Global Trade Operations: European Union Analysis Report

This report analyzes global trade operations, focusing on the European Union (EU). It begins with a brief trade history of the EU, highlighting its evolution as a unified trade and monetary body. The report then examines freight flow statistics, including exports and imports, with data on trade balances. It delves into the EU's trade policies and procedures, such as tariffs, FDI, and subsidies, referencing the General Agreement on Tariffs and Trade (GATT). A critical review identifies challenges like Brexit and the complexities of free trade agreements. Recommendations are provided, focusing on addressing Brexit and fostering relationships with emerging economies. The report concludes by emphasizing the EU's role in international trade and logistics, providing valuable insights into trade policies and practices within the economic trade zone.

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Executive Summary
Free trade zone is a course of the special economic zone in which the physical zone where the
products may be landed, deposited, touched as well as mass-produced or reconfigured as well as
re-exported further down particular duties regulations and usually not topic to taxes
responsibility. The findings of the report show the analysis of the economic trade zone that is the
European Union. The freight flow statistics shows the improvement in exports and imports of
Union. The discussion of trade policies and challenges of the European Union is presented. The
challenges related to the implementation of the trade policy are identified and major barrier is
Brexit.

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Contents
Introduction......................................................................................................................................3
Background......................................................................................................................................3
Trade history................................................................................................................................3
Freight flow statistics...................................................................................................................4
Exports.....................................................................................................................................4
Imports.....................................................................................................................................5
Trade Balance..........................................................................................................................5
Description of trade policies and procedure....................................................................................6
Critical review.............................................................................................................................6
Recommendations........................................................................................................................7
Conclusion.......................................................................................................................................9
References......................................................................................................................................10

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Introduction
The purpose of this assignment is to improve a better considerate of nature, outlines, and faces of
worldwide trade as well as policies which are required to ease or to eradicate the obstacles
related to trade within the context of the economic trade zone. ETZ has been carefully chosen for
this report is the European Union and demonstration related to the international trade policies
and procedures has been done.
Background
Trade history
European Union is a unified trade as well as the monetary body which consist of the 27 member
countries which majorly allows eliminating all the related boards that control among the
members. It has been determined that the open borders provide the free flow of the goods as well
as people instead of for the random spot checks majorly for the drugs and crime. Talking about
the history of the economic trade zone, it has been found that in 1950 there were the concepts of
the European trade are which was formed initially (European Union, 2020). This has been
determined that EU is considered as most outward-oriented markets across world. This trade
zone is the biosphere’s major particular marketplace part. Free trade among followers was one of
the EU establishment principles and this is the reason due to which it is dedicated to introductory
up across the world. Coming to history, from the year 1999 to 2010, EU overseas the trade got
double and presently it financial records for more than 30% of EU’s GDP. This trade zone is
accountable enough for procedure of trade with the member nations as well as negotiates an

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agreement for them. In year 2018, U.S. products and services trade with EU is closely $1.3
trillion (Amadeo, 2020).
Freight flow statistics
The flow of freight consists of the exports and imports statistics in the particular trade zone. This
section includes the freight flow statistics of the EU which is explained with the help of the
exports and imports in the trade zone (Howell, Gwynn and Gadbaw, 2019).
Exports
Export in international trade is considered as when the good or service manufactured in one
country that is sold out in another country. In the research, this has been found EU nations will
collectively rank 1st as an export market for US in year 2018 (Amadeo, 2020). It has been found
that the U.S. goods exports to the EU in 2018 were $318.6 billion which is 12.5% up from the
year 2017 and up 17.0% from the year 2008. The exports of the U.S to EU account for
approximately 19.1% of overall U.S. exports in the year 2018. European Union found that the
export trade is generally witnessing from 5 major countries of U.S which include United
Kingdom, Germany, Netherlands, France, and Belgium with the amount of $66.2 billion, $57.7
billion, $49.4 billion, $36.3 billion, and $31.4 billion respectively (Amadeo, 2020). U.S. local
exports of the agriculture goods to EU totalled $ 13.5 billion in year 2018. In the research, this
can be said that EU nations collected would rank 3rd being an Agriculture export marketplace for
US. It has been found that generally the country’s export Soybeans, tree nuts, wine and beer as
well as the processed food.

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Imports
The import in international trade shows that foreign goods and services are brought by the
citizen, businesses, as well as the government of another country. In the European Union, the
import of the countries together would rank as the second supplier of imports to the United States
in the year 2018 (World Trade Organisation, 2020). U.S goods imports from EU countries in the
year 2018 were approximately $487.9 billion which up 12.3% (%53.3 billion) from the year
2017 and up 32.6% from 2008 (Amadeo, 2020). As per the present data, this has been found in
2018 that the U.S imports from the EU nations which equal for 19.2% of the total U.S imports.
In research, the top 5 U.S import contractors from EU nations from the year 2018 which were
Italy, United Kingdom, Germany, Netherlands, and France. Considering the fact, this has been
found that the exports of the U.S agriculture are good but they are also getting the agriculture
products import. The total U.S imports for the consumption of agriculture goods from the EU
countries have a total of $23.9 billion in the year 2018. The research includes the top sectors of
the specific region which include transport, travel, and IPR (European Parliament, 2020).
Trade Balance
According to the analysis of the exports and imports, the European Union needs to consider the
trade balance. The research shows the U.S. goods trade deficit along with EU countries was
equal to $169.3 billion in the year 2018 which improved 11.8% over the year 2017. From the
year 2008, the U.S. goods trade shortfall with the nations in the EU improved by 77.1%. United
States has a service trade extra of approximately $59.9 billion with EU in 2018 which is actually
at the growth up to 16.4% that means $8.4 billion from the year 2018.

