Eu and nafta


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Eu and nafta

  1. 1. EU AND NAFTAPresented by:Ashish Porwal
  2. 2. The European UnionTHE EUROPEAN UNION
  3. 3. The European UnionWhat is the European Union?• Shared values: liberty, democracy, respectfor human rights and fundamental freedoms,and the rule of law.• Largest economic body in the world.• World’s most successful model for advancingpeace and democracy.• A unique institution – Member Statesvoluntarily cede national sovereignty in manyareas to carry out common policies andgovernance.• Not a super-state to replace existing states,nor just an organization for internationalcooperation.• World’s most open market for goods andcommodities from developing countries.27730490millionMember StatesCombinedpopulation ofEU MemberStatesPercent of world’spopulationPercent ofglobal GDP55Percent of combinedworldwide OfficialDevelopment Assistance
  4. 4. The European UnionHISTORY OF EUROPEAN UNION:• The European Union is set up in 1945 with the aim of ending thefrequent wars between neighbors which culminated in the SecondWorld War.• As of 1950, the European Coal and Steel Community begins to uniteEuropean countries economically and politically in order to securelasting peace. Also in 1957, the Treaty of Rome creates the EuropeanEconomic Community (EEC), or ‘Common Market’.• May 1968 , becomes famous for student riots in Paris, and manychanges in society and so-called ‘68 generation.• Denmark, Ireland and the United Kingdom join the European Union on1 January 1973, raising the number of member states to nine. In 1981,Greece becomes the 10th member and Spain and Portugal follow EUfive years later.
  5. 5. The European Union1951FoundingMembersBelgiumFranceGermanyItalyLuxembourgNetherlands
  6. 6. The European Union1973DenmarkIrelandUnited Kingdom
  7. 7. The European Union1981Greece
  8. 8. The European Union1986PortugalSpain
  9. 9. The European Union2004CyprusCzech RepublicEstoniaHungaryLatviaLithuaniaMaltaPolandSlovakiaSloveniaAustriaFinlandSweden
  10. 10. The European Union2007BulgariaRomania
  11. 11. The European UnionEU InstitutionsEuropean Commission• 27 Commissioners, representing the Europeanperspective, each responsible for a specific policy area.• EU’s executive branch proposes legislation, managesUnion’s day-to-day business and budget, and enforcesrules.• Negotiates trade agreements and manages Europe’smultilateral development cooperation.Council of the European Union• EU’s main decision-making body, comprised ofministers of 27 Member States, representing MemberState’s point of view.• Decides on foreign policy issues.• Council presidency rotates among Member Statesevery six months.European Commission PresidentHerman Van Rompuy
  12. 12. The European UnionEU InstitutionsEuropean Parliament• Voice of European citizens – members elected forfive-year terms.• With the Council, passes EU laws and adopts EUbudgets.• Approves EU Commissioners.European Court of Justice• Highest EU judicial authority.• Ensures all EU laws are interpreted and appliedcorrectly and uniformly.• Can act as an independent policy maker but unlikethe U.S. Supreme Court, the ECJ can only dealwith matters covered by the Treaties.European Parliament in session
  13. 13. The European UnionEuropean Central Bank• The European Central Bank (ECB) is thecentral bank for Europes single currency,the euro.• The ECB’s main task is to maintain theeuros purchasing power and thus pricestability in the euro area.• The euro area comprises the 15 EuropeanUnion countries that have introduced theeuro since 1999.• The ECB operates independently fromMember State governments.The euro was introduced in 1999
  14. 14. The European UnionUnited in Diversity - The €uro
  15. 15. The European UnionThe €uroIn 1999, the euro area was established as acurrency in eleven of the then fifteen EUMember States.Of the 27 EU Member States today, fifteenhave adopted the euro.One of the striking benefits of a singleEuropean currency are low interest rates dueto a high degree of price stability.The euro is as stable and credible as the best-performing currencies previously used in theeuro area countries.€€€€
