Danish, Dutch, Estonian, Finnish, French, German, Greek, Hungarian, Irish, Italian, Latvian, Lithuanian, Luxembourg, Maltese, Polish, Portuguese, Romanian, Slovak, Slovenian, Spanish, and Swedish citizens).

Population: 490,426,060

Religion: Roman Catholic, Protestant, Orthodox Christian, Muslim, Jewish.

Languages: Bulgarian, Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Gaelic (Irish—from 2007), Italian, Latvian, Lithuanian, Maltese, Polish, Portuguese, Romanian, Slovak, Slovene, Spanish, Swedish (note—only official languages of the European Union are listed).

Health: total: 10 births/1,000 population; 10 deaths/1000 population (2007 est).

Life Span: male: 75.6 years; female: 82 years (2007 est.).

Unemployment: 8.5% (2006 est.).

Government

Type: supranational/mixed intergovernmental.

Founded: November 1, 1993 (Treaty on European Union (Maastricht Treaty) establishing the EU entered into force). (Belgium, France, Germany, Italy, Luxembourg and the Netherlands signed the Treaty of Rome on March 25, 1957—see History.)

Member States: Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, UK; note—Canary Islands (Spain), Azores and Madeira (Portugal), and French Guyana, Guadeloupe, Martinique and Reunion (France), which are legally part of EU Member States, are sometimes listed separately as territories forming part of the EU.

Government branches: Executive—European Commission; legislative—EU Council, European Parliament; judicial—Court of Justice of the European Communities, Court of First Instance.

Political parties: (in European Parliament) European People's Party-European Democrats (EPP-ED); Socialist Group (Party of European Socialists -PES); Group of the Alliance of Liberals and Democrats for Europe (ALDE); Independence/ Democracy Group (IND/DEM); Group of Greens/European Free Alliance (Greens/EFA); Confederal Group of the European United Left-Nordic Green Left (EUL/NGL); Union for Europe of the Nations Group (UEN).

Suffrage: determined by national legislation in the individual Member States.

Economy

GDP: (2006) $13.08 trillion.

Annual Growth Rate: (2007) 2.9%.

Per Capita Income: (2004) $29,900 (2006 est).

Inflation Rate: 1.9% (2007 est.).

Natural Resources: iron ore, arable land, natural gas, petroleum, coal, copper, lead, zinc, hydropower, uranium, potash, fish.

Agriculture: Products—wheat, barley, oilseeds, sugar beets, wine, grapes, dairy products, cattle, sheep, pigs, poultry, fish.

Industry: Type—ferrous and nonferrous metal production and processing, metal products, petroleum, coal, cement, chemicals, pharmaceuticals, aerospace, rail transportation equipment, passenger and commercial vehicles, construction equipment, industrial equipment, shipbuilding, electrical power equipment, machine tools and automated manufacturing systems, electronics and telecommunications equipment, fishing, food and beverage process-ing, furniture, paper, textiles, tourism, media, financial services.

Trade: (2003) Exports—machinery, motor vehicles, aircraft, plastics, pharmaceuticals and other chemicals, fuels, iron and steel, nonferrous metals, wood pulp and paper products, textiles, meat, dairy products, fish, alcoholic beverages. Major markets—U.S., China, Japan, Switzerland. Imports—machinery, vehicles, aircraft, plastics, crude oil, chemicals, textiles, metals, foodstuffs, clothing. Major suppliers—U.S., China, Japan and Switzerland.

HISTORY

Following World War II, traditional European rivals sought to solidify peace by bringing their nations together under a common institutional structure. Influenced by his compatriot Jean Monnet, French Foreign Minister Robert Schuman officially tabled a plan on May 9, 1950 to pool French and German coal and steel production under an organization that would be open to other European countries. German Chancellor Konrad Adenauer supported this proposal, and six founding countries—Belgium, France, Germany, Italy, Luxembourg and the Netherlands—took an early step toward European integration by establishing the European Coal and Steel Community (ECSC) the following year.

After failing to establish a European Defense Community in the 1950s, the six countries then decided to set up a common market. With the entry into force of the Treaty of Rome in 1957, they created the European Economic Community (EEC), with an objective of liberating the movement of goods, capital, workers and services. (The European Atomic Energy Community (EURATOM) was also established at this time.) The Treaty of Rome established the basic institutions and decision-making mechanisms still in place in today's European Union. As of July 1, 1968, the EEC abolished customs duties between Member States on manufactured goods. New policies, including a common agricultural policy (CAP) and a common trade policy, were in place by the end of the 1960s.

The success of the European integration project during a period of steady economic growth in the 1960s set the stage for a first enlargement—the accession of the UK, Ireland and Denmark—in 1973. Further “deepening” of European integration followed: the Community acquired executive authority in social, regional, and environment policies. The benefits of economic convergence became more evident in the context of the 1970s energy crisis and financial turmoil, which led to the launch of the European Monetary System in 1979. In the same year, the first direct elections to the European Parliament (EP) took place. Previously, delegates from national parliaments had represented their country's legislative bodies at the EP in Strasbourg, France.

The Community further expanded southward with the accession of Greece (1981, the second enlarge-ment), followed by Spain and Portugal (1986, the third enlargement). These accessions led the EEC to adopt “structural programs” in order to reduce economic and social disparities among its regions.

During the 1960s and 1970s, the Community began to assert itself on the international scene with the conclusion of agreements with southern Mediterranean countries. Starting in 1963, the EEC signed four successive Lome Conventions, which guaranteed trading advantages and development aid for Member States’ former colonies in Africa, the Caribbean, and the Pacific (ACP).

World recession and internal disputes over Member States’ financial burdens gave way, from 1985 onward, to renewed efforts for economic integration, enshrined in the 1985 “Single European Act” (SEA) and marked by the 1992 “Single Market Project.” The SEA set January 1, 1993 as the date by which an internal single market was to be established and, by extending the practice of majority voting rather than unanimity in the EU Council, gave Community institutions the means of adopting the 300 Community-wide Directives required to abolish the remaining barriers and obstacles to intra-Community trade. In 1995, the Community entered into the “Barcelona” partnership with twelve southern Mediterranean countries. The partnership, reinforced by agreements on social, cultural, and human cooperation, was intended to lead to a free-trade area.

The collapse of the Berlin Wall and German unification prompted Member States to negotiate the 1992 Treaty on European Union (the “Maastricht Treaty”). In addition to establishing the European Union, the Maastricht Treaty set an ambitious program of further integration: establishment of Economic and Monetary Union (EMU) by 1999 (part of the “First or 'Community’ Pillar”), setting up of a Common Foreign and Security Policy (CFSP) (“Second Pillar”); and cooperation on Justice and Home Affairs (JHA) (“Third Pillar”). Shortly thereafter, in 1995, Austria, Finland and Sweden joined the EU—the fourth enlargement.

Signed in 1997 and entering into force on May 1, 1999, the Amsterdam Treaty partially streamlined the EU institutional structure. Its most significant effects were: (1) to transfer aspects of Justice and Home Affairs policy to the Community Pillar, enabling the Commission to propose decisions to be taken by the EU Council by qualified majority voting instead of by consensus, and (2) to establish a High Representative for the CFSP (who also serves as Secretary-General of the Council Secretariat). Ten countries in Central and Eastern Europe and Cyprus began accession procedures in 1997, followed by Malta. The prospect of eastward enlargement raised significant resource concerns and prompted the adoption in March 1999 of the “Agenda 2000” package, which covered amendments to the CAP and EU structural policies, as well as a budgetary framework through 2006.

In May 1998, EU heads of government officially designated eleven Member States eligible to adopt a single currency. Greece initially did not qualify, and Sweden, the UK and Denmark “opted out.”On January 1, 1999, the euro became the official currency of the EU, and the European Central Bank (ECB) put euro notes and coins into circulation on January 1, 2002. Today, thirteen countries use the euro: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Slovenia, and Spain.

Streamlining the size and procedures of EU institutions to make the expanded EU more efficient was also an aim of the 2003 Treaty of Nice. A year later, in May 2004, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia joined the EU, bringing total membership to 25. In 2007, Bulgaria and Romania joined the EU, which currently stands at 27 members. Formal Candidate countries currently include Turkey and Croatia, as well as the Former Yugoslav Republic of Macedonia (FYROM).

In October 2004, Member States signed an EU Constitutional Treaty in Rome, intending that it take effect on November 1, 2006. French and Dutch voters rejected the treaty through referenda in 2005, thereby suspending the ratification process. A new effort, undertaken in June 2007, calls for the creation of an Intergovernmental Conference to form a politcal agreement, known as the Reform Treaty. In contrast to the Constitutional Treaty, the Reform Treaty would amend existing treaties rather than replace them. The IGC approved the new reform treaty, called the Lis-on Treaty, in October 2007. The Lis-on Treaty must be ratified by all 27 national Parliaments. So far, only Ire-and has indicated that it is constitutionally bound to hold a referendum. The Lisbon Treaty would ideally streamline the decision making process of the EU and abolish the rotat-ng Presidency of the Council, replacing it with a more permanent President of the Council. The Lisbon Treaty would also combine the role of the High Representative for Common Foreign and Security Policy, currently Javier Solana, and the EU Commissioner for External Relations, currently Benita Ferrero-Walder, into a single position, in an effort to combine the face and the purse strings of European foreign policy.

MAJOR INSTITUTIONS

The European Commission

The role and responsibilities of the European Commission place it at the center of the EU's decision-making process. Acting as the EU's policy and executive engine, the Commission is composed of 25 Commissioners, one from each Member State and is supported by a substantial staff located primarily in Brussels, Belgium. In matters relating to economic integration (“First or ‘Community’ Pillar”), only the Commission has the right to propose legislation for approval by the EU Council and European Parliament. As “guardian of the Treaties,” the Commission ensures that EU laws are applied and upheld through-out the EU, prosecuting Member States and other institutions for failing to follow treaty precepts or other-wise apply Community law. The Commission has full authority to enforce Community competition policy, and its policing of implementation of Community legislation preserves the integrity of the EU single market. The Commission likewise manages and develops the Common Agriculture Policy (CAP), implements the budget, and represents the European Community in its areas of competence, notably including international trade negotiations.

The Commission President is appointed by agreement of the EU heads of government and is subject to approval by the European Parliament. Commissioners serve for a renewable five-year term. New Commissioners are identified by Member State governments in consultation with the President-designate of the Commission and are normally put in place at the beginning of the term of the Commission President. The entire Commission must be confirmed as a collective whole by the European Parliament before its formal appointment by common accord of EU governments.

The European Council

The European Council brings together EU heads of government and the President of the European Commission; foreign ministers of Member States also participate. Finance ministers are normally included when the leaders discuss questions related to EMU and the economy. The European Council meets at least twice a year, usually quarterly, at the end of each Presidency, to review major EU projects, set guidelines for policies and provide necessary guidance. The Presidency of the Council rotates every six months among EU Member States (January-June; July- December). Its role has become increasingly important with the expansion of EU responsibilities and competencies, leading member states to coordinate their Presidencies in troika formations. A ‘troika’ consists of the current President of the Council, along with the outgoing and incoming Member States. The Presidency organizes and presides over the meetings of the European Council and EU Council (ministerial) meetings, drafts compromises, and seeks solutions to problems submitted to the European Council.

Council of Ministers

The Council of Ministers of the European Union (the “EU Council”) is the body in which representatives of the individual Member State governments, usually ministers, legislate for the EU, set its political objectives, coordinate national policies and resolve differences among their governments and with other EU bodies. Legally speaking, there is only one Council, but it meets in nine different formations, depending on the matters on its agenda. Foreign ministers usually meet at least once a month in the General Affairs and External Relations Council (GAERC), which deals with major foreign policy issues and plays a coordinating role. Ministers for the Economy and Finance (ECO-FIN) and ministers responsible for agriculture also hold monthly meetings Ministers for Justice and Home Affairs (JHA) hold regular meetings to coordinate policies within their competence.

The Council holds formal sessions in its Brussels headquarters, except in April, June and October, when all sessions take place in Luxembourg. Most formations of the Council also meet informally (tasking no legally binding decisions) in the country holding the EU Presidency, usually once in the course of the Presidencys six-month term. The most prominent of these informal meetings is the so-called “Gymnich” meeting of foreign ministers, named for a town in Germany where the first such meeting took place.

The Council takes most decisions under the Community Pillar by qualified majority voting (QMV) but endeavors to reach the broadest possible consensus before approving legislation. Unanimity is required for a number of specific areas related to economic integration (e.g. taxation), constitutional matters such as amendments to the treaties, the launching of a new common policy, the accession of a new Member State, and matters falling within the EU's Common Foreign and Security Policy, European Security and Defense Policy, and aspects of law enforcement and judicial cooperation. The number of votes cast by each Member State when the EU Council votes by qualified majority voting was determined by the Nice Treaty and roughly correlates to the size of its population.

The European Parliament

Members of the European Parliament are directly elected by EU citizens for five-year terms; elections follow national election procedures. Members do not sit in national delegations; rather, they sit in groups according to political affiliation (including Socialists, Christian-Democrats/Conservatives, Liberals, Greens, etc.).

Parliament's powers have gradually grown with the entry into force of the Single European Act (1986), the Maastricht Treaty (1993) and the Treaty of Amsterdam (1999). Parliament shares decision-making power on an equal footing with the Council in many areas under the Community Pillar to which the “co-decision procedure” applies. The European Parliament is one of the two branches with budgetary authority—the Council is the other. The signature of the EP president brings the overall EU budget into effect.

The European Parliament also plays a role in the process of selecting the President and other members of the Commission. The European Council's nomination of the President is subject to approval by the Parliament. The EP holds U.S.-style public hearings of Commission nominees before taking a formal vote to approve the nomination of the Commission as a body. Parliament has the power to censure the Commission, but the Treaties do not allow for the dismissal of individual Commissioners by Parliament.

The European Court of Justice

The European Court of Justice (ECJ) ensures uniform interpretation and application of both the Treaties establishing the European Communities and the secondary legislation and other law adopted under their authority. To enable it to carry out that task, the Court has wide jurisdiction to hear various types of cases. For example, the Court has the authority to hear and issue binding judgments in lawsuits that seek to annul a law adopted by the EU, to compel an EU institution to act, or to require that a Member State comply with EU law. The ECJ may issue clarifications of EU law (in response to a request for a preliminary ruling from any Member State court) and hears appeals on legal questions arising out of cases at the Court of First Instance. The ECJ currently has 25 justices and eight advocates-general, who are appointed by common accord of the governments of the Member States and who hold office for six-year renewable terms.

U.S.-EU RELATIONS

The United States and the EU are important partners who maintain a robust agenda of cooperation in areas such as the Middle East, Balkans, Ukraine, Central Asia, and Africa.

In pursuit of Middle East peace, the United States and the EU cooperate, with the United Nations and Russia, in the “Quartet.” The EU has made significant contributions to the goal of promoting good governance, democracy, and strong civil societies throughout the Middle East. The United States and the EU also work together in promoting reform throughout the Middle East.

The United States and EU share a commitment to a free and democratic Iraq. The United States and EU supported preparations for Iraq's January 2005 elections and are cooperating to support Iraq's continuing political transition. The United States and EU co-hosted an International Conference on Iraq in June, 2005 in Brussels that marked the creation of a new international partnership to support the Iraqi Transitional Government.

In the Western Balkans, the United States and the EU are working together to strengthen democracy, ensure stability, and promote the region's integration into Euro-Atlantic structures, and are urging all parties to meet their obligations to cooperate with the International Criminal Tribunal for the Former Yugoslavia. The United States and EU also cooperate closely in the process intended to culminate in resolving Kosovo's future status.

The United States and the EU share a commitment to promoting democracy throughout Eurasia. The United States and the EU cooperated closely during the presidential election campaign in Ukraine, and especially following the flawed November 2004 second-round vote. In Afghanistan, the EU is a close partner with the United States in supporting democratic development and reconstruction. A combination of NATO security forces and EU civilian rule of law assistance are contributing to the stabilization of a democratic Afghanistan. Most notably, in 2003 the EU pledged $1.3 billion to Afghanistan over a five-year period to support reconstruction and development.

The United States and the EU cooperate on many African issues, including supporting efforts by the African Union to restore peace in the Darfur region of Sudan. The United States welcomed the EU's peacekeeping mission in Africa's Great Lakes region and supported its joining the Tripartite Commission as an observer. The United States consults regularly with the EU on assistance programs, including efforts to combat HIV/AIDS throughout Africa.

ECONOMY

The institutions of the European Union were originally created to oversee the operation of the several economic communities that later became the Single European Market. Even as the EU's political integration has continued, the area of greatest integration has always been in the economic sphere: goods, capital, and labor move freely between Member States (with some exceptions), businesses in all Member States are increasingly subject to common basic rules, and thirteen of the 27 Member States use a common currency, the euro. The twelve euro-area countries share a common monetary policy administered by the European Central Bank in Frankfurt, Germany. The EU strives to eliminate internal barriers to the free flow of goods, services, labor, and capital, and to promote the overall convergence of living standards. Internationally, the EU aims to strengthen Europe's trade position and capitalize on the political and economic leverage that a large, unified market brings.

Growth

The EU is the world's largest economic area (the U.S. is second) with a 2006 GDP of $13.08 trillion; however, growth in many of the EU's Member States in the recent past has been slow. Between 2001 and 2003, the overall growth rate dropped from 1.8 percent to 1.0 percent. The EU economy staged a modest, short-lived recovery in 2004, and increased to 3.2% in 2006. Within the euro area, growth varies as much as 4.5 percentage points between the fastest and slowest-growing economies. In 2005, many of the EU's largest economies, including Germany, France and Italy, will grow by less than two percent. Outside the euro area, growth is forecast to remain strong, particularly in the Central and Eastern European countries that joined the EU in May 2004.

In spring 2000, the EU committed to a ten-year strategic goal of transforming the EU into a more competitive, knowledge-based economy capable of sustaining higher levels of growth. Focusing on labor market reform, macroeconomic and fiscal policy, and promotion of e-commerce and entrepreneurship, the EU's “Lisbon Agenda” was an attempt to stimulate growth while remaining committed to the EU social model. Some suggest that it has so far failed to achieve its goals in large part because national governments (which retain authority over employment policy, immigration, large public sector workforces, entitlement programs and pensions) have not completed the necessary reforms. With euro area unemployment at 8.6 percent, generous social programs continue to strain national economies. The European Commission re-launched the Lisbon Agenda in March 2005, promising three percent growth and six million new jobs by 2010. The revamped strategy focuses on developing political consensus within Member States to make the changes necessary to complete elimination of barriers in the internal market, reduce the regulatory burden on business, improve labor market flexibility, provide incentives to work and increase investment in human capital.

Fiscal and Monetary Policy

Introduced in 1999, the euro is currently the official currency of thirteen of the 27 EU Member States. United Kingdom, Denmark and Sweden chose to retain their national currencies, and newer EU members have yet to adopt the euro. Prior to the euro's launch in 1999, national currency exchange rates of countries intending to join the euro were fixed within an Exchange Rate Mechanism. Following the January 2002 introduction of euro notes and coins into general circulation, national currencies were removed from circulation. Each of the euro area countries agreed to abide by a shared fiscal policy rule book known as the Stability and Growth Pact (SGP). This agreement generally obliges national governments to limit government budget deficits to 3 percent of GDP and established a target debt-to-GDP ratio of below sixty percent. Although enforcement actions have been forgiving—France and Germany, for example, avoided sanctions despite missing SGP targets—countries violating the SGP are technically subject to sanctions by the European Commission. As of March 2005, national governments have been granted budget leeway to achieve structural reforms and to combat prolonged stagnation, negative growth or other factors, such as the cost of German reunification or state pensions. The revised standards still require deficits to remain close to the targets; they may only temporarily exceed the three percent limit. The ten Member States that joined the EU in May 2004 may adopt the euro after complying with the SGP targets and meeting other applicable criteria.

The euro area's monetary policy is set by the European Central Bank (ECB), which must devise a monetary policy to accommodate a wide range of domestic policies and economic conditions within euro area Member States. The Treaties require that the ECB's primary objective be to maintain price stability (i.e., to keep inflation low). Euro-area national governments have sometimes criticized the ECB for guarding against inflation at the expense of interest rate flexibility that could enable struggling economies to gain traction. The ECB's consistent overnight interest rate of two percent has been credited with creating favorable conditions for growth in Spain and Ireland, but has been blamed for hindering growth in France, Germany, Italy, and Portugal.

Trade

The EU is the world's largest exporter of goods and services. In 2006, excluding internal EU trade, the EU exported $1.33 billion worth of goods to non-EU countries, compared to $987 billion in 2003. The EU's exports grew rapidly between 1996 and 2000 but have grown more slowly since. Except for 2002, the EU as a whole has posted a trade deficit every year since 1999; it was $62 billion in 2004. The EU is a major exporter of chemicals, transport equipment, and industrial machinery. The EU has large trade deficits in raw materials and energy, and a small deficit in food and drink.

The U.S. is the EU's main trading partner by a wide margin. In 2006, the U.S. consisted of 13.8% of all imports to the EU. U.S. goods and services exports to the EU reached $283 billion in 2004, while U.S. goods and services imports from the EU totaled $388 billion. Asian economies such as Japan and China, however, account for an increasingly important share of EU trade. The EU's two-way merchandise trade with China grew to $223 million in 2004, while merchandise trade with Japan was $149 million. Internal trade between euro area and non-euro area countries was down one percent in the first quarter of 2005, but the EU's external trade was up four percent, particularly with Russia and Norway.

Member States have given almost exclusive authority to the EU to negotiate trade treaties that bind the Member States. The European Community (EC) is a full member of the World Trade Organization and plays an active role in the Doha Development Round to foster international trade in services and agricultural products. Bilaterally, the EC maintains framework agreements to facilitate trade flows with thirty-five countries worldwide, mostly elsewhere in Europe, in North Africa, and in the Middle East.

Foreign Direct Investment

The EU is both a major destination for foreign direct investment (FDI) and a major source of FDI. U.S. foreign direct investment in the EU totaled $83.3 billion in 2004; EU FDI into the U.S. totaled $46.6 billion. Following strong year-upon-year growth in the late 1990s, however, inward and outward flows of FDI have contracted since 2001. The EU is a net recipient of FDI from Japan, receiving $81 billion in 2003. Conversely, the EU is a net investor in Canada ($86 billion in outward investment in 2003), and China ($29 billion in out-ward investment in 2003). Growth of intra-EU FDI has increased rapidly in recent years and has increased much faster than FDI in non-EU countries.

The pattern of foreign investment by European firms reflects deep commercial ties with the United States. U.S. and EU businesses invest heavily and operate profitably on both sides of the Atlantic. U.S. affiliates in Europe accounted for 56 percent of the aggregate output of U.S. affiliates worldwide. European firms were the largest foreign investors in 44 U.S. states and the second largest foreign investor in the remaining six. Sales by U.S. affiliates in Europe totaled $1.5 trillion in 2002, more than double those of U.S. affiliates in the Asia/Pacific region. European affiliate sales in the U.S. were $1.2 trillion in 2002, more than three times the value of U.S. imports from Europe.

Intra-firm trade involving foreign affiliates is particularly important to the transatlantic trade and investment relationship. Approximately 58 percent of U.S. imports from the EU in 2004 involved trade between related parties, as did 30 percent of U.S. exports to Europe in 2003. This high level of intra-firm trade has contributed to the persistence of the U.S. trade deficit with Europe even as the dollar has lost value against the euro since 2002.

Budget

The EU's budget is essentially made up of Member State contributions. Equivalent to roughly one percent of the Member States’ combined gross national income (GNI), it will be approximately 129.2 billion in 2008. The UK receives a rebate on its contribution. In June 2005, the EU failed to agree on a budget plan for 2007 through 2013, due in part to a disagreement between the UK and France over the persistence of the UK budget rebate and the funding of the Common Agricultural Policy (CAP). Costs attributable to the CAP constitute the EU's largest annual budget item, benefiting farmers across the EU, especially in France. Payments to net-recipient Member States, designed to reduce economic and social disparities among EU countries and regions, are another budget item which has become more contentious with the accession of ten new states poorer than the EU average.

Principal U.S. Embassy Officials

Last Updated: 2/19/2008

AMB:C. Boyden Gray
DCM:hristopher Murray

2007 U.S.-EU SUMMIT

April 30, 2007

General

The leaders of the United States of America and the European Union, met on April 30, 2007 in Washington to deepen the strategic partnership between the two entities. Some of the actions taken at that meeting are listed below.

The leaders adopted a framework on transatlantic economic integration which lays a long-term foundation for building a stronger and more integrated transatlantic economy, in particular by fostering cooperation to reduce regulatory burdens and accelerating work on key “lighthouse projects” in the areas of intellectual property rights, secure trade, investment, financial markets, and innovation. The leaders also reaffirmed a strong desire to reach a prompt agreement in the WTO Doha Development Agenda (DDA) negotiations that is ambitious, balanced and comprehensive and creates meaningful new trade flows in agriculture, industrial goods and services among and between developed and developing countries.

The leaders adopted a declaration on political and security issues, including commitments to concrete actions to strengthen liberty, prosperity, security, peace and human rights and address regional challenges, in particular regarding Kosovo, Afghanistan, the Middle East, Iraq, Sudan, Latin America, and efforts to combat terrorism and the proliferation of weapons of mass destruction, and to work towards visa-free travel for all EU and U.S. citizens by creating conditions by which the Visa Waiver Program may be expanded.

The leaders adopted a joint statement on energy security and climate change that underlines mutual interest in ensuring secure, affordable, and clean supplies of energy and tackling climate change. The leaders pledged to broaden and reinforce activities to improve energy security and reduce pollution and greenhouse gas emissions, while supporting economic growth.

The leaders welcomed the signing of a first stage Air Transport Agreement which is an historic advance in liberalizing transatlantic air traffic. This agreement will bring real benefits for consumers and airline companies on both sides of the Atlantic. The leaders reaffirmed a commitment to pursue, as a matter of priority and no later than 60 days after March 30, 2008, negotiations to conclude a second stage agreement in order to achieve further liberalization.

2007 U.S.-EU Summit Economic Progress Report

At the 2006 U.S.-EU Summit in Vienna, leaders committed to redouble their efforts to promote economic growth and innovation and reduce the barriers to transatlantic trade and investment by implementing all aspects of the 2005 Initiative to Enhance Transatlantic Economic Integration and Growth (2005 Economic Initiative). The U.S. endorsed the new Action Strategy for the Enforcement of Intellectual Property Rights, and agreed to build on progress of the High Level Regulatory Cooperation Forum and expand implementation of our Roadmap for U.S.-EU Regulatory Cooperation and Transparency. The U.S. pledged to intensify efforts to conclude a first stage Air Transport Agreement.

