European Union (EU)
The European Union (EU) is an intergovernmental and supranational union of 25 democratic member states. The European Union was established under that name in 1992 by the Treaty on European Union (the Maastricht Treaty). However, many aspects of the Union existed before that date through a series of predecessor relationships, dating back to 1951.
The Union currently has a common single market consisting of a customs union, a single currency managed by the European Central Bank (so far adopted by 12 of the 25 member states), a Common Agricultural Policy, a common trade policy, and a Common Fisheries Policy. A Common Foreign and Security Policy was also established as the second of the three pillars of the European Union. The Schengen Agreement abolished passport control, and customs checks were also abolished at many of the EU's internal borders, creating a single space of mobility for EU citizens to live, travel, work and invest.
The most important EU institutions include the Council of the European Union, the European Commission, the European Court of Justice, the European Central Bank and the European Parliament. The European Parliament's origins go back to the 1950s and the founding treaties, and since 1979 its members have been elected by the people they represent. Every five years elections are held in which registered EU citizens may vote.
The European Union's activities cover all areas of public policy, from health and economic policy to foreign affairs and defence. However, the extent of its powers differs greatly between areas. Depending on the area in question, the EU may therefore resemble a federation (e.g. on monetary affairs, agricultural, trade and environmental policy, economic and social policy), a confederation (e.g. on home affairs) or an international organisation (e.g. in foreign affairs).
The members of the European Union have transferred to it considerable sovereignty, more than that of any other non-sovereign regional organisation. As has been mentioned, in certain areas the EU begins to take on the character of a federation or confederation. However, in legal terms, member states remain the masters of the Treaties, which means that the Union does not have the power to transfer additional powers from states onto itself without their agreement through further international treaties. Further, in many areas member states have given up relatively little national sovereignty, particularly in key areas of national interest such as foreign relations and defence. Because of this unique structure most simply classify the European Union as a sui generis entity and leave it at that.
On October 29, 2004, EU member state heads of government and state signed the Treaty establishing a Constitution for Europe. This has been ratified by 13 member states and is currently awaiting ratification by the other states. However, in most cases ratification was based on parliamentary action, rather than popular vote, and the process faltered on May 29, 2005 when the majority of French voters rejected the constitution in a referendum by 54.7%. The French rejection was followed three days later by a Dutch one on June 1 when in the Netherlands 61.6% of voters refused the constitution as well.
The current and future status of the European Union therefore continues to be subject of political controversy, with widely differing views both within and between member states. For example, in the United Kingdom one poll suggested that around 50% of the population are indifferent to the European Union and 20% voted for parties that wanted to withdraw from the EU in the 2004 EU elections. However, other countries are more in favour of European integration — soon after the Netherlands and the French voted "no" on the constitution, the Grand Duchy of Luxembourg voted "yes." What the term "European integration" itself means is also the subject of much debate.
Issues currently facing the EU cover its membership, structure, procedures and policies. They include the status and future of the new constitutional treaty; enlargement to the south and east; problems of financial probity and democratic accountability; relative economic viability; revision of the rules of the Stability and Growth Pact; and the future budget and the Common Agricultural Policy.
At the December 2005 European Council, which is a semi-annual meeting of EU member states' heads of state and government, EU member states decided on how it should allocate the EU budget for the next seven years (2007–2013). Also, the "Financial Perspective" was defined as EU members agreed to fix the common budget to 1.045% of the European GDP. UK Prime Minister Tony Blair agreed to review the British rebate, negotiated by Margaret Thatcher in 1984, despite a promise to the contrary made to the UK Parliament. French President Jacques Chirac declared that this increase in budget will permit Europe to "finance common policies" such as the Common Agricultural Policy or the Research and Technological Development Policy. However, France's demand to lower the VAT in catering was refused.
Issues controversial during upcoming budget debates include the British rebate, France's benefits from the Common Agricultural Policy, Germany and the Netherlands' large contributions to the EU budget, and reform of the European Regional Development Funds.
