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History | Economic Unity in Europe

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World Trade Organisation, from WTO Twitter

Stage 1: 1947-57 Regional Cooperation


1948: Organization for European Economic Cooperation (OEEC)

Example

- to distribute the Marshall Plan aid & coordinate reconstruction work

Participating countries: Britain

Reasons

- to rebuild the post-war Europe

- to contain the spread of communism

Results

- Laid the foundation for future economic cooperation


1948: Benelux Union

Example

- to promote free flow of goods, resources & manpower among the member states

Participating countries: Belgium, Netherlands & Luxembourg

Reasons

- the need of pooling resources together for economic recovery


1952: European Coal and Steel Community (ECSC)

Example

- to enlarge the scale of cooperation to the production of coal & steel (Schuman Plan, Schuman = the leader of France)

Participating countries: France (lead), West Germany, Italy, Belgium, the Netherlands & Luxembourg (InnerSix)

Reason

- to use economic cooperation to end hostility between France and Germany

Results

- facilitate economic recovery though cooperation

- trade and production increased rapidly

- steel production increased by 50% during its first five years

- steel output ranked steel to US in 1960



Stage 2: 1958-72 Formation of two rival economic blocs


1958: European Atomic Energy Community (EURATOM)

Example

- to extend cooperation in the production of atomic energy

- set up energy research center to exchange information & to develop peaceful use of the energy

Participating countries: Six ECSC members (Inner Six)

Reason

- the economic benefits from the ECSC encouraged the member states to have wider cooperation


1958: European Economic Community (EEC)

Example

- to remove tariff barriers between its member states

- to impose a unified tariff on all foreign trade

- to encourage the free flow of goods, resources & labour

- to introduce a common agricultural policy

- to standardise salary, social welfare & units of measurement

Participating countires: Six ECSC members (Britain was missing --> suspicious? autonomy?)

Reason

- the economic benefits from the ECSC encouraged the member states to have wider cooperation

Results

- EC became the world's largest export region, biggest buyer of industrial raw materials --> output of steel ranked second to US


1960: European Free Trade Association (EFTA)

Example

- to remove internal tariff barriers between its members (but no unified tariff imposed on external trade)

Participating countries: Britain, Norway, Sweden, Denmark, Portugal, Seitzerland & Austria (Outer Seven)

Reason

- the British refusal to join the EEC made her economically isolated in Europe so as to uphold her sovereignty and control over her economy

- to counterbalance EEC

Result

- the achievements were not remarkable --> members from European Free Trade Association joined the EEC later


1967: European Community (EC)

Example

- to merge ECSC, EURATOM & EEC into one organization

- to impose a unified tariff on foreign trade

- to carry out a common agricultural policy

- to set up a European monetary system & launch a common European currency

Participating countries: Six ECSC members

Reason

- the European countries attempted to established a united states of Europe

Result

- Established a customs union with common external tariff and set up agricultural policy (1960s)



Stage 3: 1973-91 Expansion of the EC


1986: Expansion of European Community (EC), Single European Act

Example

- introduced the Exchange Rate Mechanism (1979) to link the currencies of the member states

- signed the Single European Act (1986) for wider cooperation, e.g. creation of a common market for trade, more power to the European Parliament

Participating countries: (1986) Inner Six + Outer Seven, except Switzerland & Norway

(1973) Britain (rejected twice), Denmark, Ireland

(1981) Greece

(1986) Spain, Portugal

(1995) Finland

Reason

- EFTA was not effective

- Stepping down of de Gaulle in France made the admission of Britain possible

- the success of EC encouraged wider cooperation

Result

- set up an internal accounting unit for its member state currency (1979)


Stage 4: 1992-2007 European Integration-developed from a pure economic organization into a regional economic and political union (non-economic aspect)


1992: Treaty of Maastricht

1993: European Union (EU)

Example

- granted European citizenship to people in the member states (mobility is high, favourable working environment)

- encouraged cooperation in environmental, education and other aspects

- extended cooperation in environmental, education and other aspects

- extended cooperation to non-economic areas, e.g. diplomacy and security on labour and social issue

- adopted a common external policy and national defense

- introduced the currency of Euro (1999)

- established organization that aimed at monetary and political unity


Participating countries

(1993) France, Germany, Italy, Belgium, the Netherlands, Luxembourg, Denmark, Ireland, Britan, Greece, Spain, Portugal, Austria, Finland & Sweden

(2004) former Soviet satellites states, e.g. Poland, Czech Republic, Slovakia

(2007) Rumania, Bulgaria


(2016) Brexit


Reasons

- the success in economic cooperation inspired Europeans to have even greater cooperation

- to enhance international status of Europe in world politics

- the collapse of the USSR and the communist bloc enabled the extension of integration between Western and Eastern Europe


Results

- integration facilitated economic development

- fostering friendly relations among the member states

- raising Europe's international status

- cultivated a sense of European identity

- closer cooperation in political, economic and diplomatic aspects

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