The economy of the European Union generates a GDP of over €12.894 trillion annually (US$16.566 trillion in 2012) according to Eurostat, which makes it the largest economy in the world. The European Union (EU) economy consists of an internal market and the EU is represented as a unified entity in the World Trade Organization (WTO). The official currency of the European Union is the euro used in all its documents and policies. The Stability and Growth Pact sets out the fiscal criteria to maintain stability and (economic) convergence. The euro is also the most widely used currency in the EU, which is in use in 18 member states known as the Eurozone.
The European Union is the largest exporter in the world and as of 2008 the largest importer of goods and services. Internal trade between the member states is aided by the removal of barriers to trade such as tariffs and border controls. In the Eurozone, trade is helped by not having any currency differences to deal with amongst most members. The services sector is by far the most important sector in the European Union, making up 69.4% of GDP, compared to the manufacturing industry with 28.4% of GDP and agriculture with only 2.3% of GDP.
The European Union is a major tourist destination, attracting visitors from outside of the Union and citizens travelling inside it. Internal tourism is made more convenient by the Schengen treaty and the euro. All citizens of the European Union are entitled to travel to any member state without the need of a visa. France is the world’s number one tourist destination for international visitors, followed by Spain, Italy and the United Kingdom at 2nd, fifth and sixth spots respectively. London, the capital of the United Kingdom is also the world’s most visited city and the highest in tourism receipts, before Paris.
The European Union’s member states are the birthplace of many of the world’s largest leading multinational companies, and home to its global headquarters. Among these are distinguished companies ranked first in the world within their industry/sector, like Allianz, which is the largest financial service provider in the world by revenue; WPP plc which is the world’s largest advertising agency by revenue; Airbus, which is the world’s largest aircraft manufacturer Air France-KLM, which is the largest airline company in the world in terms of total operating revenues; Amorim, which is the world’s largestcork-processing and cork producer company; ArcelorMittal, which is the largest steel company in the world; Inditex which is the biggest fashion group in the world; Groupe Danone, which has the world leadership in the dairy products market.
Anheuser-Busch InBev is the largest beer company in the world; L’Oreal Group, which is the world’s largest cosmetics and beauty company; LVMH, which is the world’s largest luxury goods conglomerate; Royal Dutch Shell, which is one of the largest energy corporations in the world; and Stora Enso, which is the world’s largest pulp and paper manufacturer in terms of production capacity, in terms of banking and finance the EU has some of the worlds largest banks notably HSBC and Grupo Santander, the largest bank in Europe in terms of Market Capitalization.
Many other European companies rank among the world’s largest companies in terms of turnover, profit, market share, number of employees or other major indicators. A considerable number of EU-based companies are ranked among the worlds’ top-ten within their sector of activity. Europe is also home to many prestigious car companies such as Audi, Mercedes, Jaguar Land Rover, Volkswagen, BMW group as well as volume manufacturers such as Fiat, PSA group and Renault.