What is the European Union
The European Union (or EU for short) is a unified monetary and trade body comprising 28 member nations. Members of the EU have no border controls between them. This means citizens of EU member states can move freely within the union. Goods movement are also free of taxation and other similar characteristics which exists between countries.
The stated purpose of the EU is to be competitive in the world markets. It would simultaneously balance the requirements of its independent political and fiscal members. The 28 countries which makes up the EU are Austria, Bulgaria, Cyprus, Denmark, Finland, Germany, Hungary, Italy, Lithuania, Malta, Poland, Romania, Slovenia, Sweden, Belgium, Croatia, Czech Republic, Estonia, France, Greece, Ireland, United Kingdom, Latvia, Luxembourg, Netherlands, Portugal, Slovakia, and Spain. This number will drop if the United Kingdom exits the EU. The separation is slated to happen in 2019.
The EU is technologically advanced and all member countries share data and intellectual resources linked to environmental protection and research. Energy sciences and developmental resources are open to all members. Any company registered within the EU could compete for public contracts. Products manufactured in one member nation could be sold to other members sans any duties or tariffs. Professional practitioners in the fields of medicine, insurance, tourism, and banking could operate in all the member nations. This openness has resulted in dramatic cost reduction of the Internet, airfares, and phone calls.
The EU is administered by three bodies. The national governments are represented by the EU Council. Citizens of the member countries elect the Parliamentary members. The duty of EU staff is to ensure all members act in a consistent manner when it comes to implementing and following social, regional, and agricultural policies. Contributions reach approximately 120 billion euros every year from the member states. The three bodies uphold laws that govern the EU through a series of treaties along with supporting regulations. The EU Council is responsible for proposing new legislation and setting policies. The EU Presidency or political leadership rotates among leaders at six-month intervals. The European Parliament first debate and then approve the Council proposed laws, Members get elected at five-year intervals. The laws are executed by European Commission staffs. The current EU President is Jean-Claude Juncker. His term will expire on 2019.
The EU area uses a common currency named the euro. When it comes to world currency parity, the euro comes second after the United States Dollar. The euro has replaced regional European currencies like the French franc and Italian Lira among others. The euro's value is a free-floating one determined by foreign exchange traders every day. Currency traders show a keen interest in comparing how the euro fares against the American dollar.
EU and Eurozone are not the same
The eurozone comprises all nations which use euro. Although all members of the EU have promised to adopt the euro, only 19 of them have kept this promise. The central bank of the EU is the European Central Bank. It sets the EU monitory policy along with managing the bank lending rates. The ECB also manages the foreign exchange reserves. The target inflation rate comes to a maximum of two percent.
Citizens of countries within the Schengen Area can freely move within the member nations. There is no need for a passport or visas. The Schengen Area comprises 26 countries. Only two EU members have excluded themselves: the United Kingdom and Ireland. Four non-EU countries have adopted the Schengen Agreement: Switzerland, Lichtenstein, Norway, and Iceland. Three territories: the Azores, the Canary Islands, and Madeira are part of Schengen Area.