The U.S. agreed to reinforce our strategic energy cooperation to support diversification of energy sources and supplies, secure our energy infrastructure, promote market-based energy security policies, speed development of new lower-pollution and lower-carbon technologies, and accelerate investment in cleaner, more efficient use of fossil sources and renewable sources. The U.S. and EU agreed to conduct an annual strategic review of U.S.-EU energy cooperation. The U.S. and EU also agreed to establish a U.S.-EU High Level Dialogue on Climate Change, Clean Energy and Sustainable Development to build on existing initiatives in the areas of climate change, biodiversity loss and air pollution and to advance implementation of the G8 Gleneagles Plan of Action for Climate Change, Clean Energy and Sustainable Development.

The U.S. and EU welcomed progress in these areas and discussed ways to intensify efforts on intellectual property rights, innovation and removal of regulatory barriers to trade and investment at the second informal U.S.-EU Economic Ministerial in November 2006 in Washington.

This report notes areas of progress made over the past year to implement our multi-annual, broad economic program under the Economic Initiative, per our agreements on energy and climate and in other areas of transatlantic cooperation.

Key Accomplishments

After four years of negotiations, on March 2, the U.S. and EU concluded a comprehensive, first-stage Air Transport Agreement, which will create benefits for carriers, airports, workers, consumers, communities and economies on both sides of the Atlantic. The U.S. and EU have made significant progress on the implementation of the Roadmap for Regulatory Cooperation, including advancing the OMB-European Commission Dialogue on good regulatory practices, namely work on impact assessment, and advancing cooperation on pharmaceuticals, medical devices, automotive safety and consumer product safety. The U.S. and EU led negotiations on a substantial revision of the text of the WTO Agreement on Government Procurement (GPA), which was provisionally approved by the WTO Government Procurement Committee on December 8, 2006.

The U.S. and EU also made major strides in strengthening energy and climate cooperation, holding the first High Level Dialogue on Climate Change, Clean Energy and Sustainable Development (HLD), launching working groups on biofuels and energy efficiency, finalizing renewal of the U.S.-EU ENERGY STAR agreement, and holding the first annual review of our strategic energy cooperation, which examined shared geopolitical energy security goals, energy technology cooperation, and the potential for new work on biofuels, energy efficiency, carbon capture and storage, promotion of supply diversification, and cooperation to increase energy security in third countries.

Regulatory Cooperation

Since the June 2006 Summit, the U.S. has focused cooperation primarily on intensifying work on a broad range of sector-specific activities identified in the 2005 Roadmap for Regulatory Cooperation and Transparency and deepening the dialogue on good regulatory practices between the U.S. Office of Management and Budget (OMB) and the European Commission. Implementation of the Regulatory Cooperation Roadmap resulted in significant progress in a number of key areas. On pharmaceuticals, the U.S. Food and Drug Administration and the European Commission together with the European Medicines Agency intensified cooperation on vaccines, pharmacovigilance and counterfeit medications and both sides agreed to pursue a confidentiality arrangement to permit the sharing of regulatory information on medical devices and cosmetics. The U.S. National Highway Traffic Administration and the European Commission initiated a dialogue to streamline the adoption of global regulations, and agreed to promote a global regulation on electronic stability control systems, to increase auto safety. The U.S. Coast Guard and the European Commission agreed to a two-way alert system on unsafe marine equipment and to expand the product scope of the Mutual Recognition Agreement. The U.S. Consumer Product Safety Commission and the European Commission established a program for sharing information on recalls of unsafe consumer products. The High Level Regulatory Cooperation Forum, launched in 2006, developed a set of Best Cooperative Practices to guide regulators in the conduct of more effective collaboration. The OMB-European Commission Dialogue advanced its discussions among experts, including completion of a joint comparison of our respective impact assessment guidelines A more detailed report on specific progress on regulatory cooperation can be found at Joint Report on the Roadmap for US-EU Regulatory Cooperation.

Financial Markets

Given the consolidation underway globally and trans-Atlantically in financial markets, it is important to take steps where appropriate towards the convergence of regulatory standards around high quality principles. In this regard, work has continued to progress in various areas including: accounting and auditing, banking, insurance and securities. Since the U.S.-EU 2006 Economic Summit, both sides have continued to make significant progress under the U.S.-EU Financial Markets Regulatory Dialogue, begun in 2002, and in bilateral discussions between regulators. Positive developments included: the SEC's adoption of a new deregistration standard which provides significantly greater flexibility to EU and other non-U.S. companies to exit U.S. markets; constructive discussions of further steps toward implementation of Basel II on international capital adequacy standards, and proposals being considered by the National Association of Insurance Commissioners to revise reinsurance collateral requirements.

In addition, the Chairman of the U.S. Public Company Accounting Oversight Board (PCAOB) and the EU Internal Market and Services Commissioner agreed to work on furthering cooperation in auditor oversight. The goal is to move toward full reliance on each others’ oversight systems by 2009.

The SEC is in the midst of implementing a “roadmap” on the acceptance of IFRS without need for reconciliation to U.S. Generally Accepted Accounting Standards (GAAP) in the United States. Similarly, the EU will make a final decision on the acceptance of U.S. GAAP in EU markets by the end of 2008. The SEC hosted a roundtable on its “roadmap” in Washington to solicit the views of U.S. market participants on the acceptance of IFRS in U.S. markets in March 2007 at which Chairman Cox and Commissioner Charlie McCreevy gave opening remarks in support of further sustained progress in this area, and affirmed the goal of acceptance of IFRS and U.S. GAAP in both markets no later than 2009. The SEC is completing its review of the first set of filings by EU issuers using IFRS, and the EU is in a similar position with regard to the first full set of published financial statements using IFRS. A second review round of financial statements using IFRS will commence with filings due for submission to the SEC in the summer of 2007.

In January 2007, the SEC and the College of Euronext regulators signed a memorandum of understanding on cross-border stock exchange mergers. The MOU creates a structure for discussions on enhanced cooperation, particularly in light of NYSE/Euron-ext merger.

Energy Security and Climate Change

At the U.S.-EU Summit in June 2006, the U.S. agreed to reinforce strategic energy cooperation to support diversification of energy sources and supplies, promote market-based energy security policies, secure our energy infrastructure, speed development of new lower-pollution and lower-carbon technologies, and accelerate investment in cleaner, more efficient use of fossil sources and renewable sources. To monitor and guide this process, the U.S. agreed to conduct an annual strategic review of U.S.-EU energy cooperation. The United States and EU also agreed at the Summit to establish a High-Level Dialogue on Climate Change, Clean Energy and Sustainable Development (HLD) to focus on the nexus between climate, energy, and environmental cooperation. The United States and EU held the first HLD in Helsinki October 24-25, and strategic energy cooperation meetings in Washington October 26-27, to act upon our Summit commitments and further advance the 2005 G8 Gleneagles Plan of Action for Climate Change, Clean Energy and Sustainable Development. At the HLD the two sides committed to further cooperative work on promoting commercial deployment of clean coal and other technologies, promoting energy efficiency in transportation and buildings and appliances, supporting research and development of second generation biofuels, and developing a roadmap towards compatible biofuel specifications.

At the October 26-27 strategic energy cooperation meeting, participants produced workplans on biofuels and energy efficiency, agreed to explore cooperation on clean coal and carbon sequestration, and discussed collaboration to strengthen energy security policies in third countries such as China, India, and Ukraine. Both sides began to implement the biofuels and energy efficiency workplans and carry out specific activities regarding third countries.

Among specific undertakings, the U.S. and EU jointly finalized renewal of the U.S./EU ENERGY STAR agreement (December 28, 2006), reviewed our respective biofuels R&D agendas and examined opportunities for collaboration under the U.S.-EU Science and Technology Agreement (February 9, 2007), discussed progress during the Washington visit of the Head of private office of the European Commissioner for Energy (February 9), cosponsored with the International Energy Agency (IEA) a major conference on gas transit issues in South-eastern Europe and the Caucasus (February 14), held a second biofuels working group meeting (February 26), participated together with industry and NGOs in a joint EU-CEN conference on international biofuels standards (February 26-28), and began to exchange information on efficient buildings.

In the framework of the visit of the European Commissioner for Energy to the United States, we held the first strategic energy cooperation annual review on March 26 at which we discussed progress on our biofuels and energy efficiency cooperation, examined ways to intensify our work on clean coal and carbon capture and storage, energy security and diversification of energy supplies, and reviewed possibilities to work together to strengthen key third country energy security policies, particularly in Ukraine, the Caspian and Central Asia.

In addition, U.S. and EU climate experts met March 27 to work together on an implementation plan to continue to guide follow-through on the Helsinki HLD outcomes in the future and to begin to explore the broader principles that shape cooperation on climate and clean energy.

Intellectual Property Rights

The 2006 Summit endorsed the Action Strategy for the Enforcement of Intellectual Property Rights. In following up, the IPR Working Group has worked on a number of enforcement initiatives, most notably on customs cooperation, providing technical assistance to third countries, and addressing concerns in key countries, such as China and Russia, through closer policy coordination and information exchanges. The U.S. and EU diplomatic missions in Beijing and Moscow have intensified their cooperation on IPR and have encouraged implementation of effective measures to protect and enforce intellectual property rights. The EU and United States have also worked closely with IP right-holders to improve public-private cooperation on enforcement education, public awareness and business practices. In February 2007, the Working Group agreed to give greater attention to IPR problems in transhipment areas of Latin America, the Middle East, and Southeast Asia. In working on joint border enforcement initiatives, U.S. and EU customs officials have shared best practices and agreed to share enforcement information. The two sides have agreed to explore ways to use technology to increase the efficiency of information-sharing; details following the Summit will be at stopfakes.gov.

The EU and the United States agreed to strengthen cooperation on achieving harmonization in the patent area. In particular it was decided to work towards more streamlined patent systems through substantive patent law harmonization. Both the EU and the US should intensify their bilateral contacts to facilitate the success of the “Alexandria process.”

Innovation Initiative

At the 2006 Summit, the United States and EU agreed to further our cooperation on innovation and the impact of innovation on our economies. Over the past year the two sides have:

  • concluded a workshop on metrics to better measure the impact of innovation on our economies;
  • included two European Commission experts in the review of U.S. e-accessibility standards and guidelines for public procurement, and agreed that U.S. government experts will participate in the execution of the European Commission's mandate to the European Standardization Organizations on European accessibility requirements for public procurement of products and services in the ICT domain;
  • hosted an EU delegation of innovation experts to study innovation policy in three states in the United States;
  • held a full-day workshop on innovation policy in the United States, hosted by the Department of Commerce.

Services

After four years of negotiation, the United States and EU concluded a comprehensive, first-stage Air Transport agreement. The agreement significantly expands the potential for transatlantic travel and cargo, allowing U.S. and EU airlines to fly between any point in the EU and any point in the United States, with no restrictions on the number of flights, aircraft, routes, or pricing. It will create a new template for international aviation, removing decades-old restrictions on a sector integral to global commerce. This pro-growth, pro-competition, pro-consumer accord is a major breakthrough in transatlantic economic relations and a harbinger of what the United States and EU can accomplish working together to achieve market liberalization on an unprecedented scale.

European and American architectural professional organizations submitted to EU and US competent authorities a joint recommendation for a Mutual Recognition Agreement for Architects. The European Commission and the U.S., in cooperation with relevant regulators and professional associations, have begun to consider options to promote progress towards a mutual recognition arrangement in the field of architectural services in accordance with each side's legal systems.

Investment

At the 2006 Summit, the United States and EU recognized the importance of maintaining open investment regimes that can create new economic opportunities and build prosperity. Interests in an open investment climate were reaffirmed at the U.S.-EU Economic Ministerial in December 2006, and both sides agreed to have discussions on topics of mutual interests to address any remaining significant obstacles to investment flows between us.

Procurement

The United States and EU successfully led negotiations on a major revision of the text of the WTO Agreement on Government Procurement (GPA), which the GPA Committee provisionally approved on December 8, 2006. The United States and EU will continue to work together to complete market access negotiations and reach final agreement on the revision to the GPA. We will cooperate to expand membership in the Agreement, in particular to expedite China's accession to the GPA.

2007 U.S.-EU Summit Political Progress Report

The United States and European Union continue to put strategic partnership to work. During the past year, the U.S. and EU have concentrated on specific issues, and our effective dialogue—often in advance of policy formulation—has led to convergence on key issues. the U.S. and EU can identify genuine progress in several areas, including those targeted by the joint declarations adopted at the 2006 Summit.

Key Accomplishments—Regional issues

In a world of global threats and challenges our security and prosperity increasingly depend on an effective multilateral system. The United Nations Charter is an essential pillar for international relations, and the EU and the US will strive for a strong, credible and effective United Nations. Strengthening the United Nations and equipping it to fulfill its responsibilities is a joint priority.

The U.S. and EU have collaborated actively, including in Geneva, on priorities for the Human Rights Council, such as mandate review, agenda setting, universal periodic review and a Special Session on Sudan. We successfully cosponsored UN 3rd Committee resolutions on Belarus, Burma, Iran and North Korea. The U.S. has supported the active participation of the European Community in various bodies of the Peace Building Commission (PBC).

Building on strong collaboration over the previous year, the U.S. and EU agreed on specific actions to undertake to promote peace, human rights, democracy and the rule of law worldwide.

There has been a period of rising tension in the Middle East, including the war between Israel and Lebanon in summer 2006, Iran s continued defiance of the international community in pursuit of its nuclear program and continuing Iranian and Syrian interference in Lebanon and Iraq. But there has also been promising change with the formation of a Palestinian National Unity Government, the relaunch of the 2002 Arab Peace Initiative and security and reconstruction developments in Iraq. The United States and the European Union have held regular consultations, in particular within the United Nations framework and the Quartet, on the evolving situation.

The U.S. welcomed the EU initiative to launch, under the auspices of the Quartet, a Temporary International Mechanism (TIM) to provide direct emergency assistance to the Palestinian people and the 240 million contribution so far into TIM from the European Union. The U.S. supported Palestinian President Abbas efforts to form a Palestinian government whose policy and actions reflect the Quartet principles and will continue to closely evaluate the performance of the new Palestinian National Unity Government in that respect. The U.S. also worked to promote implementation of the Security Sector Transformation (SST) plan, including implementation of the November 2005 Agreement on Movement and Access through the EU Border Assistance Mission to the Rafah crossing, and efforts to improve the Karni/al-Mintar commercial crossings between Gaza and Israel.

The United States and the European Union helped bring an end to the summer 2006 war between Lebanon and Israel, aided in particular by substantial European Union member state contributions to the UNIFIL peacekeeping force in Lebanon. The U.S. and EU worked together to provide significant humanitarian assistance to those affected by the conflict, enabling the bulk of the hundreds of thousands displaced to return to their homes and begin to rebuild their lives. The U.S. and EU welcomed the $7.6 billion in pledges of international assistance for Lebanon made at the Paris III donors conference in January 2007, including $770 million in loans and grants from the United States and $2.9 billion in loans and grants from the European Union ($535 million from the European Community budget). We called on Syria to end its interference in Lebanon and urged full implementation of UN Security Council resolutions 1680 and 1701. We urged Syria to end destabilising activities and play a more constructive role in Lebanon, Iraq, and the Palestinian territories, as well as to reconsider its relations with Iran; we issued statements calling for the release of Syrian political prisoners.

The United States and the European Union have urged the government of Egypt to proceed with the fundamental political and constitutional reforms it announced. For example, we have specifically called on the Egyptian Government to fulfill the aspirations of the Egyptian people for democracy and meet the standards of openness, transparency, and reform that they have set for themselves. U.S. bilateral assistance aims to strengthen Egyptian efforts at political and economic reform. The EU, in its joint European Neighborhood Policy Action Plan with Egypt, has made greater participation in political life, an enhanced role for civil society, and greater respect for human rights and fundamental freedoms a policy priority. Support for the implementation of the Action Plan is a main priority of the EU s financial and technical assistance to Egypt.

The United States and the European Union have worked closely together at every stage to address the concerns raised by Iran's nuclear program. The U.S. and EU offered Iran a set of far-reaching incentives to cease its domestic uranium enrichment activity. Given Iran s rejection of that offer, we successfully led efforts in the UN Security Council to pass resolutions 1737 and 1747, which call for Iran to suspend uranium enrichment and negotiate on the basis of the aforementioned incentives package, and which impose financial, travel, and other restrictions to pressure the Iranian regime to comply with its international obligations. The U.S. and EU have implemented those resolutions, and have taken additional steps to further encourage Iran to cooperate with the international community.

To support the economic reconstruction of Iraq, 19 European Union members have concluded agreements to forgive from 80% (Paris Club terms) to 100% of Iraqi official debt, and the United States forgave 100% of its outstanding official debt to Iraq. The United States and European Union actively engaged in ongoing support for the Iraq Compact process. The United States and twenty-five of 27 EU members have established relations with the Iraqi Government, and 16 (along with the European Commission) have set up resident missions. Total U.S. reconstruction assistance since 2003 approaches $25 billion, while the European Union and its member states have provided a total of 13.6 billion including debt relief—to date and will make further contributions in support of the Iraqi people and the International Compact for Iraq.. The European Union is also conducting a successful Rule of Law training program called EUJUST LEX for Iraqi officials.

The United States and European Union continue to be among the primary contributors to Afghanistan reconstruction, through participation in the Joint Coordinating and Monitoring Board and in support of the Afghan government. At the January 26 NATO informal foreign ministerial, the United States announced a two-year supplemental request for $11.8 billion for Afghanistan. In December 2006, the European Union completed its pledge to contribute 1 billion for Afghan reconstruction between 2002 and 2006. For the same period, the combined contribution from the EU budget and by EU Member States to Afghanistan reached 3.7 billion. The EU s new budget includes another 610 million for 2007-2010. The EU has been a main donor to the Afghan National Police, helping cover the salaries of some 62,000 police officers with a contribution of 135 million so far. In February, the EU General Affairs and External Relations Council approved the deployment of a police training mission to Afghanistan that will initially include 160 officers and other experts. The EU police mission will build on the efforts of key partners that have trained extensively over 18.000 officers and non-commissioned officers over the past few years. In December 2006, the European Union approved 10.6 million for the support of provincial governance projects by Provincial Reconstruction Teams (PRTs) led by or with considerable participation of EU member states. The U.S. maintains about 500 police trainers and advisors around the country, in addition to U.S. military police. The United States has trained more than 70,000 members of the Afghan National Police since the fall of the Taliban. Over 50,000 members of the Afghan National Police have completed specialized training courses in areas such as firearms, crowd control, investigative techniques, and domestic violence. The United States has also trained more than 4600 Afghan National Auxiliary Police in ten-day courses to provide them essential skills as they help the Afghan National Police fight an urgent battle in southern and eastern Afghanistan against Taliban fighters. As part of a major pay and rank reform program, the United States and international partners are helping the Afghan National Police leadership build a merit-based leadership and discipline structure to assure that the police become widely respected public servants and officers of a society based on the rule of law.

The United States and European Union have consistently supported UN Special Envoy Ahtisaari s approach to determining the future status of Kosovo and his timeline for successfully concluding the Kosovo status process. The U.S. and EU are committed to working towards furthering NATO-EU contacts to ensure smooth planning for Kosovo s post-status security. Pending a status resolution, The U.S. and EU have worked within the international community to support UNMIK efforts under UNSCR 1244 to build stability and meaningful self-government in Kosovo. Having cooperated through the Stability Pact for South Eastern Europe since 1999 to build peace and prosperity in the region, the US and EU have been working together closely to ensure the successful transition of the Stability Pact framework to regional ownership under the auspices of the South Eastern European Cooperation Process (SEECP). The U.S. and EU have been united in the view that successful resolution of Kosovo's status will help accelerate the region's Euro-Atlantic integration.

The U.S. and EU have been engaged with Russia on many international issues, such as energy security, relationships with neighboring countries, and cooperation in multilateral fora. The U.S. and EU have participated in dialogue with Russia on many political matters, including democratic freedoms and the need for the application of the rule of law, an independent judiciary, human rights, a free and independent media, and a strong civil society.

The U.S. and EU have welcomed and supported democratic and economic reforms in Ukraine, and have assisted its efforts to achieve better energy efficiency and effective energy independence.

The U.S. and EU have closely cooperated on Belarus to support democratization, local civil society and other democratic forces. The U.S. and EU urged the authorities of Belarus to release all political prisoners and to stop all human rights abuses. To encourage positive political change on behalf of the people of Belarus, The U.S. and EU have imposed further travel restrictions and targeted financial sanctions against members of Lukashenko s regime. The U.S. and EU have issued coordinated statements on political arrests, local elections, energy security and persecution of independent NGOs.

The U.S. and EU have achieved increased cooperation and a unified approach in our efforts towards peaceful solutions of separatist conflicts in Moldova and the South Caucasus, which would assure these states territorial integrity within internationally recognized borders. The U.S. and EU have been cooperating inside the Minsk Group, jointly promoting the set of Basic Principles.

Together the U.S. and EU have supported democratic and economic reforms, human rights, freedom of expression, and the rule of law in Central Asia. We have promoted regional cooperation to advance security, prosperity and stability. We have shown our support for strengthening democratic institutions in Kazakhstan, Kyrgyzstan, Tajikistan and Turkmenistan. We worked with the government of Uzbekistan to enter into an effective dialogue on human rights, and we have sought to establish an independent international investigation into the tragic events of Andijon.

Throughout the year, we have consulted on Latin America, and in this context also on Cuba, including the prospect for democracy in the future. In mid-2006, the EU renewed its Common Position on Cuba. Meanwhile, the United States released the second report of the Commission for Assistance to a Free Cuba (CAFC). On Haiti, we have worked together to support a strong MINUSTAH presence in Haiti, to maintain high-levels of international assistance and financial support for Government of Haiti development priorities, and to improve donor coordination for the delivery of humanitarian assistance.

The United States and European Union members worked closely together to ensure adoption of UNSCR 1706, and to make progress on transition to a more robust hybrid UN/AU peacekeeping force, as major steps towards ending the atrocities in Sudan. As demonstrated by the high-level U.S. and EU participation in the February 2007 Liberia Partners Forum, we are committed to ensuring the success of important infrastructure, community reintegration, and good governance initiatives in Liberia. Working with the UN and other key donors, the European Union and United States played an integral role in helping the people of the Democratic Republic of Congo conduct successful presidential elections, including with the EU s successful ESDP mission to help ensure stability during the elections. The U.S. and EU joined in supporting the renewal of the MONUC mandate, due to expire on April 15. The targeted restrictive measures have exerted pressure on regime leaders responsible for the critical political and economic situation in Zimbabwe. The U.S. and EU have consulted extensively on Somalia, and provided substantial resources to help support political dialogue between the Transitional Federal Government (TFG) and key Somali stakeholders, development of effective governance and security institutions, and rapid deployment of African peace support mission. The U.S. and EU are also seeking to coordinate our efforts in terms of support to African Union capacity-building including for peace keeping and further development of the African Standby Force.

The United States and European Union successfully cosponsored 3rd Committee (human rights and social affairs) resolutions on Burma and the DPRK. The European Union used the ASEM Summit to press the Burmese regime to adopt a more inclusive political process and introduce a timetable for democratic reform. The U.S. and EU continue intense exchanges on Burma at all levels.

Together the US and EU continued to support global efforts to mitigate the impacts of important infectious diseases and through the Global Fund to provide financing in support of developing countries efforts to fight the spread of HIV/AIDS tuberculosis, malaria, and polio.

Security

The U.S. Coordinator for Reconstruction and Stabilization has consulted with EU interlocutors in Brussels and Berlin. In addition to high-level consultations, we have organized technical consultations to implement coordination on cross-training, information sharing, and other areas of crisis management. The European Union participated as an observer in Multinational Experiment 4 (MNE-4) crises simulations led by U.S. Joint Forces Command, and is currently participating as an observer in MNE5.

The United States and (European Union s Judicial Cooperation Unit) Eurojust concluded an agreement to facilitate cooperation, coordination, and the exchange of information between investigators and prosecutors, including the posting of a U.S. Liaison Prosecutor to Eurojust. The U.S. and EU continue to make progress toward ratification and entry into force of the U.S.-EU Extradition and Mutual Legal Assistance Agreements and the implementing instruments between the U.S. and EU member states.

Continuing to take steps to strengthen the security of our borders, expert-level discussions have begun between the United States and the European Union on mutual recognition of the EU Authorized Economic Operator provisions and the U.S. Customs-Trade Partnership Against Terrorism. The U.S. and EU have produced a Joint Threat Assessment for Weapons of Mass Effect and will work to disseminate this to the World Customs Organization for its members. A pilot project at the Port of Southhampton has been undertaken under the U.S. Secure Freight Initiative to further improve detection and response capabilities for high risk container traffic.

The United States and European Union concluded an interim agreement on the processing of Passenger Name Record data in October 2006. Recognizing a mutual interest in the alignment of our aviation security efforts, we are studying the comparability of our airport assessment programs.

The United States and European Union continued to improve procedures for information sharing and pro-actively implement Financial Action Task Force s Special Recommendations, including by enforcing cash declaration regulations for travelers and by engaging private sector financial institutions to develop partnerships to improve implementation of asset freeze measures. The U.S. and EU continued to exchange information and best practices in expert-level discussions. Conferences on terrorism finance and money laundering issues were held with sanctions implementers (September, 2006 and April, 2007), analysts (October, 2006), and prosecutors and investigators (December, 2006). The U.S. and EU are working together to develop a public outreach statement on the issues of fairness and transparency in the implementation of sanctions regimes.

The U.S. and EU have engaged in detailed discussions on the legal framework governing the common fight against terrorism, and have agreed that the fight against terrorism must be conducted with respect to the rule of law and in conformity with international law including international human rights law, international refugee law and international humanitarian law.

In critical efforts to stop the proliferation of weapons of mass destruction (WMD), we continued to coordinate and strengthen our individual and collective efforts to implement the disarmament and nonproliferation regimes and reaffirmed the value of continuing consultations in this area. These consultations have continued in a variety of ways and fora, including the dialogue on verification and compliance that was established between the U.S. and EU at the 2005 Summit, endorsed at the 2006 summit, and continues to be productive. The last such meeting was held in Brussels last Fall, and yet a third meeting has been scheduled in early June of this year as the U.S. and EU continue to discuss verification and compliance challenges and identify opportunities for joint initiatives.

The United States and European Union affirmed their commitment to strengthening the Nuclear Nonproliferation Treaty (NPT). Both have shown their full support for the Additional Protocol (AP). The EU AP is in force and the U.S. recently passed implementing legislation.

29 April 2007 marked the 10th anniversary of the Chemical Weapons Convention, a unique treaty that requires irreversible destruction of an entire class of WMD under international verification and within specific timelines. The United States and the European Union welcome progress that has been made in the destruction of CW-stockpiles and recommit themselves to strengthening the treaty and working towards fulfillment of all treaty obligations by all states parties. We worked to make the UN Security Council resolution 1540 an effective tool to prevent the proliferation of dangerous materials and WMD to both state and non-state actors. In close co-operation with the 1540 Committee, we have supported full implementation of the Resolution including in the context of OSCE and ARF.