Many commentators have envisaged these debates to yield a major split between governments such as France and Germany, who call for a broader budget and a more federal union, and governments such as that of the UK, who demanded a slimmer budget with more funding transferred to science and research (and whose watchword is modernisation).
The Treaty establishing a Constitution for Europe (TCE), commonly referred to as the European Constitution, is an international treaty intended to create a constitution for the European Union. The failure of the constitution to win popular support in some member states (France and Netherlands) caused other countries to postpone or halt their ratification procedures, and the Constitution now has a highly uncertain future. Had it been ratified, the treaty would have entered into force on November 1, 2006. However, as of May 2006, Austria, Belgium, Cyprus, Estonia, Germany, Greece, Hungary, Italy, Latvia, Lithuania, Luxembourg, Malta, Slovakia, Slovenia and Spain had ratified the constitutional treaty. The two countries due to join the European Union in 2007, Bulgaria and Romania, have already accepted the constitutional treaty too, ratifying their accession treaty.
Origins and History
Attempts to unite the disparate nations of Europe precede the modern nation states; they have occurred repeatedly throughout the history of Europe. Two and a half thousand years ago, Europe was dominated by the Celts and other tribes which were not a single political entity, and then conquered and ruled by the Mediterranean centred Roman Empire. This early union was created by the force of one central state. The Frankish empire of Charlemagne and the Holy Roman Empire united large areas under a loose administration for hundreds of years. The 1800s customs union under Napoleon and the 1940s conquests of Germany had only transitory existence.
Given Europe's collections of languages, cultures and ethnic groups, these attempts usually involved military subjugation of unwilling nations, leading to instability; others have lasted hundreds of years and promulgated large spells of peace and economical and technological progress as in the Roman Empire's Pax Romana. One of the first proposals for peaceful unification through cooperation and equality of membership was made by the pacifist Victor Hugo in 1851. Following the catastrophes of the First World War and the Second World War, the impetus for the founding of (what was later to become) the European Union greatly increased, driven by the determination to rebuild Europe and to eliminate the possibility of another war. This sentiment eventually led to the formation of the European Coal and Steel Community by (West) Germany, France, Italy and the Benelux countries. This was accomplished by the Treaty of Paris, signed in April, 1951, and taking effect in July, 1952.
The first full customs union was originally known as the European Economic Community (informally called the Common Market in the UK), established by the Treaty of Rome in 1957 and implemented on 1 January 1958. This later changed to the European Community which is now the "first pillar" of the European Union created by the Maastricht treaty. The EU has evolved from a trade body into an economic and political partnership. As president of the Convention on the Future of Europe, the former French president Valery Giscard d'Estaing proposed to change the name of the European Union to United Europe but it was not adopted.
The European Union is a highly populated, culturally diverse union of 25 member states, constantly expanding and developing. Approximately 4.5 percent of the EU population is composed of Muslim (many second and third generation) immigrants, some 20,000,000 persons. These are mainly Magrehbians from North Africa, Turks, and immigrants from the Balkan states. There are small communities of Asians and some sub-saharan populations. Over the next two decades the total population of the EU25 is expected to increase by more than 13 million inhabitants, from 456.8 million on 1 January 2004 to 470.1 million on 1 January 2025. Population growth in the EU25 until 2025 will be mainly due to net migration, since total deaths in the EU25 will outnumber total births from 2010. The effect of net migration will no longer outweigh the natural decrease after 2025, when the population will start to decline gradually. The population will reach 449.8 million on 1 January 2050, that is a decrease of more than 20 million inhabitants compared to 2025. Over the whole projection period the EU25 population will decrease by 1.5%, resulting from a 0.4% increase for the EU15 and a 11.7% decrease for the ten new Member States.
Member states and enlargement
The European Union's 25 member states covers an area of 3,892,685 square kilometres (15,352,86 sq mi) and has approximately 460 million inhabitants as of December 2004. The European Union's member states combined represent the world's largest economy by GDP, the seventh largest territory in the world by area and the third largest by population. The EU describes itself as a "a family of democratic European countries", though it doesn't explicitly define "Europe" and "Europeanness". The European Union has land borders with 22 nations (23 if counting Northern Cyprus).
