American government surveillance didn't begin after 9/11. It started centuries earlier.
Check out the new online documentary "Tracked in America: Stories from the History of U.S. Government Surveillance" at www.trackedinamerica.org [http://www.trackedinamerica.org/].
"Tracked in America" has 25 firsthand accounts of what it's like to be spied on by your government. The stories come from all kinds of people who were the subjects of secret surveillance for just being activists--opposing Japanese internment during World War II, speaking out against the Vietnam War, standing up for freedom during the McCarthy era. Six historians give a real sense of context for the history of surveillance.
Tracked in America really puts today's government surveillance news [http://aclunc.org/issues/government_surveillance/index.shtml] in perspective.
This documentary is great for classrooms, too, and comes with a Teachers' Guide [http://www.trackedinamerica.org/about/educators.html].
I'm watching it and tagging it with "surveillance." What about you?
08 Jan 2007
(0)Goal 1--- Eradicate extreme poverty & hunger TARGET Halve, between 1990 and 2015, the proportion of people whose income is less than $1 a day Goal 2-- Achieve universal primary education TARGET Ensure that, by 2015, children everywhere, boys and girls alike, will be able to complete a full course of primary schooling Goal 3--Promote gender equality and empower women TARGET Eliminate gender disparity in primary and secondary education, preferably by 2005, and in all levels of education no later than 2015 Goal 4 Reduce child mortality TARGET Reduce by two thirds, between 1990 and 2015, the under-five mortality rate Goal 5 Improve maternal health TARGET Reduce by three quarters, between 1990 and 2015, the maternal mortality ratio Goal 6 Combat HIV/AIDS, malaria & other diseases TARGET Have halted by 2015 and begun to reverse the spread of HIV/AIDS Goal 7 Ensure environmental sustainability TARGET Integrate the principles of sustainable development into country policies and programmes and reverse the loss of environmental resources TARGET Halve, by 2015, the proportion of people without sustainable access to safe drinking water and basic sanitation TARGET By 2020, to have achieved a significant improvement in the lives of at least 100 million slum-dwellers Goal 8 Develop a global partnership for development TARGET Address the special needs of the least developed countries, landlocked countries and small island developing States TARGET Develop further an open, rule-based, predictable, non-discriminatory trading and financial system TARGET Deal comprehensively with developing countries debt TARGET In cooperation with the private sector, make available the benefits of new technologies, especially information and communications TARGET In cooperation with pharmaceutical companies, provide access to affordable essential drugs in developing countries TARGET In cooperation with developing countries, develop and implement strategies for decent and productive work for youth A note to the reader UNITED NATIONS The Millennium Development Goals were derived from the United Nations Millennium Declaration, adopted by 189 nations in 2000. Most of the goals and targets were set to be achieved by the year 2015 on the basis of the global situation during the 1990s. It was during that decade that a number of global conferences had taken place and the main objectives of the development agenda had been defined. The baseline for the assessment of progress is therefore 1990 for most of the MDG targets. For most of the indicators, 2004 is the last year for which comprehensive data are available. Data to monitor progress towards the Millennium Development Goals are compiled by specialized agencies within their area of expertise. They are drawn from national statistics provided by Governments to the international statistical system the United Nations Statistics Division and the statistical offices of the various international organizations and adjusted for comparability. In some cases, national Governments may have more recent statistics that have not been reported to the international statistical system. In other cases, countries do not produce the data required for the compilation of indicators. When this occurs, international statistical agencies make estimates based on the data of neighbouring countries or of countries with similar levels of income. Most of the organizations and agencies of the United Nations system, along with the Organization for Economic Cooperation and Development and the Inter- Parliamentary Union, contribute to this exercise. Many of the indicators for example, on child mortality and malnutrition, malaria prevention and treatment, and knowledge of and behaviour related to HIV/AIDS are derived from surveys sponsored and carried out by international agencies. These include, most importantly, the Multiple Indicator Cluster Surveys and the Demographic and Health Surveys, which help fill the frequent data gaps that exist. Country data derived from international surveys and national sources or estimated by the responsible agencies are aggregated into regional and global figures. It is these aggregates that are used in this report to provide an overall assessment of progress. Since the periodic assessment of progress towards the MDGs began five years ago, the international statistical community has been concerned about the lack of adequate data to compile the required indicators in many parts of the developing world. At the same time, the monitoring requirements themselves have focused attention on this shortcoming and raised awareness of the urgency to launch initiatives for statistical capacitybuilding. Though there have been many steps in this direction, much remains to be done until all countries are able to produce a continuous flow of social and economic data needed to inform their development policies and track progress.
05 Jan 2007
I. New Century, New Challenges The new millennium, and the Millennium Summit, offer the worlds peoples a unique occasion to reflect on their common destiny, at a moment when they find themselves interconnected as never before. They look to their leaders to identify and act on the challenges ahead. The United Nations can help meet those challenges, if its Members share a renewed sense of mission. Founded to introduce new principles into international relations in 1945, the UN has succeeded better in some areas than others. This is a chance to reshape the United Nations so that it can make a real and measurable difference to peoples lives in the new century. II. Globalization and Governance The benefits of globalization are obvious: faster growth, higher living standards, new opportunities. Yet a backlash has begun, because these benefits are so unequally distributed, and because the global market is not yet underpinned by rules based on shared social objectives. In 1945 the founders set up an open and co-operative system for an international world. This system worked, and made it possible for globalization to emerge. As a result we now live in a global world. Responding to this shift is a central challenge for world leaders today. In this new world, groups and individuals more and more often interact directly across frontiers, without involving the State. This has its dangers. Crime, narcotics, terrorism, pollution, disease, weapons, refugees and migrants: all move back and forth faster and in greater numbers than in the past. People feel threatened by events far away. They are also more aware of injustice and brutality in distant countries, and expect States to do something about them. But new technologies also create opportunities for mutual understanding and common action. If we are to get the best out of globalization and avoid the worst, we must learn to govern better, and how to govern better together. That does not mean world government or the eclipse of nation states. On the contrary, States need to be strengthened. And they can draw strength from each other, by acting together within common institutions based on shared rules and values. These institutions must reflect the realities of the time, including the distribution of power. And they must serve as an arena for states to co-operate with non-state actors, including global companies. In many cases they need to be complemented by less formal policy networks, which can respond more quickly to the changing global agenda. The gross disparities of wealth in todays world, the miserable conditions in which well over a billion people live, the prevalence of endemic conflict in some regions, and the rapid degradation of the natural environment: all these combine to make the present model of development unsustainable, unless remedial measures are taken by common agreement. A recent survey of public opinion across six continents the largest ever conducted confirms that such measures are what people want. III. Freedom from Want The past half-century has seen unprecedented economic gains. But 1.2 billion people have to live on less than $1 a day. The combination of extreme poverty with extreme inequality between countries, and often also within them, is an affront to our common humanity. It also makes many other problems worse, including conflict. And the worlds population is still rising rapidly, with the increase concentrated in the poorest countries. We must act to reduce extreme poverty by half, in every part of the world, before 2015. The following are priority areas: Achieving sustained growth. This means, above all, ensuring that people in all developing countries can benefit from globalization. Generating opportunities for the young. By 2015, all children must complete primary schooling, with equal opportunities for both genders at all levels of education. And ways must be found to provide young people with decent work. Promoting health and combating HIV/AIDS. Health research must be redirected at the problems affecting 90 per cent of the worlds people. By 2010 we should have cut the rate of HIV infection in young people by 25 per cent. Upgrading the slums. We must support the "Cities without Slums" action plan, which aims to improve the lives of 100 million slum dwellers by 2020. Including Africa. The Report challenges experts and philanthropic foundations to tackle low agricultural productivity in Africa. It also urges African governments to give higher priority to reducing poverty, and the rest of the world to help them. Building digital bridges. New technology offers an unprecedented chance for developing countries to "leapfrog" earlier stages of development. Everything must be done to maximize their peoples access to new information networks. Demonstrating global solidarity. Rich countries must further open their markets to poor countries products, must provide deeper and faster debt relief, and must give more and better focused development assistance. Ridding the world of the scourge of extreme poverty is a challenge to every one of us. We must not fail to meet it. IV. Freedom from Fear Wars between States have become less frequent. But in the last decade internal wars have claimed more than 5 million lives, and driven many times that number of people from their homes. At the same time weapons of mass destruction continue to cast their shadow of fear. We now think of security less as defending territory, more in terms of protecting people. The threat of deadly conflict must be tackled at every stage: Prevention. Conflicts are most frequent in poor countries, especially in those that are ill governed and where there are sharp inequalities between ethnic or religious groups. The best way to prevent them is to promote healthy and balanced economic development, combined with human rights, minority rights and political arrangements in which all groups are fairly represented. Also, illicit transfers of weapons, money, or natural resources must be forced into the limelight. Protecting the vulnerable. We must find better ways to enforce international and human rights law, and ensure that gross violations do not go unpunished. Addressing the dilemma of intervention. National sovereignty must not be used as a shield for those who wantonly violate the rights and lives of their fellow human beings. In the face of mass murder, armed intervention authorized by the Security Council is an option that cannot be relinquished. Strengthening peace operations. The Millennium Assembly is invited to consider recommendations from a high-level panel the Secretary-General has established to review all aspects of peace operations. Targeting sanctions. Recent research has explored ways to make sanctions "smarter", by targeting them better. The Security Council should draw on this research when designing and applying sanctions regimes in future. Pursuing arms reductions. The Secretary-General urges Member States to control small arms transfers more rigorously; and to re-commit themselves to reducing the dangers both of existing nuclear weapons and of further proliferation. V. Sustaining our future We now face an urgent need to secure the freedom of future generations to sustain their lives on this planet and we are failing to do it. We have been plundering our childrens heritage to pay for unsustainable practices. Changing this is a challenge for rich and poor countries alike. The Rio Conference in 1992 provided the foundations, and the Montreal Protocol on ozone-depleting substances is an important step forward. But elsewhere our responses are too few, too little and too late. Before 2002 we must revive the debate and prepare to act decisively in the following areas: Coping with climate change. Reducing the threat of global warming requires a 60 per cent reduction in emissions of carbon and other "greenhouse gases". This can be achieved by promoting energy efficiency and relying more on renewable energy sources. Implementing the 1997 Kyoto Protocol would be a first step. Confronting the water crisis. The report urges endorsement of the World Water Forum Ministerial Conferences target of cutting by half the proportion of people without access to safe and affordable water before 2015. It also calls for a "Blue Revolution" which would increase agricultural productivity per unit of water, while improving management of watersheds and flood plains. Defending the soil. The best hope of feeding a growing world population from shrinking agricultural land may lie in biotechnology, but its safety and environmental impact are hotly debated. The Secretary-General is convening a global policy network to try and resolve these controversies, so that the poor and hungry do not lose out. Preserving forests, fisheries, and biodiversity. In all these areas, conservation is vital. Governments and the private sector must work together to support it. Building a new ethic of stewardship. The Secretary-General recommends four priorities: 1) Education of the public. 2) "Green accounting", to integrate the environment into economic policy. 3) Regulations and incentives. 4) More accurate scientific data. Peoples, as well as Governments, must commit themselves to a new ethic of conservation and stewardship. VI. Renewing the United Nations Without a strong UN, it will be much harder to meet all these challenges. Strengthening the UN depends on Governments, and especially on their willingness to work with others the private sector, non-governmental organizations and multilateral agencies to find consensus solutions. The UN must act as a catalyst, to stimulate action by others. And it must fully exploit the new technologies, especially information technology. The Secretary-General recommends action in these areas: Identifying our core strengths. The UNs influence derives not from power but from the values it represents, its role in helping to set and sustain global norms, its ability to stimulate global concern and action; and the trust inspired by its practical work to improve peoples lives. We must build on those strengths, especially by insisting on the importance of the rule of law. But we also need to adapt the UN itself, notably by reforming the Security Council so it can both work effectively and enjoy unquestioned legitimacy. And we must expand the UNs relationship with civil society organizations, as well as with the private sector and foundations. Networking for change. We must supplement formal institutions with informal policy networks, bringing together international institutions, civil society and private sector organizations, and national governments, in pursuit of common goals. Making digital connections. We can use the new information technology to make the UN more efficient, and to improve its interaction with the rest of the world. But to do so we must overcome a change-resistant culture. The Secretary-General is asking the information technology industry to help us do it. Advancing the quiet revolution. To meet the needs of the 21st century we need real structural reform, a clearer consensus on priorities among Member States, and less intrusive oversight of day-to-day management. Decisions are needed from the General Assembly for instance to include "sunset provisions" in new mandates and to introduce results-based budgeting. VII. For consideration by the Summit The Secretary-General lists six shared values, reflecting the spirit of the Charter, which are of particular relevance to the new century: Freedom; Equity and Solidarity; Tolerance; Non-Violence; Respect for Nature; and Shared responsibility. He urges the Millennium Summit to adopt a series of resolutions, drawn from the body of the Report, as an earnest of its will to act on those values.
05 Jan 2007
"The Customs Union" exracted from EU Documents
Introduction
Over the past 30 years the Customs Union has achieved many things. We have eliminated all internal customs duties, developed a customs code for the whole Community and realised the internal market.
Almost taken for granted today, these achievements were the result of many years of hard work, perseverance and the building of trust between historic rivals.
Who would have believed that out of the ashes of World War II, a united Europe could be built? The same holds true after the cold war, as the EU prepares the first round of enlargement towards central and eastern Europe.
The task of getting 15 customs systems to work together as one is not yet finished, but the legal framework is in place. Today the Community is progressing steadily towards further customs integration at more operational levels.
Our success needs to be measured by how much more competitive European trade and industry becomes as a result of modern, simple, clear, more uniformly applied legislation.
As the EU moves towards economic and monetary union (EMU), customs has an important role to play with regard to the simplification of the import of goods. The challenge of EMU reminds us of the earlier challenge of integrating customs. The parallels between monetary and customs integration are clear.
Just as customs integration eased the way to, and even inspired, integration in other areas, the European monetary union will serve as a framework and inspiration for further cooperation and harmony in other areas, perhaps even in taxation.
The task now before the Commission is to prepare new objectives for customs policy and its practical application. These must face up to and overcome the challenges before us. Customs is a multifunctional tool and must become even more efficient and effective in its role. What exactly is this role and how are we facing up to the challenge?
The Customs Union
A foundation of the Union and an essential element of the single market
The Customs Union is an essential element of the European Union's single market with its four basic freedoms: the free circulation of goods, persons, services and capital. This single market with 370 million consumers is the largest in the industrialised world. The single market with no internal economic frontiers is the catalyst for the economic integration of the European Union. Thus the effects of the Community's Customs Union are far reaching.
To set up, develop and run a single common market, where goods freely circulate everywhere, can be done only within the framework of a Customs Union where common rules exist at its external borders. A Customs Union is a secure basis for highly developed integration. Without the Community's Customs Union, the European Union's common commercial and development policy, its common agricultural market and an effective coordination of economic and monetary policies would not be possible.
Customs and the Community aims
To foster world trade.
To promote fair trade.
To increase the attractiveness of the EU as a location for industry and trade and contribute to the creation of new jobs.
To promote development elsewhere.
To assist the candidates for accession in their future role.
To ensure protection for the Community's citizens and business in all areas involving imports or exports in a clear, uniform, simple way as efficiently as possible.
To 'ring fence' the single market, securing the maximum benefit from it for everybody.
To facilitate a practical system to collect revenue, customs duties, VAT and excise duties.
To collect essential statistics on trade.
Finland
Sweden
United Kingdom
Ireland
Denmark
Germany
Netherlands
Belgium
France
Luxembourg
Austria
Italy
Spain
Portugal
Greece
* non continental and overseas territories not shown
Estonia
Latvia
Lithuania
Poland
Czech Republic
Slovak Republic
Hungary
Slovenia
Romania
Bulgaria
Turkey
Malta
Cyprus
The development of the Customs Union
The early years
It all started in 1958 when the first six Member States created what was to become the European Union. One of the first steps was to create a tariff union so as to be able to abolish all customs duties on trade between the Member States.
All the Member States agreed to merge their separate and very different tariffs into a single one for the European Community as a whole.
A Customs Union in the making!
The tariff union was completed in 1968: all customs duties and restrictions among the six founding Member States of the Community were eliminated and the common customs tariff - an external tariff which applies to third country goods - was introduced. The 'new export opportunities' created by the abolition of internal tariffs gave a boost to the economies of the Member States. Trade increased between Member States leading to market optimism and investment growth in the Community.
Consumers benefited from the availability of a wider range of goods and reduced prices. Whilst trade grew threefold between 1958 and 1972, intra-Community trade exploded by a factor of nine for the same period.
The middle years, 1968-93
Customs legislation, beyond that essential to a tariff union, was progressively created in order to ensure that wherever goods were imported into the Community, they were not only subject to the same tariff rules but also to the same customs provisions to ensure that the tariff was applied in the same way everywhere. Common origin rules, warehousing procedures and all the other instruments were hammered out. One culminating step was the Single Administrative Document (SAD). In 1988 a major step was taken for the simplification of customs procedures. The SAD was established as a declaration form which replaced 150 separate documents previously used by the customs administrations in the Member States!
At the same time other trade laws were needed and introduced to turn the tariff union into a real Customs Union.
A Customs Union or a free trade area?
There are several different degrees of customs integration and of organising economic cooperation. Two common ones are Customs Unions and free trade areas. How do they differ? Why one and not the other?
