Economic Integration

1. EconomicIntegration a state of affairsor a processwhichinvolvestheamalgamation of separateeconomiesintolargerfreetradingregions. Three levels of economic integration Global: trade liberalization by GATT or WTO Regional: preferential treatment of member countries in the group Bilateral: preferential treatment between two countries Regional and bilateral agreements are against the MFN clause (normal trading relations), but allowed under WTO.

2. Stages of EconomicIntegration • Freetradeareas • Customsunions • Commonmarkets • Completeeconomicunions • Completepoliticalunions

3. Stages of EconomicIntegration • FTA (free trade area): • no internal tariffs among members, but each country imposes its own external tariffs to the third country. • NAFTA (North America Free Trade Agreement • AFTA (ASEAN Free Trade Area) • EFTA (European Free Trade Area) • Customs union: • no internal tariffs and common external tariffs • Mercosur (Southern Common Market), • CACM (Central American Common Market) • CARICOM (Caribbean Community and Common Market)

4. Stages of EconomicIntegration • Common market: • free movement of products and factors (resources), which is customs union plus factor mobility • EU (European Union – previously EEC) • Economic union: • common market plus common currency • coordination of fiscal and monetary policy • EMU (Economic and Monetary Union)

6. Effects of EconomicIntegration • Static effects: Short-term effects (shift of production) • Trade creation: production shifts to more efficient member countries from inefficient domestic or outside countries. • Trade diversion: production shift to inefficient member countries from more efficient outsiders. • Dynamic effects: Long-term effects • Cost reduction due to economies of scale • Cost reduction due to increased competition.

9. EUROPEAN UNION Over 500 millioncitizens Largesteconomy in theworld: €12.0 trillion ($16.6 trillion) GDP in 2012 GDP percapita: $33,000 (nominal), $32,021 (PPP) GDP bysector: 70.5% services, 27.3% industry, 2.1% agriculture

10. WorldTrade in Goods

11. World Trade in Commercial Services

16. Short History • Pre-1945: Pan-EuropaMovement (1923) Pan-Europa manifesto by Richard NikolausvonCoudenhove-Kalergi • After 1945: Winston Churchill’s 1946 call for a "United States of Europe“ • Robert Schuman: SchumanDeclaration in May 1950 (proposal of a community to integrate the coal and steel industries of Europe) • TheSix: France, Italy, Belgium, NetherlandsandLuxembourg, West Germany • Treaty of Paris (1951): European Coal and Steel Community (ECSC)

17. Treaty of Rome (1957) • European Economic Community (EEC) • European Atomic Energy Community (Euratom) • Merger Treaty (1967) • European Communities • Maastricht Treaty (1 November 1993) • European Union

18. Enlargement • 1973: Ireland, UK, Denmark • 1981: Greece • 1986: SpainandPortugal • 1995: Austria, Sweden, Finland • 2004: CEEC-10 (Malta, Cyprus, Estonia, Latvia, Lithuania, Poland, CzechRepublic, Slovakia, Slovenia, Hungary) • 2007: Bulgaria, Romania • 2013: Croatia

19. Institutions of the EU Themember states of the EU remain independent sovereign nations but they pool their sovereignty in order to gainstrength and world influence. The member states delegate some of their decision-making powers to shared institutions they have created, so that decisions on specific matters of joint interest can be made democratically at European level. The EU is governedby 7 institutions

20. Institutions of the EU PoliticalInstitutions • European Parliament • EuropeanCouncil • Council of the European Union • European Commission Non-politicalInstitutions • Court of Justice of theEuropeanUnion • EuropeanCourt of Auditors • EuropeanCentral Bank

21. Institutions of the EU Non-politicalinstitutions • EuropeanCourt of Justice • upholdstherule of Europeanlaw • EuropeanCourt of Auditors • checksthefinancing of theEU’sactivities.

