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TheEuropean Union has a number of relationships with foreign states. According to the European Union's official site, and a statement byCommissionerGünter Verheugen, the aim is to have a ring of countries, sharing EU's democratic ideals and joining them in further integration without necessarily becoming full member states.
TheEuropean Free Trade Association (EFTA) was created to allow European countries to partake in a free trade area with less integration as within theEuropean Communities (later European Union). Most of the countries initially in EFTA have since joined the EU itself, so only four remain outside,Norway,Iceland,Liechtenstein andSwitzerland.
TheEuropean Economic Area (EEA) agreement allows Norway, Iceland and Liechtenstein to have access to the EU's internal market and vice versa. Thefour basic freedoms (goods, services, people, and capital) apply. However, some restrictions on fisheries and agriculture take place.
Norway is a member of the EEA, therefore it participates in the single market, and most EU laws are made part of Norwegian law. Norway has signed theSchengen treaty, which means border checks are no longer made.
Like Norway,Iceland joined the EEA, and is considered part of theEuropean Single Market. Iceland has also signed the Schengen treaty. In 2009 Iceland applied to join the Union but the application was controversial and the Icelandic government withdrew it in 2015.[1]
Liechtenstein joined the EEA in 1995 and participates in the European Single Market.
TheSwiss referendum to join the EEA in 1992 failed, so Swiss products do not participate in the European Single Market. However the country negotiated two series of bilateral agreements with the Union. The first series, Bilateral Agreements I, consists of seven bilateral agreements and was signed in 1999 (entry into force in 2001), the main part being Free Movement of Persons (full text of the agreement). The second series, Bilateral Agreements II, relates to nine areas and was signed in 2004 (entered into full force on 30 March 2005) and includes the Schengen treaty and theDublin Convention (full text of the agreement) (official press release).
There are fourEuropean microstates which are neither EU member-states nor fulleurozone members, but nevertheless use and mint theeuro as their legal currency under official agreements with the EU. All of them previously used the national currencies of their larger neighbours, Italy, France and Spain, which have since all become eurozone-members.
San Marino: San Marino is not a member state of the EU, but had a special agreement withItaly to mint a limited number of itsown lira coins. There is an agreement to mint itsown euro coins (limited) which are legal tender in the eurozone.
Vatican City: The Vatican City is not part of the EU, but had a special agreement withItaly to mint a limited number of itsown lira coins. There is an agreement to mint itsown euro coins (limited) which are legal tender in the eurozone.
Monaco: Monaco is not a member state of the EU, it had a special agreement with France to mint itsown franc coins. There is an agreement to mint itsown euro coins (limited), which are legal tender in the eurozone.
Andorra: Andorra is not part of the EU. In the 20th century, both theFrench franc andSpanish peseta were used and accepted in Andorra, but the peseta was more widespread[2] There is an agreement to mint itsown euro coins (limited) which are legal tender in the eurozone.[3]In addition, two dependent territories outside of the EU use the euro as their currency under agreements with the EU, though without minting their own euro coins:
Saint Barthélemy is not a part of the EU, but there is an agreement with the EU to use euro as its currency, though without minting own euro coins. The French franc was used there before.
Akrotiri and Dhekelia is not a part of the EU, but there is an agreement between theUnited Kingdom and the EU[citation needed] to use euro as its currency, though without minting own euro coins. TheCypriot pound was used there before.Some other countriesunilaterally decided to use the euro as theirde facto currency without having currently a formal agreement with the EU.
Certain countries and territories are incustoms union with the EU. These are:
Monaco: relations between the Principality of Monaco and the EU are primarily conducted throughFrance. Through that relationshipMonaco directly participates in certainEU policies, including being an integral part of theEU customs territory andVAT area.[4]
Turkey (excluding agricultural products; since 1996)Andorra (excluding agricultural products; since 1991)San Marino (signed in 1991 and in force since 2002)Akrotiri and Dhekelia are partially part of theEuropean Union Customs Union in three domains:VAT, agriculture and fisheries.
