What is the European Union (EU)?
The EU is a unique economic and political partnership between 28 European countries# that has delivered half a century of peace, stability and prosperity; helped raise living standards; launched a single European currency; and is progressively building a single Europe-wide market in which people, goods, services and capital move among Member States as freely as within a country.
Created in the aftermath of the Second World War, the first steps taken towards a union were to foster economic cooperation. Since then, the union has developed into a huge single market with the euro as its common currency. What began as a purely economic union has evolved into an organisation spanning 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 in the world. Thanks to the abolition of border controls between EU countries, it is now possible for people to travel freely within most of the EU.
How Does It Work?
EU Member States have set up institutions to run the EU and adopt its legislation. The main ones are:
· The European Parliament (representing the people of Europe)
· The Council of the European Union (representing national governments)
· The European Commission (representing the common EU interest)
Size & Population
The EU is less than half the size of the United States covering some 4 million km². In terms of size, France is the EU’s largest country and Malta its smallest. The EU has a population of close to 503 million people – the world’s third largest after China and India.
The EU’s Economy
Operating as a single market, the EU is a major world trading power. EU economic policy seeks to sustain growth by investing in transport, energy and research while minimising the impact of further economic development on the environment. Measured in terms of the goods and services it produces, its economy is bigger than that of the US: the EU GDP in 2012 was €12,945,402 million.
The European Union & South Africa – a Partnership of Equals
Since 1994 the growing relationship between South Africa and the EU has been underpinned by the Trade, Development and Cooperation Agreement (TDCA). Closer ties between the two parties were consolidated in 2007 with the establishment of the EU-SA Strategic Partnership.
This Partnership, the only one of its kind with an African country, is centred on enhanced political dialogue around issues of shared interest including climate change, the global economy, governance, bilateral trade, and peace and security matters. In line with this, its action plan encompasses sectoral cooperation on a range of issues such as climate change, environment, education, science and technology, space, trade and migration, etc.
Annual summits, as well as ministerial and senior officials’ meetings steer the Partnership, along with the EU-South Africa Joint Cooperation Council. They provide the occasions to discuss current bilateral, regional and global issues.
Trade & Investment
The EU remains South Africa’s largest trading partner and in 2014 accounted for some 26% of the value of South Africa’s merchandise trade (import and exports). EU countries are also the source of some 80% of foreign direct investment (FDI) stock in South Africa.
The EU remains an important development partner to South Africa, providing significant external assistance funds. The EU’s total indicative grant budget for South Africa for the period 2014-20 amounts to some €250 million. It is complemented by a €450 million loan finance envelope from the European Investment Bank (EIB) as well as grant funding from the EU Member States.