Economic Integration and the Euro The United States of Europe

A. Economic Integration Highly successful since beginnings of the EEC Improved trading relations Fewer trade wars, disputes, retaliatory measures Greater cooperation: sharing markets and transport networks Higher growth in volume of intraregional (international) trade than that between non-EU industrialized countries Single market reduces barriers to trade: administrative (institutional decision making/national economic policy) and, technical (non-standard forms of production and business, e.g. European single currency (EMU), national laws governing quality standards) New Infrastructures designed and built according to new EU institutional contexts New geography of Integration being established

Euro Tunnel: New Landscape of Integration

A. Economic Integration (cont.) New geography of Integration being established Some stats: In 1983, <50% of trade in Denmark, Finland, Iceland, Italy, UK was with European countries Over 50% in all 5 countries by Older EEC countries well over 70% (especially Benelux) Recent non-EU countries have also experienced greater economic integration since joining European Regional Development Fund (ERDF) Funds infrastructural development Fosters greater integration

New Bridge spanning the Corinth Gulf Strait

Rotterdam, “Germany’s largest port”

A. Economic Integration (cont.) Recent non-EU countries have also experienced greater economic integration since joining European Regional Development Fund (ERDF) Funds infrastructural development Fosters greater integration So what are the advantages? Why are more and more Europeans buying from other Europeans? What structural changes have taken place across Europe? What are the challenges to European integration? Where does the Euro fit in?

A. Economic Integration (cont.) Why integration? Facilitated by reduction of trade barriers to create a single market Global trend of accelerated mergers, take-overs and consolidation foster horizontal as well as vertical linkages (to remain competitive) Growth of European multinationals BP (UK) Unilever (Netherlands) Daimler-Chrysler (Germany) Euro is key ingredient of European Economic integration Revenue no longer related to foreign exchange rates

B. Introducing the Euro Euro is key ingredient of European Economic integration

B. Introducing the Euro Euro is key ingredient of European Economic integration Adopted on January 1, member states currently use the Euro: Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland Culturally symbolic of integration and unity See “Striking Stories: a political geography of eruo coinage,” Political Geography 23 (2004)

Currency of the Generation ‘E’

B. Introducing the Euro Euro is key ingredient of European Economic integration Adopted on January 1, member states currently use the Euro: Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland Culturally symbolic of integration and unity Illustrates the uneven integration of Europe, even within the EU Adoption of Euro as challenge to continued EU integration Closer regional ties among ECU countries

Regionalism Toward Integration European Integration is not an even process Regional blocs even within Europe Reflect levels of development Established trading partnerships Propinquity Adoption of the Euro Still remain non-EU alliances EFTA (European Free Trade Association; 1960) EEA (European Economic Area; 1990s)

Regionalism Toward Integration European Integration is not an even process Regional blocs even within Europe Reflect levels of development Established trading partnerships Propinquity Adoption of the Euro Still remain non-EU alliances EFTA (European Free Trade Association; 1960) EEA (European Economic Area; 1990s) Summary Economic Integration is driving cultural and political integration Adoption of the Euro is key to creating a fully integrated, unimpeded European Economic space