22. European Commission • the executive arm of the EU • develop medium-term strategies • draft legislation and arbitrate in the legislative process • represent the EU in trade negotiations • make rules and regulations • draw up the budget • with the ECJ, it acts as the guardian of theEU treaties by enforcing EU law

23. EuropeanCommission • TheCommissionconsists of 28people (Commissioners) — onefromeach EU country. • Each member is appointed by a national government, but they do not represent their state in the Commission. • The President of the Commission is first nominated by the European Council; that nominee is then officially elected by the European Parliament

24. A newCommission is appointedeveryfiveyears, withinsixmonths of theelectionstothe EP. • JoséManuelBarrosopresident since November 2004 (re-elected in 2009) • President of EC is Jean-ClaudeJunckerafterNovember 2014

25. Directorates-General (DG) The Commission is divided into several departments and services. The departments are known as Directorates-General (DGs)

26. Directorates-General • HomeAffairs (HOME) • HumanitarianAid (ECHO) • HumanResourcesandSecurity (HR) • Informatics (DIGIT) • Internal Market andServices (MARKT) • Interpretation (SCIC) • JointResearchCentre (JRC) • Justice (JUST) • MaritimeAffairsandFisheries (MARE) • Mobilityand Transport (MOVE) • RegionalPolicy (REGIO) • ResearchandInnovation (RTD) • Secretariat-General (SG) • Service forForeignPolicyInstruments (FPI) • TaxationandCustomsUnion (TAXUD) • Trade (TRADE) • Translation (DGT) • AgricultureandRuralDevelopment (AGRI) • Budget (BUDG) • ClimateAction (CLIMA) • Communication (COMM) • Communications Networks, ContentandTechnology (CNECT) • Competition (COMP) • EconomicandFinancialAffairs (ECFIN) • EducationandCulture (EAC) • Employment, SocialAffairsandInclusion (EMPL) • Energy (ENER) • Enlargement (ELARG) • EnterpriseandIndustry (ENTR) • Environment (ENV) • EuropeAidDevelopment & Cooperation (DEVCO) • Eurostat (ESTAT) • HealthandConsumers (SANCO)

27. President of the Council • The President of the European Council is the person responsible for chairing and driving forward the work of the European Council. • Thecurrentpresident is Herman Van RompuyfromBelgium. • Donald TuskfromPoland takingoffice on 1st December 2014

28. European Parliament • shares the legislative and budgetary authority of the Union with the Council • elected every 5 years by universal adult suffrage and sit according to political allegiance • Located in Strasbourg and Brussels

29. European Parliament • accession by new member nations; • association agreements with non-members; • the conclusion of international agreements; • decisions affecting the right of residence for EU citizens; • its own electoral procedures; • the task and powers of the ECB

30. The President of the European Parliament presides over the debates and activities of the European Parliament. He or she also represents the Parliament within the EU and internationally. The President's signature is required for enacting most EU laws and the EU budget. • Presidents serve two-and-a-half-year terms • The current President is Martin Schultz

31. EuropeanParliament: Committees • Regional Development • Agriculture and Rural Development • Fisheries • Culture and Education • Legal Affairs • Civil Liberties, Justice and Home Affairs • Constitutional Affairs • Women's Rights and Gender Equality • Petitions • Human Rights (Subcommittee) • Security and Defence (Subcommittee) • Foreign Affairs • Development • International Trade • Budgets • Budgetary Control • Economic and Monetary Affairs • Employment and Social Affairs • Environment, Public Health and Food Safety • Industry, Research and Energy • Internal Market and Consumer Protection • Transport and Tourism

32. EuropeanParliament: Groups • European People's Party (EPP) • Progressive Alliance of Socialists and Democrats (S&D) • Alliance of Liberals and Democrats for Europe (ALDE) • The Greens–European Free Alliance (Greens–EFA) • European Conservatives and Reformists (ECR) • European United Left–Nordic Green Left (GUE-NGL) • Europe of Freedom and Democracy (EFD) • Non-Inscrits (NI)

33. EuropeanParliament: Groups

34. Institutional Reform European Constitution • replace the existing Treaties of the EU • give limited legal force to the Charter of Fundamental Rights • ExpandQualified Majority Voting into policy areas which had previously been decided by unanimity among member states

35. EuropeanConstitution • signed in October 2004 by representatives of the 25 member states • 13 member states completed the ratification procedure • French and Dutch voters rejected in 2005 • the future of the Constitution?

