European Union Economy

The total economy of all European Union countries combined generates a GDP of over 12.629 trillion euro annually, making it the largest economy in the world and operated on a budget of 141 billion Euro for the year 2011. All member states have committed to using the Euro over their former currencies once they meet the requirements to do so as part of the Stability and Growth pact except for Denmark, the UK and Sweeden, which still has the ability to opt out. At present, the Euro is the most used currency within the E.U. It is in use in 17 member states which are colloquially known as “the Euro zone.”

Economic performance within the E.U. varies from state to state. The Stability and Growth pact applies to all member states, and Eurozone members are not allowed to carry deficits higher than 3 % of GDP. Public debt must not exceed 60% of GDP. Unfortunately, some larger members of the union have stretched this number to percentages that are higher than the limit and the Eurozone currently has a debt higher than the mandated limit of 60%.

Though many economic factors come into play by virtue of its member countries, the services sector is by far the most important in the E.U., comprising 69.4% of total GDP compared to a 28.4% share held by the manufacturing industry and 2.3% share held by agriculture.