The EU has concluded free trade agreements with many countries in the world, and is negotiating with more through theStabilisation and Association Process,Eastern Partnership,Association Agreements andEconomic Partnership Agreements.
CoversMorocco,Algeria,Tunisia,Libya,Egypt,Jordan,Lebanon,Syria,Israel,Palestinian Authority,Moldova,Ukraine,Georgia,Armenia,Azerbaijan,Belarus, andRussia (through the formation ofcommon spaces).
According to the European Union's official site, the objective of theEuropean Neighbourhood Policy (ENP) is to share the benefits of the EU's 2004 enlargement with neighbouring countries. It is also designed to prevent the emergence of new dividing lines between the enlarged EU and its neighbours. The vision is that of a ring of countries, drawn into further integration, but without necessarily becoming full members of the European Union. The policy was first outlined by theEuropean Commission in March 2003. The countries covered include all of theMediterranean shores of Africa and Asia, as well as the EuropeanCIS states (with the exception of Russia andKazakhstan) in theCaucasus and eastern Europe.Russia insisted on the creation of the fourEU–Russia Common Spaces instead of ENP participation. Kazakhstan's Foreign Ministry has expressed interest in theENP[1]Archived 2 January 2008 at theWayback Machine. SomeMEPs also discussed Kazakhstan's inclusion in the ENP.[5]
TheEuropean Neighbourhood Instrument (ENI), came into force in 2014. It is the financial arm of the European Neighbourhood Policy, the EU's foreign policy towards its neighbours to the East and to the South. It has a budget of €15.4 billion and provides the bulk of funding through a number of programmes.The ENI, effective from 2014 to 2020, replaces theEuropean Neighbourhood and Partnership Instrument – known as the ENPI.
TheEuro-Mediterranean Partnership orBarcelona Process is a wide framework of political, economic and social relations between member states of the EU and countries of the Southern Mediterranean. It was initiated on 27–28 November 1995 through a conference of Ministers of Foreign Affairs, held inBarcelona. Besides the 27 member states of the European Union, the remaining "Mediterranean Partners" are all other Mediterranean countries withoutLibya (which has had 'observer status' since 1999). Since the establishment of theEuropean Neighbourhood and Partnership Instrument in 2007 (see below) theEuro-Mediterranean Partnership initiative will become fully a part of the widerEuropean Neighbourhood Policy. TheAssociation Agreements signed with the Mediterranean states aim at establishing of aEuro-Mediterranean free trade area.
CARDS, short for "Community Assistance for Reconstruction, Development and Stabilisation", was established on 5 December 2000 through Council regulation Number 2666/2000.
Its scope is the WesternBalkans countries (Albania,Bosnia and Herzegovina,Kosovo,Macedonia,Montenegro andSerbia). The programme's wider objective is to support those nations in theStabilisation and Association Process.
TheTACIS programme, established in 1991, was a programme of technical assistance that supports the process of transition tomarket economies for the 11CIS countries and Georgia. Until 2003, Mongolia was also included in the programme but is now covered by the ALA programme.
TheMEDA programme was the principal financial instrument for the implementation of the Euro-Mediterranean Partnership, offering technical and financial support measures to accompany the reform of economic and social structures in the Mediterranean partner countries.
The first MEDA programme was established for the period of 1995–1999. In November 2000, a new regulation established MEDA II for the period of 2000–2006.
ACP stands for "Africa, Caribbean and Pacific". The programme applies to 71 countries, among which are all African nations with the exception of the Mediterranean countries of northern Africa (covered by the MEDA programme above). The ACP is currently covered by theCotonou Agreement, which replaces theLomé Convention.
External links:ACP Countries at official EU site
ALA, standing for "Asia and Latin America" is a programme for financial aid and cooperation with those regions.