The six founding members were Belgium, France, West Germany, Italy, Luxembourg, and the Netherlands, which established the ECSC on 23 July 1952 and the European Community on 25 March 1957. Since then, nineteen further states have joined in successive waves of enlargement:
- 1 January 1973 Denmark, Ireland, United Kingdom
- 1 January 1981 Greece
- 1 January 1986 Portugal, Spain
- 3 October 1990 (The territory of the former German Democratic Republic as part of unified Germany also becomes part of the European Community)
- 1 January 1995 Austria, Finland, Sweden
- 1 May 2004 Cyprus1, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, Slovenia
Future enlargement and close relationships
Bulgaria and Romania are scheduled to become members on 1 January 2007, provided that they meet the conditions for membership and that the Treaty of Accession for the Republic of Bulgaria and Romania is ratified by parliaments of member states. The treaty was signed by representatives of the EU Member States at the Abbaye de Neumunster in Luxembourg on 25 April 2005. As of 2005, member state parliaments are taking forward its ratification. On 16 May 2006 an EU report to the European Parliament on the two states entry said that it was still possible for them to enter on schedule but listed areas in which progress had to be made to meet the target date. For Bulgaria this was principally tackling organised crime and for Romania it was in the area of food safety.
Croatia is an official candidate country to join and started accession negotiations in October 2005. In June 2006, the EU officials projected that the accession of Croatia would likely happen in 2010. The closure of negotiations for all chapters of the acquis communautaire is expected in 2008 or 2009, while signing the Accession treaty would happen in the year after.
Turkey is an official candidate to join the European Union. Turkish European ambitions date back to 1963 Ankara Agreements. Turkey started preliminary negotiations on 3 October 2005. However, analysts believe 2015 is the earliest date the country can join the union due to the plethora of economic and social reforms it has to complete, and the fact that the 2007-2013 budget takes no account of the considerable costs Turkey's accession will involve.
Republic of Macedonia has been given official candidate status as of December 2005 under the name "former Yugoslav Republic of Macedonia".
The EFTA states of Iceland, Liechtenstein and Norway are members of the European Economic Area which allows them to participate in most aspects of the EU single market without joining the EU. Switzerland, the fourth EFTA state, rejected EEA membership in a referendum; however, it has established close ties to the EU by means of bilateral treaties.
Context — rationale for enlargement and future prospects
Supporters of the European Union argue that the growth of the EU is a force for peace and democracy. They argue that the wars which were a periodic feature of the history of Western Europe have ceased since the formation of the European Economic Community (which later became the EU) in the 1950s. They also claim that in the early 1970s, Greece, Portugal and Spain were all dictatorships, but the desire of the business communities in these three countries to be in the EU created a strong impetus for democracy there. Others argue that peace in Europe since World War II is more due to other causes, such as the moderating influence of the USA and NATO, the need for a unified response to the threat from the Soviet Union, a need for reconstruction after World War II, and a collective temporary tiring of waging war, and that the dictatorships cited came to an end for totally different reasons.
In more recent times, the European Union has been extending its influence to the east. It has accepted several new members that were previously behind the Iron Curtain, and has plans to accept several more in the medium-term. It is hoped that in a similar fashion to the entry of Spain, Portugal and Greece in the 1980s, membership for these states will help cement economic and political stability.
As the EU continues to enlarge eastward, the candidate countries' accessions tend to grow more controversial. As previously explained, the EU has finished accession talks with Bulgaria and Romania, and set an entry date for the two countries in 2007. However, the rejection of the EU Constitution by France and the Netherlands, and the EU's slow economic growth, have cast some doubt on whether the EU will be ready to accept new members after 2007, when Romania and Bulgaria are set to join EU (in early 2005 they signed the Accession Treaty).
Institutions and legal framework
The functioning of the European Union is supported by the five institutions, as enumerated in the Maastricht Treaty:
- The European Parliament (732 members 750 max.)