A free trade area is used when countries wish to bring together their economies but not to integrate them or turn them into a single economy. Some free trade areas include the European Economic Area (EEA) and European Free Trade Association (EFTA), and the North American Free Trade Agreement (NAFTA) between the USA, Canada and Mexico, Mercosur in Latin America and Caricom in the Caribbean.
The aim is to partly, or in the end, to totally, eliminate customs duties and restrictions to trade between them.
But, as each member of a free trade area keeps its own customs tariff and commercial policy in force towards outsiders, rules are needed to determine which goods inside the area can move freely from one member country to another: basically, origin rules.
Customs procedures have to be kept for consignments crossing the internal borders to see if the rules are met.
A Customs Union goes further, and
aims at economic integration with no internal border restrictions (but different internal sales taxes hinder this);
all members of a Customs Union apply a common customs tariff and commercial policy towards third country goods so no rules are needed to determine which goods inside the union can move freely and no origin rules are needed;
thus no internal frontiers are needed for customs or external trade purposes.
A common customs tariff enables the application of common policies vis-à-vis non-members.
The economic integration within the Customs Union can be far-reaching.
The recent past
The single market entered into force in 1993, really ensuring the four basic freedoms: free circulation of goods, persons, services and capital in a frontier-free internal market. This single market abolished the role of customs collecting excises/VAT between the Member States and allowed the real Customs Union underlying the Community to become apparent to all.
In 1994 the customs code consolidated all of the Community customs legislation into a single text and set up a framework for the Community's import and export procedures. The underlying principle was that the procedures should avoid the interruption of trade flows by establishing the right balance between the freedom of trade and the responsibility of traders on the one side and the necessity of control on the other.
The single internal market serves as an engine for greater harmonisation in a variety of customs and non-customs areas.
As a consequence of this economic integration, not only has the Community become the world's most important trading partner with third countries, intra-Community trade has also grown considerably.
The single market, securely based on the Customs Union, is the foundation on which EU initiatives on policies for growth, competitiveness and employment can be based.
The single market serves as a catalyst in the strategy for economic expansion of the EU. This would not be possible without the existence of the Customs Union and its principle of free circulation of goods.
The leap into the single market
Before the single market, free circulation of goods within the Community was not a reality. Numerous customs border formalities were still in existence, for example because of the way of collecting VAT and excise duties and for statistical purposes. Before 1993, all hauliers were stopped at the internal Community borders for 'customs' and tax clearance and even inspection.
Chronic queues of trucks at the customs posts hindered intra-Community trade and cost EU trading companies large amounts of time and money.
Customs legislation, though already harmonised, was not applied in a uniform way. Despite the absence of customs duties in trade between the Member States, in fact there was little difference in administrative burden or appearance between intra-Community trade and trade with non-member countries - the same was essentially true for travellers. 'Customs' clearance at the Community's internal frontiers was elaborate and time-consuming. The constant flow of new Community and national laws, regulations and standards for health and consumer protection etc. was formerly enforced by the customs services at the internal borders, because those were there anyway. The first step in achieving a real internal single market was the replacement of 'customs' formalities at internal frontiers by new fiscal, statistical and other control systems that required no control or documentation at the moment that the goods crossed the internal borders.
On 1 January 1993, all 'customs' checks at the internal borders, including the use of the single administrative document, were abolished for the movement of goods. Spot checks still occur for drugs and immigration, but routine internal border checks have disappeared.
The tariff gives the customs duties
While the free circulation of goods within the European Union is the internal aspect of the Customs Union, the Common Customs Tariff is the external aspect. It applies to imports of goods across the external borders of the Customs Union.
The common commercial policy fixes the tariff rates for customs charges due on goods imported into the Community and the exceptions to this, as well as prohibitions and restrictions. All this is monitored and controlled by customs staff.
The Common Customs Tariff, or CCT, is common to all members of the Union, but the rates of duty differ from one kind of import to another depending on what they are and where they come from.
Rates depend on the economic sensitivity of products and are a means of protecting the Community's economic interests.
By means of its Common Customs Tariff, the Community applies the principle that home or domestic producers should be able to compete fairly and equally on the Community market with manufacturers exporting from other countries.
Raw materials and semi-manufactured goods, which the Community often does not produce anyway and which it needs to produce goods, usually benefit from low duty rates. There are also temporary or permanent duty suspensions available if Community manufacturers have to use materials or components from outside to manufacture Community exports. This makes cheap raw materials and semi-finished goods available to EU manufacturers on the same competitive footing as they are to foreign processing companies. The duty relief systems are called 'inward processing' or 'duty suspension' depending on the one used.
In some economic sectors it is necessary to stimulate competition by low tariffs, as we find in the pharmaceutical and information technology sectors.
The Community is constantly adapting the Common Customs Tariff as a steering instrument for world trade. It has participated in eight tariff rounds, cutting tariffs considerably (under the General Agreement on Tariffs and Trade, now taken up under the umbrella of the World Trade Organisation or WTO).
The last multilateral agreement, 'the Uruguay Round', focused on the abolition/reduction of duties for information technology products, one of the strategic sectors in world trade; the next, or 'Millennium Round', is being prepared at present.
Increases in duties are only possible in accordance with the rules of the WTO, which normally require compensation by reducing other rates. This can be needed when countries join Customs Unions, as sometimes, for some products, the Customs Union may have higher duties.
By shaping its Common Customs Tariff in compliance with the World Trade Organisation rules the European Union has demonstrated that it takes its responsibilities within a free world trading system very seriously.
Mutual 'preferential' trade
The European Union does not, however, promote trade only within the multilateral context of the World Trade Organisation (WTO).
It has also concluded 'preferential' agreements with individual countries or groups of countries by means of free trade agreements and customs.
There are free trade agreements, such as the European Economic Area (EEA) - the EU, Iceland, Norway and Liechtenstein - which promote and maintain trade links between the European Union and its neighbouring countries and include most of the former EFTA countries. There is also a free trade agreement with Switzerland, which is the member of EFTA that did not join the EEA. Lastly, there are free trade agreements with the central and east European countries - Poland, Hungary, the Czech and Slovak Republics, Slovenia, Estonia, Latvia, Lithuania, Bulgaria and Romania. Customs are playing an important role in this context, since these agreements aim at achieving trade promotion by mutual tariff concessions and help to prepare for accession.
All these agreements are linked, as the origin rules allow the use of each other's products in further manufacture.
Additionally, the European Union has concluded Customs Union agreements with Turkey, San Marino and Andorra.
Development and preferential trade
By using its commercial policy to encourage development, the European Union has become the world leader in helping the developing world to trade by providing 'preferential' access to Community markets. This means access at reduced rates of customs duty. Up to now these have been mostly one-way arrangements where our partners do not give any preferential treatment to Community exports. This falls into three main groups, the Lomé Convention, the set of agreements with our Mediterranean partners and the Generalised System of Preferences (GSP).
he GSP
The general system of preferences for developing countries is an internationally accepted way of developing trade based on trade concessions granted autonomously by the industrialised countries.
For the Community most of the developing countries covered by the GSP worldwide are also covered by the ACP or Mediterranean agreements. For the Community the GSP allows Asian and Latin American countries to export to the European Union at lower than normal duty rates for manufactured goods and processed agricultural products. Access to this programme can be granted as a means of promoting the ideals of the European Union in the developing world.
For example, additional GSP tariff cuts were offered to developing countries conforming to international agreements on environmental protection and forbidding child or forced labour.
In all these preferential systems the respect of customs provisions (origin rules) is the key to enjoying the benefits of such tariff preferences. In controlling the correct application of these provisions, customs officials are the guardians of the Community's external policy.
Customs cooperation agreements
Apart from the abolition of tariffs between partners, it is a priority for the European Union to create other cooperative links, bringing in the world's other large trading nations. For the benefit of world trade and international assistance to fight against customs fraud, the European Union has signed customs cooperation and mutual administrative assistance agreements with the United States, Canada and Korea and others are in the making.
In addition, the European Union has committed itself to training and information programmes with other countries, in particular helping to modernise the customs administrations in third countries and their working methods, thus improving the flow of trade.
Protection of EU economic interests by
non-tariff instruments
As tariffs are reduced and the product range of goods being imported evolves, the protection of the Union's economic interests is shifting more and more towards the use of other instruments. These 'non-tariff' measures are varied and include actions against:
Unfair competition
Unfair trade practices usually consist of dumping or paying illegal subsidies. Dumping exists when an exporter in a third country sells particular goods on the Community market more cheaply than on its domestic market. Sanctions can be introduced against subsidies when specific goods exported to the Community benefit from subsidies considered illegal under the terms of the WTO agreement.
In both cases the Commission can conduct detailed investigations in the suspect countries.
Trade sanctions in the form of extra, targeted, duties (anti-dumping duties) or insistence upon importers agreeing a certain level of prices (price undertakings) can be applied to imports which cause significant economic difficulties to producers in the European Union, because of unfair trade practices.
Sanctions are usually introduced after considering the request made by Community producers of a particular product about unfair competition. The measures we are allowed to take have to be in accordance with the criteria stipulated in the World Trade Organisation agreement and those laid down by Community legislation.
The nomenclature of the common customs tariff is used to define the products in question, and the terms used are quite specific and provide for closely targeted protection. The scope of the measures that can be taken by the Union is limited to the level of dumping or subsidy, or to what is necessary to eliminate negative economic effects suffered by Community industry, if such a level is lower than the dumping or subsidy.
However, measures are only imposed when the investigation shows that they are in the interest of the European Union.
The effects of such measures on the interests of users and consumers are thereby taken into account.
Anti-dumping and countervailing duties are charged in addition to the rates of the Common Customs Tariff. The customs rules of origin determine whether the imported goods are considered to be from the suspect country.
Restrictions on quantities of imports
Imports of products originating in 'low-cost' countries where the cost of production is unusually low can be subjected to import quantity limitations, or, as a first step, surveillance to monitor the development of the situation.
Customs administrations Fifteen working as one
A market of 370 million consumers depends on the best efforts of 130 000 customs officials from 15 Member States. It could be said that customs officials play the role of gatekeepers to the European Union.
They control products imported from third countries across the EU's common external border, with a view to collecting customs duties, value added tax and excise duties and protecting the interests of the Community and its citizens in many different ways.
The development of the EU Customs Union into the EU single market has entailed the abolition of all internal economic borders between Member States.
This evolution has increased the importance of controls at the external borders, or put in another way, focused attention on them. Normally there is no 'second chance', as there is no longer any customs intervention possible between the external border and the place of final destination.
This has underlined the need for the 15 different customs administrations to think and act like one. They are now completely interdependent and reliant on each other. The growth of trade is an additional reason for the need for effective systems for the control of goods, as it is less and less possible to intervene physically.
The challenge now facing administrations is how to ensure the flow of trade while maintaining, where necessary, effective control.
In the past, control was basically a physical one, which took time and effort. It was a costly procedure for both sides. Nowadays control procedures have totally changed and must continue to develop.
Modern working methods are applied to simplify and focus controls where they are needed and will be most effective. In particular computerisation, post-import and audit controls and using risk analysis are techniques that are becoming more widely used and more and more sophisticated.
New techniques
Information technology is increasingly being used between customs administrations and traders.
The paperless customs declaration minimises the duration of customs clearance at the frontier.
But computers are not just used for accepting declarations. Over the last 10 years the Commission has developed computer systems which enable Member States' administrations to exchange data with the Commission's centralised databases. Also, the Commission has played a significant role in setting up new systems which supplement existing national systems to enable customs offices in Member States to exchange information between one another at both national and Community level.
The use of risk analysis techniques allows the selection of those consignments which perhaps by their nature, value, origin or importer constitute a certain risk. Will this be a correct declaration or is it a cover for something else?
It allows customs to decide in a more objective way whether there is a need for a consignment to be seen and examined physically. It also helps in indicating the level of the controls to be applied. It even allows customs to take some of these decisions before the goods have reached the borders of the European Union. This is a challenge.
Obviously this kind of technique is only as good as the input data and the degree of thought that have been put towards its creation.
It is not a replacement for good people, just a different way for them to use their natural abilities.
Increasingly customs are adopting the idea of carrying out physical controls after the goods have been moved to a trader's premises. This greatly facilitates trade movement by further reducing delays at ports and airports and lowering costs because the goods will not have to be unpacked twice. By doing this it is increasingly possible, at the border itself, to concentrate on combating smuggling and fraud. After the goods have arrived at their destination and been put into free circulation, post-import audit methods can be applied. Modern controls will increasingly be based on checks of traders' records.
The Commission's role
User-friendly procedures and modern customs law can be factors when it comes to determining the location of business and industry. Time and cost saving are an element of competition for the EU economy. Not only is the simplification of trade procedures vital, but so is the efficiency of the methods used for the protection of our citizens.
The Commission and national administrations have a joint responsibility in fulfilling the legitimate expectations for all of this.
The Commission, through DG XXI - Directorate General for Taxation and Customs Union, is responsible for initiatives for the development of customs policy, for proposals for customs legislation, for aiding coordination between the Member States' administrations, and for seeking advice and feedback from business and industry at Union level. The national customs administrations are responsible for the day-to-day application of EU law: collecting customs duties, excise duties and VAT on imported goods and applying all the other policies we have mentioned here. They also maintain contact with the national local business communities.
The basic customs legislation itself is contained in the Community customs code and in the nomenclature. The other policies, which customs apply at the borders, are enshrined in other laws.
All these are, in general, adopted by the Council of Ministers and ap-proved by the European Parliament on the basis of proposals made by the Commission. Subsidiary law, often called implementation provisions, is adopted by the Commission in strictly delimited circumstances and then, usually, only after approval by the Member States' authorities expressed in the customs code committee for customs law or another committee where other legislation is concerned.
New techniques
Information technology is increasingly being used between customs administrations and traders.
The paperless customs declaration minimises the duration of customs clearance at the frontier.
But computers are not just used for accepting declarations. Over the last 10 years the Commission has developed computer systems which enable Member States' administrations to exchange data with the Commission's centralised databases. Also, the Commission has played a significant role in setting up new systems which supplement existing national systems to enable customs offices in Member States to exchange information between one another at both national and Community level.
The use of risk analysis techniques allows the selection of those consignments which perhaps by their nature, value, origin or importer constitute a certain risk. Will this be a correct declaration or is it a cover for something else?
It allows customs to decide in a more objective way whether there is a need for a consignment to be seen and examined physically. It also helps in indicating the level of the controls to be applied. It even allows customs to take some of these decisions before the goods have reached the borders of the European Union. This is a challenge.
Obviously this kind of technique is only as good as the input data and the degree of thought that have been put towards its creation.
It is not a replacement for good people, just a different way for them to use their natural abilities.
Increasingly customs are adopting the idea of carrying out physical controls after the goods have been moved to a trader's premises. This greatly facilitates trade movement by further reducing delays at ports and airports and lowering costs because the goods will not have to be unpacked twice. By doing this it is increasingly possible, at the border itself, to concentrate on combating smuggling and fraud. After the goods have arrived at their destination and been put into free circulation, post-import audit methods can be applied. Modern controls will increasingly be based on checks of traders' records.
The Commission's role
User-friendly procedures and modern customs law can be factors when it comes to determining the location of business and industry. Time and cost saving are an element of competition for the EU economy. Not only is the simplification of trade procedures vital, but so is the efficiency of the methods used for the protection of our citizens.
The Commission and national administrations have a joint responsibility in fulfilling the legitimate expectations for all of this.
The Commission, through DG XXI - Directorate General for Taxation and Customs Union, is responsible for initiatives for the development of customs policy, for proposals for customs legislation, for aiding coordination between the Member States' administrations, and for seeking advice and feedback from business and industry at Union level. The national customs administrations are responsible for the day-to-day application of EU law: collecting customs duties, excise duties and VAT on imported goods and applying all the other policies we have mentioned here. They also maintain contact with the national local business communities.
The basic customs legislation itself is contained in the Community customs code and in the nomenclature. The other policies, which customs apply at the borders, are enshrined in other laws.
All these are, in general, adopted by the Council of Ministers and ap-proved by the European Parliament on the basis of proposals made by the Commission. Subsidiary law, often called implementation provisions, is adopted by the Commission in strictly delimited circumstances and then, usually, only after approval by the Member States' authorities expressed in the customs code committee for customs law or another committee where other legislation is concerned.
What does the future hold? New Member States
The candidate countries are preparing for accession to the European Union. Customs is an area of particular importance as we are all mutually dependant on one another in the Union. The chain is as strong as its weakest link.
The very role of customs makes the creation of an efficient, effective modern customs administration an indispensable element of the accession package. The control of the external frontier on behalf of an enlarged EU will be in itself a major task, whilst the very role of customs in a single market requires specific expertise. This has been recognised by the inclusion of customs as a priority sector in the accession partnerships set up to guide the enlargement process.
Consequently, funding under the PHARE programme for technical assistance to candidate countries has been made available.
Close cooperation between the Commission, the partner countries' and the Member States' customs administrations has already pro-duced considerable progress.
This has been particularly noticeable in the adoption of new customs legislation by our partners.
Nevertheless, a significant amount of work remains to be done, especially when it comes to achieving an operational capacity equivalent to that found in the EU. This is especially the case in areas of work that are new to them (for example, the application of the common agricultural policy).
The enforcement of EU customs and trade-related laws will be in itself a major task for the candidate customs administrations; to do this, whilst allowing an increasing amount of traffic to flow without undue hindrance, will be extremely difficult.
This is why a specific strategy to assist in preparation has been adopted jointly by the Commission, the Member States and candidate countries. We have produced 'road maps' to chart the route to be taken; operational capacity will be tackled using 'blueprints' setting out operational standards or guidelines for the different sectors of customs operations.
A check on the progress made is carried out in the sub-committees on customs and taxation created under the various Europe agreements. Here we also regularly exchange information on enlargement developments.
Global aspects
The European Union is always involved in many multilateral trade and customs negotiations. In its capacity as the world's biggest trading bloc, it will continue to play a substantial role in international fora, in particular in the World Trade Organisation. The Commission takes part as the sole negotiator and spokesman on behalf of the Community, but in consultation with the Member States.
The WTO has just announced a new Millennium Round covering, among other things, improved market access, electronic commerce, preferential trade and trade facilitation, in particular the simplification and the harmonisation of customs procedures.
Trade simplification and harmonisation of customs procedures will also involve the World Customs Organisation (WCO, formerly called the Customs Cooperation Council) which is a forum of a more technical nature tackling customs methods and procedures (often working under the auspices of the WTO), the G7, the United Nations Economic Commission for Europe (UNECE) and the Asia/Europe Meeting (ASEM).
Consolidation programme: Customs 2002
The interoperability of the customs administrations of the European Union and cooperation between them are rendered more difficult by their different structures, responsibilities, cultures and traditions.
This, however, provides a fertile breeding ground for new ideas and synergies. The harmonisation of customs legislation is now virtually complete. However, differences in the detailed application of the common rules among and between the Member States can mean that the effects are slightly different.
The effect of the single market is then not exactly the same everywhere. A more homogeneous application of the harmonised customs law by administrations had to receive a higher profile.
This implied a framework for discussion and decision making on non-legal questions and issues.
This is why the Community set up the 'Customs 2000' programme.
In December 1996, the Parliament and the Council adopted the Commission proposal for an action programme for customs in the Community.
This was to agree explicit guidelines so that customs services could have a clear idea of the role they were expected to play within the Community dimension.
However, this was to be without encroaching upon national competences. This programme has been a success, but it can be improved upon. It will now be prolonged and updated as 'Customs 2002' through the inclusion in this programme of the existing and future information technology programmes (such as Transit) and the 'Matthaeus' training programme. It will also be opened to all countries that are candidates for accession.
What is Customs 2002?
Aim
One of the main objectives of Customs 2002 is to work to avoid operational divergences in customs matters at national level. The action programme recognises that the abolition of internal borders requires an efficient high-quality control of the external borders. Individual action by each administration is incapable on its own of achieving this objective.
How
By building on the spirit of partnership and cooperation that has developed between the Commission and the Member States. This is one of the most important elements to be built on in achieving the objectives of Customs 2002.
Actions
Customs 2002 provides, inter alia for:
visits to see customs procedures in action in the Member States by teams from the Commission and the Member States (this is called 'monitoring') to identify the best practices, or perhaps even deficiencies, in control measures;
the Commission and the Member States to strengthen the combating of fraud. In this context, collection, analysis and exploitation of information will be carried out making full use of computers and ensuring that irregularities are effectively followed up;
the Commission to support any action to improve the working methods of customs administrations, for example by using risk-analysis, post-importation audit techniques to check traders' records and computerised handling of customs procedures;
customs officials to be exchanged between different administrations to broaden their experience and for common training programmes to be further developed;
seminars to be held, often with the participation of the trade, to identify problem areas and discuss possible courses of action that could be taken and others to identify best practices that could be generally used;
the computerisation of customs procedures at a Union level.
Conclusions What can we conclude from the history of European customs and the future tasks which they will face?
We have come a long way, but we have not yet arrived. In fact, we will never arrive, at least for as long as trade into and out of the European Union cannot be left free from any kind of limitations or control. Will this ever happen? Perhaps, but not in the foreseeable future. Customs must adapt and change to meet new roles, new challenges, and to harmonise, possibly even, to have unified procedures and practices everywhere. The first steps have been taken: 15 customs services are now acting as one.
Customs has a future. It has a vital role in carrying out your wishes: to collect your taxes, to protect your industries, your employment, your health, your environment.
05 Jan 2007
"GOING FOR GROWTH The economy of the EU" exracted from EU Documents
GOING FOR GROWTH The economy of the EU From fragmentation to integration _____________________________________ Among the fundamental objectives of the European Union are economic and social progress and constant improvements in living and working conditions. These aims were laid down in the Treaty of Rome which, in 1957, established what was then the European Economic Community (EEC) and is now the European Union (EU). Nevertheless, it is a major achievement for the EU to have become, in just 50 years, the worlds second largest economy in which 12 countries share a single currency At its birth, the EU was made up of distinct national economies. Goods moving across borders were stopped for paperwork and to pay customs duties. Today, by contrast, the EU is essentially a single economy. Goods move freely across national borders. In addition, people, money and service providers (such as airlines, banks and phone companies) are free to move around and to operate across the EU with a degree of freedom that would have been hard to imagine 50 years ago. All this has been achieved by steadily breaking down the barriers between the national economies a process known as economic integration. The EU cannot, however, afford to rest on its laurels. Despite major advances in delivering a better life for its citizens, the EU is not as internationally competitive as it could be. If the EU does not maximise its economic potential, it will find it more difficult to fund an inclusive society with a robust safety net for the less well off. Even closer integration of the EU economy and there is still unfinished business will help achieve this because a key lesson of the last 50 years has been that economic integration brings growth and creates jobs. The EU then and now The EEC of 1958 was very different from the EU of today. In 1958, 23% of the population of the six member states Belgium, France, Germany, Italy, Luxembourg and the Netherlands - relied on farming for a job. By 2001, that figure had dropped to 4% for the then 15 EU countries. In 1958, 40% of the population worked in industry. That had dropped to 29% in 2001. Services are now by far the largest source of jobs: 67% of the population of the EU were employed in service industries in 2001, compared to 37% in 1958. This trend has been unaffected by successive waves of enlargement which added both more rural and more industrial countries to the EU: Denmark, Ireland and the UK in 1973, Greece in 1981, Spain and Portugal in 1986, and Austria, Finland and Sweden in 1995. In 1958, there were only about 3 000 km of motorway in the countries that now make up the EU. Now there are 52 000 km. In the original six member states, just 6.6% of the population owned a car. Now there are nearly half as many cars as people in the EU. And the number of plane journeys made each year by people in the EU has increased thirtyfold. Achievements and goals There have been three key milestones since the EU was founded: creation of a customs union; the single market; economic and monetary union. The customs union laid the foundations for free trade in goods. The single market swept away surviving red tape for trade in goods and took a major step towards free trade in services. Economic and monetary union removed many of the remaining obstacles to cross-border investment. It launched the single currency the euro and an agreed approach to economic policy. That leaves plenty of unfinished business. It is still more difficult than it need be for scientists in several countries to cooperate in research. Governments, including local government, do not do as much as they could to buy goods and services for the most competitive price anywhere in the EU. Financial services are not as widely available across borders as they could be. The EU must also do more to help enterprising people set up new businesses and to encourage businesses to innovate. More needs to be done to harness the Internet to generate economic growth. The agreed objective is to make the EU the worlds most competitive and dynamic knowledge-based economy by 2010. The goal is ambitious, but not unattainable. The bigger the EU, the greater the benefits The bigger the European Union, the greater the catalytic effect of integration. Enlargement of the EU to 25 countries costs money initially as the EU helps newcomers complete the transition to becoming competitive free market economies. However, there are tangible economic benefits to the EU. The economy of the old member states benefits since, as previous enlargements have shown, competition and increased personal mobility are good for growth. By the end of the decade, the combined economies of the old member states could be 1% larger than they would otherwise have been. The newcomers, meanwhile, can expect up to 1% more growth each year from membership. This will come largely from higher investment and from reforming these economies so that they run more efficiently. Standards of living and quality of life will improve. It could also mean the creation of more than 300 000 jobs in these countries by 2010. Laying the foundations Creating a customs union was the first step towards creating a single EU economy. Within the borders of the customs union, which was completed in 1968, there is free trade. Businesses pay no customs duties from Lapland to Sicily, from Portugals Atlantic islands to the EUs easternmost borders. Creating a customs union also ensured that the playing field was levelled for anyone importing from the rest of the world. If there is duty to pay on imports, then it is the same whichever port, airport, road or rail entry point is used. Importers can bring goods into the EU in bulk and then break the shipment down into different parts destined for customers in several member states. They no longer need to use Piraeus for goods intended for Greece and Marseille for goods intended for France, but can use either port for both destinations. This makes business more efficient, makes pricing more competitive and expands consumer choice. The benefits of the customs union were clear from an early stage. By 1970, member states were trading six times as much between themselves than 12 years earlier. They were also trading three times as much with the rest of the world. Their economies more than doubled in size and were expanding faster than the US economy. More hurdles to overcome _____________________________________ Creating the customs union took away only the most obvious barrier to free trade and competition and thus to economic and social progress. It still left plenty of red tape to hold up trade. Customs officers did not disappear. They still stopped lorries and freight trains to check their paperwork and often the contents of their containers as well. In 1988, this was costing industry and governments an unnecessary 9 billion each year. There was a further obstacle in the shape of differences in technical requirements, including environmental regulations. Standards were not necessarily higher or lower in one country or another, just different for historical reasons. Work on developing common EU standards goes back a long way, but progress was slow in the early years. Moreover, during the economic slowdowns resulting from the oil price shocks of 1973 and 1979, the appetite for more economic integration diminished. The long-term gains were recognised, but the short-term pain of adjustment seemed too great. It was not until the beginning of the following decade that member states were ready to start planning another quantum leap. That came in the shape of the Single European Act, the blueprint for the European Single Market. Signed in early 1986, it set the end of 1992 as the target date for eliminating the many barriers to trade which still survived. Freedom for people too In the process of opening up markets for goods and services, people were not forgotten. As soon as the EEC was set up, it became easier for citizens of one member state to live and work in another. Freedom of movement has since been extended to job seekers, students, pensioners, in fact virtually everybody. More than 15 million EU citizens have moved to work or retire in another EU country. For the last couple of decades, the passports of all EU citizens have had the same wine-coloured cover. The days when trains stopped at the frontier while passports were checked are also a thing of the past. Border checks have disappeared at most of the EUs internal frontiers since 1985. Only the UK and Ireland still carry out these checks. The single market ______________________________ Putting the single market in place meant passing more than 1 000 pieces of legislation in seven years. The single market replaced frontier checks on goods with systems based on trust, and on checks before departure and on arrival. It promoted trust in other countries standards and different technologies. These may differ in the detail, but what matters is that the product is safe, not exactly how the objective was achieved. It broke down barriers that had prevented service industries expanding across borders. In creating the single market, major steps were taken towards ensuring that all EU countries take a broadly similar approach to company law, business accounting rules and intellectual property rules. This makes it easier for companies to operate throughout the EU and to run their businesses as efficiently as possible. The remaining barriers to moving money across borders were progressively dismantled, whether it was for business investment, savings, study or holidays. It became easier for financial institutions to set up right across the EU and to offer their banking services, insurance and savings products in another country with a minimum of formalities. At the same time, steps were taken towards ensuring that customers everywhere enjoyed equal protection, regardless of what bank, insurer or investment they choose. A start was made on introducing competition into what were traditionally monopoly sectors, such as telecommunications, airlines, the railways, postal services, gas and electricity. This process has continued since then. As a result, all barriers to competition in the telecommunications industry have disappeared. Most business customers and many households are free to choose their gas and electricity supplier. Restrictions which made it difficult for airlines to operate efficiently are being removed. The markets for business use of the railways and postal services have been liberalised. Work has begun on opening up Europes port services to greater competition and on using Europes airspace more efficiently. All this improves choice and brings down prices. Keen competition and room to expand within the single market helps keep European companies among the world leaders. Of the worlds 100 largest companies, 32 are from the EU. So are 39 of the worlds 100 largest commercial banks and 27 of the 100 most valuable brands. More competition pays off __________________________________________________________________________________ The single market has been the key to releasing large amounts of Europes economic potential. In the ten years between 1992 and 2002, the single market added 1.8 percentage points to GDP growth in the EU as a whole. In addition, the single market has: generated nearly 900 billion in extra prosperity about 6 000 per household in its first ten years; created some 2.5 million jobs in the EU since 1992. These jobs would not have existed without borders being opened up; contributed to a 30% increase in trade in manufactured goods in the EU since 1992, thus increasing the selection of goods available and increasing competition; been a key factor in boosting flows of direct investment within the EU. These flows were 12 times greater in 2000 than in 1992; encouraged new inflows of foreign direct investment from outside the EU; made the EU more internationally competitive. For example, EU exports to countries outside the EU increased from 6.9% of EU GDP in 1992 to 11.2% in 2001; allocated skills more efficiently as people have taken up the opportunity to work in other EU countries; boosted purchasing power through pressure on prices. The gap between the EUs highest and lowest prices has been narrowing; some goods are cheaper in absolute terms. Further efforts are under way for example to strengthen the single market in services (which account for 70% of EU GDP). The single market is work in progress, with the capacity to deliver even more benefits in future. Economic and monetary union _____________________________________ Well before the Single European Act was drafted, economists were pointing out that member state economies would have to behave more like each other a process known as convergence if they were collectively to realise their full potential. Economic and monetary union was seen as the difficult, but necessary and desirable next step in continuing to move forward. In 1969, the EU set itself the objective of achieving economic and monetary union (EMU) by 1980. However, the path was not easy. The recessions of the 1970s held up work on EMU and the accompanying single currency just as they stalled progress in other areas. The process restarted in 1978 with closer cooperation on exchange rates and was fully re-launched in 1988, culminating in completion of the first of three stages of EMU in 1990. In that year, for example, the EU lifted the last remaining restrictions on taking money from one member state to another, transferring money or investing in another EU country. No longer would anyone have to fill in a form to obtain foreign currency to go on holiday or study in another country. Over the next few years, a clear dividing line was drawn between the finances of governments and central banks. Governments were no longer able to turn to central banks to print money to bail them out if they could not balance their budgets. By 1994, the second stage of EMU had been reached, with the creation of the European Monetary Institute (EMI), the forerunner of todays European Central Bank (ECB). As part of this process, governments promised not to live beyond their means and ceilings were placed on the amount of debt governments were allowed to run up and on the size of their budget deficits. EU countries agreed on a system of multilateral surveillance, or monitoring, to watch out for situations where one member states decisions on budgetary policy might have adverse effects on the economies of other member states. The Maastricht criteria It was agreed in 1992 that five criteria would determine whether a member state was ready to adopt the single currency. Collectively, they are known as the Maastricht criteria, after the city in which the treaty was signed that spells them out. The criteria relate to: price stability: the inflation rate should be no more than 1.5 percentage points above the rate for the three member states with the best inflation rate over the previous year; the budget deficit (the gap between governments revenue and expenditure): this must generally be below 3% of gross domestic product (GDP); debt: the limit was set at 60% of GDP, but a country with a higher debt-to-GDP ratio can nevertheless adopt the euro if its debt levels are falling steadily; the long-term interest rate: this should not be more than two percentage points above the rate in the three member states with the best inflation rate over the previous year; exchange rate stability: the exchange rate should have stayed within pre-defined fluctuation margins for two years. These margins are those of the European exchange rate mechanism, an optional system for member states which want to link their currency to the euro. EMU: the starting gun __________________________________________________________________________________ The starting gun for full economic and monetary union was fired on 1 January 1999 with the launch of the euro in 11 member states: Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain. Greece, which could not initially meet the Maastricht criteria, followed in 2001. Three countries Denmark, Sweden and the United Kingdom decided to stay out of the first wave of euro membership. If they eventually decide to adopt the euro, they too will have to comply with the Maastricht criteria, as will the new member states. The newcomers are committed to adopting the euro, but cannot do so until 2006 at the earliest because of the exchange rate criterion. The euro became the official currency of participating countries from the date they joined. But there were no notes and coins until 1 January 2002. Anyone paying in euro during that transitional period had to use a credit or debit card or pay by bank transfer. So initially the euro was to all intents and purposes a virtual currency, mainly used for business rather than everyday transactions. The benefits of the single currency The most obvious benefit of the euro is the convenience for businesses and travellers. Businesses no longer have to allow for fluctuating exchange rates within the euro area. For travellers the hassle and costs of changing money have disappeared. The euro also makes it easier to compare prices. That is healthy for competition and good for consumers. The reasons for introducing the euro are much more fundamental, however. The additional integration will bring long-term benefits in competition, growth and prosperity, by ensuring a low-inflation environment and enabling business to trade more efficiently. The cost of transferring money to do business in another country has come down and there is no need for businesses to take out insurance or increase their profit margin to protect themselves against the risks of exchange rate fluctuations. These costs were tantamount to a tax on doing business and used to amount to 1% of GDP. They have largely disappeared because more than 80% of the trade of euro-area countries is now with one another. Companies in the euro area that trade with the rest of the world have the automatic advantage of using an international currency. They can often protect themselves against variations in exchange rates simply by billing their customers in euro. It is much easier to do that than it was in the past to persuade a client to pay in Greek drachma or Finnish markka. More to EMU than the euro _____________________________________ Economic and monetary union means respecting a set of rules known as the Stability and Growth Pact. These rules are designed to ensure that the public finances of our member states are sound which is an important in achieving sustainable growth. Every year, the Commission and the member states review compliance