economic integration and the euro the united states of europe
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Economic Integration and the Euro
The United States of Europe
A. Economic IntegrationHighly successful since beginnings of the EEC Improved trading relations
Fewer trade wars, disputes, retaliatory measures Greater cooperation: sharing markets and transport networks
Higher growth in volume of intraregional (international) trade than that between non-EU industrialized countries
Single market reduces barriers to trade: administrative (institutional decision making/national economic
policy) and, technical (non-standard forms of production and business, e.g.
European single currency (EMU), national laws governing quality standards)
New Infrastructures designed and built according to new EU institutional contexts
New geography of Integration being established
Euro Tunnel: New Landscape of Integration
A. Economic Integration (cont.)New geography of Integration being establishedSome stats:
In 1983, <50% of trade in Denmark, Finland, Iceland, Italy, UK was with European countries
Over 50% in all 5 countries by 1992. Older EEC countries well over 70% (especially Benelux)
Recent non-EU countries have also experienced greater economic integration since joining
European Regional Development Fund (ERDF) Funds infrastructural development Fosters greater integration
New Bridge spanning the CorinthGulf Strait
Rotterdam, “Germany’s largest port”
A. Economic Integration (cont.)Recent non-EU countries have also experienced
greater economic integration since joining European Regional Development Fund (ERDF)
Funds infrastructural development Fosters greater integration
So what are the advantages?Why are more and more Europeans buying from
other Europeans? What structural changes have taken place across
Europe?What are the challenges to European integration? Where does the Euro fit in?
A. Economic Integration (cont.)Why integration?Facilitated by reduction of trade barriers to create a
single marketGlobal trend of accelerated mergers, take-overs
and consolidation foster horizontal as well as vertical linkages (to remain competitive)
Growth of European multinationals BP (UK) Unilever (Netherlands) Daimler-Chrysler (Germany)
Euro is key ingredient of European Economic integration
Revenue no longer related to foreign exchange rates
B. Introducing the EuroEuro is key ingredient of European Economic integration
B. Introducing the EuroEuro is key ingredient of European Economic integrationAdopted on January 1, 2002.12 member states currently use the Euro: Belgium,
Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland
Culturally symbolic of integration and unity
See “Striking Stories: a political geography of eruo coinage,” Political Geography 23 (2004) 929-956
Currency of the Generation ‘E’
B. Introducing the EuroEuro is key ingredient of European Economic integrationAdopted on January 1, 2002.12 member states currently use the Euro: Belgium,
Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland
Culturally symbolic of integration and unity Illustrates the uneven integration of Europe, even
within the EUAdoption of Euro as challenge to continued EU
integrationCloser regional ties among ECU countries
Regionalism Toward IntegrationEuropean Integration is not an even processRegional blocs even within Europe
Reflect levels of developmentEstablished trading partnershipsPropinquityAdoption of the Euro
Still remain non-EU alliancesEFTA (European Free Trade Association; 1960)EEA (European Economic Area; 1990s)
Regionalism Toward IntegrationEuropean Integration is not an even process
Regional blocs even within Europe Reflect levels of development Established trading partnerships Propinquity Adoption of the Euro
Still remain non-EU alliances EFTA (European Free Trade Association; 1960) EEA (European Economic Area; 1990s)
SummaryEconomic Integration is driving cultural and political
integrationAdoption of the Euro is key to creating a fully
integrated, unimpeded European Economic space
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