Agribusiness Teaching Center
This paper is about the EU, its
major policies, the key objectives, legislations, instruments for implementing
those policies, who the members are, and the institutions involved in the
implementation of the trade goals.
Key word: European Union;
Mission of the EU.
establishment of the EU intended to work toward common goals of European
countries. This free trade zone or economic community was and is very
successful which seeks special purposes such as political dialogue, free trade
and freedom of movement, economic, financial, and cultural cooperation. Special
attention was focused on the trade laws, regulations, and other issues (Kotler, 1999, p. 371).
The key objectives are to keep
market open, ensure fair trade, enforce the legislation objectively and
transparently, ensure trade partners respect WTO legislation, and promote
improvements to the system (European Union).
The EU provides sovereignty to its Members to act as independent ones on
behalf of the EU or in other words to welfare and interest of the Union as a
whole (European Union).
The integration of the EU after 2nd
World War enabled the EU is to raise standards
of living, build an internal market, launch the common currency - euro,
strengthen the Union’s voice in the world. To realize these goals the EU has
been implementing several trade defense instruments:
- Anti – dumping policy
- Anti – subsidy policy
- Regulation on trade barriers
- Protective measures.
The EU even uses a common currency,
the euro monetary system which tend to make the trade zone more effective and
compatible in the international market (European Union). The EU has such a
structure that there are 5 institutions and each of them is responsible for a
respective objective (European Union).
Today the EU is one of the
influential and largest trade blocs or single markets that includes 15 member
countries. Those 15 member countries totally have more than 370 million
consumers and account for 20% of the world’s exports. The EU is going to
enlarge and accept 13 European countries. The EU also intended to improve the
relations with non-member countries and for this purpose it planed to develop
special policies on trade with nonmember countries (Kotler, 1999, p. 371).
Nowadays, the EU is on the 5th
place ahead of the US and Japan. The EU is the leading player in international
market (European Union).
The European Union (EU) was established
after 2nd World War. France officially undertook the establishment
of the EU proposing to create “the first concrete foundation of a European
federation”. On May 9, 1950 the EU was created and initially six European
countries joint to the EU: Belgium, Germany, France, Italy, Luxemburg, and the
Netherlands. Then 9 countries joint to the EU and today the number of the
member countries is 15 (later joint Denmark, Ireland, the United Kingdom,
Greece, Spain, Portugal, Austria, Finland, and Sweden) (European Union).
The EU today is preparing for the
accession of 13 European countries – Bulgaria, Czech Republic, Estonia, Cyprus,
Latvia, Lithuania, Hungary, Malta, Poland, Romania, Slovenia, Slovakia, and
Turkey. In order to join the EU, these countries need to fulfill the economic
and political requirements, which in other terms called “Copenhagen criteria”.
Those requirements are mainly related to the following:
- Member countries must be a stable
democracy, respecting human rights, the rule of law, and the protection of
- Member countries must have a functioning market
- Member countries adopt the common
rules, standards and policies that make up the body of EU law.
As these countries have not yet
fulfilled all the requirements, they need financial resources or in other words
they need money. The EU assists those countries providing financial resources
to those countries The EU provides
sovereignty to its Members to act as independent ones on behalf of the EU or in
other words to welfare and interest of the Union as a whole (European Union).
All of these
countries will integrate in order to realize the principal objectives of the
EU. Those objectives are:
- Establish European citizenship
- Ensure freedom, security and
- Promote economic and social
- Assert Europe’s role in the
5 institutions implement all of
- European Parliament (EP) – This
represents the will of 374 million European citizens’ and assembles pan-European political groups that
operate in Member states. The overall task of the EP is to make and adopt
the laws with Council, to adopt the budget at the end, and
control/supervise all institutions. It is elected every five year.
- Council of the European Union –
This is the most influential institution in decision making process. The
main functions of this institution is to exercise the issues related to
the legislation, to suggest and monitor the international agreements,
implementing foreign and security policy, monitor the budget of the EU with
the EP and finally to coordinate the activates of the Member States.
- European Commission (EC) – EC
play the leading force in the Union’s institutional system. It is mainly
responsible for creating the initial outline of legislation, implementing
the legislation to assure that law is property applied, and representing
the EU in international scope and signing trade and cooperation
- Court of Justice – This
institution is responsible only the issues related to the justification.
It justifies the disputes that arise among Member States, EU institutions,
businesses, and individuals. They check whether laws are in the accordance
with the justice or not.
- Court of Auditors – Its major
function is to check whether all the Union’s revenues and expenditures are
going in a regular manner, according to the EU budget.
Today European Union is the leader
in the international trade and with its member countries it makes up the fifth
of the world trade. The EU had 4 trade defense instruments, which enables the
EU to achieve its objective related with economic and social progress. Also
this will lead the assertion of the EU’s role in the world. Those instruments
are the followings:
- Anti-dumping policy, which had
the meaning of taking steps to stop the process which enables the
exporters to bring goods at such a price which is lower compare with the
prices of the goods in the domestic market.
- Anti-subsidy policy that intended
to restrict or fully eliminate the imports of those goods that in the
third country of origin had low prices. Those prices are artificially kept
low by public subsidies.
- Regulations on trade barriers –
above mentioned policies resulted reinstating temporary custom duties on
the imports that are in the question.
- Protective measures – if the
amount of the imported goods increases very rapidly which hurt the
national producers, there should be undertook protective measures such as
restricting the imports.
The EU to make the integration more
efficient uses these trade defense instruments. Since today they achieved
stability, peace and economic prosperity. These resulted in the raise of living
standards, building an internal market, launch the euro, and the strengthening
the Union’s voice in the world (European Union).
Today the EU has 15 members
counting more than 370 million consumers, which account about 20% of the world
exports. Later on the EU’s mission is to enlarge and include more nations.
Today there are 13 candidate countries that will increase the number of Member
countries to 28, which will have totally 450 million consumers (Kotler, 1999,
Anticipated Analyses and Conclusion
Although the EU is the fifth major
trade bloc in the world, there are some weak sides the EU should consider very
carefully. At first the EU has to set special policies concerning the trade
with nonmember countries to avoid or secure from expected outsiders’ barriers.
Instead the EU can enact such policy that will deepen the relationships with
nonmember countries. As soon as 13 countries enter into this free trade zone or
bloc, the EU will become more successful and will increase exports to support
member countries’ consumers. Yet, however much nations and regions integrate
their trading policies and standards, each nation still has unique features that
must be understood. A nation’s readiness for different products and services
and its attractiveness as a market to foreign firms depend on its economic,
political – legal, and cultural environments. The EU became driving force into
the international market for member countries. Such kind of economic
communities are needed to increase today’s economic growth and make countries
- European Union. “ Trade policy
instruments”. Brussels. October 30, 2002.
Marketing Management, Regional
Free Trade Zone, Chapter 12 Designing global market offerings, p. 371,
Kotler Ph. “Marketing
Management.” Prentice-hall, Inc. New Jersey, 1999. November 12, 2002.