The Trade in the European Union - Assignment Example

European trade A. Carefully explain and assess the implication of this ment in relation to EU trade relations with the rest of the world European Union has been traditionally considered as a community of interests of all types (financial, cultural, social). In this context, the development of common practices by the countries participated in the Union should be regarded as a normal phenomenon if taking into account the turbulences occurred in the international market. Regarding this issue, the study of Archick (2005, 4) showed that the European Union should be regarded as a ‘treaty-based, institutional framework that defines and manages political and economic cooperation among its 25 member states (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)’. In the near future more states are going to be added to the above list. The decision on the requirements related with the entrance of a new country in the Union is taken within the Union in a relevant meeting of the representatives of the member states. It is this ‘body’ that also decides for the policies followed in all sectors of European Union including the commerce. It should be noticed though that specific criteria should be used for the above decision otherwise the relevant decision can be doubted from the interested parties (potential members of the Union) as of its validity and credibility. On the other hand, in a relevant report published in Social Education (2002, 1) it is noticed that “the EU has a unique structure; it was created by and is composed of sovereign countries; but it is more than an international organization; it has common institutions similar to those of a national government in that they can enact and implement laws throughout EU territory; these institutions also formulate Europes `common policies, for example in trade, agriculture, transport and the environment, which are paid for by the EUs own budget’. In accordance with the above, European Union has a particular character which is related with the characteristics of the member states. It is for this reason that any decision taken in the context of the community has to be verified by the appropriate ‘body’ in accordance with the nature of issue under examination. The use of treaties for the creation of standard practices in the community is a common practice among the member states. Regarding this issue, it is stated by Savage (2001, 46) that ‘treaties and other forms of budgetary agreements create potential compliance and free rider problems which can be confronted through the following four principal steps: a) the drafting of strict budgetary rules and agreements to reduce potential gimmickry and strategic misrepresentation; b) the dutiful enactment and implementation of legislation that seeks to meet the goals and targets specified in those agreements; c) the monitoring of behaviour to determine if compliance is occurring; and d) the imposition of appropriate positive and negative sanctions’. However, it should be noticed that the above provision is not followed strictly in practice but other – most convenient tools – are used in order to implement specific policies within the Community. The choice usually belongs to the policy – maker who has the responsibility for the success of the procedure of implementation (which will prove the effectiveness of the strategy proposed). On the other hand, Begg et al. (2003, 69) supported that ‘although the current policymaking system has worked procedurally, it has been fragmented and has had a patchy record in terms of implementation and outcomes that has led to calls for improvement; the watchword at present for institutional change is streamlining, the aim of which is to synchronise the different processes and timetables’. It could not be stated however that the use of the appropriate policies can guarantee the success of the strategies attempted to be implemented. In fact it is an issue of appropriateness of the relevant strategy which is going to be examined by the authorized bodies of the European Union. Towards this direction, it is supported in a report published in the World Economic Outlook (1994, 102) that ‘for countries that do not trade heavily with Europe, the effects of the continuing regional integration in Europe are likely, on balance, to be relatively small; however for the countries geographically closer to the European integration process, the concerns may be more complex’. In other words, the level of dependency on the European policies (either of commerce or of other European strategies) is related with the nature of the particular interest (whether it belongs to the industrial sector or it is just an element of cultural interest). The intervention of the authorized bodies of European Union will help towards the identification of the most appropriate practices in cases where the power of a specific authority in the European Union has to be examined in accordance with the creation of specific interests in favour of certain states causing damages to other states (usually the developing countries). For this reason, it is supported that ‘to the extent that they lag in their access to western European markets, the countries with a low performance in the area of investment may have greater difficulty in attracting investment than countries on a faster integration track; this applies also to the countries in transition that have not benefited from as liberal terms as the countries covered by the association agreements with the EU’ (World Economic Outlook, 1994, 102). The existence of specific interest as well as the credibility of specific actions related with the trade in the European Union are usually examined using the principles that constitute the fundamental paper of the European Union as they have been alternated after the implementation of new, more completed rules. B. in 18 December 2005 , the EU commission announced that it would be phasing-out all export subsidies currently granted to exporters in the European Union Critically discuss the likely implications for EU exports of the phasing-out of export subsidies The decision over the policies followed by EU in the trade sector (as in other sectors related with the European market) belongs to the European Commission. However, the practices followed by the Union have not been standard. More specifically, it has been proved that ‘until the mid-1980s, market integration within the EU was founded principally on the absence of both tariffs and quantitative restrictions on intra-EU trade