Question

In: Economics

What is the difference between the EU single market and the EU Customs union?

What is the difference between the EU single market and the EU Customs union?

Solutions

Expert Solution

The single market is different from the European Union Customs Union but they are interconnected. The single market (also called the ‘internal market’ and, before that, the ‘common market’) is the area of the EU in which states freely trade, and with which outside states can align their own rules by agreement.

The Customs Union overlaps with the single market, as it is a club of countries in which customs (tariffs and duties) have been removed from goods.It also ensures that countries charge the same import duties to countries outside of the single market, in order to avoid trade being diverted through members with low duties.

The Customs Union also requires the members of its club to join together to negotiate trade deals involving customs, since these have implications for the entire membership.

Like the single market, non-EU member states can also be part of the Customs Union by agreement. This currently includes Andorra, Monaco, San Marino and Turkey. Many of these arrangements are negotiated by each country and the EU.

For example, Turkey is able to trade freely in goods as a result of the European Union-Turkey Customs Union. Similarly, it is possible for a country to trade in the single market but not to be a member of the Customs Union. This is the case with EEA countries: Iceland, Norway and Liechtenstein.


Related Solutions

Explain the welfare implications of EU customs union and the Eu single market. Compare and contrast...
Explain the welfare implications of EU customs union and the Eu single market. Compare and contrast where possible
Compare the welfare effect of the UK leaving the EU Single market versus the Customs union
Compare the welfare effect of the UK leaving the EU Single market versus the Customs union
1. Highlight, with examples, the difference between the ‘Customs Union’ and ‘Economic Union’. 2. What is...
1. Highlight, with examples, the difference between the ‘Customs Union’ and ‘Economic Union’. 2. What is countertrade? Explain how switch trading works. 3. Making or buying decisions are of great strategic importance to firms in international trade. What are the advantages and disadvantages of such decisions? 4. What are Incoterms? Why do businesses use Incoterms? Highlight the differences in 2 categories of Incoterms 2010.
The difference between a free trade area and a customs union is, in brief, that the...
The difference between a free trade area and a customs union is, in brief, that the first is politically straightforward but an administrative headache, while the second is just the opposite. Consider first the case of a customs union. Once such a union is established, tariff administration is relatively easy: Goods must pay tariffs when they cross the border of the union, but from then on can be shipped freely between countries. A cargo that is unloaded at Marseilles or...
Economics 1 What are the differences between a free trade area, customs union, common market, and...
Economics 1 What are the differences between a free trade area, customs union, common market, and economic union? Do any RTAs fit completely within one of these models of integration? 2 In what ways is the EU a unique RTA? What are some of the problems confronting the EU today?
Giving an example of each, what are the differences between a Free Trade Area, Customs Union,...
Giving an example of each, what are the differences between a Free Trade Area, Customs Union, Common Market and Economic Union? Explain clearly. be as clear and specific as possible
a) Explain a Customs Union. (2 pts) b) Why does creating a Customs Union create trade...
a) Explain a Customs Union. (2 pts) b) Why does creating a Customs Union create trade and benefit a country? Use a graph in your explanation. (3 pts) c) Now assume that a small country (A) forms a Customs Union with another country (C), however that country is not the low cost producer, which is a third country (B). Use a graph in your explanation of the “trade diversion” and “trade creation” due to the formation of this Customs Union...
What are the features provided after Turkey's customs union? (embodiment)
What are the features provided after Turkey's customs union? (embodiment)
What are the key difference(s) between NAFTA and EU? (List and explain)
What are the key difference(s) between NAFTA and EU? (List and explain)
What are the pros and cons of creating a single financial market in the European Union...
What are the pros and cons of creating a single financial market in the European Union for companies? Does it make sense for consumers and businesses? What are the pros and cons of the Brexit movement? How do you reconcile the issues raised in the article Brexit Could Leave Wedding Bouquets Stuck at the Border now that Theresa May's Brexit initiative has been voted down?
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT