The European Union (EU) stands as a testament to regional cooperation, political alignment, and economic collaboration among its 27 member countries. Embodying democratic values and streamlined trade policies, it ranks as one of the globe’s most influential trade blocs. Notably, 19 of these countries, collectively known as the Eurozone, adopt the euro as their official currency.
The concept of the EU evolved post-World War II, awakening Europe’s ambition to bolster economic and political synergy. As of 2021, its Gross Domestic Product (GDP) clocked in at €14.45 trillion (approximately US $15.49 trillion). Comparatively, the U.S recorded a GDP of around US $23 trillion for the same year.
Key Takeaways
- The EU elevates 27 countries into a collective, sharing political and economic ideologies centered around democracy.
- The euro, serving as the official currency, binds 19 members into a tighter economic cohort termed the Eurozone.
- Over the decades, the EU’s boundaries expanded, bringing in countries from erstwhile socialist regimes post the Soviet Union’s collapse.
- The 2016 Brexit saw the U.K. deciding to exit the EU, a resolution finalized in 2020.
Inspiring Origins: The History of the European Union
Tracing its legacy to the 1950 European Coal and Steel Community that included Belgium, France, Germany, Italy, Luxembourg, and the Netherlands, the EU underwent transformative phases. Initially a collaborative entity known as the European Economic Community under the Treaty of Rome in 1957, it later became the European Community (EC).
The integration deepened with policies pairing foreign, security, and internal affairs, creating a common market. This shaped an environment punctuated by unrestricted movement of goods, services, people, and capital.
Crafting the Common Market
The journey toward a harmonized market began in 1986 with the Single European Act, aiming to fuse national regulations by 1992. The Mendelian Maastricht Treaty that materialized on November 1, 1993, founded the European Union, with the euro joining the fray in 1999.
While Denmark and the U.K. secured privileges to avert adopting the currency, certain newer members have maintained the choice to either not adopt it or not yet meet its standards.
European Debt Crisis: Resilience and Reform
Shocked by the 2007-2008 global financial crisis, countries within the EU—particularly Italy, Spain, Portugal, Ireland, and Greece—experienced pastry-slow growth and towering sovereign debt. The resultant entanglement saw Greece, then Ireland, and subsequently Portugal seeking existential bailouts necessitating austere fiscal mandates.
Resolute Reforms
An ensemble of measures taken primarily from 2012 onwards responded to the crisis—highlighted by the emblematic European Stability Mechanism. Establishing infrastructure to alleviate financial impediments of afflicted nations replaced the European Financial Stability Facility.
Subsequent increasingly innovative measures like the European Central Bank’s
Related Terms: Euro, European Commission, European Debt Crisis, European Central Bank, European Parliament.
References
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- Statista. “Gross domestic product of the European Union (EU27) from 1995 to 2021”.
- UK Parliament. “Brexit Timeline: Events Leading to the UK’s Exit From the European Union”.
- History. “Europe’s Common Market Founded in Major Step Toward Economic Unity”.
- European Union. “The History of the European Union”.
- European Union. “Five Things You Need to Know About the Maastricht Treaty”.
- European Union. “Treaty on European Union”, Pages 191 and 194.
- Robert Godby. The European Financial Crisis, Chapter 6. Business Expert Press, 2013.
- European Stability Mechanism. “History”.
- European Central Bank. “Targeted Longer-Term Refinancing Operations (TLTROs)”.
- Council of the European Union. “Encouraging Structural Reforms and Investment: Flexibility of the Stability and Growth Pact Rules”.
- European Commission. “2007-2019: A Timeline of EU Actions Since the Start of the Crisis”, Page 2.
- European Commission. “Regions in Europe – 2021 interactive edition: Gross Domestic Product”.
- Bloomberg. “EU’s Productivity Split”.
- Federal Reserve Bank of San Francisco. “Taxes, Transfers, and State Economic Differences”.
- Vox EU. “The Emerging Fiscal Union Needs a Solid Foundation”.
- Bloomberg. “The Roots of Brexit”.
- Center for Strategic & International Studies. “Did Russia Influence Brexit?”
- Intelligence and Security Committee of Parliament. “Russia”, Pages10-12.
- Britannica. “European Union”.
- EU Info Centre. “Why Was the EU Created?”
