FREE ESSAY ON EUROPEAN UNION

EUROPEAN UNION

European Union Description 
In 1967, three European institutions merged. The three institutions were the European
Coal and Steel Community (ECSC), the European Economic Community (EEC), and the European
Atomic Energy Community (Euratom). When the three merged, they formed the European
Community or EC. On November 1, 1993, the 12 members of the European Community ratified
the Treaty on European Union, or Maastricht Treaty. The twelve members were- Belgium,
Denmark, France, Germany, Great Britain, Greece, Ireland, Italy, Luxembourg, the
Netherlands, Portugal, and Spain. The countries of the Benelux Economic Union- Belgium,
the Netherlands, and Luxembourg- continue to and in some ways as a single economic entity
within the European Union. The EC became the policy-making body of the European Union. In
1994 Austria, Finland, and Sweden became members of the European Union. By 1997 more than
a dozen countries had applied for European Union membership, but the European Union had
only admitted the three listed above. The other countries that applied for membership
include Turkey, Cyprus, Malta, Switzerland, Hungary, Poland, Romania, Slovakia, Latvia,
Estonia, Lithuania, Bulgaria, and the Czech Republic. Of those countries, six are
considered associate members of the European Union: Bulgaria, Czech Republic, Hungary,
Poland, Romania, and Slovakia. Three other countries-Estonia, Latvia, and Lithuania-are
being considered for associate membership. Other potential European Union applicants
include members of the European Free Trade Association. The European Union was expected
to decide which counties it would open negotiations for full membership with by the end
of 1997. The purpose of the European Union was to increase economic integration and
strengthen cooperation among its member states. European citizenship was granted to
citizens of each member state, under the Treaty on European Union. Customs and
immigration agreements were enhanced to allow European citizens more freedom to live,
work, and study in any of the member states, and border controls were also eased. The
European Union also set a goal of establishing a single European currency, the Euro, by
1997; this date was later changed to 1999. It is proposed that full circulation of the
Euro is to be in effect by the year 2002. At that time the individual states notes will
no longer be valid. The European Union's attempts to establish a single European currency
have had some controversy. An example is, some member countries, such as Great Britain,
have worried that a shared European currency would threaten their national identity and
their government's authority. On the other hand, some of the other European Union member
countries have been struggling to meet the economic requirements for participating in a
common currency. To meet the requirements, which include a budget deficit of no more than
three percent of their gross domestic product, by the deadline of late 1997. To meet the
requirements some countries have imposed budget cuts and new taxes. Some of the measures
taken by these countries have faced some resistance. The people who will mainly benefit
from the common currency are the European citizens. The overall benefit that the euro
will bring is a stable economic environment that will lead to low inflation and low
interest rates. There are three main areas that the member states will gain savings from,
they include, reduced losses created by currency exchanges, lower costs created by better
competition in the euro zone, and a more favorable trading and investment environment for
local businesses. The reduction of losses due to the elimination of currency exchanges
within the euro zone will produce almost a whole percentage point of annual European
Union GDP every year. The use of a common currency will allow easier price comparisons in
the member states. By eliminating the currency exchange risk, economic and monetary union
will bring more business and trading potential to commercial companies, especially small
and medium-sized businesses. Large European companies will have a reduction in a lot of
their costs, mainly in the processes of foreign exchange transactions. Consumers will
benefit greatly from the common currency. Some of the benefits include: reduced costs for
traveling to other countries; easier and less expensive transfer of funds to other
countries; increased competition between businesses, which will lead to lower prices; low
interest rates; and more economic growth, which will lead to increased job security. The
European Union has recognized that the translation of values to the euro will be
confusing to the public, so considerable efforts will be made by private operators and
public authorities to make it as easy as possible for the people. The main entities that
will have a disadvantage from the transition to a common currency will be the companies,
large and small, that have failed to adequately prepare for the changes.