The European Union consists of twenty-seven independent member states, located mostly in Europe.  The Union was established in 1993 by the Treaty of Maastricht, for which it added new policy areas to the European Community, which was founded in 1957.  The importance of the European Union is undeniable as it is established to develop economic, political and social cooperation among its members.   Today, the European Union has become the world’s largest economy as measured by gross domestic product, being the largest external trader in the world with a market size of 450 million people.  The European Union has also enhanced a single market that follows a uniform system of laws, which functions in all of its members.  The union has a currency, the euro, which is fast establishing itself as being the world’s second most important currency next to the dollar, although only 15 of the member states have adopted it.

 

The European Union is a unique political and economic community.  It is unlike the United Nations, which is an organization composed of cooperating governments; nor is it a federation like the United States of America.  The countries that comprise the European Union retain their independent autonomy. However, they pool their sovereignty so as to come out stronger as one, gaining world influence, for which none of them would be able to achieve if they were to do it individually. The member states do this by delegating some of their decision-making powers to communal institutions that democratically resolve and govern matters of Union-wide interest. The European Union has a flag with a blue background containing twelve gold stars; the number stands for perfection and completeness.

 

CURRENT MEMBERS OF THE EUROPEAN UNION

The European Union currently has twenty-seven member countries, namely: Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, United Kingdom, Romania, and Bulgaria.  The last two aforementioned countries became new EU members on January 1, 2007, as the second part of the fifth enlargement of the European Union. 

 

FUTURE MEMBERS OF THE EUROPEAN UNION

 

The European Union is currently on the progress of its upcoming enlargements.  Candidate countries that are expected to join EU in the future are Croatia, Former Yugoslav Republic of Macedonia, and Turkey.  Forecasted joining date of Croatia is in 2010 while the other two are estimated to join in 2015.  Potential candidate countries that may join the EU depending on their fulfillment of the adhesion criteria include Albania, Bosnia & Herzegovina, Montenegro, Serbia, and Kosovo. 

 

 

HISTORY

 

The European Union was established with an aim to permanently halt the intermittent and violent wars among neighbors — conflicts that in the past have tragically culminated in the Second World War.  In 1950, European countries united politically and economically to attain continual peace. As a result, the European Coal and Steel Community was formed, with the objective to unify the coal and steel industries of its proponent states as these two were the main resources that wars were fought over. The Community was founded by six member countries namely Belgium, Italy, Luxemburg, Germany, France, and the Netherlands.

 

In 1957, the Treaty of Rome created the European Economic Community, which created a single market among its member countries, and the European Atomic Energy Community, which paved the way for the collaboration in nuclear energy development.

 

In 1967, the “European Communities” was formed, which was a single set of institutions for the three communities.  On January 1, 1973, the United Kingdom, Denmark, and Ireland joined the European Communities.  During this decade, the EU regional policy began to allocate funds to create jobs and infrastructure projects in less developed regions.  The European Parliament also amplified its influence in EU affairs. 

 

In 1979, the democratic elections of the members of the parliament were held in which all members were able to directly elect their members for the first time. 

 

In 1981, Greece joined in as the tenth member of the EU, followed by Portugal and Spain in 1986. 

 

In 1986, the Single European Act was signed, which came into force the following year.  The act introduced measures that established a single European market, along with institutional transformations and the European Political Cooperation.

 

In 1993, the single market was completed, which guarantees freedom of movement for people, money, goods, and services.  On the same year, the Maastricht Treaty was formed which contained revisions, and then it was amended through the Amsterdam Treaty signed on 1997 which came into force in 1999.  The treaty also incorporated the Schengen agreements into the law of the European Union, which allowed people to travel without having their passports checked at the borders.

 

In 1995, Sweden, Austria, and Finland joined the EU.  In 2002, twelve member states adopted the euro as a single currency; the number eventually increased into fifteen.  In 2004, ten more countries joined the EU and in 2007, even more countries joined in.  

 

 

THE THREE PILLARS

 

The political panorama of the European Union is divided into three pillars, namely:

 

1. European Community, a supranational element, seeking balanced economic progress through the establishment of a customs union, the inclusion of other parts of Europe into the combine, and the development of policies for transport, trade, and agriculture.  

 

2. Common Foreign and Security Policy, an intergovernmental element, which aims to strengthen the security of the EU, preserve peace & strengthen international security and protect the basic interests, independence, common values, and integrity of the Union in accordance with the UN Charter principles, enhance international co-operation, and lastly, advance and strengthen democracy & the rule of law and respect for human rights & freedoms. 

 

3. Police and Co-operation in Criminal Matters, another intergovernmental element, with an aim to provide citizens with maximum safety within a perimeter of security, justice, and freedom through preventing and fighting against crimes, which include terrorism, racism, illegal drug or weapon trafficking, corruption & fraud, and person & child trafficking. 

 

INSTITUTIONS

 

The decision-making process and co-decision procedure of the EU involve three primary institutions:  the European Commission, aiming to uphold the interests of the Union in general, the Council of the European Union, representing the individual member states, and the European Parliament, representing the EU’s citizens and is directly elected by them.  These three institutions create the policies and laws that are applied all through the European Union, with specifically the Commission proposing new laws, and the Parliament and Council adopting them.  Two other institutions include the Court of Justice, upholding the rule of law, and the Court Auditors, checking the finances of the EU’s activities. 

EFFECTS OF THE TRANSITION TO EURO

The euro was not created to contend with the dollar, but it was created to greatly influence the markets in essential ways.  Indeed it has brought significant changes for business within the EU countries and all throughout Europe.  Being a single currency, it enables countries in the euro zone to trade with each other without having to change their currencies thereby lessening the transaction costs.  This way, euro has made travel and business simple and convenient.  The euro also has stabilized exchange rates since the single currency have removed exchange rates between countries in the euro zone.  Thus, it has become a major factor in the international bond markets.  The euro also helps fight inflation as easily compared prices are created across Europe.