Free trade agreements : the EU

Anne-SophieYayaPeterYoshi

OVERVIEW

• History• EU free trade agreement• The EU is threat to the US? • The EU v.s NAFTA• The latest news• Conclusion

HISTORY

• Construction of the EU

–1950: Foundation of the European Coal and Steel Community.

–1957: Creation of the European Economic Community (EEC)

HISTORY

–1985: Signing of the Schengen agreement = elimination of border controls.

–February 7, 1992: The « European Community » became the « European Union ».

HISTORY

–January 1, 1993: The single market and its four freedom are established.

HISTORY• Expansion of the EU

HISTORY• The euro

–January 1, 1999: Introduction of the euro in 11 countries commercial and financial transactions

–January 1, 2002: Euro notes and coins arrive in 12 countries

HISTORY

• Other relevant information

–2004: The 25 EU countries signed a Treaty establishing a European Constitution

–2005: Citizens in both France and the Netherlands voted « No » to the Constitution in referendums

Q: Do you know anything about the EU free trade agreement?

• Interviewer: 10 people (Pass by & Depth)• Date: 2/9-2/11

Free Trade Agreement

• Economic Union

• Customs unions

• Single market

• Currency Union

Common Agricultural Policy (CAP)

• System– European Union agricultural subsides and program.– 1957, Treaty of Rome (Common Market)

• Purpose– Price support mechanisms

• guaranteed minimum prices• import tariffs• quotas on certain goods from outside the EU.

• Aim– provide farmers with a reasonable standard of living.– consumers with quality food at fair prices.– to preserve rural heritage.

• Objectives

• Criticism

– Anti-development– Oversupply and redistribution– Artificially high food prices– Environmental problems

Common Fisheries Policy

• Fisheries policy .• Allow to catch what amounts of each type of

fish.• Encourage the fishing industry by various mar-

ket interventions.

Euro

• Official Currency of the euro zone.• 17 countries use.

Q:Does the EU pose a threat to the US?

2

8

EU Threat to US?

YESYes

YES NO-Strong and competitive compa-nies

-Fast innovation

-Materials, industries

-Different policies

-EU and US are partners

-Not one nation

Q:Does the EU pose a threat to the US?

27 Nations 1 Nation

310 Million People

512 Million People

30% of World GDP GDP No.1

EU US

NAFTANorth American Free Trade Agreement

So CheapGene Modify Cone

・ Mexico can’t develop agriculture & industry because of over-import.

Also, car & electric

Mostly EURO

Export

DevelopedCountry

Currency

import

employment

US $, PesoCAD $

Helppoor country

Don’t have to

So UP So UP

UP UP

SpreadDifferentAmong 3 countries

Latest Movement7 / 1 / 2011 Start

Coming soon

1.2 billion population

market

Korea’s Decreased Export Items in Free Trading Lists

Division(Base Rate%)

Export (%, Million Dollar)Variation(%, Million Dol-

lar)

Jul – Dec, 2010 Jul – Dec, 2011Percentage

changeAmount of DecreaseResult Rate Result Rate

Ship(0) 6,077 24.2% 3,181 12.7% 47.6% 2,895

Wireless Telephone(0) 1,499 6.0% 629 2.5% 58.1% 870

Flat-Panel Display(0) 2,779 11.1% 2,011 8.0% 27.6% 768

Total 12,323 49.1% 6,835 27.2% 44.5% 5,448

Korea’s Increased Import Items in Free Trading Lists

Division(Base Rate%)

Import (%, Million Dollar)Variation(%, Million Dol-

lar)

Jul – Dec, 2010 Jul – Dec, 2011Percentage

changeAmount of IncreaseResult Rate Result Rate

Airplane(0) 12 0.1% 974 4.0% 8,328.2% 963

Naphtha(0) 60 0.3% 253 1.0% 325.6% 194

Scrap Metal(0) 188 0.9% 352 1.4% 87.6% 165

Total 391 1.9% 1,928 7.9% 393.1% 1,539

European Union – South Korea Free Trade Agreement

Korea’s Increased Import Items in in Preferential duty Lists

Division(Base Rate%)

Import (%, Million Dollar)Variation(%, Million Dol-

lar)

Jul – Dec, 2010 Jul – Dec, 2011Percentage

changeAmount of IncreaseResult Rate Result Rate

Crude Oil(3) 0 0.0% 337 1.4% % 337

Automobile(8.0) 1,093 5.4% 1,359 5.6% 24.3% 266

Parts of an auto(8.0) 745 3.7% 881 3.6% 18.3% 136

Total 2,598 12.8% 3,559 14.6% 37.0% 961

Korea’s Increased Export Items in Preferential duty Lists

Division(Base Rate%)

Export (%, Million Dollar)Variation(%, Million Dol-

lar)

Jul – Dec, 2010 Jul – Dec, 2011Percentage

changeAmount of IncreaseResult Rate Result Rate

Automobile(5~10) 1,520 6.1% 2,935 11.7% 93.1% 1,415

Jet Fuel and Kerosene(4.7) 155 0.6% 774 3.1% 339.0% 619

Parts of an auto (1.7~19) 1,740 6.9% 1,981 7.9% 13.8% 241

Total 4,191 16.7% 6,834 27.1% 63.1% 2,613

European Union – South Korea Free Trade Agreement

European Union – India Free Trade Agreement

Anti-FTA Protesters

・ Being good for economic activity

is…

・ Expanding employment opportunities

・ Decreasing domestic products

・ Causing deflation → deterioration

FTA

・ Losing job of some parts of people in domestic

・ Keeping peace among countries

・ Can’t be self-sufficiency in some field

merit

demerit

Conclusion (From interview)

・ Continue to increase FTA

should

・ Regulate amount of import in chief industries

・ Make the penalty for the country like Greecefor example : Withdraw from EURO Give EU the political initiative until recovered

・ Help poor countries by rich countries

Conclusion (including suggestion…)

Thank you for your kind attention.

Good luck, EU!