Key Economic Concepts and European Integration

Economic Globalization

Economic globalization is the process by which international economic relations become more intense and decision-making power is concentrated in a small number of agencies or businesses. Globalization results from trade liberalization, market deregulation, and increased capital mobility, which enhance international specialization. Multinational enterprises are the main beneficiaries of this process. The global economy is structured around a few localized decision-making centers in the U.S., the EU, and Japan, where the headquarters of large companies are located.

European Regional Development Fund (ERDF)

The European Regional Development Fund (ERDF) was founded in March 1975 to reduce regional disparities between the Member States of the European Union. The ERDF, together with the European Social Fund (ESF) and the European Agricultural Guidance and Guarantee Fund (EAGGF), formed the structural funds created before the Maastricht Treaty to promote regional development.

The Treaty of Rome

The Treaty of Rome was the origin of the EEC (European Economic Community) and EURATOM (European Atomic Energy Community). The treaty was signed in 1957 by six European states: France, Germany, Italy, Belgium, the Netherlands, and Luxembourg. The EEC aimed to create a common market for the free movement of goods, persons, services, and capital, and it established a customs union that removed trade barriers and tariffs among member states. EURATOM was established for the joint development and peaceful use of nuclear energy. The Rome Treaty also established the European Investment Bank.

The European Union

The European Union (EU) currently consists of 27 states sharing institutions and common social and economic policies. Since its inception after the Second World War, the union has progressed through several stages, including the formation of the European Economic Community aimed at forming a common market. Since the signing of the Maastricht Treaty (1992), which renamed the EC to the EU, the union has established:

• A political, economic, and monetary union in three stages.
• The single currency (Euro).
• A common foreign and security policy.
• Greater social protection and more rights for citizens.
• New competencies in education, health, culture, consumer protection, and the fight against drugs and terrorism.