- The Council of the European Union (or 'Council of Ministers') (25 members)
- The European Commission (25 members)
- The European Court of Justice (incorporating the Court of First Instance) (25 judges (& 25 judges of CFI))
- The European Court of Auditors (25 members)
- The European Council, which is a regular meeting of the 25 head of member states and the European Commission president is sometimes also listed as an institution, although since it lacks its own staff, budget and the legal powers held by the above 5 institutions, it is better described as a "quasi-institution".
There are two financial bodies:
- European Central Bank (which alongside the national Central Banks, composes the European System of Central Banks)
- European Investment Bank (including the European Investment Fund)
There are also two advisory committees to the institutions:
- Committee of the Regions, advising on regional issues
- Economic and Social Committee, advising on economic and social policy (principally relations between workers and employers)
There are also a great number of bodies, usually set up by secondary legislation, which exist to implement particular policies. These are the agencies of the European Union. Examples are the EUROPOL (the European Police Office), the European Environment Agency, the European Aviation Safety Agency or the Office for Harmonisation in the Internal Market, the Political and Security Committee, established in the context of the Common Foreign and Security Policy, monitoring and advising on international issues of global security.
Location of EU institutions
As soon as the European Economic Community (EEC) was established, political and legal wrangling began over where the European institutions should be located. The Member States were unable to reach agreement on where the permanent seats should be, particularly since the concept of a European district, proposed by Jean Monnet, won little support. From 1958, the Commissions of the EEC and the European Atomic Energy Community (EAEC or Euratom) had their seats in Brussels.
Until such time as the member states reached agreement on a single permanent seat for the Community institutions, European officials were distributed between Brussels, Luxembourg and Strasbourg, leading, in particular, to a considerable increase in overheads. Brussels was chosen as the seat of the Single Commission and the Council of Ministers. In practical terms, this meant that most European officials were employed there. Luxembourg sought compensation for the loss of the High Authority and the Special Council of Ministers of the European Coal and Steel Community (ECSC), both of which were relocated to Brussels. However, Luxembourg became the seat for the new European Investment Bank (EIB) and was given the assurance that certain meetings of the Council of Ministers would be held there, in April, June and September. The Court of Justice, the Central Statistical Office, the Office for Official Publications of the European Communities, the Advisory Committee and the financial services of the ECSC and the Secretariat of the Parliamentary Assembly also remained in Luxembourg. Meanwhile, France refused to renounce its claim for Strasbourg as seat of the Parliamentary Assembly. An expensive and inconvenient compromise was reached whereby Parliament’s Members met in plenary session in Strasbourg but meetings of parliamentary committees were held in Brussels. Certain plenary meetings were also held in Luxembourg, which was also the seat of the Secretariat of the European Parliament.
The EU has no official capital and its institutions are divided between several cities:
Brussels — considered the de facto capital of the EU, being the seat of the European Commission and the Council of the European Union. It is also the venue of the European Parliament's committee meetings and mini-sessions and (since 2004) the host city for all European Council summits. Strasbourg — seat of the European Parliament and venue of its twelve week-long plenary sessions each year. Strasbourg is also the seat of the Council of Europe and the European Court of Human Rights, two institutions which are separate from (and have a wider membership than) the EU.
Luxembourg City — seat of the European Court of Justice, the Secretariat of the European Parliament and the European Investment Bank.
European Union law comprises a large number of overlapping legal and institutional structures. This is a result of its being defined by successive international treaties, with each new treaty amending and supplementing earlier ones. In recent years, considerable efforts have been made to consolidate and simplify the treaties, culminating with the final draft of the Treaty establishing a Constitution for Europe. If this proposed treaty is adopted, it will replace the set of overlapping treaties that form the current constitution of the EU with a single text.
The earliest EU treaty was the Treaty of Paris of 1951 (took effect in 1952) which established the European Coal and Steel Community between an original group of six European countries. This treaty has since expired, its functions taken up by subsequent treaties. On the other hand, the Treaty of Rome of 1957 is still in effect, though much amended since then, most notably by the Maastricht treaty of 1992, which first established the European Union under that name. The most recent amendments to the Treaty of Rome were agreed as part of the Treaty of Accession of the 10 new member states, which entered into force on 1 May 2004.