36. LisbonTreaty • 13 December 2007: Lisbon Treaty • must be ratified by all Member States • Ireland: the only member state to hold a referendum • rejected on 12 June 2008 • approved on 2 October 2009 • Entered into force on 1 December 2009

37. Policies of the EU • Agriculture, fisheries and food • Business • Climate action • Cross-cutting policies • Culture, education and youth • Economy, finance and tax • Employment and social rights • Energy and natural resources • Environment, consumers and health • External relations and foreign affairs • Justice, home affairs and citizens' rights • Regions and local development • Science and technology • Transport and travel

38. Agriculture, fisheries and food • Agriculture and Rural Development • Agricultural markets • CAP (Common Agricultural Policy) • Rural development • Fisheries • Aquaculture • CFP (Common Fisheries Policy) • Food safety • Animal diseases • Animal welfare • Food labelling • Food quality • GMOs • Plant health

39. Business • Enterprise • Enterprise policies • Free movement of goods • Industry sectors • Small and Medium-sized enterprises • Your Europe - Business • Internal market • Competition • Competitiveness and Innovation Framework Programme • Free movement of services • Market access

40. ClimateAction • 2030 Framework on climate and energy • Citizens' information • EU Climate Action • Policy

41. Cross-cuttingpolicies • Better Regulation • Europe 2020 - strategy for growth and jobs • Impact assessment of new initiatives • Multilingualism

42. Culture, educationandyouth • Audiovisual and media • Media Coordination (MTF) • Culture • Culture • Education and training • Education and Training policy • Erasmus+ • Languages and multilingualism • Sport • Youth • European Youth Portal

43. Economy, financeandtax • A Single Market for Capital • Better access to finance • Financial services • Free movement of capital • Budget • EU Budget • Reforming the Budget, Changing Europe • Competition • Anti-trust • Cartels • Information for Consumers • International • Liberalisation • Mergers • State aid

44. Economy, financeandtax • Customs • Tariffs • Economy • Economic policies • Euro • Fight against fraud • OLAF (European Anti-Fraud Office) • Taxation

45. Employmentandsocialrights • European Globalisation Adjustment Fund • European Social Fund • Funding for employment and social solidarity • Gender equality • Health and safety at work • Labour law • More and better jobs • Pensions • Social and demographic trends • Social dialogue • Social inclusion • Social protection • Working abroad

46. Energyandnaturalresources • Energy policies • Energy strategies • Sustainable and responsible business • Trans-European networks

47. Environment, consumers and health • Consumers • Chemicals • Consumer protection and rights • Environment • Air • Chemicals • Civil protection • Nature and Biodiversity • Noise • Soil • Waste • Water • Health • Drugs • Human diseases • Medicines • Tobacco

48. External relations and foreign affairs • Common Foreign Security Policy (CFSP) • Civilian Crisis Management • Conflict Prevention • Development and Developing countries • Enlargement • European Neighbourhood policy • European Union in the World • External Cooperation Programmes • Peacekeeping operations • Foreign policies • Humanitarian aid (Humanitarian Aid department - Echo) • International trade and trade agreements (External trade)

49. Justice, home affairs and citizens' rights • Citizens' rights • Childrens' rights • Data protection • Disabilityissues • EU citizens' rights • Fundamentalrights • Tacklingdiscrimination • Homeaffairs • Asylum • Borders & bordercontrol • Fightagainstcrime • FightagainstTerrorism • Immigration • Policematters • Schengen • Visa • Justice • Criminaljustice • Drugtrafficking • Judicialcooperation

50. Regional policy • Cohesion Fund • European Regional Development Fund • European Social Fund • The European Union Solidarity Fund