with the Pact. Each euro-area country provides the necessary information in the form of a stability programme. Non-euro countries submit convergence programmes. These contain an additional element: information on how these economies are performing in relation to the Maastricht criteria for joining the euro. In addition, the Commission constantly monitors how member states are meeting targets for integrating the EU economy still further in every sector from finance to research and development, from energy to transport. It also checks whether the environmental implications of economic policy decisions have been properly taken into account. In addition, the Commission monitors progress in creating jobs and making the job market accessible to as many people as possible. The overriding objective is to ensure sustainable growth and an inclusive society. The Stability and Growth Pact The Stability and Growth Pact commits all EU countries to the principle of budgets that are balanced or nearly balanced over the medium term. In other words, EU member states should not spend more than they earn. That way they can avoid the sorts of debt build-up which in the past have left governments either needing to increase taxes or short of money to spend on their citizens and on investment. If economic growth slows, tax revenues dip because businesses are doing less well, consumers are spending less and governments need to spend more on unemployment benefit. Under these circumstances, some extra borrowing may be justified. However, if budgets are in a fundamentally sound position to start with, governments should have enough leeway to keep their deficits below 3% of GDP. The Pact is not a straitjacket. It allows governments to exceed the 3% margin in exceptional circumstances. Economies can run into hard times through no fault of the governments managing them. Unforeseen events can rock the international economy for example, the terrorist attacks in the United States on 11 September 2001, or the oil price rise that preceded the war in Iraq in 2003. If a member state does break the rules of the Pact without good reason, it will be warned to take corrective action very quickly. Otherwise, the European Commission and the other EU countries may impose corrective measures. If that were not a sufficient incentive to get the budget back under control, the recalcitrant member state would have to deposit money interest-free with the Commission. If this were still not enough to persuade the member state to put its house in order, it could forfeit that money altogether. That is justified because an excessive deficit in one EU country can have negative effects on the others. The role of the ECB Stable prices create a stable economic environment, and the European Central Bank (ECB) plays a crucial role in achieving this stability for the euro area. It does so by setting the interest rates it uses in its dealings with banks, and these in turn act as a baseline for all euro-area interest rates. The ECB sets its rates at the level it believes will keep prices in the euro area stable. It aims to keep inflation close to but less than 2% in the medium term, thus steering a safe course between the twin risks of deflation and excessive inflation. The Bank also manages the currency reserves of the euro area and has the power to sell and buy foreign exchange on international currency markets to influence the exchange rate of the euro. However, it does not have a set view of the appropriate level of the exchange rate. Its policy focus is on inflation. Headquartered in Frankfurt, the European Central Bank is the hub of the European System of Central Banks (ESCB). All EU central banks are part of the ESCB. This gives all of them a say, for example, in the choice of technology to ensure that businesses and banks can move money efficiently across the EU. However, only the euro-area central banks are consulted when the ECB sets interest rates for the euro area. The impact of the euro __________________________________________________________________________________ Change was evident in financial markets as soon as the euro was introduced in virtual form in 1999. Euro-area governments were in most cases immediately paying less interest on money they borrowed. On the one hand, they were operating in a stable, low-inflation environment which keeps interest rates low. On the other, they were borrowing in a highly liquid currency, in other words a currency for which there are always plenty of buyers and sellers. Lively demand keeps interest rates competitive. Lower interest rates keep the cost of debt repayment down and leaves governments more room to reduce taxes or more money to spend on health, pensions, social welfare or infrastructure. Businesses and consumers benefit too. Lower interest rates make investment more affordable for businesses and make mortgages cheaper for house buyers. Benefits not limited to the euro area It is not just euro-area governments that are tapping into the benefits of this new international currency. Other countries, both in and outside the EU, are borrowing in euro as well. They can reap some of the same benefits from the fact this is a liquid, internationally recognised currency. They often also want to diversify their currency holdings and the euro gives them an additional international currency in which to do this. The euro is also increasingly used alongside the dollar by central banks as a reserve currency, i.e. the store of convertible currency they keep for monetary emergencies. Notes and coins make the euro real For the general public, economic and monetary union made a really tangible impact only when euro notes and coins were introduced on 1 January 2002. There are notes of seven different values and coins of eight different values. Each coin has a European design on one side and on the other a symbol of the country where is was issued. The notes, on the other hand, have no national features. Euro notes and coins, regardless of where they were issued, can be used everywhere in the euro area and in some other countries too. Once citizens of the 12 euro-area countries had the cash in their hands and pockets, it brought home to them how much easier travel had become, and how it has added to their purchasing power. Before the euro was introduced, the cost of changing money could amount to 1% of the cost of a holiday, and significantly more for someone visiting several countries and changing only small sums of money each time. The euro has made people cannier shoppers, able to compare prices and to buy where goods are cheapest. All this has been facilitated by EU rules on charges for withdrawing euro from cash machines, for paying by credit card and for transferring euro to another country. These charges have come down sharply or disappeared altogether. Unfinished business _________________ European economic integration has come about in a series of logical steps. To realise the full potential of the customs union, the EU clearly required a single market. And the single market makes most sense for many countries when trade is conducted in a single currency. However, there is still unfinished business. More needs to be done to unlock the potential of the single market in services and to promote the digital economy, entrepreneurship and innovation. Pressures to backslide on sound public finances must be resisted. Finishing the work on services More integration of financial services will bring measurable benefits. For example, making it easier for companies to issue shares and bonds as an alternative to borrowing could save 0.3% of GDP. The creation of a truly single market in stocks and shares would, overall, add at least 1.1% to GDP and increase employment by half a percentage point. If banking markets were truly integrated, that could save 1.5% of GDP. Much has already been achieved and the remainder is due for completion by 2005. There are still bureaucratic barriers to trade in other services too, and the Commission is encouraging service providers to overcome these obstacles by adopting European codes of conduct. It is also pushing the public sector to do more to attract bids from companies in other countries when buying goods and services. The extra competition could save the public sector 1% of what it spends. Unleashing digital potential Unleashing Europes digital potential is equally vital to continuing growth. EU governments have already agreed to ensure that access to the Internet is cheap, fast and secure and to invest heavily in providing people with Internet skills. The EU is also working to stimulate a whole range of online activities such as e-commerce, online government services, online health services, European web content and the use of intelligent technologies to tackle transport bottlenecks. Unlocking entrepreneurial potential It is important to change mindsets and remove the barriers to creating and developing new businesses. Europeans lag behind Americans in this area: Europeans are more comfortable in employment than being self-employed. Yet job satisfaction is higher among those who run their own businesses. When Europeans do start new ventures, these tend to grow more slowly than their American counterparts. Barriers to innovation are a major reason. These include bureaucracy, difficulties in borrowing money to start new businesses and the high costs of obtaining patents. The European Commission is promoting action to tackle all these problems to cut red tape, provide easier access to start-up capital and introduce a cheaper and more efficient patent system. Closing the technology gap Finally, it is crucial to close the technology gap with the United States and Japan. The EU spends less than 2% of GDP on research and technological development; the US spends nearly 3% and Japan is not far behind the US. In the EU, high technology accounts for 10.1% of value added in manufacturing, as against 13.8% in Japan and 25.8% in the US. Expenditure on information and communications technology is 6.93% of GDP in the EU, 8.22% in the US and 8.98% in Japan. Building for the future ____________________ The more delays there are in realising the potential and the extra growth this can bring, the greater the pressure on government budgets, since they need tax revenues from a successful economy to pay for public services and pensions. Governments are finding it increasingly difficult to pay for pensions and health care as life expectancy increases, people retire earlier, birth rates fall and expectations rise that advances in medical technology will be universally available. The pensions and health care of todays older generation are paid for from the contributions of those in work. In Europe today, there are four people of working age for every pensioner, but by 2040 this ratio will be only two to one. These challenges are not unique to the EU, but are particularly acute because European birth rates are among the lowest in the world and life expectancy among the highest, pension and health care systems are particularly developed and governments want pensions and health care for all to remain a defining characteristic of European economies. A robust social welfare system is an important part of the EUs social and economic heritage. Growth helps ensure that this heritage is affordable and sustainable for future generations. If governments are to meet the costs they must go for growth by modernising the European economy, pushing ahead with integration and keeping to sound budgetary policies. More efficient financial markets without borders will give governments and individual citizens the best return on their money. Going for growth and more jobs will generate tax revenues for governments to spend on pensions, health care and other social safety nets. Investing in people The EU does not, however, see growth and job creation as ends in themselves. Growth must be sustainable in the interests of the long-term welfare of its citizens and their environment. In addition, people have a right to quality jobs and access to facilities such as adequate child care. These are fundamental tenets of EU employment and social policy. So is equal opportunity. It is a stated EU goal to strike the right balance between work and the rest of life. People are Europes main asset, as EU leaders agreed in Lisbon in 2000 when setting strategic goals for the current decade. Investing in people and developing an active and dynamic welfare state are as crucial to securing Europes place in the new knowledge economy as are economic, financial and monetary integration and the pursuit of innovation and enterprise. If the emphasis is placed on people, the emergence of a new economy will be a force for social and economic cohesion. Investing in people is crucial as the Union strives to go for growth and to become the worlds most competitive and dynamic knowledge-based economy by 2010.
05 Jan 2007
"Europe in 12 lessons" exracted from EU Documents
Europe in 12 lessons
What purpose does the EU serve? Why and how was it set up? How does it work? What has it already achieved for its citizens, and what new challenges does it face today? How can citizens get more involved?
In an age of globalisation, can the EU compete successfully with other major economies and maintain its social standards? Can Europe continue to play a leading role on the world stage and help protect against terrorism?
These are just some of the questions Pascal Fontaine EU expert and former university lecturer explores in the new 2007 edition of his popular booklet Europe in 12 lessons.
I. Peace and stability
Before becoming a real political objective, the idea of uniting Europe was just a dream in the minds of philosophers and visionaries. Victor Hugo, for example, imagined a peaceful United States of Europe inspired by humanistic ideals. The dream was shattered by the terrible wars that ravaged the continent during the first half of the 20th century.
However, a new kind of hope emerged from the rubble of World War Two. People who had resisted totalitarianism during the war were determined to put an end to international hatred and rivalry in Europe and create the conditions for lasting peace. Between 1945 and 1950, a handful of courageous statesmen including Robert Schuman, Konrad Adenauer, Alcide de Gasperi and Winston Churchill set about persuading their peoples to enter a new era. New structures would be created in western Europe, based on shared interests and founded upon treaties guaranteeing the rule of law and equality between all countries.
Robert Schuman (French foreign minister) took up an idea originally conceived by Jean Monnet and, on 9 May 1950, proposed establishing a European Coal and Steel Community (ECSC). In countries which had once fought each other, the production of coal and steel would be pooled under a common High Authority. In a practical but also richly symbolic way, the raw materials of war were being turned into instruments of reconciliation and peace.
II. Bringing Europe together again
The European Union encouraged German unification after the fall of the Berlin Wall in 1989. When the Soviet empire crumbled in 1991, the former communist countries of central and eastern Europe, after decades under the authoritarian yoke of the Warsaw Pact, decided that their future lay within the family of democratic European nations.
The enlargement process continues to this day. Entry negotiations began with Turkey and Croatia in October 2005, while several countries in the Balkans have set out along the road that could one day lead to EU membership.
III. Safety and security
Europe in the 21st century still faces safety and security issues. The EU has to take effective action to ensure the safety and security of its members. It has to work constructively with the regions just beyond its borders: the Balkans, North Africa, the Caucasus and the Middle East. It must also protect its military and strategic interests by working with its allies, especially within NATO, and by developing a genuine common European security and defence policy.
Internal security and external security are two sides of the same coin. The fight against terrorism and organised crime requires the police forces of all EU countries to work together closely. Making the EU an area of freedom, security and justice where everyone has equal access to justice and is equally protected by the law is a new challenge that requires close cooperation between governments. Bodies like Europol, the European Police Office, and Eurojust, which promotes cooperation between prosecutors, judges and police officers in different EU countries, also have a more active and effective role to play.
IV. Economic and social solidarity
The European Union was created to achieve the political goal of peace, but its dynamism and success spring from its involvement in economics.
EU countries account for an ever smaller percentage of the worlds population. They must therefore continue pulling together if they are to ensure economic growth and be able to compete on the world stage with other major economies. No individual EU country is strong enough to go it alone in world trade. The European single market provides companies with a vital platform for competing effectively on world markets.
But Europe-wide free competition must be counterbalanced by Europe-wide solidarity. This has clear tangible benefits for European citizens: when they fall victim to floods and other natural disasters, they receive assistance from the EU budget. The Structural Funds, managed by the European Commission, encourage and supplement the efforts of the EUs national and regional authorities to reduce inequalities between different parts of Europe. Money from the EU budget and loans from the European Investment Bank (EIB) are used to improve Europes transport infrastructure (for example, to extend the network of motorways and high-speed railways), thus providing better access to outlying regions and boosting trans-European trade. The EUs economic success will be measured in part by the ability of its single market of half a billion consumers to benefit as many people and businesses as possible.
V. Identity and diversity in a globalised world
Europes post-industrial societies are becoming increasingly complex. Standards of living have risen steadily, but there are still significant gaps between rich and poor. Enlargement has widened the gap since countries have joined with living standards below the EU average. It is important for EU countries to work together to narrow the gap.
But these efforts have not been made at the expense of compromising the separate cultural or linguistic characteristics of EU countries. On the contrary many EU activities help to create new economic growth based on regional specialities and the rich diversity of traditions and cultures.
Half a century of European integration has shown that the EU as a whole is greater than the sum of its parts: it has much more economic, social, technological, commercial and political clout than if its member states had to act individually. There is added value in acting together and speaking with a single voice as the European Union.
Why?
Because the EU is the worlds leading trading power and therefore plays a decisive role in international negotiations, such as those at the 149-country World Trade Organisation (WTO), as well as in the implementation of the Kyoto protocol on air pollution and climate change;
Because it takes a clear position on sensitive issues affecting ordinary people, such as environmental protection, renewable energy resources, the precautionary principle in food safety, the ethical aspects of biotechnology and the need to protect endangered species;
Because it launched important initiatives for sustainable development on the whole planet, in connection with the Earth Summit in 2002 in Johannesburg.
The old saying unity is strength is as relevant as ever to todays Europeans. But the process of European integration has not smothered the different ways of life, traditions and cultures of its peoples. Indeed, the EU makes its diversity one of its key values.
VI. Values
The EU wishes to promote humanitarian and progressive values, and ensure that mankind is the beneficiary, rather than the victim, of the great global changes that are taking place. Peoples needs cannot be met simply by market forces or imposed by unilateral action.
So the EU stands for a view of humanity and a model of society that the great majority of its citizens support. Europeans cherish their rich heritage of values, which includes a belief in human rights, social solidarity, free enterprise, a fair distribution of the fruits of economic growth, the right to a protected environment, respect for cultural, linguistic and religious diversity and a harmonious blend of tradition and progress.
The Charter of Fundamental Rights of the European Union, which was proclaimed in Nice in December 2000, sets out all the rights recognised today by the EUs member states and their citizens. These values can create a feeling of kinship between Europeans. To take just one example, all EU countries have abolished the death penalty.
Ten historic steps
1951: The European Coal and Steel Community is established by the six founding members
1957: The Treaty of Rome establishes a common market
1973: The Community expands to nine member states and develops its common policies
1979: The first direct elections to the European Parliament
1981: The first Mediterranean enlargement
1993: Completion of the single market
1993: The Treaty of Maastricht establishes the European Union
1995 : The EU expands to 15 members
2002: Euro notes and coins are introduced
2004: Ten more countries join the Union
1. On 9 May 1950, the Schuman Declaration proposed the establishment of a European Coal and Steel Community (ECSC), which became reality with the Treaty of Paris of 18 April 1951. This put in place a common market in coal and steel between the six founding countries (Belgium, the Federal Republic of Germany, France, Italy, Luxembourg and the Netherlands). The aim, in the aftermath of World War Two, was to secure peace between Europes victorious and vanquished nations and bring them together as equals, cooperating within shared institutions.
2. The Six then decided, on 25 March 1957 with the Treaty of Rome, to build a European Economic Community (EEC) based on a wider common market covering a whole range of goods and services. Customs duties between the six countries were completely abolished on 1 July 1968 and common policies, notably on trade and agriculture, were also put in place during the 1960s.
3. So successful was this venture that Denmark, Ireland and the United Kingdom decided to join the Community. This first enlargement, from six to nine members, took place in 1973. At the same time, new social and environmental policies were implemented, and the European Regional Development Fund (ERDF) was established in 1975.
4. June 1979 saw a decisive step forward for the European Community, with the first elections to the European Parliament by direct universal suffrage. These elections are held every five years.
5. In 1981, Greece joined the Community, followed by Spain and Portugal in 1986. This strengthened the Communitys presence in southern Europe and made it all the more urgent to expand its regional aid programmes.
6. The worldwide economic recession in the early 1980s brought with it a wave of euro-pessimism. However, hope sprang anew in 1985 when the European Commission, under its President Jacques Delors, published a White Paper setting out a timetable for completing the European single market by 1 January 1993. This ambitious goal was enshrined in the Single European Act, which was signed in February 1986 and came into force on 1 July 1987.
7. The political shape of Europe was dramatically changed when the Berlin Wall fell in 1989. This led to the unification of Germany in October 1990 and the coming of democracy to the countries of central and eastern Europe as they broke away from Soviet control. The Soviet Union itself ceased to exist in December 1991.
At the same time, the member states were negotiating the new Treaty on European Union, which was adopted by the European Council, composed of presidents and/or prime ministers, at Maastricht in December 1991. The Treaty came into force on 1 November 1993. By adding areas of intergovernmental cooperation to existing integrated Community structures, the Treaty created the European Union (EU).