The United States and European Union worked together to obtain the UN Security Council s unanimous adoption of UNSCRs 1718, 1737, and 1747 which require the Democratic People s Republic of Korea (DPRK) and Iran, respectively, to abide by the will of the international community. We took actions to implement the requirements set out in the resolutions to ensure we did not aid DPRK and Iran nuclear and ballistic missile programs through supply, financing, or other support.

Due in large measure to U.S. and EU cooperation, the Sixth Biological Weapons Convention (BWC) Review Conference in November 2006 was a success, with parties agreeing to an intersessional work program 2007— 2010 which will focus in 2007 on ways and means to enhance national implementation, including enforcement of national legislation and regional cooperation. The Parties also agreed to establish an Implementation Support Unit to provide administrative support as well as to prepare documentation and serve as a clearinghouse for reporting of confidence building measures, including a secure website on CBMs.

The U.S. and EU also worked together to promote consensus within the CD on a work program, in particular on commencing negotiations in the Conference of Disarmament of a Fissile Material Cut-Off Treaty banning the production of fissile material for use in nuclear weapons.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Countries of the World and Their Leaders Yearbook 2009. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Countries of the World and Their Leaders Yearbook 2009. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/international/legal-and-political-magazines/european-union

"European Union." Countries of the World and Their Leaders Yearbook 2009. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/international/legal-and-political-magazines/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

EUROPEAN UNION

Official Name:
European Union (EU)


Editor's note: The information in this article was compiled from the October 2005 Fact Sheets made available through the Bureau of European and Eurasian Affairs of the U.S. Department of State.



PROFILE

The European Union (EU) is one of the United States' strongest strategic partners, with the importance of the relationship reflected in our close cooperation on regional crises and conflicts, our extensive collaboration on a wide range of global challenges, from counter-terrorism to nonproliferation, and our deep trade and investment relations.

Geography

Area:

3,976,372 sq km; less than one-half the size of the United States.

Cities:

Capital, Brussels, Belgium (European Commission, EU Council); Strasbourg, France (most European Parliament plenary sessions); Luxembourg City, Luxembourg (European Court of Justice).

Terrain:

mainly flat along the Baltic and Atlantic coasts; mountainous in the central and southern areas.

Climate:

cold temperate; potentially subarctic to temperate in the north; mild, wet winters, and hot, dry summers in the south.

People

Nationality:

EU (Every person holding the nationality of a Member State is a citizen of the Union. Citizenship of the Union complements and does not replace national citizenship. This provision currently applies to Austrian, Belgian, British, Cypriot, Czech, Danish, Dutch, Estonian, Finnish, French, German, Greek, Hungarian, Irish, Italian, Latvian, Lithuanian, Luxembourg, Maltese, Polish, Portuguese, Slovak, Slovenian, Spanish, and Swedish citizens).

Population:

457,030,418 (July 2005 est.).

Religion:

Roman Catholic, Protestant, Orthodox Christian, Muslim, Jewish.

Language:

Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Gaelic (Irish - from 2007), Italian, Latvian, Lithuanian, Maltese, Polish, Portuguese, Slovak, Slovene, Spanish, Swedish; note - only official languages of the European Union are listed.

Health:

total: 10.1 births/1,000 population; 10 deaths/1000 population; male: 75.1 years; female: 81.6 years (July 2005 est.).

Unemployment:

8.6% (July 2005 est.).

Government

Type:

supranational/mixed intergovernmental.

Founded:

November 1, 1993 (Treaty on European Union (Maastricht Treaty) establishing the EU entered into force). (Belgium, France, Germany, Italy, Luxembourg and the Netherlands signed the Treaty of Rome on March 25, 1957, see History.)

Member States:

Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, UK; note - Canary Islands (Spain), Azores and Madeira (Portugal), and French Guyana, Guadeloupe, Martinique and Reunion (France), which are legally part of EU Member States, are sometimes listed separately as territories forming part of the EU.

Branches:

Executive, European Commission; legislative, EU Council, European Parliament; judicial, Court of Justice of the European Communities, Court of First Instance.

Major Political Parties (in European Parliament):

Group of the Alliance of Liberals and Democrats for Europe (ALDE); Independence/Democracy Group (IND/DEM); Group of Greens/European Free Alliance (Greens/EFA); Socialist Group (Party of European Socialists -PES); Confederal Group of the European United Left-Nordic Green Left (EUL/NGL); European People's Party-European Democrats (EPP-ED); Union for Europe of the Nations Group (UEN).

Suffrage:

determined by national legislation in the individual Member States.

Economy

GDP (2004):

$11.65 trillion.

Annual Growth Rate (2004):

2.4%.

Per capita Income (2004):

$26,900.

Inflation Rate:

2.1% (2004 est.).

Natural resources:

iron ore, arable land, natural gas, petroleum, coal, copper, lead, zinc, hydropower, uranium, potash, fish.

Agriculture:

Products, wheat, barley, oilseeds, sugar beets, wine, grapes, dairy products, cattle, sheep, pigs, poultry, fish.

Industry:

Type, ferrous and non-ferrous metal production and processing, metal products, petroleum, coal, cement, chemicals, pharmaceuticals, aerospace, rail transportation equipment, passenger and commercial vehicles, construction equipment, industrial equipment, shipbuilding, electrical power equipment, machine tools and automated manufacturing systems, electronics and telecommunications equipment, fishing, food and beverage processing, furniture, paper, textiles, tourism, media, financial services.

Trade (2003):

Exports, machinery, motor vehicles, aircraft, plastics, pharmaceuticals and other chemicals, fuels, iron and steel, nonferrous metals, wood pulp and paper products, textiles, meat, dairy products, fish, alcoholic beverages. Major markets, U.S., China, Japan, Switzerland. Imports, machinery, vehicles, aircraft, plastics, crude oil, chemicals, textiles, metals, foodstuffs, clothing. Major suppliers, U.S., China, Japan and Switzerland.


HISTORY

Following World War II, traditional European rivals sought to solidify peace by bringing their nations together under a common institutional structure. Influenced by his compatriot Jean Monnet, French Foreign Minister Robert Schuman officially tabled a plan on May 9, 1950 to pool French and German coal and steel production under an organization that would be open to other European countries. German Chancellor Konrad Adenauer supported this proposal, and six founding countries, Belgium, France, Germany, Italy, Luxembourg and the Netherlands, took an early step toward European integration by establishing the European Coal and Steel Community (ECSC) the following year.

After failing to establish a European Defense Community in the 1950s, the six countries then decided to set up a common market. With the entry into force of the Treaty of Rome in 1957, they created the European Economic Community (EEC), with an objective of liberating the movement of goods, capital, workers and services. (The European Atomic Energy Community (EURATOM) was also established at this time.) The Treaty of Rome established the basic institutions and decision-making mechanisms still in place in today's European Union. As of July 1, 1968, the EEC abolished customs duties between Member States on manufactured goods. New policies, including a common agricultural policy (CAP) and a common trade policy, were in place by the end of the 1960s.

The success of the European integration project during a period of steady economic growth in the 1960s set the stage for a first enlargement, the accession of the UK, Ireland and Denmark, in 1973. Further "deepening" of European integration followed: the Community acquired executive authority in social, regional, and environment policies. The benefits of economic convergence became more evident in the context of the 1970s energy crisis and financial turmoil, which led to the launch of the European Monetary System in 1979. In the same year, the first direct elections to the European Parliament (EP) took place. Previously, delegates from national parliaments had represented their country's legislative bodies at the EP in Strasbourg, France.

The Community further expanded southward with the accession of Greece (1981, the second enlargement), followed by Spain and Portugal (1986, the third enlargement). These accessions led the EEC to adopt "structural programs" in order to reduce economic and social disparities among its regions.

During the 1960s and 1970s, the Community began to assert itself on the international scene with the conclusion of agreements with southern Mediterranean countries. Starting in 1963, the EEC signed four successive Lome Conventions, which guaranteed trading advantages and development aid for Member States' former colonies in Africa, the Caribbean, and the Pacific (ACP).

World recession and internal disputes over Member States' financial burdens gave way, from 1985 onward, to renewed efforts for economic integration, enshrined in the 1985 "Single European Act" (SEA) and marked by the 1992 "Single Market Project." The SEA set January 1, 1993 as the date by which an internal single market was to be established and, by extending the practice of majority voting rather than unanimity in the EU Council, gave Community institutions the means of adopting the 300 Community-wide Directives required to abolish the remaining barriers and obstacles to intra-Community trade. In 1995, the Community entered into the "Barcelona" partnership with twelve southern Mediterranean countries. The partnership, reinforced by agreements on social, cultural, and human cooperation, was intended to lead to a free-trade area.

The collapse of the Berlin Wall and German unification prompted Member States to negotiate the 1992 Treaty on European Union (the "Maastricht Treaty"). In addition to establishing the European Union, the Maastricht Treaty set an ambitious program of further integration: establishment of Economic and Monetary Union (EMU) by 1999 (part of the "First or Community Pillar"), setting up of a Common Foreign and Security Policy (CFSP) ("Second Pillar"); and cooperation on Justice and Home Affairs (JHA) ("Third Pillar"). Shortly thereafter, in 1995, Austria, Finland and Sweden joined the EU, the fourth enlargement.

Signed in 1997 and entering into force on May 1, 1999, the Amsterdam Treaty partially streamlined the EU institutional structure. Its most significant effects were: (1) to transfer aspects of Justice and Home Affairs policy to the Community Pillar, enabling the Commission to propose decisions to be taken by the EU Council by qualified majority voting instead of by consensus, and (2) to establish a High Representative for the CFSP (who also serves as Secretary-General of the Council Secretariat). Ten countries in Central and Eastern Europe and Cyprus began accession procedures in 1997, followed by Malta. The prospect of eastward enlargement raised significant resource concerns and prompted the adoption in March 1999 of the "Agenda 2000" package, which covered amendments to the CAP and EU structural policies, as well as a budgetary framework through 2006.

In May 1998, EU heads of government officially designated eleven Member States eligible to adopt a single currency. Greece initially did not qualify, and Sweden, the UK and Denmark "opted out." On January 1, 1999, the euro became the official currency of the EU, and the European Central Bank (ECB) put euro notes and coins into circulation on January 1, 2002. Today, twelve countries use the euro: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain.

Streamlining the size and procedures of EU institutions to make the expanded EU more efficient was also an aim of the 2003 Treaty of Nice. A year later, in May 2004, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia joined the EU, bringing total membership to 25. Candidate countries currently include Bulgaria and Romania (scheduled to accede to the EU on January 1, 2007), as well as Turkey and Croatia.

In October 2004, Member States signed an EU Constitutional Treaty in Rome, intending that it take effect on November 1, 2006. French and Dutch voters rejected the treaty through referenda in 2005, thereby suspending the ratification process.


MAJOR INSTITUTIONS

The European Commission

The role and responsibilities of the European Commission place it at the center of the EU's decision-making process. Acting as the EU's policy and executive engine, the Commission is composed of 25 Commissioners, one from each Member State and is supported by a substantial staff located primarily in Brussels, Belgium. In matters relating to economic integration ("First or Community Pillar"), only the Commission has the right to propose legislation for approval by the EU Council and European Parliament. As "guardian of the Treaties," the Commission ensures that EU laws are applied and upheld throughout the EU, prosecuting Member States and other institutions for failing to follow treaty precepts or otherwise apply Community law. The Commission has full authority to enforce Community competition policy, and its policing of implementation of Community legislation preserves the integrity of the EU single market. The Commission likewise manages and develops the Common Agriculture Policy (CAP), implements the budget, and represents the European Community in its areas of competence, notably including international trade negotiations.

The Commission President is appointed by agreement of the EU heads of government and is subject to approval by the European Parliament. Commissioners serve for a renewable five-year term. New Commissioners are identified by Member State governments in consultation with the President-designate of the Commission and are normally put in place at the beginning of the term of the Commission President. The entire Commission must be confirmed as a collective whole by the European Parliament before its formal appointment by common accord of EU governments.

The European Council

The European Council brings together EU heads of government and the President of the European Commission; foreign ministers of Member States also participate. Finance ministers are normally included when the leaders discuss questions related to EMU and the economy. The European Council meets at least twice a year, usually quarterly, at the end of each Presidency, to review major EU projects, set guidelines for policies and provide necessary guidance. The Presidency of the Council rotates every six months among EU Member States (January-June; July-December). Its role has become increasingly important with the expansion of EU responsibilities and competencies. The Presidency organizes and presides over the meetings of the European Council and EU Council (ministerial) meetings, drafts compromises, and seeks solutions to problems submitted to the European Council.

Council of Ministers

The Council of Ministers of the European Union (the "EU Council") is the body in which representatives of the individual Member State governments, usually ministers, legislate for the EU, set its political objectives, coordinate national policies and resolve differences among their governments and with other EU bodies. Legally speaking, there is only one Council, but it meets in nine different formations, depending on the matters on its agenda. Foreign ministers usually meet at least once a month in the General Affairs and External Relations Council (GAERC), which deals with major foreign policy issues and plays a coordinating role. Ministers for the Economy and Finance (ECOFIN) and ministers responsible for agriculture also hold monthly meetings. Ministers for Justice and Home Affairs (JHA) hold regular meetings to coordinate policies within their competence.

The Council holds formal sessions in its Brussels headquarters, except in April, June and October, when all sessions take place in Luxembourg. Most formations of the Council also meet informally (tasking no legally binding decisions) in the country holding the EU Presidency, usually once in the course of the Presidency's six-month term. The most prominent of these informal meetings is the so-called "Gymnich" meeting of foreign ministers, named for a town in Germany where the first such meeting took place.

The Council takes most decisions under the Community Pillar by qualified majority voting (QMV) but endeavors to reach the broadest possible consensus before approving legislation. Unanimity is required for a number of specific areas related to economic integration (e.g. taxation), constitutional matters such as amendments to the treaties, the launching of a new common policy, the accession of a new Member State, and matters falling within the EU's Common Foreign and Security Policy, European Security and Defense Policy, and aspects of law enforcement and judicial cooperation. The number of votes cast by each Member State when the EU Council votes by qualified majority voting was determined by the Nice Treaty and roughly correlates to the size of its population.

The European Parliament

Members of the European Parliament are directly elected by EU citizens for five-year terms; elections follow national election procedures. Members do not sit in national delegations; rather, they sit in groups according to political affiliation (including Socialists, Christian-Democrats/Conservatives, Liberals, Greens, etc.).

Parliament's powers have gradually grown with the entry into force of the Single European Act (1986), the Maastricht Treaty (1993) and the Treaty of Amsterdam (1999). Parliament shares decision-making power on an equal footing with the Council in many areas under the Community Pillar to which the "co-decision procedure" applies. The European Parliament is one of the two branches with budgetary authority, the Council is the other. The signature of the EP president brings the overall EU budget into effect.

The European Parliament also plays a role in the process of selecting the President and other members of the Commission. The European Council's nomination of the President is subject to approval by the Parliament. The EP holds U.S.-style public hearings of Commission nominees before taking a formal vote to approve the nomination of the Commission as a body. Parliament has the power to censure the Commission, but the Treaties do not allow for the dismissal of individual Commissioners by Parliament.

The European Court of Justice

The European Court of Justice (ECJ) ensures uniform interpretation and application of both the Treaties establishing the European Communities and the secondary legislation and other law adopted under their authority. To enable it to carry out that task, the Court has wide jurisdiction to hear various types of cases. For example, the Court has the authority to hear and issue binding judgments in lawsuits that seek to annul a law adopted by the EU, to compel an EU institution to act, or to require that a Member State comply with EU law. The ECJ may issue clarifications of EU law (in response to a request for a preliminary ruling from any Member State court) and hears appeals on legal questions arising out of cases at the Court of First Instance. The ECJ currently has 25 justices and eight advocates-general, who are appointed by common accord of the governments of the Member States and who hold office for six-year renewable terms.


U.S.-EU RELATIONS

The United States and the EU are important partners who maintain a robust agenda of cooperation in areas such as the Middle East, Balkans, Ukraine, Central Asia, and Africa.

In pursuit of Middle East peace, the United States and the EU cooperate, with the United Nations and Russia, in the "Quartet." The EU has made significant contributions to the goal of promoting good governance, democracy, and strong civil societies throughout the Middle East. The United States and the EU also work together in promoting reform throughout the Middle East.

The United States and EU share a commitment to a free and democratic Iraq. The United States and EU supported preparations for Iraq's January 2005 elections and are cooperating to support Iraq's continuing political transition. The United States and EU co-hosted an International Conference on Iraq in June, 2005 in Brussels that marked the creation of a new international partnership to support the Iraqi Transitional Government.

In the Western Balkans, the United States and the EU are working together to strengthen democracy, ensure stability, and promote the region's integration into Euro-Atlantic structures, and are urging all parties to meet their obligations to cooperate with the International Criminal Tribunal for the Former Yugoslavia. The United States and EU also cooperate closely in the process intended to culminate in resolving Kosovo's future status.

The United States and the EU share a commitment to promoting democracy throughout Eurasia. The United States and the EU cooperated closely during the presidential election campaign in Ukraine, and especially following the flawed November 2004 second-round vote. In Afghanistan, the EU is a close partner with the United States in supporting democratic development and reconstruction. Most notably, in 2003 the EU pledged $1.3 billion to Afghanistan over a five-year period to support reconstruction and development.

The United States and the EU cooperate on many African issues, including supporting efforts by the African Union to restore peace in the Darfur region of Sudan. The United States welcomed the EU's peacekeeping mission in Africa's Great Lakes region and supported its joining the Tripartite Commission as an observer. The United States consults regularly with the EU on assistance programs, including efforts to combat HIV/AIDS throughout Africa.

Principal U.S. Embassy Officials

Ambassador:

C. Boyden Gray (designate).

Deputy Chief of Mission:

P. Michael McKinley.


ECONOMY

The institutions of the European Union were originally created to oversee the operation of the several economic communities that later became the Single European Market. Even as the EU's political integration has continued, the area of greatest integration has always been in the economic sphere: goods, capital, and labor move freely between Member States (with some exceptions), businesses in all Member States are increasingly subject to common basic rules, and twelve of the 25 Member States use a common currency, the euro. The twelve euro-area countries share a common monetary policy administered by the European Central Bank in Frankfurt, Germany. The EU strives to eliminate internal barriers to the free flow of goods, services, labor, and capital, and to promote the overall convergence of living standards. Internationally, the EU aims to strengthen Europe's trade position and capitalize on the political and economic leverage that a large, unified market brings.

Growth

The EU is the world's largest economic area (the U.S. is second) with a 2004 GDP of $12.1 trillion; however, growth in many of the EU's Member States in the recent past has been slow. Between 2001 and 2003, the overall growth rate dropped from 1.8 percent to 1.0 percent. The EU economy staged a modest, short-lived recovery in 2004, but forecasters expect growth to remain below two percent in 2005 and 2006. Within the euro area, growth varies as much as 4.5 percentage points between the fastest and slowest-growing economies. In 2005, many of the EU's largest economies, including Germany, France and Italy, will grow by less than two percent. Outside the euro area, 2005 growth is forecast to remain strong, particularly in the Central and Eastern European countries that joined the EU in May 2004.

In spring 2000, the EU committed to a ten-year strategic goal of transforming the EU into a more competitive, knowledge-based economy capable of sustaining higher levels of growth. Focusing on labor market reform, macroeconomic and fiscal policy, and promotion of e-commerce and entrepreneurship, the EU's "Lisbon Agenda" was an attempt to stimulate growth while remaining committed to the EU social model. Some suggest that it has so far failed to achieve its goals in large part because national governments (which retain authority over employment policy, immigration, large public sector workforces, entitlement programs and pensions) have not completed the necessary reforms. With euro area unemployment at 8.6 percent, generous social programs continue to strain national economies. The European Commission relaunched the Lisbon Agenda in March 2005, promising three percent growth and six million new jobs by 2010. The revamped strategy focuses on developing political consensus within Member States to make the changes necessary to complete elimination of barriers in the internal market, reduce the regulatory burden on business, improve labor market flexibility, provide incentives to work and increase investment in human capital.

Fiscal and Monetary Policy

Introduced in 1999, the euro is currently the official currency of twelve of the 25 EU Member States. United Kingdom, Denmark and Sweden chose to retain their national currencies, and newer EU members have yet to adopt the euro. Prior to the euro's launch in 1999, national currency exchange rates of countries intending to join the euro were fixed within an Exchange Rate Mechanism. Following the January 2002 introduction of euro notes and coins into general circulation, national currencies were removed from circulation. Each of the euro area countries agreed to abide by a shared fiscal policy rule book known as the Stability and Growth Pact (SGP). This agreement generally obliges national governments to limit government budget deficits to 3 percent of GDP and established a target debt-to-GDP ratio of below sixty percent. Although enforcement actions have been forgiving, France and Germany, for example, avoided sanctions despite missing SGP targets, countries violating the SGP are technically subject to sanctions by the European Commission. As of March 2005, national governments have been granted budget leeway to achieve structural reforms and to combat prolonged stagnation, negative growth or other factors, such as the cost of German reunification or state pensions. The revised standards still require deficits to remain close to the targets; they may only temporarily exceed the three percent limit. The ten Member States that joined the EU in May 2004 may adopt the euro after complying with the SGP targets and meeting other applicable criteria.

The euro area's monetary policy is set by the European Central Bank (ECB), which must devise a monetary policy to accommodate a wide range of domestic policies and economic conditions within euro area Member States. The Treaties require that the ECB's primary objective be to maintain price stability (i.e., to keep inflation low). Euro-area national governments have sometimes criticized the ECB for guarding against inflation at the expense of interest rate flexibility that could enable struggling economies to gain traction. The ECB's consistent overnight interest rate of two percent has been credited with creating favorable conditions for growth in Spain and Ireland, but has been blamed for hindering growth in France, Germany, Italy, and Portugal.

Trade

The EU is the world's largest exporter of goods and services. In 2003, the then-fifteen EU members exported $987 billion worth of goods to non-EU countries. The EU's exports grew rapidly between 1996 and 2000 but have grown more slowly since. Except for 2002, the EU as a whole has posted a trade deficit every year since 1999; it was $62 billion in 2004. The EU is a major exporter of chemicals, transport equipment, and industrial machinery. The EU has large trade deficits in raw materials and energy, and a small deficit in food and drink.

The U.S. is the EU's main trading partner by a wide margin. U.S. goods and services exports to the EU reached $283 billion in 2004, while U.S. goods and services imports from the EU totaled $388 billion. Asian economies such as Japan and China, however, account for an increasingly important share of EU trade. The EU's two-way merchandise trade with China grew to $223 million in 2004, while merchandise trade with Japan was $149 million. Internal trade between euro area and noneuro area countries was down one percent in the first quarter of 2005, but the EU's external trade was up four percent, particularly with Russia and Norway.

Member States have given almost exclusive authority to the EU to negotiate trade treaties that bind the Member States. The European Community (EC) is a full member of the World Trade Organization and plays an active role in the Doha Development Round to foster international trade in services and agricultural products. Bilaterally, the EC maintains framework agreements to facilitate trade flows with thirty-five countries worldwide, mostly elsewhere in Europe, in North Africa, and in the Middle East.

Foreign Direct Investment

The EU is both a major destination for foreign direct investment (FDI) and a major source of FDI. U.S. foreign direct investment in the EU totaled $83.3 billion in 2004; EU FDI into the U.S. totaled $46.6 billion. Following strong year-upon-year growth in the late 1990s, however, inward and outward flows of FDI have contracted since 2001. The EU is a net recipient of FDI from Japan, receiving $81 billion in 2003. Conversely, the EU is a net investor in Canada ($86 billion in outward investment in 2003), and China ($29 billion in outward investment in 2003). Growth of intra-EU FDI has increased rapidly in recent years and has increased much faster than FDI in non-EU countries.

The pattern of foreign investment by European firms reflects deep commercial ties with the United States. U.S. and EU businesses invest heavily and operate profitably on both sides of the Atlantic. U.S. affiliates in Europe accounted for 56 percent of the aggregate output of U.S. affiliates worldwide. European firms were the largest foreign investors in 44 U.S. states and the second largest foreign investor in the remaining six. Sales by U.S. affiliates in Europe totaled $1.5 trillion in 2002, more than double those of U.S. affiliates in the Asia/Pacific region. European affiliate sales in the U.S. were $1.2 trillion in 2002, more than three times the value of U.S. imports from Europe.

Intra-firm trade involving foreign affiliates is particularly important to the transatlantic trade and investment relationship. Approximately 58 percent of U.S. imports from the EU in 2004 involved trade between related parties, as did 30 percent of U.S. exports to Europe in 2003. This high level of intra-firm trade has contributed to the persistence of the U.S. trade deficit with Europe even as the dollar has lost value against the euro since 2002.

Budget

The EU's budget is essentially made up of Member State contributions. Equivalent to roughly one percent of the Member States' combined gross national income (GNI), it was $123 billion in 2005. The UK receives a rebate on its contribution. In June 2005, the EU failed to agree on a budget plan for 2007 through 2013, due in part to a disagreement between the UK and France over the persistence of the UK budget rebate and the funding of the Common Agricultural Policy (CAP). Costs attributable to the CAP constitute the EU's largest annual budget item, benefiting farmers across the EU, especially in France. Payments to net-recipient Member States, designed to reduce economic and social disparities among EU countries and regions, are another budget item which has become more contentious with the accession of ten new states poorer than the EU average.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Countries of the World and Their Leaders Yearbook. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Countries of the World and Their Leaders Yearbook. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/international/legal-and-political-magazines/european-union-0

"European Union." Countries of the World and Their Leaders Yearbook. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/international/legal-and-political-magazines/european-union-0

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union

Last Updated: March 2007

Official Name:
European Union (EU)

Editor’s note: The information in this article was compiled from Fact Sheets and releases made available through the Bureau of European and Eurasian Affairs of the U.S. Department of State in 2006.

PROFILE

HISTORY

MAJOR INSTITUTIONS

ECONOMIC OVERVIEW: January 12, 2006

2006 U.S.-EU SUMMIT: June 21, 2006; Vienna, Austria

PROFILE

The European Union (EU) is one of the United States’strongest strategic partners, with the importance of the relationship reflected in our close cooperation on regional crises and conflicts, our extensive collaboration on a wide range of global challenges, from counter-terrorism to nonproliferation, and our deep trade and investment relations.

Geography

Area: 3,976,372 sq km; less than one-half the size of the United States. Cities: Capital, Brussels, Belgium (European Commission, EU Council); Strasbourg, France (most European Parliament plenary sessions); Luxembourg City, Luxembourg (European Court of Justice).