The EU member states have recently agreed to the text of a new constitutional treaty that, if ratified by the member states, would have become the first official constitution of the EU, replacing all previous treaties with a single document. Although accepted by many countries, this document was rejected in a French referendum with a 55% majority on 29 May 2005 and in the Dutch referendum with a 62% majority on 1 June 2005.
If the Constitutional Treaty fails to be ratified by all member states, then it might be necessary to reopen negotiations on it. Most politicians and officials agree that the current pre-Constitution structures are inefficient in the medium term for a union of 25 (and growing) member states. Senior politicians in some member states (notably France) have suggested that if only a few countries fail to ratify the Treaty, then the rest of the Union should proceed without them, possibly creating an "Avant Garde" or Inner Union of more committed member states to proceed with "an ever-deeper, ever-wider union".
The role of the European Community within the Union
European Communities: European Community plus Euratom. The term European Communities refers collectively to two entities — the European Economic Community (now called the European Community) and the European Atomic Energy Community (also known as Euratom) — each founded pursuant to a separate treaty in the 1950s. A third entity, the European Coal and Steel Community, was also part of the European Communities, but ceased to exist in 2002 upon the expiration of its founding treaty. Since 1967, the European Communities have shared common institutions, specifically the Council, the European Parliament, the Commission and the Court of Justice. In 1992, the European Economic Community, which of the three original communities had the broadest scope, was renamed the "European Community" by the Treaty of Maastricht.
European Union: European Communities plus CFSP and PJCC. The European Communities are one of the three pillars of the European Union, being both the most important pillar and the only one to operate primarily through supranational institutions. The other two "pillars" – Common Foreign and Security Policy, and Police and Judicial Co-operation in Criminal Matters – are looser intergovernmental groupings. Confusingly, these latter two concepts are increasingly administered by the Community (as they are built up from mere concepts to actual practice).
Effect of Constitutional Treaty. If it is ratified, the proposed new Treaty establishing a Constitution for Europe would abolish the three-pillar structure and, with it, the distinction between the European Union and the European Community, bringing all the Community's activities under the auspices of the European Union and transferring the Community's legal personality to the Union. There is, however, one qualification: it appears that Euratom would remain a distinct entity governed by a separate treaty (due to the strong controversy the issue of nuclear energy causes, and Euratom's relative unimportance, it was considered expedient to leave Euratom alone in the process of EU constitutional reform).
Intergovernmentalism and supranationalism. A basic tension exists within the European Union between intergovernmentalism and supranationalism. Intergovernmentalism is a method of decision making in international organisations where power is possessed by the member states and decisions are made by unanimity. Independent appointees of the governments or elected representatives have solely advisory or implementational functions. Intergovernmentalism is used by most international organisations today.
An alternative method of decision making in international organisations is supranationalism. In supranationalism power is held by independent appointed officials or by representatives elected by the legislatures or people of the member states. Member state governments still have power, but they must share this power with other actors. Furthermore, decisions are made by majority votes, hence it is possible for a member state to be forced by the other member states to implement a decision against its will.
Some forces in European Union politics favour the intergovernmental approach, while others favour the supranational path. Supporters of supranationalism argue that it allows integration to proceed at a faster pace than would otherwise be possible. Where decisions must be made by governments acting unanimously, decisions can take years to make, if they are ever made. Supporters of intergovernmentalism argue that supra-nationalism is a threat to national sovereignty, and to democracy, claiming that only national governments can possess the necessary democratic legitimacy. Intergovernmentalism is being favoured by more eurosceptic nations such as the United Kingdom, Denmark and Sweden; while more integrationist nations such as the Benelux countries, France, Germany, and Italy have tended to prefer the supranational approach.
The European Union attempts to strike a balance between the two approaches. This balance however is complex, resulting in the often labyrinthine complexity of its decision-making procedures.
Starting in March 2002, a Convention on the Future of Europe again looked at this balance, among other things, and proposed changes. These changes were discussed at an Intergovernmental Conference (IGC) in May 2004 and led to the Constitutional Treaty discussed above.
