312 the eurpoean union Flashcards
what is the european union
- political and economic unction of 27 member states that are located primarily in europe’s
- the union has an estimated total population of about 447 million
main features of the single market
- no barriers to trade between member states
- no tariffs ( taxes on imports and exports) on goods and services traded within the single market
- free transfer of resources from one country to another eg. capital and labour-> business source employees from EU counties no restriction- no need for work permit/visas- access bigger pool of labour and find workers with skills that are not available in the uk
- goods entering the EU counters outside EU has to pay tax (tariff)- makes price of imported goods expensive
aim of single market
- favour EU produced goods and services and make them more price competitive= more demand= more jobs, incomes and improved GDP/living standards
4 features of the European Union
- free movement of goods
- free movement of labour
- free movement of capital
- common regulations and standards
what are free movement of goods
- goods can move freely between meaner states without restitions or tariffs/ quotas- any member state can stell their products in any member state
-> bigger market to sell for, but more competition
(+) of free movement of goods to business/stakeholder
- business -> expands their customer base, increasing potential sales and renenue eg. car manufacture can easily export to France or Germany without fasting additional costs, making their products more competitive for the european market
-customers- benefit from increased competition- business from different member states can sell in their home country without additional costs- lower prices and more variety eg. a consumer in Spain may have access to a wider range of electronic goods. from Germany and Italy at competitive prices
what is free movement of labour
- an citizen or EU member state can work without restriction in any other member state ie. do not need work permit or visa to work in another member state
-> businses have a bigger pool of labour to choose from and may be able o find more skilled workers
(+) of free movement of labour to a business/stakeholder
-business- business hire workers from other EU counties who already have the necessary skills and experience- no need to train employees eg. UK tech company can hire experienced sift we are developers from Germany, saving time/ money on training- productivity
-employees- more job opportunities
what is free movement of capital
- money can move freely between member states
->there is a bigger pool of investment available as busisness are not restricted to finding investors from their own country
(+) of free movement of capital t a business /stakeholder
-business- easier to get investment and to grow- capital more available
-customers- better acsess to investment- busisnes can fund research and development- better quality goods and services to customers
describe legislation, regulations and standards as a feature of the EU
- EU laws takes precedence over individual country laws- a law passed by the EU parliament needs to be made a national law eg.minimum wage
->greater restriction on business, potentially higher costs
(+) of legislation, regulations sand standards
-business- standardised laws across the EU- reduces legal uncertainty when expanding into other countries eg. a German company opening franchise in France can operate under the same employment laws simplifying compliance
-suppliers- EU regulations ensure that suppliers meet strict quality and safety standards- better quality goods eg. UK clothing manufacturer sourcing fabrics from an EU suppler can expect high quality goods due to EU labour and environmental regulations- better final product for consumers
(-) of EU
- greater competition from EU businesses
- increased cost due to complete with EU regulations
- loss of freedom to make free trade deals with other counties outside the EU
- loss of ability to charge individual or no tariffs and quotas on goods entering an individual country
how were Uk businesses impacted when they left the EU
- limited market development oppotunties for UK businesses
- more opportunities to secure trade deals with other counties
- loss of free movement of labour, limiting the skilled workers a UK based firm could hire
- complications with exports due to different legislation
- less competition for UK SMEs
what is the eurozone
- refers to the group of the european union (EU) counties that have no adapted the euro currency as their official currency- and share a common monetary policy- controlled by the european central bank (ECB)
(+) of having a single european currency
- no need to exchange money- cheaper to import
- easier to compare prices when the currency is the same
(-) of having a single european currency
- interest rates are set for the union as a whole- not for anyone country- hard to set a ‘one size fits a;;’ interest rate
- interest rate controlled by the Central European Bank- interest rates could fall and rise in a way that benefits European countries and not the Uk
- fluctuations in the exchange rates- business would not longer benefit from favourable chnage in currency eg. atria pound factors the exporter