Terrain: Mainly flat along the Baltic and Atlantic coasts; mountainous in the central and southern areas.

Climate: Cold temperate; potentially subarctic to temperate in the north; mild, wet winters, and hot, dry summers in the south.

People

Nationality: EU (Every person holding the nationality of a Member State is a citizen of the Union. Citizenship of the Union complements and does not replace national citizenship. This provision currently applies to Austrian, Belgian, British, Cypriot, Czech, Danish, Dutch, Estonian, Finnish, French, German, Greek, Hungarian, Irish, Italian, Latvian, Lithuanian, Luxembourg, Maltese, Polish, Portuguese, Slovak, Slovenian, Spanish, and Swedish citizens).

Population: 457,030,418 (July 2005 est.).

Religion: Roman Catholic, Protestant, Orthodox Christian, Muslim, Jewish.

Language: Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Gaelic (Irish—from 2007), Italian, Latvian, Lithuanian, Maltese, Polish, Portuguese, Slovak, Slovene, Spanish, Swedish; note—only official languages of the European Union are listed.

Health: total: 10.1 births/1,000 population; 10 deaths/1000 population; male: 75.1 years; female: 81.6 years (July 2005 est.).

Unemployment: 8.6% (July 2005 est.).

Government

Type: Supranational/mixed inter-governmental.

Founded: November 1, 1993 (Treaty on European Union (Maastricht Treaty) establishing the EU entered into force). (Belgium, France, Germany, Italy, Luxembourg and the Netherlands signed the Treaty of Rome on March 25, 1957, see History.)

Member States: Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, UK; noteCanary Islands (Spain), Azores and Madeira (Portugal), and French Guyana, Guadeloupe, Martinique and Reunion (France), which are legally part of EU Member States, are sometimes listed separately as territories forming part of the EU.

Branches: Executive, European Commission; legislative, EU Council, European Parliament; judicial, Court of Justice of the European Communities, Court of First Instance.

Major Political Parties (in European Parliament): Group of the Alliance of Liberals and Democrats for Europe (ALDE); Independence/Democracy Group (IND/DEM); Group of Greens/European Free Alliance (Greens/EFA); Socialist Group (Party of European Socialists -PES); Confederal Group of the European United Left-Nordic Green Left (EUL/NGL); European People’s Party-European Democrats (EPP-ED); Union for Europe of the Nations Group (UEN).

Suffrage: Determined by national legislation in the individual Member States.

Economy

GDP (2004): $11.65 trillion.

Annual Growth Rate (2004): 2.4%.

Per Capita Income (2004): $26,900.

Inflation Rate: 2.1% (2004 est.).

Natural Resources: Iron ore, arable land, natural gas, petroleum, coal, copper, lead, zinc, hydropower, uranium, potash, fish.

Agriculture: Products: wheat, barley, oilseeds, sugar beets, wine, grapes, dairy products, cattle, sheep, pigs, poultry, fish.

Industry: Type: ferrous and non-ferrous metal production and processing, metal products, petroleum, coal, cement, chemicals, pharmaceuticals, aerospace, rail transportation equipment, passenger and commercial vehicles, construction equipment, industrial equipment, shipbuilding, electrical power equipment, machine tools and automated manufacturing systems, electronics and telecommunications equipment, fishing, food and beverage processing, furniture, paper, textiles, tourism, media, financial services.

Trade (2003): Exports: machinery, motor vehicles, aircraft, plastics, pharmaceuticals and other chemicals, fuels, iron and steel, nonferrous metals, wood pulp and paper products, textiles, meat, dairy products, fish, alcoholic beverages. Major markets, U.S., China, Japan, Switzerland. Imports: machinery, vehicles, aircraft, plastics, crude oil, chemicals, textiles, metals, foodstuffs, clothing. Major suppliers: U.S., China, Japan and Switzerland.

HISTORY

Following World War II, traditional European rivals sought to solidify peace by bringing their nations together under a common institutional structure. Influenced by his compatriot Jean Monnet, French Foreign Minister Robert Schuman officially tabled a plan on May 9, 1950 to pool French and German coal and steel production under an organization that would be open to other European countries. German Chancellor Konrad Adenauer supported this proposal, and six founding countries, Belgium, France, Germany, Italy, Luxembourg and the Netherlands, took an early step toward European integration by establishing the European Coal and Steel Community (ECSC) the following year.

After failing to establish a European Defense Community in the 1950s, the six countries then decided to set up a common market. With the entry into force of the Treaty of Rome in 1957, they created the European Economic Community (EEC), with an objective of liberating the movement of goods, capital, workers and services. (The European Atomic Energy Community (EURATOM) was also established at this time.) The Treaty of Rome established the basic institutions and decision-making mechanisms still in place in today’s European Union. As of July 1, 1968, the EEC abolished customs duties between Member States on manufactured goods. New policies, including a common agricultural policy (CAP) and a common trade policy, were in place by the end of the 1960s.

The success of the European integration project during a period of steady economic growth in the 1960s set the stage for a first enlargement, the accession of the UK, Ireland and Denmark, in 1973. Further “deepening” of European integration followed: the Community acquired executive authority in social, regional, and environment policies. The benefits of economic convergence became more evident in the context of the 1970s energy crisis and financial turmoil, which led to the launch of the European Monetary System in 1979. In the same year, the first direct elections to the European Parliament (EP) took place. Previously, delegates from national parliaments had represented their country’s legislative bodies at the EP in Strasbourg, France.

The Community further expanded southward with the accession of Greece (1981, the second enlargement), followed by Spain and Portugal (1986, the third enlargement). These accessions led the EEC to adopt “structural programs” in order to reduce economic and social disparities among its regions.

During the 1960s and 1970s, the Community began to assert itself on the international scene with the conclusion of agreements with southern Mediterranean countries. Starting in 1963, the EEC signed four successive Lome Conventions, which guaranteed trading advantages and development aid for Member States’ former colonies in Africa, the Caribbean, and the Pacific (ACP).

World recession and internal disputes over Member States’ financial burdens gave way, from 1985 onward, to renewed efforts for economic integration, enshrined in the 1985 “Single European Act” (SEA) and marked by the 1992 “Single Market Project.” The SEA set January 1, 1993 as the date by which an internal single market was to be established and, by extending the practice of majority voting rather than unanimity in the EU Council, gave Community institutions the means of adopting the 300 Community-wide Directives required to abolish the remaining barriers and obstacles to intra-Community trade. In 1995, the Community entered into the “Barcelona” partnership with twelve southern Mediterranean countries. The partnership, reinforced by agreements on social, cultural, and human cooperation, was intended to lead to a free-trade area.

The collapse of the Berlin Wall and German unification prompted Member States to negotiate the 1992 Treaty on European Union (the “Maastricht Treaty”). In addition to establishing the European Union, the Maastricht Treaty set an ambitious program of further integration: establishment of Economic and Monetary Union (EMU) by 1999 (part of the “First or Community Pillar”), setting up of a Common Foreign and Security Policy (CFSP) (“Second Pillar”); and cooperation on Justice and Home Affairs (JHA) (“Third Pillar”). Shortly thereafter, in 1995, Austria, Finland and Sweden joined the EU, the fourth enlargement.

Signed in 1997 and entering into force on May 1, 1999, the Amsterdam Treaty partially streamlined the EU institutional structure. Its most significant effects were: (1) to transfer aspects of Justice and Home Affairs policy to the Community Pillar, enabling the Commission to propose decisions to be taken by the EU Council by qualified majority voting instead of by consensus, and (2) to establish a High Representative for the CFSP (who also serves as Secretary-General of the Council Secretariat). Ten countries in Central and Eastern Europe and Cyprus began accession procedures in 1997, followed by Malta. The prospect of eastward enlargement raised significant resource concerns and prompted the adoption in March 1999 of the “Agenda 2000” package, which covered amendments to the CAP and EU structural policies, as well as a budgetary framework through 2006.

In May 1998, EU heads of government officially designated eleven Member States eligible to adopt a single currency. Greece initially did not qualify, and Sweden, the UK and Denmark “opted out.” On January 1, 1999, the euro became the official currency of the EU, and the European Central Bank (ECB) put euro notes and coins into circulation on January 1, 2002. Today, twelve countries use the euro: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain.

Streamlining the size and procedures of EU institutions to make the expanded EU more efficient was also an aim of the 2003 Treaty of Nice. A year later, in May 2004, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia joined the EU, bringing total membership to 25. Candidate countries currently include Bulgaria and Romania (scheduled to accede to the EU on January 1, 2007), as well as Turkey and Croatia.

In October 2004, Member States signed an EU Constitutional Treaty in Rome, intending that it take effect on November 1, 2006. French and Dutch voters rejected the treaty through referenda in 2005, thereby suspending the ratification process.

MAJOR INSTITUTIONS

The European Commission

The role and responsibilities of the European Commission place it at the center of the EU’s decision-making process. Acting as the EU’s policy and executive engine, the Commission is composed of 25 Commissioners, one from each Member State and is supported by a substantial staff located primarily in Brussels, Belgium. In matters relating to economic integration (“First or Community Pillar”), only the Commission has the right to propose legislation for approval by the EU Council and European Parliament. As “guardian of the Treaties,” the Commission ensures that EU laws are applied and upheld throughout the EU, prosecuting Member States and other institutions for failing to follow treaty precepts or otherwise apply Community law. The Commission has full authority to enforce Community competition policy, and its policing of implementation of Community legislation preserves the integrity of the EU single market. The Commission likewise manages and develops the Common Agriculture Policy (CAP), implements the budget, and represents the European Community in its areas of competence, notably including international trade negotiations.

The Commission President is appointed by agreement of the EU heads of government and is subject to approval by the European Parliament. Commissioners serve for a renewable five-year term. New Commissioners are identified by Member State governments in consultation with the President-designate of the Commission and are normally put in place at the beginning of the term of the Commission President. The entire Commission must be confirmed as a collective whole by the European Parliament before its formal appointment by common accord of EU governments.

The European Council

The European Council brings together EU heads of government and the President of the European Commission; foreign ministers of Member States also participate. Finance ministers are normally included when the leaders discuss questions related to EMU and the economy. The European Council meets at least twice a year, usually quarterly, at the end of each Presidency, to review major EU projects, set guidelines for policies and provide necessary guidance. The Presidency of the Council rotates every six months among EU Member States (January-June; July- December). Its role has become increasingly important with the expansion of EU responsibilities and competencies. The Presidency organizes and presides over the meetings of the European Council and EU Council (ministerial) meetings, drafts compromises, and seeks solutions to problems submitted to the European Council.

Council of Ministers

The Council of Ministers of the European Union (the “EU Council”) is the body in which representatives of the individual Member State governments, usually ministers, legislate for the EU, set its political objectives, coordinate national policies and resolve differences among their governments and with other EU bodies. Legally speaking, there is only one Council, but it meets in nine different formations, depending on the matters on its agenda. Foreign ministers usually meet at least once a month in the General Affairs and External Relations Council (GAERC), which deals with major foreign policy issues and plays a coordinating role. Ministers for the Economy and Finance (ECO-FIN) and ministers responsible for agriculture also hold monthly meetings. Ministers for Justice and Home Affairs (JHA) hold regular meetings to coordinate policies within their competence.

The Council holds formal sessions in its Brussels headquarters, except in April, June and October, when all sessions take place in Luxembourg. Most formations of the Council also meet informally (tasking no legally binding decisions) in the country holding the EU Presidency, usually once in the course of the Presidency’s six-month term. The most prominent of these informal meetings is the so-called “Gymnich” meeting of foreign ministers, named for a town in Germany where the first such meeting took place.

The Council takes most decisions under the Community Pillar by qualified majority voting (QMV) but endeavors to reach the broadest possible consensus before approving legislation. Unanimity is required for a number of specific areas related to economic integration (e.g. taxation), constitutional matters such as amendments to the treaties, the launching of a new common policy, the accession of a new Member State, and matters falling within the EU’s Common Foreign and Security Policy, European Security and Defense Policy, and aspects of law enforcement and judicial cooperation. The number of votes cast by each Member State when the EU Council votes by qualified majority voting was determined by the Nice Treaty and roughly correlates to the size of its population.

The European Parliament

Members of the European Parliament are directly elected by EU citizens for five-year terms; elections follow national election procedures. Members do not sit in national delegations; rather, they sit in groups according to political affiliation (including Socialists, Christian-Democrats/Conservatives, Liberals, Greens, etc.).

Parliament’s powers have gradually grown with the entry into force of the Single European Act (1986), the Maastricht Treaty (1993) and the Treaty of Amsterdam (1999). Parliament shares decision-making power on an equal footing with the Council in many areas under the Community Pillar to which the “co-decision procedure” applies. The European Parliament is one of the two branches with budgetary authority, the Council is the other. The signature of the EP president brings the overall EU budget into effect.

The European Parliament also plays a role in the process of selecting the President and other members of the Commission. The European Council’s nomination of the President is subject to approval by the Parliament. The EP holds U.S.-style public hearings of Commission nominees before taking a formal vote to approve the nomination of the Commission as a body. Parliament has the power to censure the Commission, but the Treaties do not allow for the dismissal of individual Commissioners by Parliament.

The European Court of Justice

The European Court of Justice (ECJ) ensures uniform interpretation and application of both the Treaties establishing the European Communities and the secondary legislation and other law adopted under their authority. To enable it to carry out that task, the Court has wide jurisdiction to hear various types of cases. For example, the Court has the authority to hear and issue binding judgments in lawsuits that seek to annul a law adopted by the EU, to compel an EU institution to act, or to require that a Member State comply with EU law. The ECJ may issue clarifications of EU law (in response to a request for a preliminary ruling from any Member State court) and hears appeals on legal questions arising out of cases at the Court of First Instance. The ECJ currently has 25 justices and eight advocates-general, who are appointed by common accord of the governments of the Member States and who hold office for six-year renewable terms.

ECONOMIC OVERVIEW: January 12, 2006

The 25-nation European Union (EU), with 460 million residents, is the world’s largest economic area. EU aggregate GDP was $12.86 trillion in 2004, and per capita GDP averaged $28,000, with wide divergences across member states. Buoyed by a robust global expansion, with growth over 5%, EU GDP expanded 2.5% in 2004. EU GDP growth slowed to around 1.6% for 2005, but is projected to strengthen to 2.1% in 2006. Corresponding growth for the 12-nation Euro Area was 2.0% in 2004, around 1.2% in 2005, and a projected 1.8% in 2006.

Drivers of growth include rising domestic demand--including private investment--and exports. EU inflation ticked up from 2.1% in 2004 to 2.3% in 2005 and a projected 2.2% in 2006, mostly due to energy price hikes. Manufacturing is strengthening slightly and unemployment is dipping from 9.0% in 2004 to 8.5% in 2005 and 2006.

EU economies are among the world’s most advanced and diverse. Key sectors include metals production and processing, petroleum, coal, cement, chemicals, pharmaceuticals, aerospace, rail equipment, vehicles, construction and industrial equipment, shipbuilding, electrical equipment, machine tools, manufacturing systems, electronics, communications, food/beverage processing, tourism, media, and financial services. Agricultural products include wheat, barley, oilseeds, sugar beets, wine, grapes, dairy products, cattle, sheep, pigs, and poultry.

The EU is the world’s leading trader; goods and services exports were about $4.97 trillion, and imports about $4.81 trillion, in 2005. Goods exports include machinery, vehicles, aircraft, plastics, pharmaceuticals, fuels, metals, pulp and paper, textiles, meat, and dairy products. Imported goods include machinery, vehicles, aircraft, plastics, crude oil, chemicals, textiles, metals, and food. Leading EU trading partners are the U.S., China, Japan, and Switzerland.

Though wealthy, Europe faces short-and long-term risks to its prosperity. Near term threats include possible new oil price shocks, a disorderly correction of global imbalances, a H5N1 influenza pandemic, or abrupt cooling of housing markets in the UK, Ireland, and Spain. Longer term, growth in Europe’s large economies is tepid at best, though countries such as Ireland and new Central European EU states are more vigorous. Unemployment remains high, labor market flexibility is low, and a rapidly aging population means fewer workers and higher social benefits. In response to these challenges, in 2000 the EU committed to a ten-year reform plan, the Lisbon Agenda, aimed at transforming the EU into a faster-growing, competitive, knowledge-based economy. Key reform targets include the labor and product markets.

Failure to make significant progress toward these goals has left Europe’s large economies with lagging competitiveness, stagnant productivity and anemic growth, and struggling to respond to the rise of China and India and to meet other challenges of globalization. If EU states do not reform, innovate and raise productivity, living standards will fall in the future. Successful reform is vital for the EU and global prosperity, since the EU is and will remain a key engine of world economic growth.

2006 U.S.-EU SUMMIT: June 21, 2006; Vienna, Austria

In June 2006, President Bush met with the leadership of the European Union, Austrian Chancellor and European Council President Wolfgang Schüssel and European Commission President José Barroso. The leaders spoke about concrete actions the U.S. and EU can take to:

  • Promote the Advance of Freedom and Democracy Around the World;
  • Advance Cooperation to Secure the U.S. Homeland and the World;
  • Promote Transatlantic Economic Integration and Energy Security; and
  • Promoting the Advance of Freedom and Democracy Around the World.

The U.S. and EU renewed the commitment to promoting peace, democracy, and freedom worldwide, and agreed on concrete actions in support of the shared goal of advancing freedom from Europe’s doorsteps to the Broader Middle East, Africa, Latin America and beyond. President Bush and his EU counterparts agreed to redouble their efforts to assist the Iraqi Government in enhancing security, economic reform and the political process.

In the pursuit of a lasting peace in the Middle East, the Quartet, of which the U.S. and EU are members, remains committed to President Bush’s vision of two states, Israel and Palestine, living side-by-side in peace and security. They are also working through the Quartet to ensure that humanitarian assistance reaches the neediest Palestinians.

In Africa, the U.S. and EU are key supporters of the African Union’s efforts to bring peace and stability to Darfur, Sudan, and have taken measures to address the political crises in Cote D’ Ivoire, Mauritania and Zimbabwe. They are also exploring avenues to bring peace to war-torn Somalia. Their efforts also support democracy, free markets and economic integration in partnership with African states and leaders. The U.S. and EU recognize the need for democratic change in Cuba, and urge the Cuban government to take rapid steps to improve the deteriorating human rights situation on the island. The U.S. and EU are united in support of continued UN involvement in Haiti, where the situation is still fragile. The U.S. and EU remain committed to advancing a vision of a Europe whole, free and at peace. They will work together to support the consolidation of democracy and free markets in Ukraine, Georgia and Moldova. The U.S. and EU will continue their joint actions to support the democratic aspirations of the people of Belarus, Europe’s last dictator-ship. Since the fraudulent Belarussians presidential elections in March 2006, the United States and EU have imposed coordinated travel restrictions and financial sanctions against the Lukashenka regime, targeting those implicated in undermining democratic processes, human rights abuses and public corruption. They will also maintain their support for Belarussians civil society and independent media.

Advancing Cooperation to Secure the U.S. Homeland and the World

Protecting citizens from the global threats of terrorism and the proliferation of weapons of mass destruction (WMD) remains one of the highest priorities for the United States and the European Union. The past year has seen significant progress in implementing the framework for joint efforts set out in the 2004 and 2005 U.S.-EU summits.

Fight Against Global Terrorism. In their efforts to combat terror, the U.S. and EU have worked together to promote effective global standards that will ensure the safety of their citizens by securing international borders and transportation, developing biometric standards, and preventing terrorist financing and radicalization and recruitment into terrorism. In the next year the U.S. and EU planned to work together to:

  • Improve lost and stolen passport data sharing with Interpol;
  • Coordinate implementation of biometric standards;
  • Expand cooperation on terrorism finance issues;
  • Strengthen law enforcement cooperation;
  • Pursue ratifications of the U.S.-EU Extradition and Mutual Legal Assistance Agreements and bilateral protocols with EU Member States;
  • Push for agreement on a Comprehensive Convention on International Terrorism at the UN; and,
  • Coordinate efforts to counter radicalization and recruitment of terrorists.

Preventing WMD Proliferation. The United States and the EU will deepen cooperation on preventing the proliferation of WMD. They have agreed to work together to find a way to restrict the spread of enrichment and reprocessing (ENR) technology and to support multilateral mechanisms for reliable fuel supply assurances for states that have chosen not to pursue ENR. They have committed to:

  • Establishing effective export control regimes, backed by criminal sanctions;
  • Working to identify, control, and interdict WMD and missile related proliferation shipments and assisting others to do the same; and,
  • Stopping the financing of proliferation activities by identifying, tracking, seizing, or freezing assets associated with proliferation trade.

Over the past year U.S.-EU cooperation on Iran has reached a new level. They have worked closely together at every stage of the ongoing attempts to address the question of Iran’s nuclear program. They have agreed on a set of far-reaching proposals as a basis for discussion with Iran and believe that they offer Iran the chance to reach a negotiated agreement based on cooperation, if Iran is willing to make that choice. The United States has made clear that it is prepared to join the negotiations should Iran resume full and verifiable suspension of all enrichment related and reprocessing activities as required by the IAEA. The U.S. and EU have agreed that if Iran decides not to engage in negotiations, further steps would be taken in the Security Council.

All EU members have endorsed the Proliferation Security Initiative Statement of Interdiction Principles. The U.S. and EU committed to seeking stronger enforcement of nuclear nonproliferation obligations, including making the IAEA Additional Protocol a new standard for nuclear supply, creating a new IAEA committee to focus on safeguards and verification, and declaring that states under investigation should not participate in IAEA compliance decisions.

Promoting Transatlantic Economic Integration

The strong economic relationship the United States and the European Union enjoy has created millions of jobs on both sides of the Atlantic. Leaders have agreed to continue the advancement of the 2005 Summit Economic Initiative to further promote economic integration and growth by cooperating in the areas of regulation, innovation and technology policy, competitive financial markets, energy, and enhanced trade, travel and security.

U.S. and EU leaders endorsed joint efforts to promote effective enforcement in third countries and cooperation with the private sector to reduce global piracy and counterfeiting. The U.S. and EU will pursue a strong, results-oriented Action Strategy for the Enforcement of Intellectual Property Rights (IPR) to strengthen border enforcement of IPR; encourage strengthened enforcement of IPR in third countries, including through technical assistance; and expand cooperation with, and contributions from, private industry.

Promoting Energy Security. The disruptions of Hurricanes Katrina and Rita last fall, the Ukraine-Russia gas crisis in January, and the strong pace of global economic growth in the past several years have raised the urgency of joint action on energy security and related issues.

President Bush and his EU counterparts today adopted a set of Principles to promote energy security worldwide. In addition, they agreed to work together to diversify energy sources and supplies; secure energy infrastructure; promote market-based energy security policies that ensure private competition, transparency, respect for contracts, and non-discriminatory trade, transit and access; speed development of new lower-pollution and lower-carbon technologies; and accelerate investment in more efficient, cleaner use of fossil sources and renewable sources in order to cut air pollution harmful to human health and natural resources.

This program will include numerous actions, such as supporting maintenance and improvement of pipeline infrastructure; providing technical assistance to improve energy regulatory frameworks in third countries; and cooperation on development of biofuels, clean diesels and plug-in hybrids, and others. These efforts will benefit not only the U.S. and EU but energy consumers, markets and producers worldwide. Raising global energy security will increase political and economic stability and help protect the global environment. The imperative of working together to improve energy security is matched by the need to act with resolve to address the serious and closely linked challenges of climate change and air pollution. To help ensure the global economy is powered in a sustainable manner, the U.S. and EU will work together to advance the development and deployment of existing and transformational technologies that are cleaner and more efficient, producing energy with significantly lower emissions. Since 2001, the U.S. has dedicated over $29 billion to climate change programs, more than any other nation. President Bush’s approach to this close cooperation with the EU on energy and climate issues draws upon the best scientific research, harnesses the power of markets, fosters the creativity of entrepreneurs, and works with the developing world to meet shared aspirations for our people, our economy, and our environment.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Countries of the World and Their Leaders Yearbook 2008. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Countries of the World and Their Leaders Yearbook 2008. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/international/legal-and-political-magazines/european-union-1

"European Union." Countries of the World and Their Leaders Yearbook 2008. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/international/legal-and-political-magazines/european-union-1

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union

Type of Government

The European Union (EU) is a hybrid governing entity based on treaties agreed to by its twenty-seven member countries, or states. Its organization is complex and unique, employing a combination of supranational elements (whereby one government body reigns over others) and intergovernmental elements (whereby various sovereign governments come together to cooperate on matters that may fall partially or completely outside of their respective jurisdictions). Its basic structure can be best understood within the framework of traditional executive, legislative, and judicial branches. An appointed European Commission, with representatives from each of the member states, including a president, forms the EU’s executive branch. It has a bicameral legislature, with its upper house, the Council of the European Union, being the dominant lawmaking body, composed of government officials from each member state, and a European Parliament, which is directly elected by the citizens of the member states. The judicial branch is headed by the European Court of Justice.

Background

The European Union is made up of twenty-seven independent nations, often referred to as “member states”—Austria, Belgium, Bulgaria, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom. It encompasses 1.6 million square miles, approximately half of billion people, and more than twenty-three languages. Nearly one-third of the world’s gross national product is produced by the union. The EU’s official currency, the euro, has been adopted as the sole legal tender in thirteen member states.

The idea of a unified Europe is a very old one and many battles have been fought over it. But the creation of the present-day European Union stemmed from a very different premise than those that had gone before: achieving that integration without force. The actualization of such a concept was almost without precedent.

World War II (1939–1945) left Western Europe physically and economically devastated. Its aftermath also included the advent of the Cold War—a period of heightened tensions between the United States and the Soviet Union—and the Soviet Union’s obvious designs on parts of Eastern Europe beyond Poland and Bulgaria. The Western powers thus saw a need to rebuild their economies while protecting themselves from both one another and from the Soviet Union. French statesman and economist Jean Monnet (1888–1979) and foreign minister Robert Schuman (1886–1963) believed that the most effective way to begin the necessary international cooperation was to establish economic ties. This philosophy was reflected in the Schuman Plan, a joint suggestion from the two Frenchmen to pool European coal and steel production under a common authority. In addition to the economic incentive of a more efficient market, the proposal ensured that control over the materials of war was shared by various national governments. Their plan is widely seen as the first step toward a unified Europe.

The European Coal and Steel Community (ECSC) was brought into being by the Treaty of Paris, signed in April 1951 by Belgium, the Federal Republic of Germany (West Germany), France, Italy, Luxembourg, and the Netherlands, a group that came to be known as “the Six.” The ECSC worked beautifully, increasing trade by almost 130 percent over five years, so the Six sought other areas that could be unified. Their next successful efforts were two treaties signed in Rome in 1957 and entered into force the following year—one established the European Economic Community (EEC) and the other the European Atomic Energy Community (EAEC, or EURATOM).