  16. 16. The European Union1951:• In the aftermath of World War II, the aim was tosecure peace among Europe’s victorious andvanquished nations and bring them together asequals, cooperating within shared institutions.• Based on a plan by French Foreign MinisterRobert Schuman.• Six founding countries – Belgium, the FederalRepublic of Germany, France, Italy, Luxembourgand the Netherlands – signed a treaty to run heavyindustries (coal and steel) under commonmanagement.European Coal andSteel CommunityJean Monnet and other leaders withthe first “European” ingot of steel
  17. 17. The European UnionTreaty of Rome• The six founding countriesexpanded cooperation to othereconomic sectors, creating theEuropean Economic Community(EEC) – or “common market.”• As a result, people, goods,services, and capital todaymove freely across the Union.1957:Signing of the Treaty of Rome
  18. 18. The European UnionThe EU is a global player.Its soft power promotesstability, prosperity,democracy and humanrights, delivers concreteresults in the fight toeradicate poverty, and inachieving sustainabledevelopment.UN Secretary General Ban Ki-moon, High Representativefor the Common Foreign and Security Policy Javier Solana,and EU Commissioner Benita Ferrero-WaldnerThe EU in the World
  19. 19. The European UnionAddressing Global Challenges• Peace & Security– Works for global peace and security alongside theUnited States and multilateral organizations –including NATO and the United Nations.– Undertakes humanitarian and peacekeepingmissions and has provided military forces for crisismanagement around the globe.• Counterterrorism & Homeland Security– Taken steps to improve intelligence sharing,enhance law enforcement and judicial cooperation,curtail terrorist financing.– Boosts trade and transport security to support thestruggle against terrorism.
  20. 20. The European Union• Democracy & Human Rights– Works globally for free elections and opendemocratic processes.– Fights racism and intolerance at home andabroad.– Campaigns globally against capital punishment.• Development Assistance & HumanitarianRelief– The EU and its Member States are the world’slargest aid donor, providing 55% of total officialdevelopment assistance.– Provides billions of dollars in humanitarian aidto more than 100 countries in response tocrises and natural disasters.Addressing Global Challenges
  21. 21. The European Union• Trade– European Commission represents all 27 EUMember States before the World TradeOrganization.– Supports free trade and open markets, withinthe rules-based structure of the WTO, topromote growth and jobs in both industrializedand developing countries.– The worlds most open market for products andcommodities from developing countries – 40%of all EU imports are from developing countries.Addressing Global Challenges
  22. 22. The European Union• Environmental Protection– A leader in global efforts to protect theenvironment, maintaining rigorous andcomprehensive systems at home.– Plays a key role in developing andimplementing international agreements,such as the Kyoto Protocol on ClimateChange.– Executing a “cap and trade” system toreduce greenhouse gas emissions– Takes the lead in the fight against globalwarming with the adoption of bindingenergy targets (cutting 20% of the EU’sgreenhouse gas emissions by 2020).Addressing Global ChallengesSource: German Information Center USA
  23. 23. The European UnionPartners in Global Leadership• EU and U.S. work together to developinternational standards:– Fighting terrorism and transnational crime– Advancing global trade liberalization– Combating piracy and intellectual propertyviolations– Spreading benefits of globalization• EU and its Member States are helping restorepeace and stability in Afghanistan.• EU and U.S. work together in the Middle EastQuartet to advance the peace process.• When the EU and U.S. agree, others tend tofollow.EU Commissioner Benita Ferrero-Waldner & U.S. Secretary of StateCondoleezza Rice
  24. 24. The European UnionShared Values and Responsibilities• Freedom & DemocracySupport free elections, good governance, human rights,and the rule of law around the world.• SecurityCooperate to fight terrorism, limit the spread of nuclearweapons, and work for global peace.• DevelopmentTogether, EU and U.S. provide 80% of globaldevelopment assistance and an even larger share ofglobal humanitarian aid in times of disaster andconflict.