8. This new European dynamism and the continents changing geopolitical situation led three more countries Austria, Finland and Sweden to join the EU on 1 January 1995.
9. By then, the EU was on course for its most spectacular achievement yet, creating a single currency. The euro was introduced for financial (non-cash) transactions in 1999, while notes and coins were issued three years later in the 12 countries of the euro area (also commonly referred to as the euro zone). The euro is now a major world currency for payments and reserves alongside the US dollar.
Europeans are facing globalisation. New technologies and ever increasing use of the Internet transform the economies, but also bring social and cultural challenges.
In March 2000, the EU adopted the Lisbon strategy for modernising the European economy and enabling it to compete on the world market with other major players such as the United States and the newly industrialised countries. The Lisbon strategy involves encouraging innovation and business investment and adapting Europes education systems to meet the needs of the information society.
At the same time, unemployment and the rising cost of pensions are putting pressure on national economies, making reform all the more necessary. Voters are increasingly calling on their governments to find practical solutions to these problems.
10. Scarcely had the European Union grown to 15 members when preparations began for a new enlargement on an unprecedented scale. In the mid-1990s, the former Soviet-bloc countries (Bulgaria, the Czech Republic, Hungary, Poland, Romania and Slovakia), the three Baltic states that had been part of the Soviet Union (Estonia, Latvia and Lithuania), one of the republics of former Yugoslavia (Slovenia) and two Mediterranean countries (Cyprus and Malta) began knocking at the EUs door.
The EU welcomed this chance to help stabilise the European continent and to extend the benefits of European integration to these young democracies. Negotiations on future membership opened in December 1997. The EU enlargement to 25 countries took place on 1 May 2004 when 10 of the 12 candidates joined. Bulgaria and Romania are expected to join on 1 January 2007. (
Enlargement and neighbourhood policy
The European Union is open to any European country that fulfils the democratic, political and economic criteria for membership.
Following several enlargements, the EU has increased from six to 25 members. It is expected to have 27 from 2007 onwards, while other candidate countries are engaged in membership negotiations.
Each treaty admitting a new member requires the unanimous approval of all member states. In addition, in advance of each new enlargement, the EU will assess its capacity to absorb the new member(s) and the ability of its institutions to continue to function properly.
The successive enlargements have strengthened democracy, made Europe more secure and increased its potential for trade and economic growth.
I. Uniting a continent
(a) A union of 25
When it met in Copenhagen in December 2002, the European Council took one of the most momentous steps in the history of European integration. By inviting 10 more countries to join the EU on 1 May 2004, the European Union was not simply increasing its geographical size and population; it was putting an end to the split in our continent which, from 1945 onwards, had separated the free world from the communist bloc.
This fifth enlargement of the EU had a political and moral dimension. It enabled countries Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia which are as European as the others, not just geographically but also in terms of culture, history and aspirations, to join the democratic European family. They are now partners in the momentous project conceived by the EUs founding fathers.
(b) Further enlargement
Bulgaria and Romania, candidates since 1995, have completed negotiations. Now that the European Parliament has given its assent, and once all the EU member states have ratified their accession, they should join the EU on 1 January 2007. The EU will then have 27 member states.
(c) Candidates for membership
Turkey, a member of NATO, with a long-standing association agreement with the EU, applied for membership in 1987. Its geographical location and political history made the EU hesitate for a long time before replying positively to its application. However, in October 2005, the European Council opened accession negotiations with Turkey. At the same time, it entered into negotiations with Croatia, another candidate country. No date has yet been set for the entry into force of any future accession treaty for these two countries at the end of the membership negotiations.
(d) The western Balkans
These countries, most of which were once part of Yugoslavia, are turning to the European Union to speed up their economic reconstruction, improve their mutual relations, which have been scarred by ethnic and religious wars, and consolidate their democratic institutions. The EU gave status as candidate country to the former Yugoslav Republic of Macedonia (FYROM) in November 2005. Other potential candidates include Albania, Bosnia and Herzegovina, Montenegro and Serbia.
II. Membership conditions
(a) Legal requirements
European integration has always been a political and economic process that is open to all European countries prepared to sign up to the founding treaties and take on board the full body of EU law. According to Article 237 of the Treaty of Rome any European state may apply to become a member of the Community.
Article F of the Maastricht Treaty adds that the member states shall have systems of government [
] founded on the principles of democracy.
(b) The Copenhagen criteria
In 1993, following requests from the former communist countries to join the Union, the European Council laid down three criteria they should fulfil so as to become members. By the time they join, new members must have:
stable institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities;
a functioning market economy and the capacity to cope with competitive pressure and market forces within the Union;
the ability to take on the obligations of membership, including support for the aims of the Union. They must have a public administration capable of applying and managing EU laws in practice.
(c) The accession process
The entry negotiations are carried out between each candidate country and the European Commission which represents the EU. Once these are concluded, the decision to allow a new country to join the EU must be taken unanimously by the existing member states meeting in the Council. The European Parliament must give its assent through a positive vote by an absolute majority of its members. All accession treaties must then be ratified by the member states and the candidate countries in accordance with each countrys own constitutional procedures.
During the years of negotiation, candidate countries receive EU aid so as to make it easier for them to catch up economically. For the enlargement of the 10 countries in 2004, this involved a package of 41 billion aimed mainly at funding structural projects to allow the newcomers to fulfil the obligations of membership.
III. How large can the EU become?
(a) Geographic frontiers
The debates concerning ratification of the EUs Constitutional Treaty that took place in most member countries showed that many Europeans had a number of concerns about the final borders of the European Union and even about its identity. There are no simple answers to these questions, particularly since each country views its geopolitical or economic interests differently. The Baltic countries and Poland advocate EU membership for Ukraine. The possible entry of Turkey will raise the question of the status of some countries in the Caucasus such as Georgia and Armenia.
Despite fulfilling the membership conditions, Iceland, Norway, Switzerland and Liechtenstein are not members of the European Union because public opinion in those countries is currently against joining.
The political situation in Belarus and the strategic position of Moldova still pose problems. It is clear that Russian membership would create unacceptable imbalances in the European Union, both politically and geographically.
(b) Administrative constraints
Furthermore, the current membership rules, as defined in the Treaty of Nice from 2003, set the institutional framework for a Union with a maximum of 27 members. To go beyond this figure will require a new intergovernmental agreement on the relationships between the member states within the institutions.
The ability of the Union to function in accordance with the fundamental principles of the Treaties (see Chapter 4: How does the EU work?) will be harder with more than 30 countries. The decision-making procedures would have to be thoroughly re-examined to avoid paralysis and allow the EU to retain the ability to act.
Then there are sensitive issues like the use of the official languages. Bulgarian and Romanian membership will bring the number of official languages to 23. EU enlargement must not make ordinary people feel that their national or regional identities are being diluted within a standardised EU.
IV. Candidates and non-candidates
The European Union has two parallel policies for handling its relations with neighbouring countries depending on whether they are on the current list of potential candidates or not.
Stabilisation and association agreements open up the possibility for a country to become a candidate for EU membership at the end of a negotiation process. The first such agreements were with Croatia and the former Yugoslav Republic of Macedonia (FYROM). They were followed by Albania. Other potential candidates in this context are Bosnia and Herzegovina, Montenegro and Serbia.
Under its neighbourhood policy, the EU has trade and cooperation agreements with non-member countries in the southern Mediterranean and the southern Caucasus as well as with countries in eastern Europe whose future relationship with the European Union remains unclear.
How does the EU work?
The Council of Ministers of the European Union, which represents the member states, is the EUs main decision-taking body. When it meets at Heads of State or Government level, it becomes the European Council whose role is to provide the EU with political impetus on key issues.
The European Parliament, which represents the people, shares legislative and budgetary power with the Council of the European Union.
The European Commission, which represents the common interest of the EU, is the main executive body. It has the right to propose legislation and ensures that EU policies are properly implemented.
I. The decision-making triangle
The European Union is more than just a confederation of countries, but it is not a federal state. It is, in fact, a new type of structure that does not fall into any traditional legal category. Its political system is historically unique and has been constantly evolving over more than 50 years.
The Treaties (known as primary legislation), are the basis for a large body of secondary legislation which has a direct impact on the daily lives of EU citizens. The secondary legislation consists mainly of regulations, directives and recommendations adopted by the EU institutions.
These laws, along with EU policies in general, are the result of decisions taken by the institutional triangle made up of the Council (representing national governments), the European Parliament (representing the people) and the European Commission (a body independent of EU governments that upholds the collective European interest).
(a) The Council of the European Union and the European Council
The Council of the European Union (also known as the Council of Ministers) is the EUs main decision-making body. The EU member states take it in turns to hold the Council Presidency for a six-month period. Every Council meeting is attended by one minister from each EU country. Which ministers attend a meeting depends on which topic is on the agenda: foreign affairs, agriculture, industry, transport, the environment, etc.
The Council has legislative power, which it shares with the European Parliament under the co-decision procedure. In addition to this, the Council and the Parliament share equal responsibility for adopting the EU budget. The Council also concludes international agreements that have been negotiated by the Commission.
According to the Treaties, the Council has to take its decisions either by a simple majority vote, a qualified majority vote or unanimously, depending on the subject to be decided.
The Council has to agree unanimously on important questions such as amending the Treaties, launching a new common policy or allowing a new country to join the Union.
In most other cases, qualified majority voting is used. This means that a Council decision is adopted if a specified minimum number of votes are cast in its favour. The number of votes allocated to each EU country roughly reflects the size of its population.
Number of votes for each country in the Council
Germany, France, Italy and the United Kingdom 29
Spain and Poland 27
Netherlands 13
Belgium, Czech Republic, Greece, Hungary and Portugal 12
Austria and Sweden 10
Denmark, Ireland, Lithuania, Slovakia and Finland 7
Estonia, Cyprus, Latvia, Luxembourg and Slovenia 4
Malta 3
Total: 321
A minimum of 232 votes out of 321 (72.3 %) is required to reach a qualified majority. In addition:
a majority of member states (in some cases two thirds) must approve the decision, and
any member state may ask for confirmation that the votes cast in favour represent at least 62 % of the EUs total population.
When they join the EU, Bulgaria will have 10 votes and Romania 14 votes. The qualified majority will require 255 out of 345 votes.
The European Council meets, in principle, four times a year. It is chaired by the president or prime minister of the country holding the presidency of the Council of the European Union at the time. The President of the European Commission attends as a full member.
Under the Treaty of Maastricht, the European Council officially became an initiator of the Unions major policies and was empowered to settle difficult issues on which ministers meeting in the Council of the European Union fail to agree.
The European Council also deals with pressing international issues through the common foreign and security policy (CFSP), which is intended to allow the EU to speak with one voice on diplomatic questions.
(b) The European Parliament
The European Parliament is the elected body that represents the EUs citizens. It exercises political supervision over the EUs activities and takes part in the legislative process. Since 1979, members of the European Parliament (MEPs) have been directly elected, by universal suffrage, every five years.
Number of seats in the European Parliament per country 200709
Austria 18
Belgium 24
Bulgaria 18
Cyprus 6
Czech Republic 24
Denmark 14
Estonia 6
Finland 14
France 78
Germany 99
Greece 24
Hungary 24
Ireland 13
Italy 78
Latvia 9
Lithuania 13
Luxembourg 6
Malta 5
Netherlands 27
Poland 54
Portugal 24
Romania 36
Slovakia 14
Slovenia 7
Spain 54
Sweden 19
United Kingdom 78
Total 786
Members from Bulgaria and Romania take up their seats at the expected accession on 1 January 2007. Until then the Parliament has in total 732 members.
The political groups in the European Parliament
European Peoples Party (Christian Democrats) and European Democrats 278
Socialist Group 219
Alliance of Liberals and Democrats for Europe 103
Greens/European Free Alliance 42
European United Left Nordic Green Left 41
Union for Europe of the Nations 30
Independence/Democracy 28
Non-attached members and temporarily empty seats 45
Total 786
Situation in October 2006. The figures include observers from Bulgaria and Romania.
The European Parliament normally holds its plenary sessions in Strasbourg and any additional sessions in Brussels. It has 20 committees which do the preparatory work for plenary sessions, and a number of political groups that usually meet in Brussels. The General Secretariat is based in Luxembourg and Brussels.
The Parliament takes part in the legislative work of the EU at three levels:
Under the cooperation procedure, introduced by the Single European Act in 1987, the European Parliament can give its opinion on draft directives and regulations proposed by the European Commission, which is asked to amend its proposals to take account of Parliaments position.
Since 1987, there has also been the assent procedure, under which the European Parliament must give its assent to international agreements negotiated by the Commission and to any proposed enlargement of the European Union.
The 1992 Treaty of Maastricht introduced the co-decision procedure, which puts the Parliament on an equal footing with the Council when legislating on a whole series of important issues including the free movement of workers, the internal market, education, research, the environment, trans-European networks, health, culture, consumer protection, etc. The European Parliament has the power to throw out proposed legislation in these fields if an absolute majority of members of Parliament vote against the Councils common position. The Treaty has made provision for a conciliation procedure.
The European Parliament also shares, with the Council, equal responsibility for adopting the EU budget. The Parliament can reject the proposed budget, and it has already done so on several occasions. When this happens, the entire budget procedure has to be re-started. The European Commission proposes the draft budget, which is then debated by the Council and the European Parliament. Parliament has made full use of its budgetary powers to influence EU policymaking.
Last but not least, the European Parliament exercises democratic supervision over the Union. It has the power to dismiss the Commission by adopting a motion of censure. This requires a two-thirds majority. It also supervises the day-to-day management of EU policies by putting oral and written questions to the Commission and the Council. Finally, the President of the European Council reports to the Parliament on the decisions taken by the Council.
(c) The European Commission
The Commission is the third part of the institutional triangle that manages and runs the European Union. Its members are appointed for a five-year term by agreement between the member states, subject to approval by the European Parliament. The Commission is answerable to the Parliament, and the entire Commission has to resign if the Parliament passes a motion of censure against it.
Since 2004, the Commission has been made up of one Commissioner from each member state
The Commission enjoys a substantial degree of independence in exercising its powers. Its job is to uphold the common interest, which means that it must not take instructions from any national EU government. As Guardian of the Treaties, it has to ensure that the regulations and directives adopted by the Council and Parliament are being implemented in the member states. If they are not, the Commission can take the offending party to the Court of Justice to oblige it to comply with EU law.
As the EUs executive arm, the Commission implements the decisions taken by the Council in areas such as the common agricultural policy. It has wide powers to manage the EUs common policies, such as research and technology, overseas aid, regional development, etc. It also manages the budget for these policies.
The Commission is assisted by a civil service made up of 36 directorates-general (DGs) and services, which are mainly based in Brussels and Luxembourg.
II. Other institutions and bodies
(a) The Court of Justice
The Court of Justice of the European Communities, located in Luxembourg, is made up of one judge from each EU country, assisted by eight advocates-general. They are appointed by joint agreement of the governments of the member states for a renewable term of six years. Their independence is guaranteed. The Courts role is to ensure that EU law is complied with, and that the Treaties are correctly interpreted and applied.
(b) The Court of Auditors
The Court of Auditors in Luxembourg was established in 1977. It has one member from each EU country, appointed for a term of six years by agreement between the member states following consultation of the European Parliament. It checks that all the European Unions revenue has been received and all its expenditure incurred in a lawful and regular manner and that the EU budget has been managed soundly.
(c) The European Economic and Social Committee
When taking decisions in a number of policy areas, the Council and Commission consult the European Economic and Social Committee (EESC). Its members represent the various economic and social interest groups that collectively make up organised civil society, and are appointed by the Council for a four-year term.
(d) The Committee of the Regions
The Committee of the Regions (CoR) was established under the Treaty on European Union and consists of representatives of regional and local government proposed by the member states and appointed by the Council for a four-year term. Under the Treaty, the Council and Commission must consult the CoR on matters of relevance to the regions, and it may also issue opinions on its own initiative.
(e) The European Investment Bank
The European Investment Bank (EIB), based in Luxembourg, provides loans and guarantees to help the EUs less developed regions and to help make businesses more competitive.
(f) The European Central Bank
The European Central Bank (ECB), based in Frankfurt, is responsible for managing the euro and the EUs monetary policy (see Chapter 7 Economic and monetary union (EMU) and the euro).
What does the EU do?
The European Union acts in a wide range of policy areas economic, social, regulatory and financial where its action is beneficial to the member states. These include:
o solidarity policies (also known as cohesion policies) in regional, agricultural and social affairs;
o innovation policies, which bring state-of-the-art technologies to fields such as environmental protection, research and development (R & D) and energy.
The Union funds these policies through an annual budget of more than 120 billion, which is largely paid for by the member states. It represents a small proportion of the EUs collective wealth (a maximum of 1.24 % of the combined gross national income of all member states).
I. Solidarity policies
The main purpose of the solidarity policies is to support the completion of the single market (see Chapter 6, The single market), and to correct any imbalances by means of structural measures to help regions lagging behind or industrial sectors encountering difficulties. The need for solidarity between EU countries and between regions became even more acute following the recent entry of 12 newcomers with incomes well below the EU average. The EU must also play its part in helping to restructure sectors of the economy which have been badly affected by fast-growing international competition.
(a) Regional aid
The EUs regional policy is based on transfers of funds from rich to poor countries. The money is used to boost development in regions lagging behind, to rejuvenate industrial regions in decline, to help young people and the long-term unemployed find work, to modernise farming and to help less-favoured rural areas.