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Description of trade policies and procedure
The trade policies and procedure of EU is the steady progress towards the liberal external trade
regime. This economic trade zone has different rules and regulations for the tariffs, FDI,
Subsidies, and many others. In the research, this has been found that General Agreement on
Tariffs and Trade (GATT) that covers the global trade. The belongings can be imported into EU
under the various trade governments that majorly rely on goods and origin of country. The
industry of manufacturing has been benefited with the continued decline in the tariffs and non-
tariff barriers (Congressional Research Service, 2018). In the research, this has been found that
aspects of tariff quote administration, the use of the special safeguards as well as the export
subsidies that have been a concern to other WTO Members. In the year 2003, the EU was
expenditure a massive $41 billion on the agriculture subsidies that consists of the export
subsidies. It has been found that over than 35% of the overall EU properties belonging to the
foreign-owned business. Trade policy of the EU has marinated by the EU for the world’s most
open investment regimes (European Commission, 2020).
Critical review
In the study, this has been found that the implementation of the policies and procedure of EU is
very important for entire trade of this Union across the world. In the effective working of trade
policy and procedures, EU still deals with certain barriers and obstacles when it comes to the
implementation (Chalmers, Davies and Monti, 2019).
One of the major issues that have been witnessed is related to Brexit. The research shows that
access to the single market with the other seven of its ten top export markets need the Britain to
shadow the rules provided by the EU without getting involved in the decision making. This has

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been found that Britain provided the views by saying that the prices on its products sold in EU
will improve as well as the barriers might arise for its financial sector which is equal to 10% of
the total exports to EU (Cini and Borragán, 2016). The major challenge that is faced by the
implementation of EU is that the free trade agreements with the other countries will be
considered as more difficult as they might ask for the less stringent regulation implemented by
the EU (Moello, 2020). This includes forcing Britain to either select between the EU rules or
demand of third countries.
Another challenge that has been witnessed is related to the bilateral agenda of the EU which
provide the explanation of the relations with the advanced emerging economies which is the vital
source of the growth. The rise in the economy has strengthened the competition when it comes to
the price as well as the quality. The research shows that it is determined that it is not required
that the emerging countries don’t necessarily share the approach of Europe to the policy of trade
(McCormick, 2017). All these countries tend to abide by the more domineering industrial model
with the comparatively low degree of the opening.
In the research, one of the challenges that have been witnessed is deepening the integration. EU
needs to strengthen the Eurozone as it is considered as common defence, it protects the external
border and also ensures that all the member of the states can abide with the integration principles
which is difficult (Hill, Smith and Vanhoonacker, 2017).
Recommendations
 It is recommended to the EU that they should look towards the Brexit challenge on the
priority basis because this is has been found that Brexit involves many trade deals related
to the exports and imports which are essential to be considered by the EU member.

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 EU should form relations with the different emerging economies because this is the way
through which they can manage the trade balance and improve the same.
 It is recommended that the EU should look towards their rules and policies once as this
will provide help to them for the easy trade.

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Conclusion
At the end of the report, this can be concluded that European Union is one of the economic trade
zones which is analysed with the motive of the international trade and logistics practices
considering the perspective of the international trade. The report includes the analysis of the
freight flow statistics, trade policies, and related barriers. At the end, the recommendations have
been provided to the European Union.

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References
Amadeo, K. (2020) The European Union, How It Works, and Its History [Online]. Available
from: https://www.thebalance.com/what-is-the-european-union-how-it-works-and-history-
3306356 [Accessed on 7th April 2020]
Chalmers, D., Davies, G. and Monti, G. (2019) European union law. Cambridge university press.
Cini, M. and Borragán, N.P.S. eds. (2016) European union politics. Oxford University Press.
Congressional Research Service (2018) The European Union: Ongoing Challenges and Future
Prospects [Online]. Available from: https://fas.org/sgp/crs/row/R44249.pdf [Accessed on 7th
April 2020]
European Commission (2020) Foreign direct investment report: continuous rise of foreign
ownership of European companies in key sectors [Online]. Available from:
http://trade.ec.europa.eu/doclib/press/index.cfm?id=1993 [Accessed on 7th April 2020]
European Parliament (2020) EU trade policy [Online]. Available from:
https://www.europarl.europa.eu/RegData/etudes/IDAN/2019/642229/EPRS_IDA(2019)642229_
EN.pdf [Accessed on 7th April 2020]
European Union (2020) Trade [Online]. Available from:
https://europa.eu/european-union/topics/trade_en [Accessed on 7th April 2020]
Hill, C., Smith, M. and Vanhoonacker, S. eds. (2017) International relations and the European
Union. Oxford University Press.

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Howell, T.R., Gwynn, R.E. and Gadbaw, R.M. (2019) European Community. In Conflict Among
Nations (pp. 389-468). Routledge.
McCormick, J. (2017) Understanding the European Union: a concise introduction. Palgrave.
Moello, J.O. (2020) Five Challenges for the European Union [Online]. Available from:
https://nationalinterest.org/feature/five-challenges-european-union-113006 [Accessed on 7th
April 2020]
World Trade Organisation (2020) European Union: November 1997 [Online]. Available from:
https://www.wto.org/english/tratop_e/tpr_e/tp065_e.htm [Accessed on 7th April 2020]