Treaties continued to be key to the integration process. Important agreements leading up to the creation of the EU include the Merger Treaty of 1967, which incorporated the ESCS, EEC, and EAEC into one unit known as the European Communities, and the Single European Act of 1987, which assisted in the formation of a single market. Then came the Treaty on European Union (also known as the Maastricht Treaty), which took effect in November 1993. The Maastricht Treaty formally established the European Union and expanded and enhanced the provisions of the founding three treaties. Among the essential points of this treaty were a timeline to attain Economic and Monetary Union (EMU) and create a single currency, specific eligibility requirements for potential member states, a Common Foreign and Security Policy (CFSP), a Justice and Home Affairs (JHA) policy, a Social Chapter on labor standards and other social issues, and the introduction of EU citizenship. The Maastricht Treaty served as the basis of the current EU.

Government Structure

The European Union (EU) is a hybrid governing entity based on treaties agreed to by its member countries. A comparison to the United States is somewhat apt, as the two bodies do have some characteristics in common. Member countries of the EU, for instance, have relinquished some of their inherent powers in the interest of unity and shared values, as the U.S. states did when forming the federal government. In those instances, such as trade, the EU acts directly on its members’ behalf, as the U.S. government does for its states. Like citizens of the United States, EU citizens have the right to free movement from one member state to the others, and can establish residence in other EU states. There are, however, many differences between the two as well. Key among these is that each EU member is a sovereign nation. This means that each retains its own authority in numerous areas, including defense. While there is a single unit of currency, the euro, most member states have not agreed to a joint monetary policy and still circulate their own money. Regardless of these limitations, the EU is the only governmental entity that can, in many cases, enact laws that are directly binding on citizens of different countries.

Thus, similarities to the United States aside, the EU’s combination of supranational and intergovernmental elements renders it one of a kind. It is not exactly a federation, nor a mega-state to replace existing nations, yet it is more than a simple cooperative organization among governments—the EU is forging a new governmental template.

The executive role is played by the European Commission (EC), which is made up of an appointed commissioner from each member state and a single president. The Commission is appointed every five years, within six months of the European Parliament (EP) elections. First, member governments agree on new Commission president. A majority of the EP must then approve their choice. Next, the president-elect, in consultation with member governments, selects the twenty-seven commissioners. Finally, the EP interviews each prospective member before issuing a verdict on the entire group. It is important to note that the EP retains supervisory power over the Commission after appointments have been approved—it can, for example, dismiss the entire Commission through a motion of censure, and the Commission must clarify and/or justify its policies to the EP upon request.

The Commission’s principal duties include acting as guardian and enforcer of the EU’s underlying treaties, initiating legislation, managing policies and the budget, and representing the EU internationally. The Commission can issue guidelines for the implementation of legislation and treaties, initiate infringement proceedings against member states who violate EU directives, impose fines on companies or individuals, and administer the Union’s budget appropriations. It also negotiates international agreements on the EU’s behalf and retains the sole right of legislative initiative. Note that the Commission acts independently of the underlying individual governments, representing the interests and perspective of the EU instead.

The legislative function is essentially served through the bicameral efforts of the Council of the European Union and the European Parliament (EP). The Council represents the interests of the EU’s member states, thus providing a check to the Commission’s larger perspective, and is the primary decision-making entity. One minister from each country attends meetings according to the agenda, and so the individual minister varies depending on the subject at hand—an agriculture minister would, for instance, be sent to discuss crop prices. Ministers in attendance must have the authority to commit their government’s votes, which are weighted by (but not directly proportional to) each member state’s population. The Council presidency rotates among member states every six months (January through June, and July through December). The Council is assisted by a permanent body of member states’ ambassadors called the Permanent Representatives Committee (COREPER). Council decisions are made in one of two ways: by the vote of a qualified majority representing a minimum of 73.9 percent of votes and at least 62 percent of the EU population, or, in areas such as taxation or asylum and immigration policy, by unanimous vote. Unanimity is also required when the Council wants to deviate from Commission proposals or reject Commission-accepted EP amendments.

The Council addresses both supranational and intergovernmental issues. Major supranational responsibilities include adopting European laws (often in conjunction with the EP), coordinating economic policies of member states, concluding international agreements, and approving the EU budget (jointly with the EP). Intergovernmental duties include developing the EU’s Common Foreign and Security Policy (CFSP) and coordinating national judicial and law enforcement cooperation in criminal matters.

The other half of the legislative branch is the European Parliament (EP). Established in 1979, the EP is directly elected by EU citizens. Each member state holds its own parliamentary elections for the EP—the only requirement is that elections be held on a population-based, proportional representation system. The EP’s 785 members serve five-year terms, and the size of each country’s delegation is based on overall population. The composition in 2007 was as follows: 99 from Germany; 78 each from France, Italy, and the United Kingdom; 54 each from Spain and Poland; 35 from Romania; 27 from the Netherlands; 24 each from Belgium, the Czech Republic, Greece, Hungary, and Portugal; 19 from Sweden; 18 from Austria and Bulgaria; 14 each from Denmark, the Slovak Republic, and Finland; 13 each from Ireland and Lithuania; 9 from Latvia; 7 from Slovenia; 6 each from Estonia, Cyprus, and Luxembourg; and 5 from Malta. The EP elects its own president, who serves a two-and-a-half year term.

Primary duties of the EP are the passing of European laws (often in conjunction with the Council), supervising other EU institutions (most notably, the Commission), and, jointly with the Council, overseeing the EU budget. The EP serves an important role as a check upon the other governmental bodies. It has the ability to approve or reject Commission members and the right to censure and dismiss the entire Commission; the Council must also obtain the EP’s consent as to some crucial decisions, such as those involving international agreements or procedures for parliamentary elections.

The EU’s governance also includes the European Council (not to be confused with the Council of the European Union), which was granted legal status in 1974. This entity is made up of the member countries’ heads of state or government, along with the president of the European Commission, and meets up to four times a year. Another way of maintaining proper balance between the supranational and intergovernmental, these senior diplomats set broad policy for future action and reconcile issues left unresolved by the Council. On a less formal level, these meetings provide a forum for brainstorming among member nations at the highest political level.

The judicial branch is headed up by the Court of Justice of the European Communities or, as it is commonly known, the European Court of Justice (ECJ). It is composed of twenty-seven justices, one per member state, assisted by eight advocates-general. Judicial appointments are for renewable six-year terms (staggered between thirteen and fourteen members, lest the entire Court be replaced at one time), and are mutually agreed to among member states. The Court selects its own president who serves a three-year, renewable term. Justices rarely sit en masse, given the size of the Court, but instead either convene as a Grand Chamber of thirteen or in panels of three to five.

The ECJ hears cases involving member states, institutions, businesses, and individuals, while ensuring EU legislation is construed and applied consistently in all member nations. The Court generally regards European legislation as prevailing over conflicting national laws. A Court of First Instance was established in 1989 to help ease the ECJ’s heavy caseload. Its particular focus is on cases involving individuals and those concerning competition law. The newest addition to the EU’s judiciary is the European Civil Service Tribunal. As the name implies, its role is to hear disputes between the EU and its civil service.

The other vital component of the EU judiciary is the European Court of Auditors (ECA). Its function is to monitor and oversee the use of all EU funds. It submits a yearly report to assist in the implementation of the EU’s annual budget and has the authority to audit any person or organization handling EU funds, among other duties. The ECA is made up of one member from each EU nation. Members are appointed by the Council for renewable six-year terms and elect a president from within their own ranks to a three-year term.

Although it is not part of the EU’s governmental structure, the European Central Bank (ECB) is another significant institution. Founded in 1998, its primary purpose is overseeing the EU’s monetary policy. Managing the euro is an important part of that role, and the ECB is charged with maintaining the currency’s price stability through such means as controlling the money supply via setting interest rates. The thirteen member states that have adopted the euro, along with their central banks and the ECB, make up what is known as the Eurosystem.

Political Parties and Factions

The political parties of the EU are coalitions of various political parties from the member nations that share common ideologies or goals. The most prominent parties are the European People’s Party–European Democrats (EPP–ED), a coalition of conservative and Christian-democratic parties throughout Europe; the Party of European Socialists (PES), which encompasses various national labor and social democratic parties; the Alliance of Liberals and Democrats for Europe (ALDE); the European Greens–European Free Alliance, a coalition of environmentalist “green” parties and parties that represent stateless regions such as the Basque country; and the Union for Europe of the Nations (UEN), a conservative group that espouses national sovereignty within the EU. In the EP, members sit together in these party groups rather than as national contingents.

Major Events

After the Maastricht Treaty formally established the EU in 1993, there were three additional treaties of notable impact. The Treaty of Amsterdam, which took effect in 1999, took a renewed look at EU institutions with an eye toward enhancing economic and security objectives. Preparation for the union’s growth, or “enlargement,” was also part of the agenda. Among the treaty’s more salient provisions were measures extending the scope of qualified majority voting, increasing the EP’s powers and responsibilities (this, for example, is where parliament’s decision-making role was placed on a more equal footing with the Council), and strengthening the EU’s ability to engage in joint foreign policy endeavors. The Treaty of Nice (2003) went even further by setting the conditions for enlargement through more policy revisions. Those revisions included re-weighting votes within the Council, redistributing member country representation with the EP, and re-vamping the European Commission. It also extended the use of “enhanced cooperation,” which permits a minimum of eight member states to proceed with policy initiatives on their own, providing those initiatives do not infringe on the rights of other members. All this build-up led to the largest single expansion of the EU when ten new members—Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, the Slovak Republic, and Slovenia—were admitted on May 1, 2004, bringing its membership to twenty-five. Additional expansion in 2007 brought two more Eastern European nations, Romania and Bulgaria, into the fold.

The EU’s next major treaty enterprise was not initially as successful as its predecessors. In February 2002, the Convention of the Future of Europe (also known as the “European Convention”), composed of 105 members representing the governments of the EU’s member nations and candidate nations, the parliaments of those states, the EP, and the Commission, began work on a draft treaty to create a European Constitution. The process lasted sixteen months and was open to the public, including the publication of official documents on the Internet. A draft constitution was completed in the early summer of 2003 and approved via the European Constitutional Treaty on October 29, 2004.

The Constitution for Europe contains many major reforms and innovations. These include creating a five-year presidency for the Council (as opposed to the six-month rotation policy), establishing a foreign minister and foreign service, simplifying voting procedures, providing EU citizens with more opportunity for direct participation in government, and improving overall transparency. However, the document requires ratification by popular referendum or parliamentary vote by every EU member. In this, it has so far failed. French and Dutch voters refused the constitution in 2005. The matter has been put on hold while a report is compiled for the European Council, which is then expected to offer guidance on how to proceed sometime in 2008.

Twenty-First Century

Despite the setback of not gaining ratification of its proposed constitution, the EU appears poised to continue growing and evolving. 2007 saw the admission of Bulgaria and Romania to its ranks, bringing its membership up to twenty-seven. Entrance negotiations with Croatia and Turkey were begun in 2005, and an application from the former Yugoslav Republic of Macedonia were being entertained. Some member states worry that expansion may hamper decision-making as members with less “European” perspectives are brought into the union, while others are concerned about potential economic burdens caused by less-affluent member states or a possible influx of immigrants. Proponents of expansion, on the other hand, welcome the new blood and look forward to continuing to forge economic and political bonds with all the people of Europe. Such integration was, after all, the point of the EU’s creation.

European Union. “Europa–A Gateway to the European Union.” http://europa.eu/index_en.htm.

Pinder, John. The Building of the European Union . 3rd ed. Oxford: Oxford University Press, 1998.

Shore, Cris. Building Europe: The Cultural Politics of European Integration . London: Routledge, 2000.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Gale Encyclopedia of World History: Governments. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Gale Encyclopedia of World History: Governments. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/history/encyclopedias-almanacs-transcripts-and-maps/european-union-0

"European Union." Gale Encyclopedia of World History: Governments. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/history/encyclopedias-almanacs-transcripts-and-maps/european-union-0

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union

In January 1972 the Taoiseach Jack Lynch and his foreign minister Dr. Patrick Hillery left Dublin airport for Luxembourg to sign Ireland's Treaty of Accession to the European Communities. Just over fifty years after the signing of the Anglo-Irish Treaty, which gave the people of twenty-six of the thirty-two counties of Ireland the right to establish a state (the Irish Free State) separate from the United Kingdom, an Irish government negotiated membership of a community that had altered the nature of statehood in Europe. Ireland as a relatively young state was preparing to pool and share its sovereignty with the other member states of the Union in a dynamic political experiment. The Irish government made its first application for European Union (EU) membership on 31 July 1961. It took twelve years to bring this key foreign-policy goal to fruition, largely because of events beyond the control of any Irish government. Throughout the 1960s successive governments remained wedded to Ireland's eventual membership of the Union. In 1972, 83 percent of those who voted in the referendum voted in favor of membership.

The Nice No

Ireland's engagement with the EU system was relatively smooth until the shock of the defeat of the Nice referendum in June 2001. Ireland was the only member state that had to submit the Nice Treaty to a popular referendum for constitutional reasons. In Ireland this was the fifth referendum on the EU since 1972. All of the others had been passed by a comfortable, albeit declining, majority. On 7 June 2001 the Irish electorate voted no to the Nice Treaty by 54 to 46 percent in an extremely low voter turnout of just 35 percent. The outcome of the referendum was a major reversal for the government that had negotiated the treaty, for the main opposition parties that had advocated a yes vote, and for the peak groups in civil society, notably the main business associations, farming organizations, and the Trade Union Congress. Although a second referendum in October 2002 reversed this decision by a decisive 62 to 38 percent, Irish attitudes toward the EU have since entered a more complex and a more ambivalent phase.

Ireland's Policy Interests

There is remarkable consistency in the policies that are accorded a high priority by Ireland in the EU. Preferences were molded by Ireland's low level of development relative to the continental European economies, by sustained high levels of unemployment, and by Ireland's dependence on mobile foreign investment. The aim was to try to ensure that Ireland could accommodate developments in social and economic policy at the EU level. From an Irish perspective, the key policy areas were as follows:

  • The EU's Common Agricultural Policy (CAP) enabled Irish agriculture to escape from the traditional cheap-food policies of the United Kingdom. The emphasis in relation to the CAP is to maintain or improve farm incomes. Ireland and France remain the key supporters of CAP.
  • Cohesion policies at the EU level assist Europe's peripheral areas in catching up. Successive Irish governments deployed considerable diplomatic effort to ensure that the EU would develop a cohesion policy and that Ireland would benefit from financial transfers from the EU budget. Following reform of the structural funds in 1988, Ireland experienced a significant increase in financial transfers from the EU budget. Given Ireland's high level of economic growth in the 1990s, the volume of transfers will be reduced progressively until 2006.
  • Successive Irish governments attempted to protect the domestic space by carefully vetting policies and EU regulations that were likely to have an impact on Ireland's competitive position and on regulatory frameworks at the national level. The internal-market program was thus accorded a high priority because of the weight of EC legislation and the need to prepare Irish industry and the service sector for the competitive shock of the 1992 program. Irish administrations have been adamantly opposed to any harmonization of taxation policy in Europe and have fought a hard campaign to maintain low levels of corporation tax.
  • The 1992 Maastricht Treaty on European Union (TEU) marked further integration, with provisions on a single currency, the common foreign and security policy, and cooperation among EU members on justice and home affairs. Rather than dislodging the high-ranking policies of the past, the TEU simply added priorities and concerns. Irish governments in the 1990s showed considerable commitment to the public debt philosophy and targets set out in the Maastricht Treaty and supported the full observance of the Maastricht criteria across Europe. In practice the Irish political and policy system was converted to the sound-money/tight-budget philosophy of the German Bundesbank.

Successive Irish governments have endorsed EU social and environmental regulation, provided that regulations do not impose an undue burden on Irish industry or the exchequer. The goal of maintaining Ireland's attractiveness to foreign mobile investment, particularly American capital, runs deeply through Irish policy. In promoting domestic preferences and protecting national space, Irish politicians and administrators have had to engage in coalition-building with like-minded states. Unlike other small states, such as the Nordic or the Benelux countries, Ireland does not have a natural grouping of like-minded states and thus must seek allies on a case-by-case basis: with the French on agriculture, the United Kingdom on taxation, and the other "cohesion countries" on regional funds.

Domestic adaptation to the challenge of competition and Ireland's vulnerability as a small open economy caused difficulties. Irish adjustment in the 1970s, notwithstanding the oil crises, was relatively smooth. However, by the end of the 1970s Ireland had entered a vicious circle of economic policy. Ireland had the worst economic performance in Europe during most of the 1980s as a result of international recession, which was reinforced by dramatic domestic efforts to reduce public-finance and balance-of-payments deficits and to lower inflation. By the mid-1980s Ireland's economic and social strategy was in ruins and its hope of prospering in the EU was in considerable doubt. There was a widespread sense of Ireland's failure, not unlike the prevailing mood in the 1950s. The state and its society found itself at another critical juncture. Ireland had to find the institutional and cultural capacity to overcome the failure of the 1980s. Without this, the opportunities offered by the internal European market and the deepening of integration would have been lost. Tight management of the domestic budget and a new system of social partnership meant that Ireland could take advantage of the larger market. The conditions for the remarkable boom of the 1990s were in place.

Repositioning Ireland in the EU

Just over thirty years of membership of the Union and over forty years since the Irish state altered its strategy of economic development, Ireland finds itself as a small, prosperous Western European state with per capita incomes that have converged with those of other wealthy EU states. The claim that Ireland is a "nation caught on the hop between the traditional and the modern, between the Bishop of Rome and the Treaty of Rome" no longer holds (Eagleton 1999, p. 177). The economic modernization represented by the Treaty of Rome has prevailed. Within the EU, Ireland will find itself as one of over twenty five small states in the decades ahead. It is no longer regarded as a deserving, small, poor state. Policy preferences are likely to change when Ireland becomes a net contributor to the EU budget Irish officials will be expected to contribute more actively to EU debates rather than concentrate on the key issues of interest to Ireland. How Ireland repositions itself in the EU system depends on the outcome of several proposed developments. The draft EU constitution, agreed by the Convention on the Future of Europe, is the subject of negotiations among the member states and represents an important development in the dynamic of European integration. The purpose of the draft constitution is to simplify the EU's constitutional and institutional framework and to add to its legitimacy by inserting a charter on rights. Major changes are foreseen in the institutional architecture and decision-making processes. In a Union of twenty-five, it will be more difficult for Ireland to have its voice heard. Managing its relations with the EU will demand greater prioritization and care from Irish governments and policy-makers. While it is highly improbable that a common European defense policy will emerge in the near future, any moves in that direction would present major difficulties for a neutral Ireland.

SEE ALSO Agriculture: After World War I; Celtic Tiger; Common Agricultural Policy; Health and Welfare since 1950, State Provisions for; Industry since 1920; Neutrality; Overseas Investment; Politics: Independent Ireland since 1922; United Nations; Primary Documents: Speech to Ministers of the Governments of the Member States of the European Economic Community (18 January 1962)

Bibliography

Dooge, Jim, and Ruth Barrington, eds. A Vital National Interest: Ireland in Europe, 1973–1998. 1999.

Eagleton, Terry. The Truth about the Irish. 1999.

Laffan, Brigid, R. O'Donnell, and M. Smith. Europe's Experimental Union: Re-thinking Integration. 1999.

Maher, Denis. The Tortuous Path: The Course of Ireland's Entry into the EEC, 1947–73. 1986.

Brigid Laffan

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Encyclopedia of Irish History and Culture. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Encyclopedia of Irish History and Culture. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/international/encyclopedias-almanacs-transcripts-and-maps/european-union

"European Union." Encyclopedia of Irish History and Culture. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/international/encyclopedias-almanacs-transcripts-and-maps/european-union

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

EUROPEAN UNION

Last updated March 2003

Official Name:
European Union (EU)


Editor's note: The information in this article was compiled and edited from the 1996 and 1998 Background Notes and 2002 Fact Sheets made available through the Bureau of European and Eurasian Affairs of the U.S. Department of State.



BACKGROUND

May 26, 1998

The European Union (formerly the European Community) is comprised of three separate communities: the European Coal and Steel Community (established in 1951) and the European Atomic Energy Community and the European Economic Community (both established in 1957). The EU has 15 members (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, and the United Kingdom) and four major institutions (the Commission, Council of Ministers, European Parliament, and Court of Justice). Member states agree to relinquish a degree of national sovereignty to EU institutions and to cooperate in the joint administration of the union.

On November 1, 1993, under the Maastricht Treaty the European Community formally became the European Union, and the Commission of the European Communities became the European Commission. Member states began intergovernmental coordination on Common Foreign and Security Policy (the "Second Pillar") and Justice and Home Affairs (the "Third Pillar"). The treaty set a timetable for the introduction of a single currency (euro) and a European Central Bank as well as the development of common economic and monetary policies.

The question of how fast to proceed with enlargement of the Union while strengthening EU institutions (the "widening" versus "deepening" issue) continues to be a major topic for discussion among member states. In the most recent enlargement, Austria, Finland, and Sweden joined the EU in 1995. Bulgaria, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, Slovenia, and Turkey have applied for membership. In March, the EU began formal accession negotiations with Cyprus, the Czech Republic, Estonia, Hungary, Poland, and Slovenia.

The EU's Intergovernmental Conference (IGC), completed in June 1997, reviewed the Maastricht Treaty and made modest institutional changes to prepare for further enlargement. The resultant Amsterdam Treaty is now awaiting ratification by the member states, a process that could take 1-2 years. More far-reaching reforms will be revisited at a later date.

The EU is currently involved in the launch of the European Monetary Union (EMU). On May 2, 1998, an extraordinary EU Summit announced that 11 European countries qualified for and decided to join a single currency area (Denmark, Sweden, and the U.K. have opted out for now and Greece did not meet the criteria to join). Having long supported European integration, the United States applauds the economic convergence that makes the EMU possible. A successful EMU that contributes to a dynamic, strong, and stable Europe with open markets and healthy growth is clearly in the best interest of the U.S. The EU additionally decided upon the first President of the European Central Bank, Wim Duisenberg of the Netherlands, whose term of office will be 8 years. The bank is to be headquartered in Frankfurt, Germany.

The 20-member Commission, appointed by common agreement of the 15 member governments and approved by the European Parliament, has primary responsibility for initiating and implementing EU policy in areas that fall under EU communities (for example, the internal market, external trade, and agricultural policy). The Council of Ministers, representing the member states, occupies the preeminent position in the current institutional power balance and decides on the Commission's proposals. Each member state serves as President of the Council for 6 months in rotation. The presidency country presides at all meetings of the member states and serves as spokesman in dealing with countries on intergovernmental matters, including efforts to coordinate the foreign policies of the member states.

The Parliament, the only EU institution that directly represents European citizens, has significant power over budgetary matters and can amend or reject certain legislation approved by the Council. The Court of Justice is the final authority on the interpretation of EU treaties and laws.


U.S.-EU RELATIONS

The United States and the European Union (EU) enjoy an exceptionally broad and deep commonality of interests and values that form the basis of a close, mutually beneficial relationship. Since the end of the Cold War, the U.S. has worked intensively with its EU partners to strengthen the partnership as part of a broader effort to build a New Atlantic Community and a New Transatlantic Marketplace.

The U.S. and the EU share the goal of promoting a healthy, open commercial relationship and strong multilateral economic institutions. The U.S. supports greater European political and economic integration and ongoing EU efforts to enlarge to include central and east European states. We believe this process of integration and enlargement contributes to a more stable and prosperous Europe, just as NATO enlargement does. It should proceed, however, without creating new trade barriers.

The EU is the United States'largest economic partner, its largest investment partner, and second-largest trading partner. European companies are the number-one investor in 41 U.S. states and rank second in the other nine.

The EU plays an increasingly important role in foreign affairs, especially in the area of humanitarian and development assistance. The EU's current 3-year foreign aid budget exceeds $36 billion. This assistance reinforces many important U.S. interests. For example, the EU is the largest donor of grant assistance to help promote democracy and free market reforms in the countries of central and eastern Europe. EU aid also is supporting U.S. efforts to bring stability and prosperity to troubled areas including the Middle East, the former Yugoslavia, Albania, and central Africa.

Since December 1995, the New Transatlantic Agenda (NTA) has provided the framework for enhanced political and economic cooperation between the U.S. and the EU. The President meets with the EU leadership at semiannual summits. The May 18 Summit in London highlighted recent U.S.-EU accomplishments under the United Kingdom's Presidency of the EU. Notably, the U.S. and EU:

  • Began discussions on a broad, new trade liberalization initiative.
  • Registered strengthened cooperation on nonproliferation, counterterrorism, and related issues, including Caspian energy resources.
  • Launched a joint initiative to promote nuclear safety in northwest Russia.
  • Implemented an information campaign to combat trafficking in women in Ukraine and Poland.
  • Announced the first Democracy and Civil Society Awards, recognizing the democracy-promoting efforts of NGOs and individuals from 26 central and east European countries and the New Independent States (NIS).

The New Transatlantic Agenda (NTA)

The New Transatlantic Agenda (NTA), launched in December 1995, provides a framework for managing and enlarging our cooperation with the EU. It reinforces our bilateral relations with the EU member states and offers a framework for engaging the EU as a whole through a regular consultative process involving the EU Presidency country and the European Commission.

The NTA lays out an ambitious agenda for expanding U.S.-EU cooperation on promoting peace, stability, democracy, and development around the world; responding to global challenges; contributing to the expansion of world trade and closer economic relations; and "building bridges" between Americans and Europeans of the post-Cold War generation.

A key element of the U.S.-EU worldwide partnership is intensified diplomatic cooperation. The U.S. and the EU are, for example, working together to support reconstruction and reconciliation in Bosnia, promote needed reform in Ukraine, and improve nuclear safety in northwest Russia. The U.S. also is working with the EU to reinforce political and economic cooperation with Turkey, and we have encouraged dialogue among the parties in the Middle East Peace Process.

The U.S. and the EU have undertaken several new initiatives to expand cooperation on law enforcement, counternarcotics, environmental degradation, and health issues. U.S.-EU consultations have spurred development of a successful joint counternarcotics program in the Caribbean, exchanges of law enforcement officials, and an information campaign to combat trafficking in women in Poland and Ukraine. The U.S. and the EU have recently begun to discuss ways to improve counternarcotics activities in the Andean region.

Joint U.S. and EU trade efforts are helping to reduce transatlantic barriers and support the multilateral trading system. The U.S. and the EU are discussing a new initiative to remove trade barriers and create a New Transatlantic Marketplace. The U.S. and the EU are working diligently to resolve important trade differences in the areas of Specified Risk Materials and Genetically Modified Organisms. Within the next few months, the U.S. and the EU will sign a Positive Comity agreement on enforcement of competition laws. Our governments are cooperating closely with the Transatlantic Business Dialogue (TABD), a U.S.-European business partnership, to address a wide range of trade barriers important to the business community.