The funds earmarked for regional activities in the 200713 budget are targeted at three objectives.
Convergence. The aim here is to help the least-developed countries and regions catch up more quickly with the EU average by improving conditions for growth and employment. This is done by investing in physical and human capital, innovation, the knowledge society, adaptation to change, the environment and administrative efficiency.
Regional competitiveness and employment. The objective is to increase the competitiveness, employment levels and attractiveness of regions other than the least-developed ones. The way to make this happen is to anticipate economic and social changes and promote innovation, entrepreneurship, environmental protection, accessibility, adaptability and the development of inclusive job markets.
European territorial cooperation. The aim of this new objective is to increase cross-border, transnational and interregional cooperation. It aims to promote joint solutions to problems that are shared by neighbouring authorities in sectors such as urban, rural and coastal development, the cultivation of economic relations, and networking between small and medium-sized enterprises (SMEs).
These objectives will be financed by specific EU funds, which will top up or stimulate investment by the private sector and by national and regional government. These funds are known as the Structural Funds and the Cohesion Fund.
The European Regional Development Fund (ERDF) is the first Structural Fund and provides funding to strengthen economic, social and territorial cohesion by reducing differences between regions and supporting the structural development and adjustment of regional economies, including the redevelopment of declining industrial regions.
The European Social Fund (ESF), the second Structural Fund, provides funding for vocational training and job-creation initiatives.
In addition to the Structural Funds, there is a Cohesion Fund, which is used to finance transport infrastructure and environmental projects in EU countries whose GDP per capita is lower than 90 % of the EU average.
(b) The common agricultural policy (CAP)
The aims of the CAP, as set out in the original Treaty of Rome from 1957, have largely been achieved: a fair standard of living has been ensured for the farming community; markets have been stabilised; supplies reach consumers at reasonable prices; farming infrastructure has been modernised. Other principles adopted over the course of time have also worked well. Consumers enjoy security of supply and the prices of agricultural products are kept stable, protected from fluctuations on the world market. The European Agricultural Guidance and Guarantee Fund (EAGGF) is the name of the budget for the CAP.
However, the CAP has been a victim of its own success. Production grew far faster than consumption, placing a heavy burden on the EU budget. In order to resolve this problem, agriculture policy had to be redefined. This reform is beginning to show results. Production has been curbed. Farmers are being encouraged to use sustainable farming practices that safeguard the environment, preserve the countryside and contribute to improving food quality and safety.
The new role of the farming community is to ensure a certain amount of economic activity in every rural area and to protect the diversity of Europes countryside. This diversity and the recognition of a rural way of life people living in harmony with the land are an important part of Europes identity.
The European Union wants the World Trade Organisation (WTO) to put more emphasis on food quality, the precautionary principle and animal welfare. The European Union has also begun reforming its fisheries policy. The aim here is to reduce the overcapacity in fishing fleets, to preserve fish stocks and to provide financial assistance to allow fishing communities to develop other economic activities.
(c) The social dimension
The aim of the EUs social policy is to correct the most glaring inequalities in European society. The European Social Fund (ESF) was established in 1961 to promote job creation and help workers move from one type of work and/or one geographical area to another.
Financial aid is not the only way in which the EU seeks to improve social conditions in Europe. Aid alone could never solve all the problems caused by economic recession or by regional under-development. The dynamic effects of growth must, above all, encourage social progress. This goes hand in hand with legislation that guarantees a solid set of minimum rights. Some of these rights are enshrined in the Treaties, e.g. the right of women and men to equal pay for equal work. Others are set out in directives concerning the protection of workers (health and safety at work) and essential safety standards.
In 1991, the Maastricht European Council adopted the Community Charter of Basic Social Rights, setting out the rights that all workers in the EU should enjoy: free movement; fair pay; improved working conditions; social protection; the right to form associations and to undertake collective bargaining; the right to vocational training; equal treatment of women and men; worker information, consultation and participation; health protection and safety at the workplace; protection for children, the elderly and the disabled. At Amsterdam in June 1997, this Charter became an integral part of the Treaty and is now applicable in all the member states.
II. Innovation policies
The European Unions activities impact on the day-to-day life of its citizens by addressing the real challenges facing society: environmental protection, health, technological innovation, energy, etc.
(a) The environment and sustainable development
The cornerstone of EU environmental activity is an action programme entitled Environment 2010: our future, our choice. This covers the period from 2001 to 2010 and emphasises the need to:
mitigate and slow down climate change and global warming;
protect natural habitats and wild fauna and flora;
deal with problems linked to environment and health;
preserve natural resources and manage waste efficiently.
Throughout the period covered by this programme and the five programmes preceding it, and in more than 30 years of setting standards, the EU has put in place a comprehensive system of environmental protection.
The problems being tackled are extremely varied: noise, waste, the protection of natural habitats, exhaust gases, chemicals, industrial accidents, the cleanliness of bathing water and the creation of a European information and assistance network for emergencies, which would take action in the event of environmental disasters such as oil spills or forest fires.
More recently, concerns about the health effects of pollution have been examined in an environment and health action plan for the 200410 period. This plan establishes the link between health, the environment and research policy.
European regulation provides the same level of protection throughout the EU, but is flexible enough to take account of local circumstances. It is also constantly being updated. For example, it has been decided to rework the legislation concerning chemicals and replace earlier rules, which were developed on a piecemeal basis, with a single system for the registration, evaluation and authorisation of chemicals (REACH).
This system is based on a central database to be managed by a new European Chemicals Agency, located in Helsinki. The aim is to avoid contamination of the air, water, soil or buildings, to preserve biodiversity and to improve the health and safety of EU citizens while at the same time maintaining the competitiveness of European industry.
(b) Technological innovation
The founders of the European Union rightly saw that Europes future prosperity would depend on its ability to remain a world leader in technology. They saw the advantages to be gained from joint European research. So, in 1958, alongside the EEC, they established Euratom the European Atomic Energy Community. Its aim was for EU countries together to exploit nuclear energy for peaceful purposes. As part of this, was created the Joint Research Centre (JRC) consisting of nine institutes at four locations: Ispra (Italy), Karlsruhe (Germany), Petten (the Netherlands) and Geel (Belgium).
However, as innovation gathered pace, European research had to diversify, bringing together as wide a variety of scientists and research workers as possible. The EU had to find new ways of funding their work and new industrial applications for their discoveries.
Joint research at EU level is designed to complement national research programmes. It focuses on projects that bring together a number of laboratories in several EU countries. It also supports fundamental research in fields such as controlled thermonuclear fusion (a potentially inexhaustible source of energy for the 21st century). Moreover, it encourages research and technological development in key industries such as electronics and computers, which face stiff competition from outside Europe.
The main vehicle for funding EU research is a series of framework programmes. The seventh research and technological development framework programme covers the 200713 period. The biggest share of the 50 billion plus budget will go on areas like health, food and agriculture, information and communications technology, nanosciences, energy, the environment, transport, security and space and socioeconomic sciences. Additional programmes will promote ideas, people and capacities, via research work at the frontiers of knowledge, support for researchers and their career development and international cooperation.
(c) Energy
Fossil fuels oil, natural gas and coal account for 80 % of energy consumption in the EU. A large and growing proportion of these fossil fuels are imported from outside the EU. At present, 50 % of gas and oil is imported, and this dependence could grow to 70 % by 2030. The EU will thus be more vulnerable to cuts in supply or price hikes caused by international crises. Another reason to reduce its consumption of fossil fuels is to reverse the process of global warming.
Various steps will have to be taken in future, such as saving energy by using it more intelligently, developing alternative energy sources (particularly renewable energy sources in Europe), and increasing international cooperation. Energy consumption could fall by one fifth by 2020 if consumers changed their behaviour and if technologies that improve energy efficiency were fully used.
III. Paying for Europe: the EU budget
To fund its policies, the European Union has an annual budget of more than 120 billion. This budget is financed by what is called the EUs own resources, which cannot exceed an amount equivalent to 1.24 % of the total gross national income of all the member states.
These resources are mainly drawn from:
customs duties on products imported from outside the EU, including farm levies;
a percentage of the value-added tax applied to goods and services throughout the EU;
contributions from the member states in line with their respective wealth.
Each annual budget is part of a seven-year budget cycle known as the financial perspective. The financial perspectives are drawn up by the European Commission and require unanimous approval from the member states and negotiation and agreement with the European Parliament. Under the 200713 financial perspective, the total budget for this period is 864.4 billion.
The single market
The single market is one of the European Unions greatest achievements. Restrictions between member countries on trade and free competition have gradually been eliminated, with the result that standards of living have increased.
The single market has not yet become a single economic area. Some sectors of the economy (public services) are still subject to national laws.
The individual EU countries still largely have the responsibility for taxation and social welfare.
The single market is supported by a number of related policies put in place by the EU over the years. They help ensure that market liberalisation benefits as many businesses and consumers as possible.
I. Achieving the 1993 objective
(a) The limits of the common market
The 1957 Treaty establishing the European Economic Community made it possible to abolish customs barriers within the Community and establish a common customs tariff to be applied to goods from non-EEC countries. This objective was achieved on 1 July 1968.
However, customs duties are only one aspect of protectionist barriers to cross-border trade. In the 1970s, other trade barriers hampered the complete achievement of the common market. Technical norms, health and safety standards, national regulations on the right to practise certain professions and exchange controls all restricted the free movement of people, goods and capital.
(b) The 1993 objective
In June 1985, the Commission, under its then President, Jacques Delors, published a White Paper seeking to abolish, within seven years, all physical, technical and tax-related barriers to free movement within the Community. The aim was to stimulate industrial and commercial expansion within a large, unified economic area on a scale with the American market.
The enabling instrument for the single market was the Single European Act, which came into force in July 1987. Its provisions included:
extending the powers of the Community in some policy areas (social policy, research, environment);
gradually establishing the single market over a period up to the end of 1992, by means of a vast legislative programme involving the adoption of hundreds of directives and regulations;
making more frequent use of majority voting in the Council of Ministers.
II. How the single market looks today
(a) Physical barriers
All border controls within the EU on goods have been abolished, together with customs controls on people. Random spot checks by police (part of the fight against crime and drugs) still take place when necessary.
The Schengen Agreement, which was signed in June 1985 by nine of the then 12 member states (the United Kingdom, Denmark and Ireland did not sign), governs police cooperation and a common asylum and immigration policy, so as to make it possible to completely abolish checks on persons at the EUs internal borders (see Chapter 10: Freedom, security and justice). The countries which joined in 2004 are gradually coming into line with the rules of the Schengen area.
(b) Technical barriers
For the majority of products, EU countries have adopted the principle of mutual recognition of national rules. Any product legally manufactured and sold in one member state must be allowed to be placed on the market in all others.
It has been possible to liberalise the services sector thanks to mutual recognition or coordination of national rules concerning access to or practice of certain professions (law, medicine, tourism, banking, insurance, etc.). Nevertheless, freedom of movement for persons is far from complete. Obstacles still hinder people from moving to another EU country or doing certain types of work there.
Action has been taken to improve worker mobility, and particularly to ensure that educational diplomas and job qualifications (for plumbers, carpenters, etc.) obtained in one EU country are recognised in all the others.
The opening of national services markets has brought down the price of national telephone calls to a fraction of what they were 10 years ago. Helped by new technology, the Internet is being increasingly used for telephone calls. Competitive pressure has led to significant falls in the price of budget airfares in Europe.
(c) Tax barriers
Tax barriers have been reduced through the partial alignment of national VAT rates. Taxation of investment income was the subject of an agreement between the member states and some other countries (including Switzerland) which came into force in July 2005.
(d) Public contracts
Regardless of whether they are awarded by national, regional or local authorities, public contracts are now open to bidders from anywhere in the EU as a result of directives covering services, supplies and works in many sectors, including water, energy and telecommunications.
III. Work in progress
(a) Financial services
The EUs action plan to create an integrated market for financial services by 2005 has been completed. This cuts the cost of borrowing for businesses and consumers, and will offer savers a wider range of investment products savings plans and pension schemes which they will be able to obtain from the European provider of their choice. Bank charges for cross-border payments have been reduced.
(b) Administrative and technical barriers to free movement
EU countries are often still reluctant to accept each others standards and norms or, on occasion, to recognise the equivalence of professional qualifications. The fragmented nature of national tax systems also hinders market integration and efficiency.
(c) Piracy and counterfeiting
Protection is required to prevent piracy and counterfeiting of EU products. The European Commission estimates that these crimes cost the EU thousands of jobs each year. This is why the Commission and national governments are working on extending copyright and patent protection.
IV. Policies underpinning the single market
(a) Transport
The EUs activities have targeted mainly the freedom to provide services in land transport, particularly free access to the international transport market and the admission of non-resident transport firms into the national transport market of member countries. Decisions have been taken to harmonise the conditions of competition in the road transport sector, particularly worker qualifications and market access, the freedom to establish a business and provide services, driving times and road safety.
The common air transport policy has to respond to the effects of worldwide competition. The skies over Europe are being liberalised in stages, with the result that there is greater scope for capacity-sharing between major airlines, reciprocal market access and the freedom to set fares. This goes hand in hand with safeguard clauses so as to take account of airlines public service responsibilities and zoning requirements.
Shipping whether carried out by European companies or by vessels flying the flag of non-EU countries is subject to EU competition rules. These rules are intended to combat unfair pricing practices (flags of convenience) and also to address the serious difficulties facing the shipbuilding industry in Europe.
(b) Competition
The EUs robust competition policy dates from the Treaty of Rome. It is the vital corollary to the rules on free trade within the European single market. This policy is implemented by the European Commission which, together with the Court of Justice, is responsible for ensuring that it is respected.
The reason for this policy is to prevent any agreement between businesses, any aid from public authorities or any unfair monopoly from distorting free competition within the single market.
Any agreement falling under the Treaty rules must be notified to the European Commission by the companies or bodies concerned. The Commission may impose a fine directly on any companies which break its competition rules or fail to make the required notification.
In the event of illegal public aid, or failure to notify such aid, the Commission may demand that it be paid back by the recipient. Any merger or takeover that could lead to a company having a dominant position in a particular sector must be notified to the Commission.
(c) Consumer policy
The EUs consumer policy permits its citizens to shop in confidence in any member country. All consumers benefit from the same high level of protection. The products you buy and the food you eat are tested and checked to make sure they are as safe as can be. The EU acts to make sure you are not cheated by rogue traders and are not the victim of false or misleading advertising. Your rights are protected and you have access to redress wherever you are in the EU and whether you buy your goods in a shop, by mail-order or via the telephone and Internet.
Economic and monetary union (EMU) and the euro
The euro is the single currency of the European Union. Twelve of the then 15 countries adopted it for non-cash transactions from 1999 and for all payments in 2002 when euro notes and coins were issued.
Three countries (Denmark, Sweden and the United Kingdom) did not participate in this monetary union.
The new member countries are getting ready to enter the euro area as soon as they fulfil the necessary criteria.
In parallel with the objective of monetary stability, which is the responsibility of the European Central Bank, the member states are committed to higher growth and economic convergence.
I. The history of monetary cooperation
(a) The European monetary system (EMS)
In 1971, the United States decided to abolish the fixed link between the dollar and the official price of gold, which had ensured global monetary stability after World War Two. This put an end to the system of fixed exchange rates. With a view to setting up their own monetary union, EU countries decided to prevent exchange fluctuations of more than 2.25 % between the European currencies by means of concerted intervention on currency markets.
This led to the creation of the European monetary system (EMS) which came into operation in March 1979. It had three main features:
a reference currency called the ecu: this was a basket made up of the currencies of all the member states;
an exchange rate mechanism: each currency had an exchange rate linked to the ecu; bilateral exchange rates were allowed to fluctuate within a band of 2.25 %;
a credit mechanism: each country transferred 20 % of its currency and gold reserves to a joint fund.
(b) From the EMS to EMU
The EMS had a chequered history. Following the reunification of Germany and renewed currency pressures within Europe, the Italian lira and pound sterling left the EMS in 1992. In August 1993, the EMS countries decided to temporarily widen the bands to 15 %. Meanwhile, to prevent wide currency fluctuations among EU currencies and to eliminate competitive devaluations, EU governments had decided to relaunch the drive to full monetary union and to introduce a single currency.
At the European Council in Madrid in June 1989, EU leaders adopted a three-stage plan for economic and monetary union. This plan became part of the Maastricht Treaty on European Union adopted by the European Council in December 1991.
Economic and monetary union (EMU)
(a) The three stages
The first stage, which began on 1 July 1990, involved:
completely free movement of capital within the EU (abolition of exchange controls);
increasing the amount of resources devoted to removing inequalities between European regions (Structural Funds);
economic convergence, through multilateral surveillance of member states economic policies.
The second stage began on 1 January 1994. It provided for:
establishing the European Monetary Institute (EMI) in Frankfurt; the EMI was made up of the governors of the central banks of the EU countries;
independence of national central banks;
rules to curb national budget deficits.
The third stage was the birth of the euro. On 1 January 1999, 11 countries adopted the euro, which thus became the common currency of Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain. (Greece joined them on 1 January 2001). From this point onwards, the European Central Bank took over from the EMI and became responsible for monetary policy, which is defined and implemented in euro.
Euro notes and coins were issued on 1 January 2002 in these 12 euro-area countries. National currencies were withdrawn from circulation two months later. Since then, only the euro has been legal tender for all cash and bank transactions in the euro-area countries, which represent more than two thirds of the EU population.
