European Union in 2007

Now there is 27 welcome to our new members states

But what is the biggest task for the EU this year? Well, i believe it will be reform.

www.openeurope.org.uk...

Reform in Justice and Home affairs, that will increase the role of Europol and working together to combat terrorism within the EU. This has caused problems with certain members states, including the UK and the Republic of Ireland who are worried that this will strip them of their veto.

Next, is probably the most supported and weclomed reform. Economic. The German Presidency of the EU wants to cut atleast 25% of EU red tape and this is welcomed by many in the business sector of the EU. Economic reform is also needed to help boost the Euro and help it continue its growth.

Green reforms will also be introduced, which is strongly supported by the United Kingdom. More work towards a common defence agenda, which is supported by most Europeans (myself included) and maybe the first steps towards a European Army.

Others include social and health reform, which will help to support many Europeans across our Union.

[edit on 1-1-2007 by infinite]

Interesting document, thanks for posting it.

I found the section about the Euro the most interesting. Finally I see something confirming what I've been saying that a high Euro to the dollar exchange rate is bad for Europe and good for the U.S. even though most people here seem to be thinking the reverse.

I'd be pretty funny if Airbus had to move all its manufacturing to the U.S.

[edit on 1/1/2007 by djohnsto77]

of course,

A high Sterling to the Dollar is bad as well because it means our exports become very pricey indeed. Just because we can buy things cheaper in the States does not make it a good thing

I'd also say that the U.S. will learn a lot from looking at the EU joining with the more marginal states like Romania and especially Turkey if that happens. It would probably be very similar to what would happen here if a North American Union became a reality and border crossings between the U.S./Canada and Mexico became a reality. And even later some people invision a united trade zone stretching from Alaska to to Tierra del Fuego.

It's true that the classic economic argument around an high (or expensive) currency would say a high € is 'bad'
but
it's also worth bearing in mind that the recent post-war European experience which saw a heavily depreciating £ and an expensive and appreciating Deutschmark did not readily 'fit' those supposed economic 'facts'.

Politically an appreciating € can only help (all those others who scorned the loss in value since the introduction of the €).

The EU 'zone' also allows us the luxury of low costs in the newly joined countries (which includes more than just this wave).

Europe is emerging from the crippling costs and drag of German reunification, it's going to be interesting times in the years ahead.

I would avoid simplistic judgements about currency (so many claims have already fallen away as unrealistic), 27 nations operating in ever-growing cooperation is not something so easily pigeon-holed and weighed up.

A high euro vs low dollar hurts European economy far more than it helps the American economy in terms of balance of trade. Due to the fact that the main industry it will effect is manufacturing which Europe as a whole does much more of than the US.

Originally posted by sminkeypinkey
Europe is emerging from the crippling costs and drag of German reunification, it's going to be interesting times in the years ahead.

Thats very true.
The German economy, and France too, are starting to grow beyond expected growth now. The Europeans economy are expected to do very well this year with a good German economy and the World economy is expected to grow as well.

Originally posted by djohnsto77
Interesting document, thanks for posting it.

I found the section about the Euro the most interesting. Finally I see something confirming what I've been saying that a high Euro to the dollar exchange rate is bad for Europe and good for the U.S. even though most people here seem to be thinking the reverse.

I'd be pretty funny if Airbus had to move all its manufacturing to the U.S. :lol

I don't think we'll see a situation in which Europe becomes dependent on cheap American labor, but I agree, it would be ''funny'' if Europe would use the US as the US uses third world countries for exactly the same purpose.

Obviously, like many others, you have no clue about the consequences of a high valued Euro. There's no such thing as ''good for the US and bad for the EU''. Have you ever thought about US multinationals in Europe, conversion rates to parent companies etc.?

You might want to read the following article to improve your knowledge:

Europe calmly looks at sliding dollar
Staff and agencies
15 December, 2006


By DAVID McHUGH, AP Business Writer Sun Dec 3, 5:04 AM ET

BERLIN - With the European economy on the upswing, companies and governments are shrugging off the dollar‘s renewed slide against the euro this week — a phenomenon once dreaded as potential poison for the continent‘s many exporters.

The euro reached $1.3257 in European trading Thursday, up from $1.3156 in New York late Wednesday, a 20-month high. The pound hit $1.9644, its strongest since September 1992, with analysts saying the British currency could reach $2 by the end of the year.

"I am not concerned," said Dutch central bank head Nout Wellink. Bernd Pfaffenbach, Germany‘s deputy economics minister, said the stronger euro "reflects the strength of the European economy" — but conceded it was not particularly helpful for exports.