Supranationalism is closely related to the inter-governmentalism vs. neofunctionalism debate. This is a debate concerning why the process of integration has taken place at all. Intergovernmentalists argue that the process of EU integration is a result of tough bargaining between states. Neofunctionalists, on the other hand, argue that the supranational institutions themselves have been a driving force behind integration.
As the changing name of the European Union (from European Economic Community to European Community to European Union) suggests, it has evolved over time from a primarily economic union to an increasingly political one. This trend is highlighted by the increasing number of policy areas that fall within EU competence: political power has tended to shift upwards from the member states to the EU.
Some member states have a domestic tradition of strong regional government. This has led to an increased focus on regional policy and the European regions. A Committee of the Regions was established as part of the Treaty of Maastricht.
EU policy areas cover a number of different forms of co-operation.
Autonomous decision making: member states have granted the European Commission power to issue decisions in certain areas such as competition law, state aid control and liberalisation. Harmonisation: member state laws are harmonised through the EU legislative process, which involves the European Commission, European Parliament and Council of the European Union. As a result of this European Union law is increasingly present in the systems of the member states. Co-operation: member states, meeting as the Council of the European Union, agree to co-operate and co-ordinate their domestic policies.
The tension between EU and national (or sub-national) competence is an enduring one in the development of the European Union.
All prospective members must enact legislation in order to bring them into line with the common European Union legal framework, known as the Acquis Communautaire. (See also European Free Trade Association (EFTA), European Economic Area (EEA) and Single European Sky.) See table of states participating in some of the initiatives.
Many of the policies of the EU relate to the development and maintenance of an effective single market. Significant efforts have been made to create harmonised standards designed to bring economic benefits through creating larger, more efficient markets.
The power of the single market reaches beyond the EU borders, because to sell within the EU, it is beneficial to conform to its standards. Once a non-member country's factories, farmers and merchants conform to EU standards, much of the cost of joining the union has already been sunk. At that point, harmonising domestic laws in order to become a full member is relatively painless, and may create more wealth through eliminating the customs costs.
Euro banknotes. Free trade of goods and services among member states (an aim further extended to three of the four EFTA states by the European Economic Area, EEA).
A common EU competition law controlling anti-competitive activities of companies (through antitrust law and merger control) and member states (through the State Aids regime).
The Schengen treaty allowed removal of internal border controls and harmonisation of external controls between its member states. This excludes the UK and Ireland, which have derogations, but includes the non-EU members Iceland and Norway. Switzerland also voted in 2005 to become part of the Schengen zone.
Freedom for citizens of its member states to live and work anywhere within the EU with their spouses and children, provided they can support themselves (also extended to the other EEA states and Switzerland). This has led to a gross anomaly whereby family related social welfare benefits are payable by the member state where an EU citizen is employed, even where the family of the worker are resident elsewhere in the Union.
Free movement of capital between member states (and other EEA states). Harmonisation of government regulations, corporations law and trademark registrations. Eurozone, a single currency area with the euro (excluding the UK and Denmark, which have derogations). Sweden, although not having a specific opt-out clause, has not joined the ERM II, voluntarily excluding itself from the monetary union. A large amount of environmental policy co-ordination throughout the Union. A Common Agricultural Policy and a Common Fisheries Policy. Common system of indirect taxation, the VAT, as well as common customs duties and excises on various products. Funding for the development of disadvantaged regions - structural and cohesion funds, as well as the emergency financial aid - the solidarity fund.
External policies and Military
A common external customs tariff, and a common position in international trade negotiations. Funding for programmes in candidate countries and other Eastern European countries, as well as aid to many developing countries, through programmes such as Phare, TACIS, ISPA. The establishment of a single market energy community by means of the Energy Community South East Europe Treaty. The establishment of a single market aviation area. The establishment of a European Defence Agency.
Co-operation and harmonisation in other areas
Freedom for citizens of the EU to vote in local government and European Parliament elections in any member state. Co-operation in criminal matters, including sharing of intelligence (through EUROPOL and the Schengen Information System), agreement on common definition of criminal offences and expedited extradition procedures. A common foreign policy as a future objective, however this has some way to go before being realised. The divisions between the member states (in the letter of eight) and then-future members (in the Vilnius letter) during the run up to the 2003 invasion of Iraq highlights just how far off this objective could be before it becomes a reality.