A key part of the agenda is a fourth chapter dealing with "building bridges" between the different constituencies in the transatlantic community. At the May 18 summit, the U.S. and the EU presented the first U.S.-EU Democracy and Civil Society Awards to NGOs and individuals from some 26 central and eastern Europe and New Independent States (NIS) countries who have excelled in promoting democratic values and civil society. The U.S. and the EU are also working to launch an ongoing dialogue that will focus on consumer issues in the transatlantic marketplace.


SUMMARY OF THE U.S.-EU SUMMIT

June 26, 2004

Strengthening the Transatlantic Economic Partnership

The United States and the European Union are each other's largest sources of foreign direct investment, with the 2002 stock of U.S. direct investment in the European Union reaching $700 billion and EU investment in the United States reaching $850 billion. In 2003, two-way transatlantic trade exceeded $390 billion. The total output of U.S. foreign affiliates ($333 billion in 2000) in Europe and of EU affiliates in the United States ($301 billion) is greater than the total GDP of most nations. Investment is good for workers: foreign subsidiaries in the United States and the European Union pay higher wages on average than do domestic companies.

At the summit, President Bush and his EU counterparts agreed to call upon all interested U.S. and EU stakeholders to engage in vigorous discussions over the coming months on how to eliminate trade, regulatory, and investment impediments to further economic integration.

To this end, the United States intends to convene a number of public dialogue sessions and participate in conferences and meetings with the business, consumer, labor, environmental, and academic communities, and other elements of civil society in order to outline proposals for possible adoption by governments.

On the basis of stakeholder discussions and proposals, and as called for in the U.S.-EU joint Declaration, the United States will in early 2005 develop its contribution to a forward-looking U.S.-EU strategy to enhance economic growth and eliminate transatlantic barriers. The U.S.-EU Senior Level Group, comprising government officials, will present these ideas to Leaders before the 2005 U.S.EU Summit.

Fighting the Challenge of the HIV/AIDS Epidemic

The United States and the European Union reaffirmed their commitment to combat AIDS, pledging to: Support the U.N. Declaration of Commitment on HIV/AIDS; Ensure resources from the Global Fund for AIDS, Malaria, and Tuberculosis are available to countries most severely affected by the disease; Cooperate on formally amending WTO rules in accordance with our groundbreaking agreement on intellectual property rights and public health; Support and accelerate the development of vaccines and technologies to prevent the spread of HIV/AIDS and other communicable diseases; and Work to promote donor coordination and civil society and private involvement in the fight against AIDS.

President Bush is leading a global effort to combat the HIV/AIDS pandemic through his historic $15 billion Emergency Plan for AIDS Relief and his commitment to the Global Fund to Fight AIDS, Tuberculosis, and Malaria, to which the United States has pledged more than $1.96 billion, or 36 percent of all pledges through 2008.

On June 10, 2004, President Bush and his G-8 counterparts endorsed the establishment of a Global HIV Vaccine Enterprise, a virtual consortium to accelerate HIV vaccine development by enhancing coordination, information sharing, and collaboration globally.

President Bush announced plans to establish a new U.S. Vaccine Research & Development Center, in addition to the one at the United States National Institutes of Health. The new center will become a key component of the Global HIV Vaccine Enterprise. The United States is investing $488 million in HIV vaccine development in FY2004, and has requested $533 million in FY2005.

Declaration on the Nonproliferation of Weapons of Mass Destruction

The United States and the European Union agreed to expand their cooperation to prevent, contain, and reverse the proliferation of weapons of mass destruction (WMD) and their delivery systems. Their commitments build on their agreement at the 2003 U.S.-EU Summit, and further President Bush's February 11 proposals to heighten international action against WMD proliferation, and the G-8 Action Plan on Nonproliferation adopted at the Sea Island Summit.

The United States and the European Union:

Welcomed the G-8 Action Plan on Nonproliferation, agreeing to:

  • Refrain for one year from initiating new transfers of enrichment and reprocessing equipment and technology to additional states, while seeking permanent controls to keep this capability from terrorists or states seeking it for nuclear weapons;
  • Subscribe fully to the Proliferation Security Initiative Statement of Interdiction Principles, support efforts to interdict WMD shipments, and enhance cooperation against proliferation networks, including in intelligence and law enforcement.
  • Seek stronger enforcement of nuclear nonproliferation obligations, including by: making the International Atomic Energy Agency (IAEA) Additional Protocol an essential new standard in the field of nuclear supply; creating a new special committee of the IAEA Board of Governors to focus on safeguards and verification; and declaring that states under investigation should not participate in IAEA compliance decisions;
  • Continue to support the work of the G-8 Global Partnership Against the Spread of Weapons and Materials of Mass Destruction; and
  • Take concrete action to expand and improve capability to prevent and respond to bioterrorism.

The United States and the European Union also:

  • Committed to implement fully United Nations Security Council Resolution 1540, to criminalize proliferation, establish effective export controls and protect dangerous materials, and to assist others to do the same;
  • Resolved to enhance cooperation to promote the security of radioactive sources and prevent their misuse;
  • Agreed to continue to promote effective export controls, backed up by criminal sanctions, and to work to identify, control, and interdict WMD- and missilerelated proliferation shipments;
  • Called for the complete, verifiable, and irreversible dismantlement of North Korea's nuclear program, including uranium enrichment and plutonium reprocessing; and,
  • Welcomed Libya's decision to abandon, under international verification, its WMD and longer-range missile programs.

On Iran, the United States and the European Union expressed united determination to see the proliferation implications of Iran's nuclear program resolved. In this connection, the U.S. and EU were disturbed by Iran's recent announcement of its intention to resume manufacturing and assembly of centrifuges and called on Iran to rethink its decision.

Cooperation to Combat Terrorists and Other Serious Criminals

The United States and the European Union agreed at the summit to: Work together to deepen the international consensus and enhance international efforts to combat terrorism through support of the United Nations, its General Assembly, and the Security Council; Share data on lost and stolen passports to prevent terrorists from traveling undetected with these documents; Work together to prevent access by terrorists to financial and other economic resources and have a regular dialogue on terrorist financing; Promote cooperation between our law enforcement agencies and institutions for the purpose of the prevention, detection, and investigation and prosecution of terrorist offenses; Identify areas for closer cooperation in dealing with the consequences of terrorist attacks; and Focus assistance programs on the enhancement of counterterrorist capacity and commitment in priority Third Countries.

These steps build on the expanding transatlantic counterterrorism cooperation. Specifically, the United States and the European Union recently have: Reached an agreement giving U.S. border enforcement authorities access to airline passenger reservation data on transatlantic flights that will allow U.S. authorities to screen for potential terrorists in advance of boarding aircraft; Begun cooperation to secure our ports, vessels, cargo, and supply chains through programs such as the Container Security Initiative and the Customs-Trade Partnership Against Terrorism to detect radioactive material; and Inaugurated a high-level dialogue to enhance mutual understanding and complementarity of U.S.-EU security policies and improve security in land, air, and maritime environments.

This extensive and growing collaboration with the EU is part of 'President Bush's broader counterterrorism strategy.

Cooperation on the Development of the Hydrogen Economy

President Bush and his EU counterparts welcomed and encouraged the collaboration between the United States and the European Union on accelerating development of the global hydrogen economy, which will enhance security of energy supply, increase diversity of energy resources, promote economic growth and job creation, and improve local and global environmental quality.

This U.S.-EU collaboration is helping to advance President Bush's goal that the first car driven by a child born today could be powered by hydrogen fuel cells, and is a natural extension of the President's $1.2 billion Hydrogen Fuel Initiative.

This U.S.-EU collaboration was launched at the 2003 U.S.-EU Summit, and has led to a series of meetings on both sides of the Atlantic to advance hydrogen research and technology development and the establishment of harmonized codes, standards, and regulations. Together, the United States and the European Union have:

  • Increased coordination of our approaches to hydrogen research, helping to guarantee that research efforts are focused and complementary and make the best use of our facilities and the most effective scientific methods;
  • Identified targeted areas of cooperation including fuel cell development, hydrogen storage, hydrogen production, and the necessary codes and standards to support these applications;
  • Committed United States' and the European Union's resources to advance research in critical areas such as high-temperature membranes and catalysts for improved fuel cell cost and durability;
  • Identified model demonstration programs showing the value of public applications of hydrogen;
  • Shared lessons from municipal hydrogen-powered bus demonstrations in San Diego, California and Brussels, Belgium; and
  • Explored collaborative applications of new safety techniques for handling hydrogen in transportation applications in America and Europe.

This transatlantic cooperation is intended to support the International Partnership for the Hydrogen Economy (IPHE), which held its inaugural meeting in Washington, D.C., in November 2003. The IPHE has helped launch international cooperation on research for high-temperature membranes used in fuel cells, hydrogen storage materials, and renewable hydrogen production. The IPHE combines financial and intellectual resources in a global effort to overcome the remaining obstacles to the commercial adoption and trade of hydrogen technology worldwide. These include finding means to bring consumer costs to a level competitive with other energy sources and to build the infrastructure needed to produce, transport, and safely handle hydrogen and hydrogen-based fuel cells.

Continuing Our Cooperation to Expand Transatlantic Trade

At the summit, President Bush and EU leaders:

  • Directed their trade ministers, in cooperation with other WTO members, to finalize framework agreements in the WTO's Doha trade negotiations by the end of July, in order to further enhance the conditions for sustained global economic growth; and
  • Welcomed the continued progress in reducing impediments to transatlantic commerce and expanded regulatory cooperation.

Doha Negotiations and the Global Economy: President Bush believes that trade liberalization is critical to boosting global prosperity, generating sustained economic growth, and raising living standards. Emphasizing the need to seek an ambitious outcome in the WTO's Doha negotiations, President Bush and his EU counterparts reaffirmed their commitment to cooperate with other WTO members to finalize framework agreements in the Doha trade negotiations by the end of July in order to expeditiously complete these negotiations and further enhance the conditions for sustained global economic growth. President Bush and his EU counterparts also:

  • Emphasized the need to focus on the core areas of the Doha negotiations; and
  • Underscored that we are on the verge of an historic opportunity to fundamentally reform trade in agriculture and noted that progress in the agriculture negotiations will be essential to move the other core areas of the negotiations forward.

While the United States and the EU are working to advance WTO negotiations, both the United States and the EU have had laws and other measures challenged under WTO dispute settlement procedures. President Bush intends to comply with final WTO rulings against U.S. measures, such as in the FSC/ETI case where the Bush Administration continues to work closely with the U.S. Congress. The United States is currently awaiting EU action to comply with the WTO ruling in the beef hormone case, as well as awaiting a WTO ruling against the EU moratorium on bio-tech approvals.

The cooperation with the EU on WTO Doha negotiations is part of President Bush's broader effort to open markets globally, regionally, and bilaterally. In addition to the global efforts in the WTO Doha negotiations and the Free Trade Area of the Americas encompassing the Western Hemisphere, the Bush Administration has negotiated or is negotiating comprehensive, high-quality free trade agreements (FTAs) with partners in every region of the globe.

Positive Economic Agenda: President Bush and his EU counterparts welcomed the ongoing cooperation as part of the "Positive Economic Agenda." The United States and the European Union share the largest bilateral trade and investment relationship in the world, accounting for over $1.5 trillion. In order to ensure that this critically important economic relationship continues to thrive, President Bush and his EU counterparts established in 2002 the "Positive Economic Agenda" to advance bilateral cooperation to reduce trade frictions and foster expanded transatlantic commerce.

Regulatory Cooperation: Recognizing that regulatory differences, not tariffs, comprise the most significant remaining transatlantic trade barriers, President Bush and his EU counterparts welcomed the U.S.-EU Regulatory Cooperation Roadmap. This Roadmap builds on the 2002 U.S.-EU Guidelines for Regulatory Cooperation in which the European Commission undertook to make its regulatory process more transparent. The Regulatory Cooperation Road-map provides a framework for U.S. and EU officials to cooperate on a broad range of important areas such as pharmaceuticals, auto safety, information and communications technology, cosmetics, consumer product safety, chemicals, nutritional labeling, and eco-design of electrical/electronic products. Through targeted U.S.-EU regulatory consultations, we aim to promote better quality regulation, minimize regulatory divergences, and facilitate transatlantic commerce.

Financial Markets Regulatory Dialogue: President Bush and his EU counterparts welcomed a joint report from U.S. and EU officials participating in the Financial Markets Regulatory Dialogue. The report describes the ongoing collaboration of U.S. and EU policy and regulatory officials on corporate governance and financial market regulation. The Dialogue, launched in 2002, provides a forum for discussing bilateral financial and regulatory issues, with a view to fostering an efficient and transparent transatlantic capital market. The Dialogue has, in particular, provided a useful vehicle for ensuring that European legislation not impede U.S. participation in European capital markets. More broadly, with recent efforts to improve corporate governance and financial market regulation, the Dialogue has served a valuable function in enabling U.S. and EU regulators to work on potential regulatory issues in a cooperative and timely fashion.

Agreement on GPSGalileo Cooperation

At the summit, the United States and the European Union reached an agreement covering their satellite navigation services, the U.S. Global Positioning System, and Europe's planned Galileo system.

The U.S. Global Positioning System (GPS) is a constellation of 28 satellites and ground support facilities, used for a wide array of economic, scientific, and military applications. The satellites broadcast signals that can be converted into precise positioning and timing information anywhere in the world. In 1998, the European Union decided to pursue its own satellite navigation system, known as Galileo, which currently is still in its development phase.

U.S. Secretary of State Colin Powell, European Commission Vice-President Loyola de Palacio, and Irish Foreign Minister Brian Cowen signed the Agreement on the Promotion, Provision, and Use of Galileo and GPS Satellite-Based Navigation Systems and Related Applications. This historic agreement protects Allied security interests, while paving the way for an eventual doubling of satellites that will broadcast a common civil signal worldwide, thereby promoting better and more comprehensive service for all users.

The agreement ensures that Galileo's signals will not harm the navigation warfare capabilities of the United States and the North Atlantic Treaty Organization military forces, ensures that both the United States and the European Union can address individual and mutual security concerns, and calls for non-discrimination and open markets in terms of trade in civil satellite navigation-related goods and services.

Recognizing the added benefit to civil and commercial users if the two independent systems were compatible and interoperable, the United States and the European Union have shared technical analyses and information, resulting in an agreement to establish a common civil signal. The additional availability, precision, and robustness that will be provided by dual GPS-Galileo receivers lays the foundation for a new generation of satellite-based applications and services, promoting research, development, and investment that will benefit business, science, governments, and recreational users alike.


EUROPEAN INTEGRATION

The process of European integration was strengthened by the implementation, in July 1987, of the Single European Act (SEA), which increased the scope of the Union's legislative and executive authority. The SEA endorsed the objective of economic and monetary union and outlined a series of directives necessary to eliminate all physical, technical, and fiscal barriers to completion of an internal "single" market by January 1, 1993. It also formalized procedures for cooperation in the area of foreign policy.

At the landmark Maastricht summit in December 1991, EU members approved additional proposals to forge even closer economic, monetary, and political ties within the Union. The treaty called for the EU to establish a European Central Bank and a single currency, the euro.

The euro was adopted January 1, 1999 by eleven member-states of the EU. These states were: Austria, Belgium, Germany, Finland, France, Ireland, Italy, Luxembourg, the Netherlands, Portugal, and Spain. Britain, Denmark, and Sweden opted not to adopt the euro at that time. Since then, Greece has also adopted the euro. The creation of a euro zone marks the third phase of the path toward economic union among the countries of the EU. Euro notes and coins began replacing the currency of individual countries in 2002.

The question of how fast to proceed with enlargement of the Union while strengthening EU institutions (the "widening" versus "deepening" issue) continues to be a major topic for discussion among member states. In the most recent enlargement, Austria, Finland, and Sweden joined the EU on January 1, 1995.

In December 2002, the EU announced the acceptance of negotiations for membership with Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, the Slovak Republic and Slovenia. Thee countries are expected to become full members in May 2004.


RELATIONS WITH OTHER COUNTRIES

The EU is the largest trading entity in the world. In April 1992, the EU and the seven-member European Free Trade Association (Austria, Finland, and Sweden were EFTA members before joining the EU) signed an agreement to broaden their existing free trade agreement and create a European Economic Area (EEA). The EEA establishes free movement of goods, services, capital, and labor throughout the combined territory. In a December 1992 referendum, Switzerland rejected participation in the EEA.

The EU and its member states have long-standing political and economic ties with the formerly communist countries of Central Europe and the New Independent States (former Soviet republics). The EU has provided significant economic assistance to these new emerging democracies and has eased access to its markets for them. The EU created a new kind of association agreement for the countries of Central Europe.

These agreements, also known as Europe agreements, cover industrial, technical, and scientific cooperation, financial assistance, and political dialogue. Most importantly, these agreements envision eventual EU membership for these Central European states.

In 1989, the European Commission began coordinating aid from the then-24 countries (including the U.S.) of the Organization for Economic Cooperation and Development to Central and Eastern Europe; this process is known as the Group of 24. The objective is to strengthen the process of political and economic reform, with emphasis on improving the private sector. The European Bank for Reconstruction and Development (of which the United States is an active member) was established in 1990 to support investment and the development of market economies in these countries.

In January 1992, the commission announced that it would negotiate new agreements with the former Soviet republics to replace the 1989 EU-U.S.S.R. trade and cooperation agreement. In June 1994, the EU signed a partnership and cooperation agreement (PCA) with Russia which provides for political dialogue at all levels; possible talks in 1998 on a free trade area; EU support for eventual Russian accession to the World Trade Organization (WTO); and EU assistance on nuclear safety, restructuring state-run enterprises, and economic reforms.

The EU also signed a similar PCA with Ukraine in June 1994. The EU has initialed less-extensive PCAs with Kyrgyzstan, Kazakhstan, Belarus, and Moldova. The Union has placed priority on improving relations with developing countries.

The Lome Convention provides a framework for EU development cooperation with 70 African, Caribbean, and Pacific (ACP) countries. In 1989, a new 10-year agreement was signed with the ACP states to provide aid to development projects, free access to EU markets for almost all manufactured imports from those countries, and incentives to promote European investment.

The Union is linked with a number of countries in the Mediterranean by either association or preferential trade agreements that provide duty-free access for industrial products and direct grants and loans. EU economic ties to Asia and Latin America usually take the form of bilateral agreements that allow preferential access and certain types of development aid.

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Countries of the World and Their Leaders Yearbook 2006. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Countries of the World and Their Leaders Yearbook 2006. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/international/legal-and-political-magazines/european-union-2

"European Union." Countries of the World and Their Leaders Yearbook 2006. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/international/legal-and-political-magazines/european-union-2

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

EUROPEAN UNION.

THE ANTECEDENTS OF EMU
THE TRANSITION TO EMU
THE COMMON FOREIGN AND SECURITY POLICY
THE ENLARGEMENT OF THE EUROPEAN UNION
BIBLIOGRAPHY

The European Union (EU) came into being on 1 November 1993 when the Treaty on European Union, negotiated and ratified by the twelve member states of the European Communities (EC)—Belgium, Denmark, France, the Federal Republic of Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, and the United Kingdom—took effect. The treaty was negotiated in an Intergovernmental Conference of the member states that began in December 1990 and concluded in December 1991 in the Dutch city of Maastricht (hence the frequent reference to it as the "Treaty of Maastricht"). The treaty was formally signed on 7 February 1992.

Article A of the treaty states that it "marks a new stage in the process of creating an ever closer union among the peoples of Europe" and that the Union "shall be founded on the European Communities, supplemented by the policies and forms of cooperation established by this Treaty." The Communities, commonly referred to as the European Community, consisted of the European Coal and Steel Community (ECSC), which came into being on 23 July 1952 as a result of the Treaty of Paris signed by France, the Federal Republic of Germany, Italy, Belgium, the Netherlands, and Luxembourg on 18 April 1951; and the European Economic Community (EEC) and European Atomic Energy Community (Euratom), both of which came into being on 1 January 1958 as a result of the Treaties of Rome signed by the six member states of the ECSC on 25 March 1957.

After withdrawing from discussions in the early and mid-1950s about possible membership in the ECSC and the EEC the British government, as well as those of Ireland, Denmark, and Norway, applied for membership in the EC in August 1961. President Charles de Gaulle (1890–1970) of France vetoed British membership in January 1963, saying that Britain lacked a "European vocation," and one week later signed a Treaty of Friendship with the Federal Republic of Germany. A subsequent British government applied again for membership in May 1967, but again de Gaulle vetoed British membership.

De Gaulle resigned after a referendum defeat in April 1969. His successor, Georges Pompidou (1911–1974), signaled that the EC would welcome an application from Britain and in July 1969 Britain, Ireland, Denmark, and Norway applied for the third time. After the completion of accession negotiations Norwegian voters rejected membership in a referendum in September 1972. Britain, Ireland, and Denmark joined the EC on 1 January 1973.

On 21 April 1967 a military coup led by Colonel George Papadopoulos (1919–1999) and other colonels took power in Greece. After seven years of a repressive dictatorship the regime collapsed in August 1974 in the wake of the invasion and occupation of northern Cyprus by Turkey. Democracy was restored, the Greek government applied for membership in the EC in June 1975, and Greece joined the EC on 1 January 1981.

In April 1974 a military coup in Portugal launched by a group of army captains and other lower-level officers opposed to the government's colonial policies in southern Africa brought an end to a lengthy period of authoritarian rule and inaugurated a short-lived period of social revolution. A democratic regime was established in 1975 and the government applied for EC membership in March 1977.

In Spain, Francisco Franco (1892–1975) died in November 1975. Franco had come to power when his Nationalist forces, aided by Nazi Germany and Benito Mussolini's (1883–1945) Italy, defeated the supporters of the Second Republic in the Civil War of 1936–1939. After some uncertainty as to the nature of the post-Franco regime, a government headed by Adolfo Suarez (b. 1932) engineered, with the vital assistance of King Juan Carlos I (r. 1975–), who had become head of state upon the death of Franco, engineered a transition to a democracy that culminated in the first free election of the Congress of Deputies in June 1977. One month later Spain applied for membership in the EC. After a prolonged accession negotiation, complicated by the fears of French, Italian, and Greek agricultural producers, Spain and Portugal entered the EC on 1 January 1986.

The Treaty on European Union, which took effect on 1 November 1993, transformed the existing European Communities (EC) into the European Union (EU). All of the existing treaties, laws, regulations, directives, court rulings, and institutions of the Communities continued in the EU. The treaty changed the Communities into a single Community and added new functions, responsibilities, and institutions to those that had existed in the EC. Most notably, it committed the member states to the establishment of an Economic and Monetary Union (EMU); implementation of a Common Foreign and Security Policy (CFSP), including the eventual framing of a common defense policy that might in time lead to a common defense; close cooperation in the area of justice and home affairs (JHA); creation of citizenship in the Union; and an increase in the legislative power of the European Parliament. The treaty provided, however, that both the Common Foreign and Security Policy and cooperation in the area of justice and home affairs would be pursued solely through intergovernmental cooperation. The treaty thus defined three "pillars" of activity, the first of which involved the institutions and domains of policy of the existing European Community, the second of which involved the CFSP, and the third of which involved cooperation in the area of JHA.

THE ANTECEDENTS OF EMU

The idea of economic and/or monetary union had been on the agenda of the European Communities in some form for several decades prior to the negotiation of the Treaty on European Union. Indeed, Belgium and Luxembourg had created the Belgium-Luxembourg Economic Union (BLEU) on 25 July 1921. BLEU removed the economic frontier between the two countries and created a monetary union in which the exchange rate for the two currencies, the Belgian franc and Luxembourg franc, was fixed at 1:1 with no fluctuation range. The Belgian central bank assumed the role of the central bank for the two countries and the Luxembourg central bank became, instead, the Luxembourg Monetary Institute.

On 5 September 1944 the governments-in-exile of Belgium, the Netherlands, and Luxembourg, meeting in London, agreed to institute after World War II a common tariff regime with a common external tariff and, eventually, a customs union that would, in time, evolve into an economic union in which there would be a single internal market in which goods could move freely and without barriers across the national borders. The Benelux Customs Union came into being in 1948 and in 1960 it was replaced by the Benelux Economic Union.

The Benelux countries played a major role in the creation of the European Economic Community in 1958. As early as 1950 one or more of the Benelux governments proposed that a customs union be created that would include additional countries beyond the Benelux three. In June 1950, after the French politician Robert Schuman (1886–1963) had proposed the creation of what would become the ECSC, the Dutch government proposed a sector-by-sector plan of trade liberalization that would eventually result in a free-trade area. Known as the Stikker plan after its proponent, the Dutch foreign minister Dirk Stikker (1897–1979), it was followed in 1953 by another Dutch proposal put forward by the foreign minister, Willem Beyen (1897–1976), which aimed to create a customs union.

In August 1954 the French National Assembly rejected a treaty negotiated by the six founding member states of the ECSC to create a European Defense Community. With that defeat and the resignation of Jean Monnet (1888–1979), who had devised the Schuman Plan and had served as the first president of the High Authority of the ECSC, the ambition to integrate the economies of the six member states appeared to be thwarted. In an effort to relaunch the effort to integrate Europe, the foreign ministers of the Benelux countries—Paul-Henri Spaak (1899–1972) of Belgium, Joseph Bech (1887–1975) of Luxembourg, and Beyen—put forward a series of proposals in early 1955 to relaunch European integration. In April 1955 they resurrected Beyen's 1953 proposal for a customs union, combined it with proposals to extend supranational regulation to other sectors, such as atomic energy and transportation, and submitted it for consideration by the ECSC foreign ministers at their meeting in Messina, Italy, in June 1955. At the conclusion of the meeting the ministers agreed to create a committee of experts to study the proposal that, by then, featured the creation in stages of a customs union, the institution of a common external tariff, fiscal and monetary harmonization, and the development of common policies in agriculture, energy, and transportation.

The committee of experts, chaired by Spaak, began meeting in the fall of 1955 and submitted a report to the foreign ministers in April 1956 that proposed the creation of a customs union as well as an atomic energy community and a common agricultural policy. The ministers, meeting in Venice in May 1956, agreed to start negotiations aimed at implementing the proposal and did so in October 1956. The Treaties of Rome, creating the EEC and Euratom, were signed on 25 March 1957. The treaty establishing the EEC promised to eliminate in stages all tariffs and quotas limiting trade between the member states; establish a common external commercial frontier; coordinate the economic policies of the member states; and provide for the free movement of goods, services, capital, and people. In its preamble, the signatories stated they were "determined to lay the foundations of an ever closer union among the peoples of Europe."