Reasons for the calm are several. Many companies have at least some production in the United States, eliminating exchange rate issues for products sold in the world‘s largest economy, while others have limited their exposure to currency swings through complex hedging deals.

"People have gotten used to the stronger euro," said economist Christian Dreger at the German Institute for Economic Research in Berlin. "That is the difference from two years ago."

The stronger euro also reduces inflation by making imports cheaper, Dreger added. That in turn reduces the need for the European Central Bank to continue with its interest rate increases, which fight inflation but can dampen growth.

Economists say the large U.S. trade and budget deficits are putting long-term pressure on the dollar. The most recent dollar slide accelerated after comments by ECB head Trichet in October that the bank might need to raise its key rate from 3.25 percent to combat inflationary pressures from an increasing money supply. At the same time, expectations have grown that the U.S. Federal Reserve Federal Reserve may cut interest rates sometime next year.

Major companies have made only muted comment on the exchange rate, another contrast with 2004 when some businesses cited the strong euro as a partial excuse for lower-than-desired earnings. Automaker DaimlerChrysler AG cited its strategy: "We protect ourselves against currency fluctuations in order to make possible a reliable planning foundation for our business units." Porsche AG, which relies heavily on U.S. sales, says it has hedged a full three years ahead.

Likewise, Munich-based luxury competitor BMW makes its X5 sport utility vehicle and Z4 roadster in South Carolina — paying costs in dollars and exporting some of them back to Europe, where they take advantage of the exchange rate by earning pricey euros.

Not only that, but Airbus parent EADS faces a squeeze between its costs — paid in euros — and its revenues, since international practice is to price jetliners in dollars. The dollar‘s weakness has only added to its financial squeeze as European Aeronautic Defence and Space Co. struggles to launch a new mid-sized jet program while coping with a two-year delay in its A380 jumbo jet.

Economists say the general acceptance could change if the euro hits $1.40 or $1.50 next year, or if the slide moves so fast that businesses can‘t adjust.

Until then, many companies are taking the attitude of Italy‘s Luxottica Group SpA. Even though more than 70 percent of its manufacturing is done in Italy, the world‘s largest manufacturer and retailer of eyewear said its business in the United States nearly equals its U.S. costs.

About 70 percent of Luxottica‘s revenues are generated in the U.S., where it operates 4,500 Sunglass Hut, Pearle Vision and LensCrafters stores, while 65 percent of its costs are in U.S. dollars. Although the exchange rate shrinks U.S. earnings when they‘re translated to euros, profit margins aren‘t affected.

"Most of our dollar revenue is hedged because a similar portion of our costs are in that currency," said spokesman Luca Biondollilo. "At the end of the day, we have a natural hedge."

Source

djohnsto77
I'd also say that the U.S. will learn a lot from looking at the EU joining with the more marginal states like Romania and especially Turkey if that happens. It would probably be very similar to what would happen here if a North American Union became a reality and border crossings between the U.S./Canada and Mexico became a reality. And even later some people invision a united trade zone stretching from Alaska to to Tierra del Fuego

it's impossible for a union to form with the US, canada and mexico because it would violate the US constitution in regards to our sovereignty, NAFTA and SPP etc are international 'treaties', the US defines 'treaties' as a 'CEA' ( congressional executive agreements ) which are under strict constraint by the US constitution. the US is not a party of the vienna convention and the U.S. habitually includes in treaty negotiations the reservation that it will assume no obligations that are in violation of the U.S. Constitution. If such a violation were to take place such as our sovereignty being stripped and our borders we fought and died for erased you would see a MASSIVE UPROAR not only in the US but in canada aswell, im pretty sure the mexicans would try to make it a holiday to rejoice. the American view is that international agreements become part of the body of U.S. federal law therefor legislation can be passed and Congress can modify or repeal treaties by subsequent legislative action, even if this amounts to a violation of the treaty under international law.

politicans in the long run if the right amount of pressure is put on them will act in favor of the people, americans wont stand for a union with canada and especially mexico. however I am worried about the TTC, i mean it's owned by a mexican company and it's first customs checkpoint is in kansas which would violate our sovereignty as a nation, this is already a hot topic and more and more americans are not liking it, especially the imminent domain crap.


secondly eventually europes industry will come to the US, only the labor wont be cheap, they will come here to escape that socialist liberal haven and to escape from the taxation. you see once americans enact the fairtax you're going to see a US that nobody has ever seen before. I wish the EU the best of luck in 07.



[edit on 10-1-2007 by ape]

The E.U. is just a step in the process that the elite set up for a one world government. Why are you so happy about it


The U.S. has nothing to learn from the E.U., we took what we wanted from all the countries of the world and started our own....

[edit on 16-2-2007 by Royal76]