  25. 25. The European UnionA DynamicTransatlantic Economy• EU and U.S. together account for 40% of totalglobal trade (more than $1.5 billion intransatlantic trade every day).• The $3 trillion EU-U.S. transatlantic economyemploys 14 million workers on both sides of theAtlantic.• In 2005, Europe accounted for roughly two-thirds of total global investment flows into theU.S. – by far the most significant source offoreign investment in the U.S. economy.
  26. 26. The European Union• European companies are the leadingforeign investors in the U.S.– The UK, Germany, France, and theNetherlands – top four sources ofjobs created by foreign investmentin the United States.• American companies invest far more inEU countries than in Asia.– U.S. businesses make 5 times theprofit in the Netherlands - alone -as they make in China.– In 2005, EU investments in Texasalone surpassed all in China and Japan,combined.BMW’s assembly plant is South Carolina’slargest private sector employer.
  27. 27. The European UnionFuture of Transatlantic Relations• EU and U.S. face common challenges that are global inorigin and impact. With global challenges, come globalresponsibilities.• EU and U.S., with our shared values and commoninterests, are natural partners to give a lead in fourkey areas:– Promote peace, human rights and democracyworldwide.– Confront global challenges, including security andnon-proliferation.– Foster prosperity and opportunity.– Advance strategic cooperation on energy security,climate change and sustainable development.
  28. 28. The European Union“Since no single nation can efficientlyand effectively deal with globalchallenges such as climate change,counterterrorism, non-proliferation,pandemics and natural disasters on itsown, we commit ourselves tostrengthening our cooperation toaddress these challenges.”EU-U.S. Summit DeclarationVienna, July 2006
  29. 29. The European UnionEducation & Research• EU and U.S. cooperate on science andtechnology education through:– Exchange programs– More than 700 institutionalpartnerships– Vocational training– Scholarship programs– R&D cooperatives• EU and U.S. provide joint or dualhigher educational degree programs.• EU funds Centers of Excellence atleading U.S. universities.EU supports R&D toincrease Europe’sgrowth and globalcompetitiveness.
  30. 30. NAFTA
  31. 31. HISTORY OF NAFTA• NAFTA (NORTH AMERICAN FREE TRADE AGREEMENT) is anagreement signed by the governments of the United states,Canada and Mexico creating a trilateral trade bloc in NorthAmerica.• Members: Canada, Mexico & United States• Official languages: English, French and Spanish• Secretariats: Mexico city, Ottawa, Washington D.C.• Establishment: 1 January 1994• GDP of NAFTA alliance: USD 12 trillion• NAFTA supplements: NAAEC & NAALC
  32. 32. BACKGROUNDIn 1988 Canada & the United States signed the Canada-United states Free Trade AgreementThe American government then entered into negotiations with the Mexican government for asimilar treatyCanada asked to join the negotiations in order to preserve its perceived gains under the 1988dealThe agreement NAFTA was signed by• U.S. president - George H. W. Bush,• Canadian prime minister - Brian Mulroney• Mexican president - Carlos Salinas in San Antanio, Texas on December 17,1992.
  33. 33. AMENDMENT • Final provisions (NAFTA) were fully implemented on January 1, 2008.•NAFTA one of the most successful trade agreements in history and hascontributed to significant increases in agricultural trade and investment.•Most comprehensive Regional Trade Agreement signed by the UnitedStates.
