In the 1990s and in the first years of the twenty-first century, the countries of Western Europe widened the geographical scope of their international federation and deepened the legal, political, and economic bonds that tied the member states (Belgium, France, Italy, Luxembourg, the Netherlands and Germany) together. In December 1991, in the Dutch city of Maastricht, the twelve member states of the European Community met to draw up a revised treaty for the association, which took the new name European Union (EU) – an entity with a much higher degree of internal cohesion. Like many alterations in Europe sociopolitical landscape, these changes came in response to the collapse of Communism and the pressure of globalization – especially the latter. Europe faced increased competition from new trading blocs like the North American Free Trade Association (NAFTA) as well as from the new economic dynamo, China. More than ever, the Europe Union felt the need to move beyond the nation-state and agreed on that same day of December 1991 to create a European Monetary Union (EMU) with a single currency, the euro.
New forms of cooperation thus also appeared regarding defense, justice and home affairs between EU governments. First composed of six members, after several expansions the European Union is today an economic and political union of 28 member states.
Europe is in fact the world’s largest economic area (28% of the world’s GDP), of a comparable weight to North America and superior to those of Japan and China combined. It received 42% of the foreign direct investments made worldwide and each year attracts more than a third of the new flows. With its 500 million inhabitants, the EU carries out 16% of the world’s exports of goods and 27% of the services. Indeed, the combination of technological progress, lower transport costs and policy liberalization in the European Union and elsewhere has led to increasing trade and financial flows between countries, which had important consequences for the functioning of the EU economy.
While globalization brings huge benefits and opportunities, it also means that Europe has to face broader competition as well as increasing political and environmental responsibility towards the rest of the world. As many (such as the former French President Jacques Chirac) argue the negatives effects of American globalization, could it nevertheless also be a necessity for the EU’s future economy?
By Capucine Tong
New forms of cooperation thus also appeared regarding defense, justice and home affairs between EU governments. First composed of six members, after several expansions the European Union is today an economic and political union of 28 member states.
Europe is in fact the world’s largest economic area (28% of the world’s GDP), of a comparable weight to North America and superior to those of Japan and China combined. It received 42% of the foreign direct investments made worldwide and each year attracts more than a third of the new flows. With its 500 million inhabitants, the EU carries out 16% of the world’s exports of goods and 27% of the services. Indeed, the combination of technological progress, lower transport costs and policy liberalization in the European Union and elsewhere has led to increasing trade and financial flows between countries, which had important consequences for the functioning of the EU economy.
While globalization brings huge benefits and opportunities, it also means that Europe has to face broader competition as well as increasing political and environmental responsibility towards the rest of the world. As many (such as the former French President Jacques Chirac) argue the negatives effects of American globalization, could it nevertheless also be a necessity for the EU’s future economy?
By Capucine Tong