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Competitiveness of the EU










Introduction. 3

1. Theoretical concepts of the competitiveness. 4

2. Dynamics of the EU competitiveness in the world economy. 7

3. The trade effects of the enlargement 9

4. Important factors for the countrys competitiveness. 10

5. Effective Exchange Rates Based on Different Deflators. 11

6. The keys for success. 13

7. Competitiveness of the European Shipbuilding Industry. 15

8. Competitiveness of the EU eco - industry. 21

9. Competitiveness of the EU tourism industry. 24

10. Competitiveness of the EU Food Industry. 28

11. Competitiveness of the EU security industry. 32

12. Constraints within security markets. 36

Conclusion. 41









A competitive region is cooperation between several countries, not within a single one. These courswork aims to present the competitiveness of the European Union. In 2000, Europes heads of state and government declared their intention to make the European Union the most competitive and dynamic knowledge- based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion. In order to achieve this goal by 2010, the Lisbon Strategy of political and economic reforms was adopted.

We are living in an environment of continuous changes. In this environment both research and practical actions are needed. This conference calls attention to the tradition and perspective of cooperation between countries in different parts of Europe. The weak signals show that regions may hold a stronger position in the future than they do today. A competitive region is, however, cooperation between several countries, not within a single one. In this development a natural cooperation between European countries has a lot of potential.

A countrys economic outlook is closely related to its competitiveness. It is not surprising that new data on a countrys competitive position in the world are on the radar of both the media and policymakers. Growing international trade integration raises the importance of competitiveness indicators even further. In the 1990s, world trade expanded more than twice as fast as real economic output. More and more goods and services are becoming tradable, and ever more companies and countries are opening up to foreign trade. The principle of the international division of labor, which in a competitive environment leads to efficiency gains if every country makes use of its comparative advantages, lies at the heart of the importance of trade for growth.



4. Important factors for the countrys competitiveness


There are another important factors for the countrys competitiveness: exchange rate developments and the inflation differential, main trading partners, labor costs, the countrys sectoral and regional trade structures, which determine whether its export activities are focused on more or less dynamic industries and regions; and finally, a number of location factors which have an impact on the countrys attractiveness as an investment and business location. Depending on the nature of a countrys locational disadvantages, the media are often quick to urge central banks, social partners and governments to promote competitiveness in a systematic way. In particular, they tend to call for short-term solutions like adjusting exchange rates or subsidizing crucial production factors, such as energy prices, rather than encouraging decision makers to uncover the structural causes of these deficits, which concern wage-setting processes, trade structures, research and education systems as well as the business and investment climate.

The competitiveness can be measured in many different ways. Basically there are two complementary approaches to gauge a countrys competitiveness. The result-oriented approach focuses on the past performance of a country in international competition based on indicators, such as export growth, the market share in the global economy, the real exchange rate, real per capita income, the current account balance as well as the countrys presence in high-technology sectors and comparative advantages. While these indicators capture a countrys current and past performance in international competition, they do not lend themselves to forecasting future developments and often do not point to the sources of competitiveness. As a case in point, increased export growth might result exclusively from a global economic boom, rather than from improved competitiveness.





These coursework represented the essence of the competitiveness and the place of the Europe Union in the world economy as made evident in an analysis of various indicators. In the euro area, exports account for around 33% of GDP (United States: 8%, Japan: 14%). The EU accounts for over 60% of all innovations. Europe is ranked 2nd in the global security market, with a market share ranging approximately from 25% to 35%. It has good shares in the shipping industry and has a leading global position in recycling (50%), water supply (30%) and renewable energy (40%). EU and USA are the largest players in the food industry. And in last, but not at least, Europe Union is the most visited tourism destination in the world. Tourism sector has major importance for the European economy as a whole.







1.      Crescenzi R., Competitiveness of the EU regions: determinants and strategies for the future, London School of Economics and Political Science;

2.      European Commission- EU industrial structure 2009, Performance and competitiveness;

3.      European Commission- The EU Economy: 2005 Review. Rising International Economic Integration Opportunities and Challenges;

4.      Rodríguez-Pose, Crescenzi R.,- R&D, spillovers, innovation systems and the genesis of regional growth in Europe, 2008;

5.      Study on the Competitiveness of the EU eco-industry, Final Report Part 1 , 09 October 2009;

6.      Study on the Competitiveness of the EU security industry, Within the Framework Contract for Sectoral, Competitiveness Studies ENTR/06/054, Final Report, ECORYS SCS Group, 15 November 2009;

7.      Study on the Competitiveness of the European Shipbuilding Industry Within the Framework Contract of Sectoral Competitiveness Studies ENTR/06/054 Final Report, ECORYS SCS Group, 8 October 2009;

8.      Struggle for Leadership: Krijn J. Poppe, Jo H.M. Wijnands- The Competitiveness of the EU and US Food Industry, Association Annual meeting, Portland, OR, July 29 August 1, 2007.

9.      Vahtra P., Pelto E., The future competitevness of the EU and its eastern neighbours, Proseedings of the conference.



17. 05. 2010 .


2009 .



competitiveness of the EU, world economy, tourism industry, constraints within security markets, country competitiveness, SWOT, food industry, innovation systems


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