  34. 34. TRADE AND INVESTMENT EFFECTS :•TRADE AND INVESTMENT EFFECTS NAFTA is a broad agreement. From1994 to 2008, U.S. exports to Mexico rose 91%, compared to 41% to theworld. U.S. imports increased by 179%, compared to 89% from theworld.•After fourteen years, most tariffs have gone to zero, except for somevery sensitive (mostly agricultural) goods that have limited protection forup to 15 years
  35. 35. TRADE WITHIN THE GROUPProvides job opportunities :•Employment in Canada grew by 11 percent, generating 1.8 million newjobs.•Employment in Mexico grew by 22 percent, generating 2.2 million newjobs.•Employment in the United States grew by more than 16.3 percent,generating 18.1 million new jobs.WORKS FOR SMALL AND MEDIUM SIZED BUSINESS:•97 percent of Canadian, 96 percent of U.S. and 95 percent of Mexicanexporters are small and medium sized businesses.
  36. 36. NAFTAs partners created an independent and effective rules-basedsystem in order to avoid disputes within the groupMain production within the group is of Electronic, Automotive andTextile industries
  37. 37. NAFTA IN PERSPECTIVE• U.S. two-way trade with Canada and Mexico exceeds U.S. trade withthe European Union and Japan combined.• In fact, US trades more with Maxico in a month than trade with othercountries in a year. US exports more to Mexico in a day than withParaguay in a year.• US exports more in a week with Canada than with Central America in ayear.
  38. 38. • BENEFITS :• NAFTA eliminates trade barriers.• Benefits the importers by reduced or duty free goods.• No MPF from Canada for NAFTA goods. Can make the exporter morecompetitive then other non-participating countries.• 200% increase in trade among the 3 countries.• Increase market access within each country.
  39. 39. LIMITATONS• It has negative impacts on farmers in Mexico who saw food prices fallbased on cheap imports from U.S. agribusiness.• It has negative impacts on U.S. workers in manufacturing andassembly industries who lost their jobs. Critics also argue that NAFTAhas contributed to the rising levels of inequality in both the U.S. andMexico.• Some economists believe that NAFTA has not been enough (or workedfast enough) to produce an economic convergence, nor to substantiallyreduce poverty rates.
  41. 41. PUBLIC OPINION PUBLIC OPINION Public opinion towards NAFTA in the United States,Canada, and Mexico is mixed. A survey conducted by CIDE andCOMEXI in Mexico showed that 64 percent of the Mexican publicfavored NAFTA. The Program on International Policy Attitudes reported in a poll that 47percent of Americans thought that NAFTA has been good for the UnitedStates, while 39 percent thought it had been bad for the country
  42. 42. Impact on Jobs• The studies indicate that the reduction in net exports to Mexico has eliminated227,663 U.S. job opportunities since 1993, and the reduction in net exports toCanada has eliminated 167,172 job opportunities in the same period. In total,NAFTA resulted in a net loss of 394,835 jobs in its first three years.• The analysis has found that NAFTA has eliminated significant numbers of jobsfor women and members of minority groups, as well as white males. Between1993 and 1996, women lost 141,454 jobs to NAFTA, blacks lost 36,890 jobs,and Hispanics lost 22,520 jobs, numbers closely reflecting these groups sharesin manufacturing industries
  43. 43. RECENT NAFTA NEWS NAFTA• NAFTA Toll Highway Destroying Prime Agricultural LandThe Trans-Texas Corridor (TTC) is no ordinary highway. The toll roadwould be four football fields wide. It includes separate lanes (up to sixfor automobiles, four for large trucks), plus tracks for freight trains,separate tracks for high-speed and commuter rail, also space for oiland gas pipelines, electricity wires, and broadband transmission cables.The implications of this scheme are staggering. Some experts say thatup to a million people in Texas stand to lose their homes and 584,000acres of rich farm and ranchland are to be destroyed, all for a privatelyfunded highway
  44. 44. CONCLUSIONNAFTA is one of the most successful treaties of the times in terms ofgrowth in trade i.e. imports & exports , G.D.P etc. but on the other hand itis also responsible for causalities like loss of jobs, migration, rising levelof inequality and many others. Thus it is important that the treaty shouldbe carried forward concerning about taking steps for the problemsoriginated due to NAFTA ,otherwise it will create inequality in manyterms which can lead to bad conditions in future for all the threecountries.