A common security policy as an objective, including the creation of a 60,000-member European Rapid Reaction Force for peacekeeping purposes, an EU military staff and an EU satellite centre (for intelligence purposes). Common policy on asylum and immigration. Common funding of research and technological development, through four-year Framework Programmes for Research and Technological Development. The Sixth Framework Programme is running from 2002 to 2006.
If considered a single unit, the European Union has the largest economy in the world, with a GDP of 12,427,413 million USD (2005) using Purchasing power parity (PPP) equivalence. The EU economy is expected to grow further over the next decade as more countries join the union — especially considering that the new states are usually poorer than the EU average, and have the capacity to grow at a higher rate. The European Council published estimations on 17 November 2005 that the economy of the European Union will have grown approximately 1.5% in 2005 (1.3% in the eurozone), and 2.3% 2006 (2.1% in the eurozone) surpassing earlier growth predictions. In 2006, it is expected 3? million jobs will be created in the Eurozone . The European Council is hopeful that the European Union will grow further in the future; economic growth for 2007 is expected to be at 2.7%. Germany, the largest economy in the EU, will grow about: 0.8% in 2005, 1.2% in 2006 and 1.6% in 2007. After extremely slow growth, the EU's rate of growth is expected to increase in the next couple of years.
EU member states have agreed a programme called the Lisbon Strategy which aims at making "the EU the world's most dynamic and competitive economy" by 2010.
Below is a table and three graphs showing, respectively, the GDP (PPP), the GDP (PPP) per capita and the GDP (nominal) per capita for the European Union and for each of its 25 member states, sorted by GDP (PPP) per capita. This can be used as a rough gauge to the relative standards of living among member states, with Luxembourg and Ireland the highest; Poland and Latvia the lowest. The two future members Bulgaria and Romania (set for 1 January 2007) are also included in the table, as are the official candidates and officially recognised potential candidates. The data set is for the year 2006 and graphs are for the year 2004. All 2006 data are projections.
Language barriers. One major criticism of the EU is the fact that it has 20 official languages for 25 member states (some members share languages). This results in a potential 380 interpretations needed to translate all statements between all the languages of the EU. Everyone in the European Parliament is entitled to communicate in their own native language and to have this interpreted into other languages.
The European Parliament employs over 4000 interpreters at a cost of almost one billion euros, and translations can take up to a week to be translated into the languages of all member states. One of the problems is that sometimes translating needs to be done across intermediate languages, due to a lack of interpreters between certain languages (e.g. Greek-Danish, Portuguese-Greek) which can often lead to a loss of information and clarity, or even worse, errors in the translation.
Common Agricultural Policy. The Common Agricultural Policy, better known as the CAP, is a system of subsidies paid to EU farmers. Its main purposes are to guarantee minimum levels of production, so that Europeans have enough food to eat, and to ensure a fair standard of living for those dependent on agriculture.
The policy costs around 30bn pounds a year - or half the EU's 60bn pounds annual budget. Common attempts to put the finances into some sort of perspective include examples along the lines of it adding 9 pounds onto a family of four's weekly food bill, or that the annual income of an EU dairy cow exceeds that of half the world's human population. Another problem is that the subsidies cause overproduction. The CAP has also been blamed for encouraging environmentally damaging intensive farming. Critics say that the CAP has become badly unbalanced, with 70% of its funds going to only 20% of Europe's farms - predominantly the largest - and leaves nearly three-quarters of EU farmers surviving on less than 5,000 pounds a year. Small farmers account for about 40% of EU farms, but receive only 8% of available subsidies from Brussels. For example, according to British government figures, five UK farms receive more than ?1m a year in subsidies.
France led the anti-reform camp, which includes Spain, the Republic of Ireland and possibly Germany, while Britain, Sweden and the Netherlands were demanding change.
Source - "Wikipedia"