(b) The convergence criteria
Each EU country must meet the five convergence criteria in order to go to the third stage. They are:
price stability: the rate of inflation may not exceed the average rates of inflation of the three member states with the lowest inflation by more than 1.5 %;
interest rates: long-term interest rates may not vary by more than 2 % in relation to the average interest rates of the three member states with the lowest interest rates;
deficits: national budget deficits must be below 3 % of GNP;
public debt: this may not exceed 60 % of GNP;
exchange rate stability: exchange rates must have remained within the authorised margin of fluctuation for the previous two years.
(c) The Stability and Growth Pact
In June 1997, the European Council adopted a Stability and Growth Pact. This was a permanent commitment to budgetary stability, and made it possible for penalties to be imposed on any country in the euro area whose budget deficit exceeded 3 %. The Pact was subsequently judged to be too strict and was reformed in March 2005.
(d) The Eurogroup
The Eurogroup is the informal body where the finance ministers of the euro-area countries meet. The aim of these meetings is to ensure better coordination of economic policies, monitor the budgetary and financial policies of the euro-area countries and represent the euro in international monetary forums.
(e) The new member states and EMU
New EU members are all due to adopt the euro, when they are able to meet the criteria. Slovenia was the first of countries from the 2004 enlargement to do so and it joined the euro area on 1 January 2007.
Towards a knowledge-based society
Priority on growth and jobs
The Union intends to respond to globalisation by making the European economy more competitive (liberalisation of telecommunications, services and energy).
The Union is supporting the reform programmes of member countries by making it easier to exchange best practice.
It seeks to match the need for growth and competitiveness with the goals of social cohesion and sustainable development which are at the heart of the European model.
The EU Structural Funds will spend more on training, innovation and research, in the 200713 budget period.
At the beginning of the 1990s, two great changes began transforming economies and daily life throughout the world, including Europe. One was the emergence of a globalised economy as economies everywhere became increasingly interdependent. The other was the technological revolution, including the Internet and new information and communication technologies.
I. The Lisbon process
(a) Objectives
By the year 2000, EU leaders were well aware that the European economy needed thorough modernisation in order to compete with the United States and other major world players. Meeting in Lisbon in March that year, the European Council set the EU a new and ambitious goal: to become, by 2010, the most competitive and dynamic knowledge-based economy in the world, capable of sustainable growth with more and better jobs and greater social cohesion.
(b) The strategy
The European Council also agreed on a detailed strategy for achieving this goal. The Lisbon strategy covers a whole range of areas, such as scientific research, education, vocational training, Internet access and online business. It also covers reform of Europes social security systems. These systems are one of Europes great assets, as they enable our societies to embrace necessary structural and social changes without excessive pain. However, they must be modernised so as to make them sustainable and so that their benefits can be enjoyed by future generations.
Every spring, the European Council meets to review progress in implementing the Lisbon strategy.
II. Closer focus on growth and jobs
The European Council in spring 2006 did not attempt to hide the fact that, six years after its launch, the results of the Lisbon process have been mixed. As a result, it decided to address the problem of continuing high unemployment in many EU countries and refocus the EUs priorities on growth and jobs. If it is to make its economies more productive and increase social cohesion, Europe must continue to concentrate its efforts mainly on raising economic performance, innovation and improving its peoples skills.
On the initiative of the
05 Jan 2007
"single market" exracted from official web site of EU
How the EU's single market benefits you
The creation, growth and development of the European Union have over the last fifty years freed its citizens from all sorts of restrictions. Progress has been especially marked since the creation of the EUs single market a decade ago. National frontiers between EU countries have been virtually dismantled. The resulting single market means that goods, people and services can move freely throughout the EU and it has opened up economic and working opportunities that have transformed the lives of hundreds of millions of Europeans.
This booklet describes some of the many benefits EU citizens now enjoy. It sets out to show that the single market is not a dry and dusty concept relevant only to big business. It is delivering a better life for everyone.
A liberating experience
You do not have to be very old to remember a time when moving around Europe was a big headache. Not so long ago people living in the 15 countries that are now EU Member States could take very little cash out to travel abroad. They had to put up with long queues at customs posts and passport controls every time they crossed a border.
Goods worth more than EUR 600 were immediately trapped in a web of paperwork, red tape and import taxes. The tax system alone required some 60 million customs clearance documents a year a huge burden to companies, who had to pass on these costs to their customers.
Moving from one country to another for work reasons can still pose administrative problems today, but it was infinitely more difficult with the nightmare bureaucracy of old times.
Now, thanks to the European Union and its constantly developing single market, we have many new freedoms.
They are freedoms to travel, work and do business abroad, choose from more goods and services and enjoy full consumer rights when shopping outside your own country.
And they are freedoms from many unnecessary rules and regulations, from rip off prices in markets closed to competition and from artificial restrictions on choice.
We have had a frontier-free single market in Europe since 1 January 1993, a decade ago.
Gone are most of those barriers physical, procedural, bureaucratic and commercial that tended to confine people, goods and money behind national, protectionist walls. Now those barriers have been broken down, peoples opportunities, experiences and horizons are widening.
Of course, the process of opening up Europe is far from complete and much work remains to be done. Not all the principles behind the single market are yet fully applied in practice. However already, the single market has transformed for the better many aspects of European life.
And the achievement of the last decade or so is not just an economic one. Without losing any of their national characteristics and cultural traditions, citizens of the Member States have also become citizens of Europe (see box).
European citizenship and the Charter of Fundamental Rights [Box]
In December 2000 the European Unions heads of state and government endorsed the Charter of Fundamental Rights of the European Union. This draws together in a single, easy-to-read text all the personal, civil, political and social rights that European citizens are guaranteed. The concept of European citizenship is clearly defined. Not only can EU citizens stand for office in their own country, they also have the right to stand in European Parliament and municipal elections in the EU country where they live. (europa.eu.int/abc/cit1_en.htm
Reaping the benefits
No other region in the world can match Europes achievement in banishing borders without diminishing the importance of national languages, cultures and traditions.
People move freely across most borders: more Europeans are visiting their EU neighbours for a holiday or study break than ever before. Going to work in another Member State is much easier now countries recognise a wide variety of each others professional qualifications.
The Schengen Agreement [box]
The Schengen Agreement, named after the Luxembourg border town where it was signed in 1985, is a cornerstone of the border-free Union. The agreement removes checks on travellers (irrespective of their nationality) at most of the EUs internal borders, harmonises controls at the EUs external borders and introduces a common policy on visas. Once a visitor has legally entered a country in the Schengen area, he or she can travel freely to all others without prior permission or even a passport. Schengen covers all EU Member States except Ireland and the UK which cooperate with their partners on police and judicial affairs but have not ended border controls. That is why passports still have to be shown when travelling between the UK or Ireland and the rest of the EU.
Goods are no longer delayed for hours or days at borders by heavy paperwork: this makes delivery times shorter, allowing manufacturers to save money and reduce prices for customers. One international express delivery company calculates that open highways have cut operating costs by 15%.
Consumer choice is vast: the range of products on sale across the EU is wider than ever and in most cases prices are easily compared thanks to the euro. Manufacturers have to keep prices down because they are selling into one huge competitive market. Mutual recognition of technical standards means products which are legally sold in one Member State can be marketed in all others.
Cross-border services are rapidly taking off: insurance, property, transport and tourism are among a wide range of services being marketed by companies in one Member State to customers in other countries.
Home loan information [box]
Most people buy a mortgage in their own country and never think of shopping cross-border for the loan, even though they can sometimes get better value by doing so. The lack of transparent financial information often made it difficult to compare home loan products across borders. In 2001, after three years of negotiations brokered by the European Commission, the mortgage industry and consumer organisations agreed to a Voluntary Code of Conduct to help consumers compare the cost of cross-border mortgages. Lenders signing up to the code agree to publish or to provide detailed information on the products they offer, including types of interest rates and all additional costs associated with mortgages.
Capital the investment that businesses need to start and to grow flows easily within the single market, sustaining companies and generating jobs. The arrival of the euro will be followed by important gains for savers and investors. The EU is implementing an action plan to develop a real Europe-wide market in financial services by 2005. This will reduce the costs of borrowing and provide consumers with a wider choice of investment products such as savings plans and pensions which they will be able to buy from anywhere in Europe they choose. A more developed single market in financial services will also make it easier and cheaper for companies to borrow money, bringing down the cost of goods and services for everybody.
From uncommon market to single currency
To grasp fully the European Unions achievement in building its single market, we need to look back much further than just the past decade or so.
For centuries, Europe was the scene of frequent and bloody wars. France and Germany fought each other three times in the period 1870 to 1945, with terrible loss of life. That is why, in 1951, they and four other European countries (Belgium, Italy, Luxembourg and the Netherlands) signed a treaty to tie their coal and steel industries so closely together that they could never again go to war against each other.
Within a few years, these same six countries decided to widen the scope of this economic integration between them, as a further guarantee of future peace and prosperity. So in 1957 they signed the Treaty of Rome, creating the European Economic Community (later the European Union) with its common market. By July 1968 they had eliminated all quotas and tariffs duties on imported goods from trade in goods between them. But that was the easy bit.
Persistent barriers
It proved much more difficult to remove the so-called non-tariff barriers things like differences between the Member States safety or packaging requirements or between national administrative procedures. These differences in practice prevented manufacturers from marketing the same goods all over Europe. The only genuine single market was for agriculture.
What is more, trade between the EU countries was often disrupted by shifts in the exchange rates between their currencies. That is why, in 1978, the European Monetary System was launched. It brought greater stability to the market by tying the national currencies more closely together.
However, by the early 1980s, progress had been virtually halted. The main reason was simply that Europes increasingly uncompetitive national economies were too rigid and fragmented, and the European countries could not reach the unanimous agreements necessary to change the situation. An impasse had been reached: these were the years of so-called eurosclerosis when Europes economies and technological capacities appeared in serious danger of falling irrevocably behind the United States and Japan.
Putting an end to eurosclerosis
The European Commission, under its new president Jacques Delors, seized the initiative in 1985: it published a comprehensive blueprint for welding together the fragmented national markets to create a genuinely frontier-free single market by the end of 1992. All the Member States agreed on this goal and the EU which by now included Denmark, Greece, Ireland and the United Kingdom suddenly acquired a galvanising purpose.
But to achieve the1992 objective would require more than political will from the Member States. It also needed major changes in the way the EU took decisions. It would be impossible to meet the 1992 deadline if most decision-making still required unanimity. So, in 1986 (the year Spain and Portugal joined), the EU adopted the Single European Act. This made it possible for certain necessary decisions to be taken by a majority vote in the Council of Ministers, where each Member State has a number of votes, which is weighted in a way that takes into account the size of the population.
Less, and more simple regulation
Between 1986 and 1992, the EU adopted nearly 280 separate items of legislation prising open hitherto-closed national markets. In many areas, 12 sets of national regulations there were only 12 members then were replaced by one common European rule vastly reducing the complications and costs for any business trying to market a product throughout the Union.
In other areas, to avoid having to adopt new legislation, the Member States simply agreed to give each others laws and technical standards the same validity as their own. In other words, if a product could legally be sold in one country of the EU it could be sold in all twelve. This is the mutual recognition principle.
Harmonised legislation new EU law with detailed rules applying across the Union was required only where existing national rules (usually on health, safety or environmental protection) were too different.
Already, by 1994, the total income in EU countries was probably 1.1 to 1.5 percentage points higher thanks to the single market, with somewhere between 300 000 and 900 000 extra jobs created. The impact was particularly positive in the poorer regions of the EU: the less wealthy countries enjoyed the highest growth rates.
One currency for one market
Soon after the adoption of the Single Act, the Commission and member governments began to ask whether the single market would be complete and truly efficient without a single currency, which would ensure financial stability, further reduce business costs and give Europe a stronger voice in the world, as well as making it much easier for consumers to compare prices and to travel without having to pay exorbitant exchange commissions. By 1990, there was a consensus in favour, strengthened by the desire for greater political integration after the reunification of Germany.
So European leaders made Economic and Monetary Union an objective for the European Union. This was laid down in the Maastricht Treaty, signed in 1992, which said that those EU Member States who wished to introduce a single currency would do so by 1999.
At their meeting in Madrid in December 1995, European leaders agreed that the new currency would be called the euro. From 1 January 1999, all national currencies were to become sub-divisions of the euro, which from that date would be used in all non-cash transactions within and between participating Member States. By the time euro notes and coins were introduced on 1 January 2002, twelve of the fifteen Member States were in the euro zone: Denmark, Sweden and the UK remain outside.
Fair bank charges
But even once people had euro notes and coins in their hands, they were still paying more in bank charges to withdraw euros from cash machines or to buy things with credit or payment cards when they travelled to other EU countries than they would pay for similar transactions in their own country.
The Commission felt this was unacceptable. So it proposed an EU Regulation, which was quickly agreed by the European Parliament and Member States, on payments in euro. This aims at creating a single payment zone. As a result, since 1 July 2002, card withdrawals and payments in euro up to EUR 12 500 have cost the same whether they are made in the customers own country or elsewhere in the EU. That means significant savings for people travelling on holiday or on business.
From 1 July 2003, credit transfers in euro from one bank account to another will also cost the same whether the accounts concerned are held in the same country or in two different EU countries.
Freedoms without strings
The European Union is a great deal more than a marketplace with its own currency. It is home to some 390 million people who, for the last decade, have been free to live, work, study, shop and travel whenever and wherever they like in the EUs 15 member countries.
There are no strings attached to these freedoms. They embody the real benefits of being a citizen of the European Union.
The EU has worked hard to make the single market freedoms and benefits a reality. It is constantly trying to iron out practical problems that deter people from taking advantage of those freedoms. It is doing its utmost to strip away red tape.
Social security
One reason why people think twice about going to live and work in another country is that they are afraid of inadequate health or unemployment cover, or of losing their rights to social security.
Now they have much less to worry about because EU citizens enjoy proper welfare protection wherever they live and work in the EU:
the length of the working day is regulated for most industrial sectors;
minimum safety conditions have been set;
the right to paid holidays is established in law;
minimum entitlements for maternity and paternity leave have been agreed;
costs of medical treatment in another EU country can be reimbursed.
EU law prohibits discrimination in employment on grounds of sex, race, colour, religion, handicap, or sexual orientation. The EU is a leading force in the ongoing fight to make sure equal opportunities become a reality, for everyone.
Safer food
The Union is radically revising its laws and practices affecting the safety of food. The European Food Safety Authority has now been set up. Its main task is to provide scientific advice and support for all EU legislation and policies which affect the safety of food and animal feed.
Trust what you eat [box]
A wide-ranging reform of EU food legislation is under way which will make the food and animal feed businesses responsible for ensuring that only safe products are marketed and that anything unsafe is withdrawn. It also includes rules on the traceability of all foodstuffs, animal feed and feed ingredients and procedures for developing food law and dealing with food emergencies.
Cheaper energy and telecommunications services
Old-style monopolies have been broken up, particularly in the utilities and telecommunications sectors. Many new service providers have been born, sharpening competition with the former state monopolies, speeding up technological progress and innovation and delivering lower prices to the consumer.
Telecommunications prices across the EU have been falling at about 7.5 % a year since the market was fully liberalised in 1998.
Electricity prices for households fell by 6.5 % between 1996 and 2001. In some countries those reductions were much bigger, for example over 20 % in Spain.
Faster and easier travel
Air travel in the Union has been transformed to give the consumer more choice at much lower prices. The EUs open skies deregulation has introduced competition on routes that were once jealously protected by national airlines.
With judicious use of EU funding, Europe's patchwork transport system is being upgraded and transformed into a Trans-European Transport Network, linking together different modes of transport. This means passengers can travel or goods can be transported easily over long distances, using air, sea, road and rail for different sections of their journey, with convenient changes from one to the other. The EUs transport policy aims to improve transport connections between EU countries and between the EU and its neighbours to the east, most of whom are set to become members in the next few years.
Making the single market work better for you (Box)
To help make sure the single market really works for people the European Commission has set up an information service: Dialogue with Citizens and Business. The Dialogue offers several ways to get help.
First, the service publishes multilingual guides on all aspects of the single market, with country-specific information on topics such as rights of residence or opening a bank account in another Member State. These are available online at: europa.eu.int/citizens.
Second, there is a Citizens' Signpost Service to provide personal help in overcoming practical problems, such as administrative formalities on moving to a new Member State. It is quick, easy and free of charge. Users telephone a freephone number 00800 67891011 everywhere in the EU or send their query by e-mail to: europa.eu.int/citizensrights/signpost/front_end/signpost_en.htm. Legal experts will reply within three working days with informal advice and signposting to where the questioner can get further help.
Third, the Commission has set up a new problem-solving network called Solvit, targeting cases of misapplication of EU law. EU citizens and businesses who feel their single market rights are being denied can contact Solvit centres directly, either in their Member State of origin or in the one where they are living or doing business. A list of Solvit Centres is at: europa.eu.int/comm/internal_market/solvit/index_en.htm
The Commission also wants to hear citizens' views on EU policies and legislation. The Commission web service Your voice in Europe at: europa.eu.int/yourvoice allows you to take part in online consultations and discussions. By participating in this interactive process, you can help make the single market more user-friendly.
Keeping competition clean, free and fair
In the free market, business is a competitive game and needs a competition authority to act as a referee. The European Commission is mandated by the EU Treaties to act as the EUs competition authority at EU level, and its job is to enforce rules to ensure that competition between suppliers, producers, traders and manufacturers throughout the EU is free and fair.
