The process of framing EU policies focus on its capacity to respond to global challenges. The single market benefits from high-quality and transparent rules that make it possible to benefit from economies of scale. Competition in single market encourages businesses to provide high-quality products. EU does not rely on single mechanism to tackle trade barriers. EU’s multilateral cooperation is strengthened by bilateral Free Trade Agreements with ASEAN, Korea, India, the Andean and Central American countries.
EU accounts for 20% of global imports and exports. Open trade among its members countries have brought growing prosperity to all its member states. The Union opened up world trade for the benefit of developed and developing economy. Competition between imports and domestic products results in lower prices and higher quality standards. EU’s globalization policies and multilateral cooperation helps in integrating the developing economies with developed economies. EU provides the developing countries with a better access to its market, while encouraging them to open their markets to European products.
Under “generalized system of preferences” (GSP), the EU began removing tariffs and quotas on its imports from developing countries. It also grants almost 50 least-developed countries free access to the EU market.
The trading countries classified into 3 categories are:
Priority Markets – China, India, Mexico, Brazil and Argentina are the priority markets. These are considered priority markets because of their trade potential for EU exports or supply of raw materials, the existence of serious Market Access problems and the perspective of a Free Trade Agreement.
Important Markets – Russia, the US, Japan, Thailand, Egypt and Pakistan have been qualified as important markets where trade barriers still hamper EU exports or supply of raw materials.
Easiest Markets – South Korea, Canada, Australia, Taiwan, Indonesia, Malaysia and South Africa. These are considered as easy markets due to Market Access regulatory improvements, reduction of trade flows or a lower interest of EU companies.
EU trade statistics 2008:
EU Area1 (EA15) trade balance with the rest of the world in April 2008 gave a 2.3 bn euro surplus, compared with +2.0 bn in April 2007. Extra-EU271 trade balance was a deficit of 15.4 bn euro, compared with -12.9 bn in April 2007.
The EU27 energy deficit increased (-88.0 bn euro in 1Q 2008 compared with 1Q 2007), while the surplus rose for machinery and vehicles (+34.0 bn compared with +24.0 bn).
EU27 trade with most of its major partners grew, with the exception of exports to Japan and the USA, and imports from Japan and the USA. The largest increases were recorded for exports to Russia and Brazil, and for imports from Russia and Norway.
The EU27 trade surplus fell with the USA (+15.8 bn in 1Q 2008 compared with the 1Q 2007) and Switzerland (+3.2 bn).
The EU27 trade deficit grew with Russia (-18.8 bn compared with -14.2 bn) and Norway (-12.1 bn compared with -8.6 bn), but decreased with China (-38.4 bn compared with -39.7 bn) and remained stable with Japan.
Concerning the total trade of Member States, the largest surplus was observed in Germany (+50.4 bn euro in 1Q 2008), followed by the Netherlands (+10.9 bn). The United Kingdom (-34.0 bn) registered the largest deficit, followed by Spain (-26.7 bn), France (-14.5 bn) and Greece (-9.0 bn).
