ASSIGNMENT -2

REFLECTION PAPER
EUROPEAN UNION
 Introduction:
European Union is a political and economic group of 27 countries. Among the
27 countries, nineteen countries use euro as their official currency. The
countries forming the Europeans union are Austria, Belgium, Croatia, Bulgaria,
Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece,
Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, The Netherlands,
Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden. United
Kingdom was the founding member of the EU left the organization in 2020.

Why was the European union created?

The European union was created in the aftermath of world war 2. The first
steps were to promote economic cooperation because the countries that trade
together are economically interdependent and will thus avoid conflict.
Through a series of trade and political agreements from 1951 to 1993, a
European community was created which was focused on economic and
political cooperation among the countries.
The Maastricht treaty was signed in 1993, which replaced the European
community with European union. The treaty was established to form common
foreign and security policy. A coordinated policy on asylum, immigration, drugs
and terrorism. European union citizenship, which allowed people to travel
freely throughout the countries in the EU. A specific economic and budgetary
criterion which would determine when countries were ready to join.

European Union symbols

The symbol of European union seems like a circle made of stars. The stars
symbolize unity, solidarity and harmony among the peoples of Europe. The
symbol signifies how Europeans come together to work for peace and
prosperity, while at the same time adding many different cultures, traditions,
languages of each continent.
Political Component of the EU
The European union has evolved into an organization covering all areas, from
development aid to environmental policy. The EU actively promotes human
rights and democracy and has the most ambitious emission reduction targets
for fighting climate change. Since there has been abolition of border controls
between the EU countries, it is now possible for people to travel freely within
most of the EU.

How are decisions made?

The European parliament and the council review proposals by the commission
and propose amendments.
 A second reading takes place if the council does not agree with the
amendments.
 Parliament and the council can propose their amendments again. The
Parliament can block the proposed legislation if the council disagrees
with it.
 If the parliament and the council agree with the proposed amendments,
then the proposed legislation can be adopted. A conciliation committee
tries to find a solution in case the council disagrees with the legislation.
Both the parliament and the council have the power to block the
legislation in the final reading.

European Monetary Union

 Coordinated fiscal and economic policy and having euro as their
common currency.
 On January 1,1999, the euro was first launched as a virtual currency for
cash less payments and accounting purposes. Bank notes were
introduced on January 2,2002.

Eurozone Crisis
 The countries with weaker economies borrowed large amount of money
and accumulated huge debt.
 Due to poor financial planning of Greece’s government, they were
unable to repay the debt.
 Other countries and banks viewed EU countries as a credit risk which
affected the Eurozone.
 What is in the Brexit deal?
 UK Withdrew from the EU and European atomic energy community at
the end of 31 January 2020.
 To make sure neither side has unfair trade advantages and tariff
benefits.
 In 2021, freedom to work and live between the UK and the EU came to
an end. UK nationals will now need a visa if they want to stay in the EU
for more than 90 in a 180-day period.
 Now that UK is no longer a part of the EU, UK is free to set their own
trade policies and can negotiate deals with other countries.

NAFTA
 North American Free Trade Agreement (NAFTA) is a controversial trade
pact signed in 1992.
 Eliminated tariffs, trade barriers on services and goods between US,
Mexico, Canada.
 To create a trilateral block trade in North America.
 Came into force on January 1,1994.
 Replaced 1988 Canada-US free trade agreement.
 Does not provide coverage for aviation transport, maritime and
telecommunications.
 Involves copyrighted material, trademark, patents.
 Equal treatment is guaranteed to US investors In Canada & Mexico.
 Ship qualifying goods in Canada and Mexico without paying taxes.
 According to the products rule of origin there is enough work and
materials required in NAFTA party to make the product become what it
is at the time of export.

Provisions
NAFTA’s main provision demanded gradual reduction of tariffs, custom duties
and other trade barriers between the three members. Some tariffs were
removed immediately, and others were removed over the period of 15 years.
Eventually the agreement ensured duty free access to a vast range of
manufactured goods and commodities traded between the signatories.
Products imported from other NAFTA countries were given “National goods”
status, thus banning any state, local, or Provincial government from imposing
any taxes or tariffs on such goods.

Understanding NAFTA
 NAFTA promoted free trade and lower tariffs among Canada, Mexico
and US.
 Trump announced a new trade deal with Mexico to replace NAFTA.
 The US-Mexico trade agreement- duty free access to agricultural goods.
 Eliminate tariff barriers to maintain trade relations between both
countries.

Criticism
 Viewed as a radical experiment by multinational corporations at the
expense of citizens.
 Critics argued that this treat would bring major degradation in
environmental health standards.

ASEAN
Members of ASEAN- Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar,
the Philippines, Singapore, Thailand, and Vietnam.
Aims and purpose of ASEAN:
1. To accelerate economic growth, social progress and cultural development.
2. To promote regional peace and stability through abiding respect for justice
and the rule of law in the relationship among countries of the region.
3. To promote active collaboration and mutual assistance on matters of
common interest in the economic, social, cultural, technical, scientific and
administrative fields.
4. To collaborate more effectively for the greater utilization of their agriculture
and industries, the expansion of their trade, including the study of the
problems of international commodity trade.

Fundamental Principles
As mentioned in the treaty of Amity and cooperation in Southeast Asia (TAC) of
1976:
 • Mutual respect for the independence, sovereignty, equality, territorial
integrity, and national identity of all nations.
• The right of every State to lead its national existence free from external
interference, subversion or coercion.
• Non-interference in the internal affairs of one another.
• Settlement of differences or disputes by peaceful manner.
• Renunciation of the threat or use of force; and
• Effective cooperation among themselves.
1.ASEAN political security community:
Ensure that the people and the member states of ASEAN live in peace with one
another.
2.ASEAN economic community:
Transformed ASEAN into stable, prosperous and highly competitive region and
reduce poverty.
3.ASEAN Socio cultural community:
People oriented and ensuring solidarity among people of the member states.
ASEAN countries’ gross domestic products combined to $2.73 trillion in 2017,
putting the group ahead of the United Kingdom’s 2.63 trillion and India’s $2.61
trillion. ASEAN is set to grow even more quickly, as some countries like
Vietnam and the Philippines boast huge growth rates.
SAARC
Eco political organization of 8 south Asian nations. Established on 8th December
1985, for friendship and cooperation within themselves and other developing
countries.

Objectives
 To improve quality of life and welfare of the people.
 Economic, social, and cultural development.
 Contribute mutual trust and understanding.
 Sports and arts.
 Looks in Critical areas like poverty, education and culture.
 Organizational Structure
 A council.
 Council of members.
 Standing committee.
 Programming committee.
 Technical committee.
 The secretariat.

Areas of operation
 Agriculture and biotechnology.
 Trade and finance.
 Science and technology.
 Energy and environment.
 People to people contacts.
 Education, culture.
 Tourism and social development.

SAFTA
• The Agreement on South Asian Free Trade Area (SAFTA) was signed at

Islamabad during the Twelfth SAARC Summit on 6 January 2004. The

Agreement was signed by all the member states of the South Asian
Association for Regional Cooperation (SAARC), namely, India,

Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka. India,

Pakistan and Sri Lanka are categorized as Non-Least Developed
Contracting States (NLDCS) and Bangladesh, Bhutan, Maldives and Nepal
are categorized as Least Developed Contracting States (LDCS).

Preferential Trade Agreement (PTA)

 A special type of agreement that allows access to certain goods.
 Reduction in tariffs rates but not eliminating them completely.
 Established through a trade pact which is the weakest form of economic
integration.
 Among the SAARC countries, India enjoys PTA with Afghanistan.