The aim of the EU competition policy is to deliver benefits to consumers. Without it, phone charges would still be high, airfares ridiculously expensive compared to those in the US and you would not be able to buy a car in the country where it is cheapest.
Competition policy focuses on four main areas:
Stopping companies agreeing with each other to restrict competition, for example by fixing prices (cartels), and stopping them behaving in ways that abuse a dominant position in a particular sector.
Price fixing is outlawed (box)
In June 2001, the Commission imposed a fine of EUR 30 million on the car manufacturer Volkswagen. During 1996 and 1997, Volkswagen had sent circular letters to its German dealers inciting them not to sell the new VW Passat at discounted prices. This kind of retail price-fixing is completely against competition rules, as it keeps consumer prices artificially high.
Controlling mergers to ensure that the combination of companies does not lead to the creation of a dominant position and that the existing level of competition in the market is maintained.
Different service stations to choose among [box]
In France, Totalfina and Elf Aquitaine proposed a merger that would have given the new combined company control of a number of petroleum product markets in France. This would have pushed up costs for distributors and consumers. To resolve the competition problems identified by the Commission, TotalFina/Elf agreed to sell a large proportion of the operations concerned to competitors. For example, the new company would have had a dominant position in motorway fuel sales. To keep this market competitive in the interest of consumers, the Commission obliged TotalFina/Elf to sell off some 70 motorway service stations as one of the conditions for authorising the merger.
Ensuring that markets such as postal deliveries, rail transport or electricity generation are opened up to the greatest possible extent.
Where national public authorities grant a company special rights, in particular monopoly rights, to provide services of public interest, the Commission must ensure that these special rights do not go beyond what is necessary to deliver that service effectively. For example, special rights may be justified if they ensure everyone can enjoy a reasonable quality of service at affordable prices. They would not be justified if the aim were simply to prevent fair competition.
Fair conditions [box]
Legislation to open up the market in mobile telephony was introduced in 1996. The Commission found that the second largest mobile phone operator in Spain, Airtel Móvil, had been required to pay around EUR 510 million for the right to operate on the Spanish market, while Telefónica, the state-owned operator, had not paid any fee at all. The Commission told the Spanish government it must either reimburse Airtel Móvil or propose corrective measures. The government introduced measures to ensure that the mobile telephone market was properly open to competition.
Monitoring public subsidies (state aids) to ensure that state aid does not finance national champions or give certain companies an unfair advantage over their competitors. However, in certain circumstances, state aid is allowed for example, to help the development of backward regions or to promote environmental goals.
Aid as a positive incentive [box]
In February 1998, the Commission approved aid totalling EUR 1.89 million for the development of small tourism businesses in the area of Doñana in southern Spain. The subsidy was allowed to provide incentives for investment in new tourist ventures and to create jobs because it contributed to the sustainable development of a relatively poor area of Europe Andalusia.
Protecting our freedoms
Like all freedoms, those guaranteed by the single market need legal protection, not least because the removal of internal borders could, if not properly policed, offer new opportunities for criminals. So the treaties of Maastricht (1992) and Amsterdam (1997) allowed the EU countries to extend their cooperation into areas that until then had been exclusively a national affair justice and law enforcement.
In October 1999, at their meeting in Tampere in Finland, the political leaders of the EU countries set a strategy for protecting citizens safety without limiting the freedoms we enjoy in the new Europe. They called for a Europe-wide fight against crime. This includes:
closer cooperation between national police forces;
coordination of national prosecuting authorities and their fight against organised crime;
stronger action against money laundering;
more mutual recognition of judicial decisions in each others courts.
They also called for a common EU asylum and migration policy and for the creation of a genuine European area of justice. This means that anyone who needs legal help or protection should have easy access to the courts in any EU country, and that the courts and law enforcement systems in EU countries should cooperate on cross-border civil, commercial and criminal cases.
Partnerships for protection
Since the 1992 Treaty of Maastricht made the Union responsible for customs and police cooperation, law enforcement agencies have been steadily closing ranks and stepping up co-operation:
The Schengen Information System is an important element in the fight against crime. This database enables the EU countries to exchange such information as the names of people wanted for extradition, or information on stolen vehicles and stolen works of art.
Europol has been launched as the EUs policing weapon against cross-border crime. A major advance in cross-border law enforcement, Europol is based in The Hague and became fully operational in July 1999.
The police must be as international as the criminals (box) must
Europol is a police coordination centre to help law enforcement agencies principally police and customs carry out cross-border investigations. Its services collate, analyse and exchange information on illegal trafficking in drugs, stolen vehicles and human beings, as well as on illegal immigration networks, the sexual exploitation of women and children, pornography, forgery, the smuggling of radioactive and nuclear materials, terrorism, money-laundering and counterfeiting. At the heart of Europol is a vast computer database, which, when fully operational, will make it easier to track down and follow up suspected criminals or stolen property.
Eurojust helps the Member States to coordinate their fight against organised crime. National prosecutors, senior lawyers, magistrates and police have been seconded from the Member States to support criminal investigations into organised crime cases and to help and advise national prosecuting authorities, who may not know the legal systems in other counties.
A European Police College is training senior law enforcement officials through a network of national training institutes.
A European police chiefs task force has been set up to encourage more spontaneous cooperation at the top of police forces
Closer cooperation like this is helping the Union counter a wide range of threats to its quality of life:
Terrorism and organised crime: the EU has agreed in principle to introduce a common European arrest warrant to replace the present lengthy extradition system. The European Union is also taking part in United Nations negotiations on three protocols on combating the smuggling of illegal immigrants, trafficking in human beings and the illicit manufacture and trading of firearms.
Drug trafficking and addiction: a key element in the Unions anti-drugs strategy is the European Monitoring Centre for Drugs and Drug Addiction recently established in Lisbon. The Centre will for the first time enable the Union to assess the scale of drugs use in the EU as a whole. The EU countries have also set up an early-warning system to identify and assess the risks associated with new synthetic drugs.
Trafficking in human beings: proposals are being prepared for a joint effort against trafficking in human beings and sexual exploitation of children (including child pornography on the Internet), offences which are clearly international by nature.
Money laundering, counterfeiting and other forms of financial crime. Banks are subject to strict regulations and supervision to prevent money laundering. National authorities are cooperating with EU institutions to combat counterfeiting of the new single currency.
Chasing the money launderers [box]
In 2001, as part of its efforts to tackle money laundering, the EU widened the scope of its rules on client identification, record-keeping and the requirement to report all suspicious financial activity. These EU rules now cover not only the proceeds of suspected drug offences but of all serious crime, and apply not only to the financial sector but also to a whole range of professions that are vulnerable to misuse by money launderers. These include dealers in high-value goods such as gems, precious metals and works of art, as well as external accountants, auditors, real estate managers, lawyers, notaries, casino owners, auctioneers and companies involved in the transfer of funds.
Cybercrime: the internet society, with its growing e-commerce, could offer criminals opportunities for fraud and other forms of cybercrime. The EU is working towards common definitions of cybercrime.
Environmental crime: Member States are discussing making criminal offences a range of activities already outlawed by existing EU legislation when they are committed intentionally or with serious negligence. These offences would include polluting water supplies, various forms of air pollution, trading in protected species and serious damage to protected habitats.
Immigration is on the agenda
Questions of immigration and asylum occupy citizens all over Europe. Two of the Unions key objectives in this area are to help legal immigrants to live and work successfully in Europe and to discourage illegal immigration by improving living conditions in developing countries so that people feel less compelled to leave.
It is up to individual EU Member States to decide whether to grant asylum but they have agreed to coordinate their rules so that requests will be examined according to a common set of principles. Long-term objectives are a common asylum procedure and EU-wide acceptance for those granted asylum. In the meantime, the EU countries are setting up a common finger-print data base for asylum seekers and receiving some assistance from the European Refugee Fund, set up in 2000, to cover the costs of receiving asylum seekers, helping refugees and implementing voluntary return programmes.
Aiming to be a world leader
Technological change, led by digital communications technologies, is revolutionising the way we live. It is both a threat and an opportunity: a threat because if we fail to adapt and compete in the global economy we shall fall behind; an opportunity because success offers every chance of sustainable economic growth, job creation, and better living standards.
At their summit in Lisbon in March 2000, European leaders pledged to make the EU by 2010, the most competitive and dynamic knowledge-based economy in the world, capable of sustaining economic growth with more and better jobs and greater social cohesion.
Single market is work in progress
The job of building the single market is never finished. Often, it takes time for the European Parliament, Member States and the European Commission to agree on complex legislation affecting many different interest groups. Rules frequently need to be updated to take account of new technologies and other developments. But the single market is more than just rules: it is a set of complex economic, social and political dynamics that affect most aspects of our lives.
Thanks to the EU breaking down barriers to trade and increasing competition, Europes economy has changed enormously over the past decade, boosting competitiveness and stimulating growth. Some think the pace is too slow to meet the 2010 target. Others believe that if national governments, European institutions, business and the public and voluntary sectors continue to work together successfully, then the single market can deliver even more over the next decade than it has delivered since the frontiers between EU countries were first thrown open in 1993. That will mean:
more wealth, better education and training and more mobility between EU countries;
more and better jobs;
even lower utility costs;
a wider and better range of goods and services for consumers;
more efficient capital markets triggering faster economic growth and creating jobs;
less red tape for small businesses.
Taxes are different [box]
The removal of fiscal barriers is leading to a re-thinking of the tax system. Company and personal tax rates are, and will remain, the preserve of the national authorities of each country. But business still complains that 15 separate sets of tax rules add significantly to operating costs and hinder cross-border trade. Differing tax treatment of savings and other financial products is one of several obstacles preventing individual investors from buying financial services in other countries. Work is moving ahead on a tax package that will help to smooth out some of the persistent inconsistencies.
What we need to do
The European Commission has identified various targets the EU must meet if it is to achieve the objective it set itself at the Lisbon-summit. They include:
Energy liberalisation: the task here, as it was in telecommunications, is to improve efficiency and reduce prices by dismantling the monopolies enjoyed by state-owned utilities or recently privatised companies. This means opening up energy markets to competition from new suppliers. Two years after Lisbon, European leaders agreed in Barcelona in March 2002 that the market for supplying energy to businesses would be fully opened up, but no date has yet been set for domestic consumers.
Financial services integration: the Union cannot enjoy the full benefits of its single currency without developing a genuinely Europe-wide market in finance. National markets are regulated by a patchwork of different rules governing investment and insider trading, investor protection, information disclosure, take-overs, pension provision and supervision and many other areas. An EU action plan aims by 2005 to put in place the basis for a single set of EU rules that will set free respectable financial services companies to give customers everywhere in Europe wider choice and better value, while reining back the less scrupulous and the incompetent.
A way to settle disputes over financial services [box]
Businesses and consumers need to be able to resolve financial services disputes fast and efficiently, avoiding lengthy and expensive legal action. That is why FIN-NET, the cross-border out-of court complaints network for financial services, was launched in 2001. This network has been designed to help settle out of court any disputes between a consumer living in one EU country and a financial service provider established in another EU country.
Financial integration: the outlook is promising [box]
A study carried out for the European Financial Services Round Table found that a single market for financial services could add between 0.5 and 0.7 percentage points a year to growth in the EU countries. The two German institutes which made the study concluded that, in an integrated market, houseowners could have saved between EUR 800 and EUR 2 500 a year through lower interest payments on a EUR 100 000 mortgage between 1995 and 1999.
Job creation: concerned at the EUs persistently high unemployment rates, the Lisbon summit set for the Member States an ambitious programme of job creation that would raise the Unions overall employment rate from 60% of the active population to 70%.
This target means that the EU must create 20 million new jobs 1112 million for women and 5 million for older workers by 2010. The Commission is recommending more public funds for training workers, a review of tax and benefit systems to ensure they encourage people to work and more effort to close pay gaps between men and women and to reduce school drop-out rates.
Removing red tape: the Commission and EU governments, together with business and consumer representatives, are making a major effort to cut red tape to the minimum by rescinding unnecessary rules, simplifying others and trying to reform the EUs legislative process so that new laws, when needed, can be drafted and implemented more quickly.
New challenges
Within a few years, the benefits of the single market will be extended to maybe ten or twelve new Member States with the enlargement of the EU. Less than two decades ago many of their economies were languishing under state control that stifled innovation and prevented entrepreneurship and wealth creation.
Now the first green shoots of prosperity and dynamism are beginning to flower in these countries. There will be challenges in some areas, but they should in general be able to integrate quickly and comfortably into the single market, provided they can apply the Unions rules swiftly and effectively.
The value and effectiveness of these rules are confirmed by the millions of transactions that take place every day in the single market. The growth in personal prosperity and freedoms that it has made possible has already transformed our lives.
Much has already been achieved, but the single market still has plenty of untapped potential that can be turned into even greater benefits for Europes citizens and businesses. The European Union needs to resist protectionist instincts that could fragment the single market and wipe out the progress made. It also needs to keep the rules up to date as the world in general and technology in particular go on changing.
Building the single market is a permanent job.
05 Jan 2007
dün ilk kez cıkacaktı dışarıya
heyacanlıydı
gerci daha once bir deneyimi olmustu ama hatırlayamayacak kadar bası belaya girmisti
hatılamaya calıstı
sadece bir orduydu icine dustugu
etrafi anlamaya calismisti sonra aynı ayak sesinden yüzbinlerce duymustu
alasagı edildigini hatırladı
birileri onu sırtlamis goturuyordu
sonra bir tunel ama uzun
birden yuz ampulle aydınlatılmıs buyuk bir bosluk,, burası bir kayıp ulkeydi ya da...bilmiyorum bir seye benzetemedi... beyaz boloncuklar vardı ama icinde bir sey oldugu belliydi birden hareket ettigini anladi, korkmustu yoksa bende mi diye
boloncuklarin yanina kut diye bıraktılar ve gittiler
kimdi bunlar bilmiyordu
birden yanında bir ses duydu. bu neydi hic bir seye benzetemedi
ama icten oldugunu anladı ve binlerce soruyu birden sordu sonra garip bir yalnizlik hissetti
hic bir sey kendisi gibi degildi
boloncuklardan cikanlar hemen orduya dahil oluyor gozden kayboluyordu cunku hic birini birbirinden ayıramıyordu..takıldı pesine kendiyle ilk konusana sonra o uzun tunelden ciktilar bu sefer sarı sarı agacların arasındaydılar kendisini farkedememislerdi
sonra kendisine tanidik geln bir yerden gectiler bunlar kendisine benziyordu sonra birden adımlar hızlandı ve her yer karanlık oldu...
cikacagı ilk gun aynı gunu yasamaktan korkmustu ama istiyordu
kendisine icten bir acimayla bakan iki kisiyle cıktımıslardı......devamı gelecek
05 Jan 2007
kagıttan düşmüştüm; elimi kolumi kanatmış kendime gelmeye çalışırken soguk bir eli ensemde hissettim( nedense, ensede her zaman hissedilen elin yada ne nefesin soguk oldugunu hiç bir zaman anlayamadım) biri sanki basımı zorla aşagı iteliyor ama çekiyor desek daha iyi...ne var asagıda bilmiyorum ama yasanmiş hayatların kısa bir öyküsü gözüme ilişti....insanlar yürüyor kimi bir birine bakıyor, bir birleriyle konuşuyordu ama köşede duran kadın az sonra aralayacagı kapının önünde bekliyordu. biliyordu burdan çıkamayacagını ama çaresizdi. girdi ve çıkamadı...ben hayata üstten baktigim için (öykümüz de sadece) başla sonu nokta gibi...
içerde önce yataga aldılar sonra makıneye..neydi bunlar... ben izlerken iyi degildim..kadın düşünürken içine düştügü durumu anliz etmeye çalışıyordu çünkü okulda anlizi ögrenmişti..bu bir tiyatro mu yoksa kısa metrajlı bir film mi..bu soruyu aynı anda sorduk birbirimize...sonra renkli şekerleri andıran uzun kapsüllerden aldı baktı attı agzına herhalde razı olmustu olan bitene..yok mu bu kadının yakını ya .. koridorda mr. lonely bagırıyordu..bir de ben ama neye olan bitene mi yoksa olacaklara mı...tamam ümit yok umut da ama sadece gördüklerim bunlar...kadın 3 ay böyle durduktan sonra birden karnlıga gömüldü boslukta uçuyordu ama sonra gözlerini tekrar açtı yeniden dönmüştü ama o istiyor muydu bilmiyorum herhalde bekledigi biri vardı...
devamı gelecek...........................
05 Jan 2007
55 56 57 58 59 00 01
yine bitti işte bir dakika daha geçti
çabuk çabuk çabuk ol yapabilecegin herşeyi yap
dur elim ayagıma dolaştı ne yapacaktım ben tamam şimdi hatırladım markete inip öteberi alacaktım
dursana nereye gidiyorsun 58 59 00 01 bir dakika daha geçti allah kahretsin bırak beni
dakikalarını markete mi harcayacaksın paranla birlikte
halbuki ben düşünmüştüm de geçmişin yaralarını iyileştirirsin belki, belki bir şiir yazar kagıt karalarsın, topraga tutunursun, varlıgını sorgularsın, hayatta oldugunu ispatlarsın ne bileyim,,
58 59 00 01 bırak beni allahın cezası senin yüzünden 1 dakika daha geçti
tamam gidiyorum ama zamanla zamansizlık arasına sıkışma,,ben gidiyorum seni bir daha görmemek dilegiyle
56 57 58 59 00 01
58 59 00 01
58 59 00 01
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05 Jan 2007