Below is a table and three graphs showing, respectively, the GDP (PPP), the GDP (PPP) per capita and the GDP (nominal) per capita for some of the third countries that the European Union has relations with. This can be used as a rough gauge to the relative standards of living among member states.
The table is sorted byGDP (PPP) per capita to show the relative economic development level of the different countries. Reference values for the EU average, highest and lowest are included.
| Third country | GDP (PPP) millions of int. dollars | GDP (PPP) per capita int. dollars | GDP (nominal) per capita int. dollars |
|---|---|---|---|
| European Economic Area: | |||
 Luxembourg (EU highest) | 96,886 | 143,742.69 | 131,384.164 |
 European Union (EU average) | 26,308,203 | 58,838.098 | 42,443.319 |
 Bulgaria (EU lowest) | 229,107 | 35,963.358 | 16,942.519 |
| European Free Trade Association: | |||
 Switzerland | 816,456 | 91,931.752 | 105,668.981 |
 Iceland | 29,077 | 73,783.627 | 84,593.939 |
 Liechtenstein (2022) | 4,978 (2014 est.) | 123,609 (2014 est) | 187,267.1 |
 Norway | 461,107 | 82,831.777 | 94,659.918 |
| European Microstates: | |||
| Vatican City unique noncommercial economy | 252 | 273,615 | no data |
| San Marino | 2,978 | 86,988.999 | 59,405.352 |
| Monaco (2022) | 7,672 (2015 est.) | 115,700 (2015 est.) | 240,862.2 |
| Andorra | 6,001 | 69,146.025 | 44,899.596 |
| Current Enlargement Agenda: | |||
 Albania | 58,795 | 20,632.444 | 8,924.317 |
 Bosnia and Herzegovina | 71,254 | 20,622.798 | 8,415.970 |
 Kosovo(under UNSCR 1244) | 29,719 | 16,775.149 | 6,388.731 |
 Montenegro | 18,812 | 29,695.785 | 12,645.548 |
 North Macedonia | 45,905 | 25,586.124 | 8,847.378 |
 Serbia | 185,014 | 27,984.719 | 12,383.904 |
| Turkey | 3,831,533 | 43,920.715 | 12,764.707 |
| European Neighbourhood Policy: | |||
 Israel | 552,151 | 55,532.543 | 53,371.545 |
 Libya | 182,897 | 26,456.471 | 6,975.33 |
 Russia | 5,472,880 | 38,292.239 | 14,391.176 |
 Tunisia | 168,315 | 13,644.731 | 4,435.001 |
 Belarus | 234,661 | 25,685.299 | 7,557.795 |
 Algeria | 768,521 | 16,482.600 | 5,721.678 |
 Ukraine | 515,947 | 15,463.851 | 5,662.948 |
 Lebanon (2022) | 70,558 | 12,852.7 | 3,823.9 |
 Jordan | 141,191 | 12,401.617 | 4,705.339 |
 Azerbaijan | 199,195 | 19,327.534 | 7,640.915 |
 Morocco | 409,073 | 10,946.567 | 4,077.525 |
 Egypt | 1,898,538 | 17,614.053 | 3,224.868 |
 Armenia | 64,432 | 21,746.233 | 8,575.301 |
 Syria (2021) | 62,151 | 2,914.5 | 421,1 |
 Georgia | 94,020 | 25,248.121 | 8,825.411 |
 Moldova | 43,882 | 17,901.591 | 7,488.443 |
 Palestinian Authority (2023) | 30,418 | 5,888.4 | 3,367.6 |
Source:IMF World Economic Outlook April 2024,World Bank Indicators (Lebanon, Syria, Palestinian Authority, Liechtenstein (nominal GDP per capita), Monaco (nominal GDP per capita)),CIA World Factbook (Liechtenstein and Monaco (PPP GDP and PPD GDP per capita)), Unknown for Vatican Data