Why were the Benelux countries the leading proponents, from the advent of BLEU in 1921 to Messina, Venice, and Rome in 1955–1957, of trade liberalization and the creation of a customs union and eventually an economic and monetary union in Europe? The answer lies in the fact that their economies are unusually open in the sense of being highly dependent on trade. Throughout the twentieth century many of the goods these countries produced were purchased by consumers in other countries and many of the goods they consumed were produced in other countries. In 1958, for example, Italian and French exports were equivalent to roughly 12 percent of GDP and German exports to roughly 22 percent of GDP. Belgian exports, by contrast, represented one-third of GDP, those of the Netherlands nearly one-half of GDP, and those of Luxembourg more than three-quarters of the country's GDP. And those countries were also much more dependent on trade with their large neighbors than those large neighbors were on trade with them. Thus, in 1958, roughly 25 percent of all of the exports of France, Italy, and Germany went to the other five member states of the EC. In contrast, more than 40 percent of the exports of Belgium, Luxembourg, and the Netherlands went to the other member states. As countries that were highly dependent on trade, including trade with larger neighbors that maintained protective barriers to their national markets, the Benelux countries had a strong national interest in liberalizing trade both among themselves and with their larger neighbors.

The Treaty of Rome anticipated the creation of a common market in which all internal tariffs, quotas, and other barriers to trade would be removed by 1970. But the move to a common market occurred more rapidly than anticipated and elimination of the last remaining internal tariffs was advanced to July 1968. In anticipation of that development, as well as the scheduled introduction at that time of a common pricing scheme in the Common Agricultural Policy, Pierre Werner (1913–2002), the prime minister and minister of finance of Luxembourg, proposed in January 1968 that the six member states irrevocably lock the exchange rates among their currencies and create a fund that could intervene in foreign exchange markets in order to maintain the fixed rates. It was hardly surprising, of course, that the first call for a monetary union of the Six would come from Luxembourg; by that time it had participated for nearly a half-century in the BLEU, a central feature of which was the irrevocably locked 1:1 exchange rate without a fluctuation range between the Belgian and Luxembourg francs.

Werner's proposals prompted several memoranda to the Counsel from Raymond Barre (b. 1924), the vice president of the commission in charge of monetary affairs. Barre did not fully endorse Werner's proposals but did call for a reduction in the margins of fluctuation between the EC currencies, provision for multilateral negotiation of currency realignments, a fund and mechanism for joint intervention in currency markets, and a common exchange rate vis-à-vis other EC currencies.

In July 1969 the council approved Barre's recommendation for the creation of some form of joint consulting and decision-making mechanism in the domains of monetary and exchange-rate policy. At their summit in The Hague in December 1969 the leaders of the six member states endorsed the idea of creating an Economic and Monetary Union and recommended that the council accept Barre's proposal that an EMU be created in three stages, with the third and final stage coming into existence in December 1980. The council approved the plan in March 1970 and created a working group, chaired by Werner, to develop the plan. In October 1970 the Werner group proposed that in the first stage the fiscal and monetary policies of the member states be coordinated and harmonized, regulatory restrictions in financial markets be eliminated, and the range of fluctuation among exchange rates be narrowed. New supranational monetary institutions would come into being in the later stages.

The council accepted the Werner Committee's report at its meeting in February 1971 and stage one of what was anticipated would be a ten-year transition to an economic and monetary union began shortly thereafter. But only months later the first of several crises in the International Monetary Fund's exchange-rate regime, in which the value of the American dollar was fixed vis-à-vis gold and all other currencies were pegged to the dollar, took place. Pressure from holders of dollars who sought to exchange them for gold as the United States experienced trade and budget deficits and an acceleration of the rate of change in prices led President Richard Nixon (1913–1994) to close the gold window in August 1971. Shortly thereafter the dollar was devalued vis-à-vis gold and the margin of fluctuation between the dollar and other currencies was increased from plus or minus 0.75 percent to 2.25 percent.

The threefold increase in the range of fluctuation between the dollar and other currencies meant, of course, that rather than narrowing, the fluctuation range among the EC currencies had increased dramatically. The widening range of fluctuation among the currencies would of course create havoc for the trade among countries with highly interdependent economies and common prices in the agricultural sector. In order to reduce that fluctuation, the member states agreed in April 1972 to limit the fluctuation in the exchange rates among their currencies to a range equal to one-half that allowed by the IMF, and they reaffirmed the objective of achieving EMU by 1981 in summit conferences in October 1972 and again in December 1974. By 1976, however, it became obvious that the widened fluctuation range, coupled with the absence of any mechanism to keep the currencies in a more narrow range, spelled the end—at least for the time being—of the ambition to create an economic and monetary union.

The EC continued to face the problem of maintaining an internal market among highly interdependent economies in the face of continuing fluctuation of each EC currency vis-à-vis the other EC currencies, since the fluctuations translated into immediate changes in the prices of goods produced in one member state relative to the prices of goods produced in the other member states. That meant that producers might obtain competitive advantages or, on the other hand, be harmed in both their home markets and other markets through fluctuations in the value of the currencies. It also greatly complicated the task of setting common prices for agricultural commodities in the CAP.

The necessity of dampening the fluctuations among the currencies of highly interdependent economies belonging to a common market led the EC, after the large fluctuations in inflation rates and exchange rates in the wake of the first "oil price shock" and subsequent economic downturn in 1973–1975, to search for a new way to limit the fluctuations among their currencies and create a zone of monetary stability. Following a proposal in October 1977 by Roy Jenkins (1920–2003), the president of the commission, chancellor Helmut Schmidt (b. 1918) of Germany and president Valery Giscard d'Estaing (b. 1926) of France—both former finance ministers who were knowledgeable about exchange-rate and monetary policy—agreed to create a new European Monetary System (EMS). The EMS, which came into being in March 1979, created a bilateral parity grid among all the currencies, limited the fluctuation range among them to plus or minus 2.25 percent, provided a means of monitoring the fluctuations among the currencies, and provided for a means of negotiating realignments in the values of the currencies.

Not all of the member states participated in the EMS. Britain, for example, refused to join until 1990. But those that did participate gradually came to understand EMS constraints on monetary and fiscal policy. A critical period in the development of the EMS occurred during the first two years of the administration of President François Mitterrand of France. Mitterrand, a Socialist, was elected in 1981 with the support of the Communist Party. Coming to power for the first time since the advent of the Fifth Republic in 1958 and in the midst of a recession marked by an increasing rate of unemployment, the Left-dominated government sought to pursue a reflationary policy that tolerated large increases in wages, a substantial increase in public spending, a budget deficit, and an acceleration in the rate of inflation to 12–13 percent. The predictable result was a deteriorating balance of trade and downward pressure in the currency markets on the franc relative to the German mark. As it approached its floor against the mark, France was forced to negotiate a devaluation of the franc within the EMS on three occasions in the first two years of the Mitterrand-led government—in October 1981, June 1982, and March 1983. Since any devaluation of the franc involved, by definition, a revaluation of other currencies that would hurt the competitive position in the EC of goods produced in the revaluing countries, the devaluations were always modest. Moreover, agreement on a devaluation—even a modest one—came only with a French agreement to scale back public spending, first in a pause, then in a policy of rigueur, then in a policy of austerity.

The French experience conveyed a lesson to the rest of the EC. Participation in the EMS required countries to emulate the macroeconomic policy of the strong-currency countries, such as Germany, which sought to stabilize prices through a tight monetary policy and a balanced fiscal policy. As that lesson was internalized by the participating member states in the 1980s, the frequency of realignments decreased. But countries such as France and Italy continued to object to what they regarded as the asymmetry of influence and benefit in the EMS. The German Bundesbank in effect set monetary policy for the countries participating in the EMS, since its interest rates established the de facto floor for interest rates in the other countries. And Germany, along with the Netherlands, which shadowed German monetary and fiscal policy, enjoyed substantial gains from trade since participation in the EMS in effect caused their currencies to be undervalued, especially as realignments—which invariably involved revaluation of the mark and the guilder—became less frequent.

The decreasing frequency of realignments in the exchange rates of the EMS currencies created the impression that the EC might someday approach the stability of a fixed-exchange-rate regime such as would exist in an EMU with irrevocably locked rates. And perhaps for that reason, EMU reappeared, albeit surreptitiously, on the agenda of the EC in the mid-1980s. The preamble of the Single European Act (SEA) of 1986, which was designed to remove the non-tariff barriers that still interfered with the free movement of goods and services in the internal market of the EC, claimed as one of the objectives of the Act "the progressive realization of economic and monetary union." And the SEA amended the Treaty of Rome by adding an ambiguously titled chapter, "Cooperation in Economic and Monetary Policy (Economic and Monetary Union)."

The preamble and reference to EMU in the SEA were apparently the work of Commission President Jacques Delors (b. 1925). Soon after the SEA was agreed to in February 1986 Delors convened a group of economists to analyze the effects of the SEA. In their report, published in 1987, they concluded that completion of the internal market by 1992—the overarching objective of the SEA—would require greater coordination of monetary policy and a strengthening of the EMS. They noted the incompatibility of nationally determined monetary policies with EC–wide free movement of goods, services, and capital, on the one hand, and an exchange-rate regime that, because of the decreasing frequency of realignments, was becoming increasingly analogous to a fixed-exchange-rate regime.

It was, however, a dispute between France and Germany over exchange-rate policy that ultimately led to the resurrection of the Werner plan to create in stages an Economic and Monetary Union. Very soon after taking power after the election of March 1986, the French cohabitation center-right government headed by Prime Minister Jacques Chirac (b. 1932)—Mitterrand was still president—negotiated another devaluation of the franc, which by then had become significantly overvalued in the EMS. Yet despite that devaluation, the franc remained over-valued and under pressure in the foreign exchange markets. As the franc moved toward its floor against the mark in January 1987, the French finance minister Édouard Balladur (b. 1929), taking the view that the problem was caused in part by the systematic undervaluation of the mark, let the franc go through its floor in order to force the Bundesbank to intervene in support of the franc.

Eventually the German government revalued the mark by a modest amount. But the French government remained dissatisfied with the operation of the EMS. In July 1987 and again in August 1987 Balladur called upon the EC to strengthen the EMS and alleviate the asymmetry that existed between Germany and its partners. The result was the Basel-Nyborg Agreements of September 1987, in which the governors of the EC central banks and the ministers of finance agreed on a credit facility to support intra-margin interventions in the currency markets. In December 1987, with the franc again under attack in the markets and the government again forced to raise interest rates to support the currency, Balladur called again for reform of the EMS. He proposed a greater degree of symmetry in the operation of the EMS—especially in the defense of currencies at their floors—and strengthening of the European Monetary Cooperation Fund. And in order to present a common front vis-à-vis the American dollar and Japanese yen, he called for the EC to create a common currency and assign the responsibility for monetary policy to a single central bank—in short, for EMU.

The French proposal, soon supported by the Italian government, was placed on the agenda of the June 1988 meeting of the heads of state and government in Hanover, Germany. The leaders created a committee, chaired by Delors and composed largely of the central-bank governors, to study the issue. In April 1989 the committee recommended, very much along the lines of the earlier Werner committee, creation in three stages of an Economic and Monetary Union. Meeting in Madrid in June 1989, the leaders accepted the report as defining a process leading to EMU, agreed that the first stage would begin on 1 July 1990, and agreed that an Intergovernmental Conference would be convened sometime after the start of the first stage to negotiate the treaty amendments necessary for the later stages. At a meeting in Strasbourg in December 1989 the leaders agreed the IGC would begin one year hence.

THE TRANSITION TO EMU

Title VI of the Treaty on European Union committed the member states to coordinating their economic policies through the formulation of broad guidelines for their economic policies and multilateral surveillance and assessment of those policies by the Commission, Council, and Parliament of the EU. The treaty stipulated that the member states would avoid "excessive deficits," defined as a ratio of the combined deficit of all levels of government to Gross Domestic Product in excess of 3 percent unless the ratio had declined substantially and continuously to a level close to 3 percent or the excess was exceptional and a ratio of government debt to GDP in excess of 60 percent unless the ratio was diminishing and approaching 60 percent. The treaty established sanctions, including fines, to be levied on countries that did not repair their excessive deficits.

The treaty committed the member states to the creation of an EMU in stages by 1999. The first stage of EMU had begun, by agreement of the heads of state and government, on 1 July 1990. The treaty provided for a transitional second stage beginning in 1 January 1994 and a third and final stage to begin on 1 January 1999 at the latest. In the second stage the member states were to undertake programs to ensure their lasting economic convergence, the achievement of price stability, and avoidance of excessive deficits. They were also required, if it was necessary, to begin the process leading to the independence of their central banks. At the start of the second stage a European Monetary Institute (EMI) was to be created. The EMI was to be headed by a council consisting of a president appointed by the heads of state and government and the governors of the national central banks. The EMI was mandated to strengthen the cooperation between the national central banks and the coordination among their monetary policies, oversee the functioning of the European Monetary System, and prepare for the third and final stage of EMU.

The treaty stipulated that in the third and final stage of EMU the EMI would be transformed into a new European Central Bank that would assume responsibility from the national central banks for the formulation and implementation of monetary policy in the participating member states. The Governing Council of the ECB, which would be located in Frankfurt, Germany, would consist of the six members of the ECB's Executive Board—a president, a vice-president, and four other members, appointed by the heads of state and government—and the governors of the national central banks of the participating member states. The exchange rates among the national currencies of the participating member states would be irrevocably locked and the national currencies would, in time, be replaced by a new single currency, the euro.

The treaty stipulated that during the second stage the EMI and the commission would report periodically to the council on the fulfillment by the member states of the criteria, set forth in the treaty, by which the achievement of the high degree of sustainable convergence necessary for participation in the third and final stage of EMU would be judged. Those criteria, often referred to as the "convergence criteria," included: (1) the achievement of price stability as reflected in a rate of inflation close to that of the three best-performing member states; (2) the achievement of a sustainable budgetary position as reflected in the absence of an "excessive deficit;" (3) the observance of the normal fluctuation margins in the Exchange Rate Mechanism of the European Monetary System for at least two years without a devaluation; and (4) the durability of convergence as reflected in long-term interest rates that were close to those of the three best-performing member states.

The treaty provided that the Council, meeting as the heads of state or government, would vote no later than 31 December 1996 whether a majority of the member states satisfied the "convergence criteria" and thereby fulfilled the necessary conditions for participation in the third and final stage of EMU and, if so, when that stage would begin. It stipulated, also, that if by the end of 1997 a date for the start of the third stage had not been set, it would start on 1 January 1999 and the leaders would decide, prior to 1 July 1998, which member states fulfilled the conditions for participation.

By the time the decisions pertaining to movement to the third stage of EMU were to be taken, three more states—Austria, Finland, and Sweden—had joined the EU, all having acceded on 1 January 1995.

Meeting in Cannes in June 1995, after the finance ministers of the fifteen member states had agreed that the earliest possible date for entry to the third stage of EMU—1 January 1997—was "not realistic," the heads of state and government stated their "firm resolve" to move to the third stage by 1 January 1999. Meeting at Madrid six months later, the leaders confirmed "unequivocally" that the third stage would begin on that date. They also adopted the EMI's scenario for the move to the third stage, according to which the exchange rates among the participating currencies would be irrevocably locked with each other and with the euro as of 1 January 1999 and the national currencies and the euro would circulate as "different expressions of the same money" until the first half of 2002, at which time the national currencies of the participating member states would be withdrawn from circulation and the euro would become the sole legal tender, and single currency, of the participating states.

Meeting in Brussels in May 1998, the leaders of the fifteen member states decided that eleven of the fifteen member states—all but the United Kingdom, Denmark, Sweden, and Greece—fulfilled the necessary conditions for adoption of a single currency and would, therefore, enter the third and final stage of EMU on 1 January 1999. The United Kingdom had negotiated an "opt-out" at the concluding meeting at Maastricht of the Intergovernmental Conference by which it is not obliged or committed to move to the third stage without a separate decision to do so by its government and parliament. In October 1997 the British government set forth five criteria by which it would assess whether it was appropriate to enter. It did not carry out an assessment prior to the May 1998 meeting. In fact, it did not carry out an assessment until 2003, at which time it found some of the criteria had not been satisfied. Moreover, Britain had not participated in the Exchange Rate Mechanism of the EMS since September 1992, when it had been forced by unabated downward pressure on the exchange rate of the pound vis-àvis the German mark to withdraw the pound.

After the Treaty on European Union was signed in early 1992 the Danish Storting had overwhelmingly approved it. But ratification of the treaty required, also, approval by the Danish electorate in a referendum. Despite the fact that the Danish government had obtained at Maastricht an "opt-out" from the third and final stage of EMU, in the referendum, held on 2 June 1992, 50.7 percent of the voters rejected the treaty. The government subsequently obtained additional "opt-outs" at a meeting of the heads of state and government at Edinburgh in December 1992 that allowed it to call another referendum, on 18 May 1993, at which 56.7 percent approved the treaty. But at Edinburgh, Denmark gave notice that it would not participate in the third stage. (Later, in 2000, the Danish government had second thoughts about participating in the third stage of EMU and called another referendum on the issue but 53.1 percent voted against participation on 28 September 2000.)

In June 1997 the Swedish government announced that it would not enter the third stage in 1999 and that it would hold an election or referendum on the issue if it decided to recommend entry. Moreover, Sweden, like the United Kingdom, refused to participate in the Exchange Rate Mechanism of the EMS, thereby failing to satisfy one of the necessary "convergence criteria" for participation. Like the Danish government, the Swedish government did subsequently have second thoughts about participating in the single currency and called a referendum on the matter. In the referendum, which took place on 14 September 2003, only three days after the murder of Anna Lindh (1957–2003), the Swedish foreign minister who had become the chief spokesperson supporting participation, 53.1 percent of the Swedish electorate voted against participation.

On the basis of its economic performance in 1997 Greece did not satisfy all of the "convergence criteria" and was barred from entering the third stage with the eleven other participating member states. However, it did subsequently qualify and joined as of 1 January 2001.

At their May 1998 meeting the leaders of the fifteen member states chose the president, vice president, and four other members of the Executive Board of the European Central Bank. The meeting was marked by a heated dispute between Helmut Kohl (b. 1930), the German chancellor, who supported Wim Duisenberg (1935–2005), the Dutch central-bank governor, for president and Chirac, the French president, who favored Jean-Claude Trichet (b. 1942), the governor of the Banque de France. Chirac reasoned that since the ECB was to be located in Frankfurt and since it embodied the German Bundesbank's priorities, which favored price stability above all else, it would only be fair for France to hold the presidency. Ultimately, it was agreed that the initial eight-year term would be split, with Duisenberg holding the presidency until some time after the national currencies had been withdrawn from circulation in early 2002. He assumed the presidency on 1 June 1998 and held it until 31 October 2003, at which time Trichet became president.

In late 1998 the exchange rates among the currencies of the eleven participating countries were irrevocably locked and the third and final stage of EMU came into being on 1 January 1999. The ECB assumed responsibility for monetary policy in the eleven states as of that date. In early 2002 the national currencies were withdrawn from circulation and replaced with bills and coins denominated in euros.

THE COMMON FOREIGN AND SECURITY POLICY

In addition to creating the European Union and committing the member states to the creation of an Economic and Monetary Union, the Treaty on European Union committed them to defining and implementing a Common Foreign and Security Policy (CFSP). The CFSP would be designed to safeguard the common values and interests of the EU, strengthen the security of the EU and its member states, preserve peace and strengthen international security and cooperation, and develop and consolidate democracy and the rule of law and respect for human rights and fundamental freedoms. It was designed to deal with all questions related to the security of the EU, including "the eventual framing of a common defense policy, which might in time lead to a common defense."

The CFSP was designed to achieve these objectives by establishing systematic cooperation between the member states and gradually implementing joint action in the areas in which they had important interests in common. The member states were mandated to consult with each other on any matter of foreign and security policy and they could, when necessary, define a common position in the Council. In such cases they were to ensure that their national policies conformed to the common position and they were mandated, further, to coordinate their action in international organizations in order to uphold the common positions. The Council could also decide, on the basis of general guidelines established by the heads of state and government, that a particular matter should be a subject of joint action and, if so, by what means that action would be undertaken. The presidency of the Council was designated as the representative of the EU in matters falling within the CFSP and the office responsible for the implementation of common measures.

Having been negotiated at a time in which Europe was undergoing a historic geopolitical transformation with the collapse of communist regimes throughout central and eastern Europe and in the Soviet Union, it was inevitable that the Treaty on European Union would attempt to empower the EU as an international actor. But the commitment to the pursuit and implementation of a CFSP was nearly derailed even before the formal signing ceremony of the treaty in February 1992 by developments in the former Yugoslavia.

After the former Yugoslav republics of Slovenia and Croatia declared their independence in June 1991 and the Yugoslav army undertook military action in both, the EC became deeply involved in efforts to resolve both conflicts. An effort by the EC to end the Yugoslav intervention in Slovenia was facilitated by the unexpected ability of the Slovenian National Guard to defeat the Yugoslav army's contingent in a "ten-day war" in July 1991. But in Croatia, where the Yugoslav army came to the defense of the Serb population concentrated in the Krajina and shelled Vukovar in eastern Slavonia and Dubrovnik, the EC found itself unable to prevent a full-fledged war. By December five hundred thousand Croats and two hundred thousand Serbs had been displaced, Vukovar had been destroyed, and the Yugoslav army occupied one-third of Croatia.

In the fall of 1991, as the negotiations on the Treaty on European Union were drawing to a close, the EC faced the issue of whether it should recognize Slovenia, Croatia, and perhaps other Yugoslav republics as independent. In November 1991 it created a five-person commission headed by Robert Badinter (b. 1928) to develop criteria for international recognition.

Meeting only a week after the heads of state and government had agreed to the treaty and its provisions for a CFSP the German foreign minister, Hans-Dietrich Genscher (b. 1927), made it clear that if the EC refused to recognize Croatia and Slovenia, Germany would do so unilaterally. The ministers agreed that any Yugoslav republic seeking EC recognition should apply immediately, the applications would be considered by the commission, and the commission would report in January 1992. Several member states opposed immediate recognition. But Germany had already told Slovenia and Croatia they would be recognized by Christmas. Four republics applied—Slovenia, Croatia, Macedonia, and Bosnia and Herzegovina. The Badinter commission recommended that Slovenia and Macedonia be recognized, that Croatia not be recognized until it guaranteed the rights of the Serb minority, and Bosnia not be recognized until it had held a national referendum on the issue. Greece vetoed the recognition of Macedonia, Croatia was recognized despite the commission's recommendation, and Bosnia and Herzegovina was advised to hold a referendum on independence. The Bosnia referendum had the entirely predictable effect of precipitating a three-year war. The sizable Serb population in Bosnia abstained from the referendum since it was obvious their desire to remain in Serb-dominated Yugoslavia would lose. As a result the vote overwhelmingly endorsed independence; Bosnia immediately received international recognition; hostilities broke out immediately between the Bosnian Serbs, Muslims, and Croats; and the Yugoslav army entered the fray.

The inability of the EC to deal collectively with the recognition issue was amplified by its inability to terminate the conflict. Lacking the military capacity and will to take on the Yugoslav army in a ground war, the EC could only stand by and watch as two hundred thousand were killed and two million displaced in a war that ended only in 1995. Eventually, the war came to an end, but only after the United States had engineered a coalition of Bosnian Croats and Muslims in 1994 and provided assistance to the Croatian military, which, beginning in May 1995, swept through the Serb-controlled areas of the country and took control of a significant portion of Serb-occupied Bosnia. In the wake of the Bosnian Serb army's massacre of eight thousand Bosnian Muslims at Srebrenica in July 2005 the air power of the North Atlantic Treaty Organization was brought into the battle and the war ended with the signing of the Dayton Accords (negotiated at an American air base in Ohio).

In 1998, as NATO prepared to once again use military force to bring to an end Serbia's effort to defeat the Kosovo Liberation Army and remove large numbers of ethnic Albanians from the territory, it became apparent once again that the EU lacked the military capacity to carry out a Common Foreign and Security Policy even in the unlikely event that it could adopt a "common position." That realization, shared by Prime Minister Tony Blair (b. 1953) of the United Kingdom and President Chirac of France, the two countries that had made the largest contributions to a United Nations peacekeeping force in Croatia and Bosnia in 1992–1995, resulted in an agreement at St. Malo in December 1998 that set the stage for the development of an EU Rapid Reaction Force and a European Security and Defense Policy. Both the Force and the ESDP came into being in 1999.

The EC and EU's failure to prevent and then terminate the genocidal wars of the 1990s in the Balkans made it apparent that the pursuit and implementation of a Common Foreign and Security Policy requires more than a substantially increased capability to conduct military operations, important as such capability may be. The failure made it apparent that pursuit and implementation of CFSP requires, also, the articulation of a "common position" and the binding commitment of the member states to that position. The articulation of and adherence to a binding "common position," depending as it does upon a convergence of the national interests of the member states in the domains of foreign, security, and defense policy, may be difficult—if not impossible—to achieve. That difficulty was perhaps best illustrated in the acrimonious dispute within the EU in the run-up to the American-led war in Iraq in 2003. In that dispute, some member states—most notably, the United Kingdom but also Spain, Italy, and several others—enthusiastically supported and joined the American "coalition of the willing" while other member states—most notably, France, Belgium, and Germany—strongly objected to the American effort to use military force, rather than the efforts of the International Atomic Energy Agency and United Nations, in dealing with Iraq.

THE ENLARGEMENT OF THE EUROPEAN UNION

The negotiation of the Treaty on European Union took place in the immediate aftermath of the historic events of 1989–1991 in central and eastern Europe and the Soviet Union. As the communist regimes collapsed many of the new governments looked toward the EC and EU and sought arrangements that would enable them, in time, to become members. As early as 1990, for example, governments in Poland and Hungary negotiated "Europe Agreements" with the EC that anticipated eventual membership.

The EC sought initially to create a new entity, the European Economic Area, in which the post-communist states would participate, enjoying many of the economic benefits of the single market without, however, participating in the institutions of the EC. But it soon became obvious that, armed with the slogan "Return to Europe," most if not all of postcommunist Europe wanted nothing less than full membership.

In June 1993 the leaders of the twelve member states of the European Communities, in Copenhagen for their recurring summit meeting, approved criteria by which the applications of states for membership would be evaluated. The criteria, known as the Copenhagen Criteria, require that in order to be considered for membership a country must be democratic and abide by the rule of law; must respect the rights of minorities and human rights; must have a functioning market economy; and must be able to administer and implement the acquis communautaire, the body of all treaty obligations, laws, regulations, directives, and policies of the EU.

By 1996 the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, the Slovak Republic, Slovenia, Bulgaria, and Romania had applied for membership in the EU. (Prior to the demise of the postcommunist regimes in central and eastern Europe, two small island countries in the Mediterranean—Cyprus and Malta—had applied for membership in the EC, and Turkey had applied as early as 1987.) Applying the "Copenhagen Criteria," the EU opened accession negotiations with the Czech Republic, Poland, Hungary, Slovenia, Estonia, and Cyprus in early 1998. In 1999 it agreed to open the negotiations as well with the Slovak Republic, Latvia, Lithuania, Malta, Bulgaria, and Romania and did so in early 2000.

By late 2002 those negotiations had reached agreement on all but a few of the most difficult aspects of the acquis communautaire. Negotiations on two of the most contentious chapters of the acquis—agriculture and financial and budgetary provisions—were completed with ten of the twelve candidates—all but Bulgaria and Romania—at the Copenhagen meeting of the heads of state and government in December 2002. The accession treaty was signed in Athens on 16 April 2003 and the ten candidates, as well as the fifteen member states, set about the process of ratifying the treaty. All did so and the ten entered the EU on 1 May 2004. As of that date, therefore, the EU increased from fifteen to twenty-five member states.

Bulgaria and the EU concluded their accession negotiations in December 2004, at which time the EU expressed the view that it anticipated that Bulgaria would enter in January 2007. However, the accession treaty signed in April 2005 allows the EU to postpone Bulgaria's entry one year to January 2008 if there is clear evidence that it is unprepared for membership. Any such delay would, however, have to be approved by all of the member states.

Like Bulgaria, Romania completed its accession negotiations with the EU in December 2004, signed the accession treaty in April 2005, and anticipates accession on 1 January 2007. However, as with Bulgaria, its entry can be postponed one year upon a unanimous vote of the twenty-five member states that clear evidence exists that it is unprepared for membership.

In November 2000 a summit meeting between the EU and the governments of the Western Balkans—Croatia, Bosnia and Herzegovina, Serbia and Montenegro, the Former Yugoslav Republic of Macedonia, and Albania—agreed upon a Stabilization and Association Process (SAP) that supports the development of the Western Balkan countries and prepares them for eventual membership in the EU. The SAP is designed to support the countries through a Stabilization and Association Agreement, trade, and financial assistance. An SAA is regarded as a precursor of an application for membership.

Croatia applied for membership in the EU in February 2003. After Croatia addressed a number of issues pertaining to minority rights, the return of refugees, and judicial reform, the EU set March 2005 as the date for the start of accession negotiations, provided the government cooperated fully with the International Criminal Tribunal for the former Yugoslavia (ICTY) in The Hague. Unable or unwilling to turn over a popular former general, Ante Gotovina (b. 1955), who had led the Croatian military in its 1995 victory over the Serb and Bosnian Serb armies, the start of Croatia's negotiations was delayed until October 2005. After being assured by the Chief Prosecutor of the ICTY, Carla del Ponte (b. 1947), that Croatia was cooperating fully, the negotiations began on 3 October 2005. Gotovina was arrested in December 2005 in the Canary Islands.

Macedonia reached agreement with the EU on an SAA in April 2001 and it applied for membership in March 2004. In December 2005 the EU concluded that Macedonia was officially a candidate for membership, but it did not set a date for the start of accession negotiations pending continued progress in a variety of economic and political domains of policy.

Albania opened negotiations with the EU for an SAA in January 2003. Both sides hoped to complete the negotiations in the first half of 2006.

Serbia and Montenegro opened SAA negotiations in October 2005 and Bosnia and Herzegovina opened the same negotiations a month later. The EU made it clear that in both cases progress in the negotiations would depend upon the countries' full cooperation with the ICTY.

In addition to the ongoing negotiations between the EU and the five countries that are part of the Stabilization and Association Process for the Western Balkans, the EU opened accession negotiations in October 2005 with Turkey, which had applied for membership in April 1987.

In the event all of the countries that, as of 2006, were acceding countries (Bulgaria, Romania), candidates for membership (Croatia, Macedonia, Turkey), or potential candidates for membership (Albania, Bosnia and Herzegovina, Serbia, and Montenegro) join the EU, it will have thirty-three states encompassing nearly six hundred million citizens. In addition, it should be noted that some of the non-Baltic states of the former Soviet Union—most notably, Georgia after its "Rose Revolution" of 2004 and Ukraine after its "Orange Revolution" of 2005—have expressed a strong desire to join the EU. In 2006 the EU declared that Ukraine had a functioning market economy, thereby satisfying one of the criteria for membership set forth at Copenhagen in June 1993.

See alsoBenelux Economic Union; Euro; European Coal and Steel Community (ECSC); European Commission; European Constitution 2004–2005; Maastricht, Treaty of; Monnet, Jean; Rome, Treaty of; Schuman, Robert.

BIBLIOGRAPHY

Cameron, David R. "Transnational Relations and the Development of European Economic and Monetary Union." In Bringing Transnational Relations Back In: Non-State Actors, Domestic Structures, and International Institutions, edited by Thomas Risse-Kappen, 37–78. Cambridge, U.K., 1995.

——. "Creating Supranational Authority in Monetary and Exchange-Rate Policy: The Sources and Effects of EMU." In European Integration and Supranational Governance, edited by Wayne Sandholtz and Alec Stone Sweet, 188–216. Oxford, U.K., 1998.

Dinan, Desmond. Ever Closer Union: An Introduction to European Integration. 3rd ed. Boulder, Colo., 2005.

Duff, Andrew, John Pinder, and Roy Pryce, eds. Maastricht and Beyond: Building the European Union. London and New York, 1994.

Gillingham, John . European Integration, 1950–2003: Superstate or New Market Economy? Cambridge, U.K., and New York, 2003.

Hitchcock, William I. The Struggle for Europe: The Turbulent History of a Divided Continent, 1945–2002. New York, 2003.

Hix, Simon. The Political System of the European Union. 2nd ed. New York, 2005.

Judt, Tony. Postwar: A History of Europe Since 1945. New York, 2005.

Kenen, Peter B. Economic and Monetary Union in Europe: Moving Beyond Maastricht. Cambridge, U.K., and New York, 1995.

Milward, Alan S. The Reconstruction of Western Europe, 1945–51. Berkeley, Calif., 1984.

Milward, Alan S., with the assistance of George Brennan and Federico Romero. The European Rescue of the Nation-State. Berkeley, Calif., 1992.

Moravcsik, Andrew. The Choice for Europe: Social Purpose and State Power from Messina to Maastricht. Ithaca, N.Y., 1998.

Silber, Laura, and Allan Little. Yugoslavia: Death of a Nation. Rev. and updated ed. New York, 1997.

Wallace, Helen, William Wallace, and Mark A. Pollack, eds., Policy-Making in the European Union. 5th ed. Oxford, U.K., and New York, 2005.

David R. Cameron

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Encyclopedia of Modern Europe: Europe Since 1914: Encyclopedia of the Age of War and Reconstruction. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Encyclopedia of Modern Europe: Europe Since 1914: Encyclopedia of the Age of War and Reconstruction. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/history/encyclopedias-almanacs-transcripts-and-maps/european-union-1

"European Union." Encyclopedia of Modern Europe: Europe Since 1914: Encyclopedia of the Age of War and Reconstruction. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/history/encyclopedias-almanacs-transcripts-and-maps/european-union-1

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.

European Union

European Union

The European Union (EU) is a grouping of states from Western, Eastern, and Central Europe. Those interested in politics view the EU with great interest because it is unique among regional and international power arrangements. Even non–political scientists study the entity; following its 2004 enlargement, it represented approximately 450 million people and 25 percent of the world's economic production, making it a significant international actor.

States created the EU and states make up its members. Unlike most other international organizations, however, the EU holds a measure of power over members' policies, especially in the realm of economics. This difference has led to debate about whether the EU has an intergovernmental (states alone hold power) or supranational (states and EU institutions together hold power) character. The answer depends on where one looks—which institutions and policy areas—as evidence for both characterizations exists. In the early twenty-first century students of the EU have turned to explanations provided by "multilevel governance" and "two-tiered bargaining." For many, these theoretical models better capture the reality of Europe's multiple arenas of bargaining, and the varied interests, actors, and influences that collaborate to create policy in the EU.

This sometimes untidy, always complex entity results from a long historical process. During its evolution, citizens of member states witnessed the completion of a single market encompassing all their economies, the removal of most barriers to intra-EU movement, as well as the adoption of a single currency (euro) and monetary policy by most member governments. Further, the November 1993 Maastricht Treaty on European Union (TEU) committed members to "deepening" integration. They agreed to coordinate a common foreign and security policy and justice and home affairs (police and legal functions). In addition, the EU continues to widen its membership, admitting ten states from Central and Eastern Europe (Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovenia, and Slovakia) in 2004. Romania and Bulgaria are scheduled to join the EU in 2007 and Turkey in 2010. The EU is a fascinating experiment in new ways of organizing power, sovereignty , and citizenship.

history of european integration

Following World War II (1939–1945), France and other states sought to "cage" Germany so that it could never again threaten its neighbors. This effort led first to the Brussels Treaty Organization (BTO) in 1948; its member states were Belgium, the Netherlands, and Luxembourg (Benelux), as well as France and the United Kingdom. The BTO evolved into the Western European Union (WEU) with the addition of West Germany (formed in 1949 from the British, French, and U.S.–occupied sectors of defeated Germany) and Italy in 1955. In 1950, BTO's members plus Canada, Denmark, Iceland, Italy, Norway, Portugal, and the United States became the North Atlantic Treaty Organization (NATO), formed to protect against military threats from the Soviet-led East bloc .

The Allies focused on rebuilding Europe to insulate it from perceived threats by the Communist Union of Soviet Socialist Republics (USSR). To stretch scarce European resources, the United States conditioned Marshall Plan aid (initiated in 1947) on recipients preparing integrated recovery plans. This requirement helped countries develop cooperative habits that served the community's later integrative efforts.


Integration took place in stages: first, the European Coal and Steel Community (ECSC); next, the European Economic Community (EEC); then the European Community (EC); and finally the EU. From a limited agenda and membership, European unity now encompasses vast new policy areas and reflects a much wider association.

France's Jean Monnet, regarded as the Father of Europe, and West Germany's Chancellor Konrad Adenauer notably provided the political finesse and inspiration for the ECSC. It came into existence after the Benelux states, France, Italy, and Germany signed the Treaty of Paris in 1951. Although the "Six" invited the United Kingdom to participate, domestic politics prevented British membership. The ECSC assumed regulatory authority over the production and sale of coal and steel. In focusing on these important products—essential to war and industry—the ECSC helped appease members' fears regarding their neighbors' ability to wage war during post-World War II reconstruction.

The ECSC was composed of a supranational High Authority, an intergovernmental Council of Ministers, an independent Court of Justice, and an advisory Assembly. The High Authority served as the executive. To ensure its supranationality, members pledged to take no instruction from their home governments. The authority had significant autonomy, including the power to fine firms, raise and invest money, arrange loans for members, and finance the retraining and resettlement of workers. In addition, it regulated the common market for coal and steel.

The Council of Ministers and Court of Justice both limited the authority. The council's members came from the Six's national cabinets, usually in the person of the minister of economics or industry. It could set the authority's agenda and block its initiatives. The council also exercised budgetary control. The Court of Justice also could check the authority through judicial review . Council members could ask the Court to examine whether the authority had overstepped its mandate or acted contrary to ECSC law.

On the other hand, the Assembly, made up of representatives from members' national legislatures, had little influence; it could not directly stop authority initiatives. The assembly could only censure the authority as a whole, forcing its resignation. Also, the assembly held limited proposal power regarding the budget.

This system of checks and balances created several important legacies. The High Authority showed great reluctance—and perhaps great wisdom—in refusing to exercise its powers contrary to explicit member preferences. Clearly, states' wishes restrained the authority's supranationality. This delicate balance continues in the EU. In addition, the court's capacity to evaluate and overturn the authority's decisions legitimized the use of judicial review, which later courts have employed to enhance European supranationality. Finally, the assembly, with its limited powers and non-elected members, does not always represent popular opinion, a serious deficiency for an organization of democratic states. The EU continues to struggle with this "democratic deficit," seeking to remedy this problem through bestowing greater power on the European Parliament (EP).

The ECSC's successes inspired its members to integrate additional policy areas. When an attempt to incorporate defense and security through the European Defense Community failed in 1954, ECSC members contemplated other possibilities. In 1957 they signed the Treaties of Rome that created the European Atomic Energy Community (Euratom) for peaceful atomic development and the EEC for construction of a common market in a wider array of goods in addition to ECSC products. Again, the British were invited to participate; again, they declined.

In the 1960s the EEC removed barriers to trade and freed the movement of labor within the Community, two prerequisites to a common market. Additionally, members negotiated the politically sensitive Common Agricultural Program (CAP), which provided Community support for farming (this subsidy remains a significant budget item). Moreover, in 1965, the states signed a Merger Treaty—fusing the ECSC, Euratom, and EEC into the EC—and created common institutions.

This same year witnessed the Empty Chair Crisis, in which France refused to move from unanimous to majority voting (on some issues) in the Council of Ministers as envisioned by the Treaties of Rome. Majority voting would have forced states that were opposed to an action to accept it if enough other states agreed. This reflected the ongoing debate over the nature of the Community's character. French President Charles de Gaulle (b. 1948) refused to cede any national prerogatives and withdrew France's representative. The 1966 Luxembourg Compromise filled France's "empty chair," allowing unanimity on any issue deemed very important by a member. This agreement gave each state a veto, preserving intergovernmentalism. Although this slowed the momentum of the EC, even the most intergovernmental states began to feel more secure.

By 1968 the Europeans completed the Common Market and again began to consider expansion. After two attempts to join, which were vetoed by de Gaulle (who considered Great Britain a rival), the United Kingdom entered the EC in 1973, along with the Republic of Ireland and Denmark. (Norway's citizens rejected EC membership by referendum .)

This period reflected great economic uncertainty. In 1971 the United States delinked the dollar—the peg of the international currency system—from a fixed relationship with gold. The Community responded, in 1972, with the Snake in the Tunnel policy (the "snake" represented tightly joined European currencies, while the "tunnel" symbolized their more flexible relationship to the U.S. dollar). That same year, the Organization of Petroleum Exporting Countries (OPEC) drastically increased the price of oil, which led to wide swings in EC currency values. The Europeans decided to create a better system and, in 1979, launched the European Monetary System (EMS). Another reform in 1979 was direct elections of Members of the European Parliament (MEPs), an important step toward democracy.

The 1980s witnessed significant activity, from widening membership to deepening integration. Beginning with Greece (1981), followed by Spain and Portugal (1986), the Community grew. In addition, the Council of Ministers named Jacques Delors as Commission president in 1985. Under his energetic leadership, the Community made great progress, including passage of the 1986 Single European Act outlining the steps remaining for, and committing members to, the completion of a Single Market. The 1989 Delors Report by central bankers detailed the steps toward a Economic and Monetary Union (EMU). Finally, the Council of Ministers dropped the requirement for unanimity on many issues, eroding the Luxembourg Compromise and easing EC operations.

The enthusiasm and optimism of the 1980s swept the EC forward with ambitious plans. In 1990 most members signed the Schengen Treaty that eliminated internal borders. Given its problems with domestic terrorism, the United Kingdom declined to sign the treaty (with Ireland abstaining), as did Norway, which sought to preserve travel agreements with non–EC Nordic states. Member states—including a newly unified Germany—signed the TEU in 1992, greatly expanding Community competencies. Ratification meant coordination of common foreign and security policies, as well as policing, immigration, political asylum, and legal procedures under the rubric "justice and home affairs." Members' initial steps toward the EMU included making central banks autonomous, coordinating monetary policies, and irrevocably linking participating states' currencies. In 1995 Sweden, Finland, and Austria joined the EU. Additionally, the group considered numerous new candidates for membership, mostly from the former Soviet bloc.

Economic difficulties, citizen revolt, and Commission scandal undermined these positive steps, however. In 1992 and 1993 the EMS underwent speculative attacks that led to its virtual collapse. In addition, states seeking to join the EMU often had to cut social spending, raise taxes, and even practice creative accounting to meet stringent entrance criteria. Such actions, especially in high unemployment areas, led many of them to question the desirability of membership. Political repercussions included Danish rejection of the TEU (later reversed) and France's ratification of the treaty by less than a 1 percent margin. The entire Commission, led by Jacques Santer, resigned in 1999 following reports of fraud, nepotism , and mismanagement of resources.

The early twenty-first century saw the EU focus on the ambitious agenda of the TEU, enlargement, and institutional reform. On January 1, 2002, citizens of the twelve "euroland" states began using paper euros. The EU also began developing an autonomous military "rapid reaction force," for use in a variety of situations. Further, members are coordinating asylum and immigration policies and other justice and policing activities.

The EU's enlargement by ten new members, in 2004, highlighted the need for institutional reform. The Treaty of Nice, signed in 2000, furthered reforms mandated by the 1996 Treaty of Amsterdam. Both agreements left many issues unsettled, however, in anticipation of a future constitutional conference. Reallocation of power and budget responsibilities particularly troubled members that wanted no reduction in the first or increase in the second, but such disagreements were overcome and leaders agreed to the EU Constitutional Treaty in the summer of 2004. Although many countries support the new constitution, France and the Netherlands do not. When put to a vote, both the French and the Dutch people rejected it. Unless the treaty receives a unanimous vote, the new constitution cannot be ratified.

institutions of the eu

The institutions governing the EU distribute power and responsibility uniquely. Functions overlap, creating unfamiliar authorities and responsibilities compared to national governments. This, in large measure, reflects the starting point provided by the ECSC and the evolutionary nature of the institutions' development.

European Council. This intergovernmental body should not be confused with the Council of Europe. The head of the country holding the presidency of the Council of Ministers convenes at least two meetings of this council during his or her six-month term. Here, national leaders set the EU's extraordinary agenda for the near future and approve previous efforts, usually in the form of treaties (e.g., the Single European Act). Originally an informal forum of heads of member states, the Community in 1974 accorded this meeting legal status. This move shifted the supranational/intergovernmental balance, returning power to the states. At the same time, it allowed bold expansion into new areas, for example, security and defense, that less senior diplomats could not propose, given political ramifications.

Commission. The supranational Commission, heir to the High Authority, serves both legislative and executive functions. Currently each member appoints one Commissioner, although that may change with future enlargements. After gaining approval from the Council of Ministers' (based on qualified majority voting) and European Parliament, commissioners serve five-year renewable terms. While many have served prominently in national governments, commissioners swear to forsake allegiance to any national agenda and agree to put EU interests first. The Commission president assigns commissioners to the twenty-three functionally distinct directorates-general and various services. The EP may censure and remove the commission en masse for failure to fulfill its commitments.

the european coal and steel community

The European Coal and Steel Community (ECSC) was the first organization established by treaty that led to the eventual formation of the European Union. The ECSC is sometimes called the Schuman Plan, after the French foreign minister who proposed it in 1950. It was originally intended to pool French and German coal and steel production. By the time the Treaty of Paris was signed on April 18, 1951, however, the ECSC involved six countries (Italy, Belgium, Luxembourg, and the Netherlands in addition to France and Germany). The treaty went into effect on July 24, 1952 and was scheduled to expire fifty years later on July 23, 2002.

The six members agreed to create a common market for coal and steel, to lift restrictions on imports and exports, and to set up a unified labor pool. The structure of the ECSC included a nine-member High Authority, a Council of Ministers, an Assembly, and a Court of Justice. This organizational structure served as the model for the later European Union. The ECSC was an economic success in its early years; it raised iron and steel production in the member nations by 75 percent between 1952 and 1960, and general industrial production by 58 percent.

The ECSC's assets were turned over to the European Community when it went out of existence in July 2002.

As a legislative body, the Commission proposes bills in consultation with the EP, states, and lobbyists , with direction from the European Council. Its submissions make up much of the Council of Ministers' agenda. As an executive body, the commission supervises implementation of legislation at the EU level through oversight of a bureaucracy of "Eurocrats," as well as at the state level by monitoring members' implementation of regulations and directives. (Regulations are immediately applicable and binding on member states, whereas directives outline objectives that states must achieve through means determined in national legislation.) In this executive capacity, the commission often writes guidelines for the implementation of legislation, giving it significant interpretative powers.

The Council of the European Union. This body, formerly, the Council of Ministers, representing states' national interests, counterbalances the commission's supranational bias. Several different councils do, in fact, exist, as membership varies based on the issue. In all cases, national ministers compose the council. The six-month council presidency rotates among members. The state holding this office also presides over the European Council. Ministers' dual role—both national and EU responsibilities—dictates additional support. Thus, the Council of Permanent Representatives (COREPER), a permanent bureaucracy of national civil servants, and a General Secretariat aid ministers.

The Council of Ministers performs a legislative function. Although formerly one could summarize operations as "the Commission proposes, the Council disposes," given increasing parliamentary responsibility, this no longer holds true in most instances. While the council still approves, amends, or rejects commission proposals, now, after it acts, proposals often move to the EP for approval (co-decision). In other situations, however, the Council still need only consult the EP or gain its assent.

Council ministers enjoy a different number of votes, weighted according to their states' sizes. Thus, the five largest members represent about 60 percent of total votes. After the Luxembourg Compromise, the council often required unanimity, but in treaties beginning with the TEU, it has added a growing number of issues to those decided by qualified majority voting (QMV). To ensure the protection of states' interests, QMV voting requires more than a simple majority. According to the Treaty of Nice, passage by "qualified majority" requires assent by a majority of member states, holding at least 72.3 percent of total Council votes and representing at least a majority of member states and at least 62 percent of the EU's population. The Constitutional Treaty further addresses this system.

European Parliament (EP). Since 1979 Europeans have elected MEPs directly, to five-year terms, with each delegation 's size based on its state's population. After the 2004 enlargement, the EP's size grew, but it should return to 535 in 2009. In the EP, MEPs sit in transnational party groupings. In addition, the EP has structured parliamentary activity and funding to enhance these cross-border political identities. Still, EP elections more often serve as referendums on national governments rather than reflecting voter opinions on European issues.

Parliament's authority varies depending on the issue, because European treaties have awarded it different roles. From humble "consultation" under the Treaties of Rome, the EP won the powers of cooperation and co-decision in the Single European Act and Maastricht Treaty, respectively. Honoring the EP's consultation role, the council must listen to its views, but it is not obliged to act on them. When operating under the cooperation procedure, the EP can amend or reject council proposals, although the ministers, acting unanimously, may overturn the EP's decision. Finally, co-decision gives the EP veto power over legislation approved by both commissioners and ministers. Such increases in EP power are one way to address the previously mentioned democratic deficit.

European Court of Justice. The EU's legal system encompasses several specialized bodies, for example, the Court of Auditors and two general courts: the Court of First Instance and the European Court of Justice (ECJ). The Community created the Court of Auditors, in 1977, to ensure that the budget is spent correctly and the Court of First Instance, in 1988, to relieve the ECJ's heavy caseload. Members each appoint one judge to the ECJ. With the 2004 enlargement, the number of judges increased to twenty-five, each serving a six-year term. These judges rarely sit en masse, meeting instead in smaller panels to hear cases. Judges consider suits involving EU institutions, firms, individuals, and member states. The court system has increased Europe's supranational character in two important ways. As discussed earlier, ECSC members accepted judicial review of the High Authority. The later ECJ also reviews actions by member states, in some cases ruling against national legislation. This derives from the ECJ judgment that European legislation is supreme over conflicting national legislation. Thus, ECJ rulings have driven forward the EU's agenda, in some cases against members' legislated preferences.

conclusion

As the EU looks forward, it faces new and continuing challenges. The 2004 enlargement highlighted the need for additional reform of its institutions and budget. In addition, worries by many about the fairness of representation (the democratic deficit) persist, despite a strengthened EP. The nature of the EU and whether true authority lies with the states alone, or with the institutions of the EU, remains contentious. Further, such debate spotlights the difficulty of agreement in new areas of involvement: foreign policy, security, justice, and domestic affairs. The EU's recent and planned expansions also bring it into increasingly close contact with developing areas of the world (e.g., the Balkans, the former Soviet republics, and Turkey) with special needs. The EU remains an important international actor as it addresses these internal and external challenges.

See also: European Court of Justice; European Parliament.

bibliography

Archive of European Integration. <http://aei.pitt.edu/>.

De Giustino, David. A Reader in European Integration. London: Longman, 1996.

Eur-Lex. Portal to European Law.<http://europa.eu.int/eur-lex/en/index.html>.

European Research Paper Archive. <http://www.wu-wien.ac.at/erpa/>.

European Union. <http://www.eurunion.org>.

Gilbert, Mark. Surpassing Realism. Lanham, MD: Rowman & Littlefield, 2003.

McCormick, John. Understanding the European Union: A Concise Introduction, 2d ed. New York: Palgrave Macmillan, 2002.

Urwin, Derek W. The Community of Europe, 2d ed. London: Longman, 1995.

Wood, David, and Birol Yesilada. The Emerging European Union, 2d ed. New York: Longman, 2002.

Janet Adamski

Cite this article
Pick a style below, and copy the text for your bibliography.

  • MLA
  • Chicago
  • APA

"European Union." Governments of the World: A Global Guide to Citizens' Rights and Responsibilities. . Encyclopedia.com. 10 Sep. 2018 <http://www.encyclopedia.com>.

"European Union." Governments of the World: A Global Guide to Citizens' Rights and Responsibilities. . Encyclopedia.com. (September 10, 2018). http://www.encyclopedia.com/international/legal-and-political-magazines/european-union-3

"European Union." Governments of the World: A Global Guide to Citizens' Rights and Responsibilities. . Retrieved September 10, 2018 from Encyclopedia.com: http://www.encyclopedia.com/international/legal-and-political-magazines/european-union-3

Learn more about citation styles

Citation styles

Encyclopedia.com gives you the ability to cite reference entries and articles according to common styles from the Modern Language Association (MLA), The Chicago Manual of Style, and the American Psychological Association (APA).

Within the “Cite this article” tool, pick a style to see how all available information looks when formatted according to that style. Then, copy and paste the text into your bibliography or works cited list.

Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.com cannot guarantee each citation it generates. Therefore, it’s best to use Encyclopedia.com citations as a starting point before checking the style against your school or publication’s requirements and the most-recent information available at these sites:

Modern Language Association

http://www.mla.org/style

The Chicago Manual of Style

http://www.chicagomanualofstyle.org/tools_citationguide.html

American Psychological Association

http://apastyle.apa.org/

Notes:
  • Most online reference entries and articles do not have page numbers. Therefore, that information is unavailable for most Encyclopedia.com content. However, the date of retrieval is often important. Refer to each style’s convention regarding the best way to format page numbers and retrieval dates.
  • In addition to the MLA, Chicago, and APA styles, your school, university, publication, or institution may have its own requirements for citations. Therefore, be sure to refer to those guidelines when editing your bibliography or works cited list.