and on a common external tariff; these proved inadequate to realize the goal of a common market, owing to national prerogatives in regulating domestic markets and the associated border controls however the unveiling of the internal market program in 1985 signaled a concerted effort to eliminate most physical, technical, and fiscal barriers to market integration by end-1992’ (World Economic Outlook, 1994, 98). Through the time, the influence of the particular aspects of the economies of member states on the policies implemented in the context of the European Union has been differentiated (in fact it has been increased). This phenomenon can possibly explain the reason why EU commission decided to phase out ‘all export subsidies currently granted to exporters in the European Union’. An appropriate explanation could be perhaps the fact that policy coordination has not reached the necessary level within the European Union. For this reason every member states tries to impose the policies that promote its own interest (although in many cases there are common interests among the states). Regarding the above it has been found that ‘policy coordination can be defined as supranational rules or norms which are agreed by all Member States, leave primary responsibility for the policy area with national authorities, but set limits on their discretion; action to enforce the rules or, at least, to assure conformity with the spirit of shared policy aims will be triggered if there is a failure to keep within the parameters set by the legislation’ (Begg et al., 2003, 66). The existence of coordination in the procedure of implementing a particular policy in the context of the European Union is necessary. In the particular case, the consent of the member states on the decision of the European Union to phase out the export subsidies granted to exporters in European Union should be highly doubted. At a next level, it has been stated that “EU double standards on trade policy are a disgrace; the EU forces Third World countries to open their markets at breakneck speed, while maintaining barriers to Third World exports, particularly farm products and textiles; the EU does further damage to livelihoods in the developing world by dumping highly-subsidised agricultural surpluses with which small farmers cannot compete’ (Jensen, 2005). In other words, practices followed by the European Union in the area of trade (including the issue under examination) should be reviewed as of their feasibility and their appropriateness particularly in countries where the standards of living are at very low level. In this context, the particular decision of the European Union should be characterized as inappropriate regarding the target set by the European bodies – the promotion of the interests of the European Union in favour of its members. C. Assess the significance of these of sale: Ex-works free on board (FOB) and Delivered duty paid (DDP) in international trade Both the above practices are important for the international trade. Generally, it is stated by Bolin (2006, 189) that “with the expansion of the European Union eastwards, nations have adopted various strategies for being included in the European community; the phenomenon is in fact not new, as the marketing of nations has occurred since at least the World’s Fairs of the 19th century; however, while the World’s Fairs addressed the nation-states of high industrialism, cultural technologies are the features used in a post-industrialized context, where it is more important to impress with abilities of symbolic production rather than with traditional industrial production”. In this context, the introduction and the application of specific practices while making business in the international community is a common phenomenon. On the other hand, it is stated by Begg et al. (2003, 66) that ‘article 99 of the European Community Treaty calls on Member States to regard economic policy as a matter of common concern and to coordinate their policies within Council (and through a range of committees and mechanisms) with a view to achieving, inter alia, stable and noninflationary growth; it is, however, sometimes hard to ascertain where effective control lies in a system that involves so many players’. In accordance with the above every policy implemented in the context of the European Union should be followed by all member states no matter its importance for the completion of the required task. In the international market, the application of specific practices and ethics is an issue that has been doubted extensively by the relevant Bodies. Generally, it could be stated that the methods used by European Union in order to cooperate commercially with the countries of the international market are many. However, there are some issues that need to be taken into consideration when evaluating a particular strategy (financial or not) in the context of the European Union: ‘what is good for European big business is good for developing countries, and free trade is good for everyone; in reality, European governments are turning a collective blind eye to any negative impacts of these policies on local income and employment, on poor people’s access to essential services, and on national development processes’ (Jensen, 2005). On the other hand, because within the European Union the decision on the practices followed by its members is taken following a system of ‘majority’, it should be considered that any relevant decision is sufficiently and appropriately justified. In many cases, this assumption has not been verified by the practices that follow the implementation of a particular strategy. The appearance and the intervention of specific interests from the site of particular member states during the phase of the implementation of a new policy within the European region should be considered as the major reasons for this situation. References Archick, K. (2005). The European Union in 2005 and Beyond. The library of Congress Begg, I., Hodson, D., Maher, I. (2003) Economic Policy Coordination in the European Union. National Institute Economic Review, 66-80 Bolin, G. (2006) Visions of Europe: Cultural Technologies of nation-states. International Journal of Cultural Studies, 9(2): 189-206 Savage, J. (2001). Budgetary Collective Action Problems: Convergence and Compliance under the Maastricht Treaty on European Union. Public Administration Review, 61(1): 43-49 Social Education (2002) What in the World Is the European Union? 66(7):1 World Economic Outlook (1994) European Economic Integration, 98-104 Read More