European Union (EU)

The EU has 31 member states and over 450 million people

The EU offers more consumers and therefore sales to UK based firms

By locating in cheaper countries e.g. Eastern Europe businesses are able to reduce costs

Can also lead to increased competition

Institutions of the EU

• European commission – policy and legislation
• Council of ministers – unions decision making body
• European parliament
• European court of justice
• European central bank

The Euro

In January 1999 the Euro was introduced into 12 countries

By January 2002 Euro notes and coins were available

The Euro influences markets by:

• Having cheaper transaction costs
• Stable exchange rates
• Transparent price differences