| dc.description.abstract | The commercial relations between South America and Europe present a historical origin, this refers back to the year 1492, when Christopher Columbus discovered this continent. From then on, the expansive will of Europe was translated into a series of empires and in effect the trade spread, originating new routes of commercial flows, between the West and the lands of the South. At present, relations between the Andean Community and the European Union are sustained on historical facts, commercial interests and on shared values. In recent decades, bi-regional ties have deepened not only in the scope of trade and investments, but also in political and cooperation. Proof of this is the subscription of a 1992 cooperation agreement; the establishment of the specialized dialogue on drugs 1995; the Rome Treaty on Political Dialogue 1996; and the agreement of political dialogue and cooperation in 2003. Likewise, in 2007 a negotiation was initiated to subscribe an Association Agreement, but in 2008 the arrangement was broken and, in effect, the bilateral negotiations with the countries of Colombia and Peru initiated in 2009, which finalized with the signing of a 2013 Trade Agreement. It is timely to highlight that it is precisely in the 1980s, with the entry of Spain to the bosom of the European Union, which provides a great impetus to bi-regional relations.
Globalization is the result of the consolidation of the free market system, of the technological advances and of the need of expansion of commercial flow at the world level. Having crossed borders generated an economic expansion, making it possible to carry out financial and commercial transactions, until then limited by the domestic market, to other, distant and emerging markets. In effect, globalization has modified the way in which the markets of different countries interact in international trade. In this context, the economic relations of the Andean Community and the European Union arise. However, these are two regions with different levels of development, in the case of the Andean countries they present a primary model of exporter of raw materials and the European countries have reached a high level of technology, in effect, they are exporters of industrial products.
The theoretical framework of the research comprises the theory of foreign trade and of the regional integration. The classical school (Smith, 1776) maintained that the state should refrain from intervening in the economy already, that if men acted freely in the pursuit of his own interest and promoted free competition, there was an invisible hand that converted their efforts in benefits for the whole society. In relation to trade, it points out the principle of the absolute advantage of the factors. He affirms that it will never ever be profitable for an individual to produce what he can get cheaper from another person. Another classic (Ricardo, 1784), says that the reason for international trade is comparative advantage based on differences in labour productivity between countries. The neoclassical school (Heckscher-Ohlin, 1919) argues that countries tend to export these goods that are intensive in the factors with which they are abundantly endowed. According to (Balassa, 1964), regional integration goes from the phase of a free trade zone to the economic and political union.
In relation to foreign trade, the European Union is the second destination market for exports from the Andean Community, after the United States market. Exports to the European market represent (14%) of the total, in the period (2005-2014). However, for the European Union, the Andean market represents only (0.6%) of its total trade. Exports by countries: Spain is the main market (27%), followed by the Netherlands (19%), Germany (13%), Italy (11%) and, the United Kingdom (9%). Exports are concentrated in five countries of destination, which makes up (80%) of total trade (2014). The main export products are: (Bolivia) soybeans, zinc, gold, wood and metals. (Colombia) coffee, coal, clothing, bananas and flowers. (Ecuador) bananas, shrimp, cocoa, flowers and fish. (Peru) copper, fish, fruits, zinc, gold and silver.
The European Union represents the third market of origin of the imports of the Andean countries, after the markets of the United States and China. The main imported products are: machinery, apparatus and electric material (28%); transportation material (25%); chemical industry (18%), manufactures (5%); and optical apparatus (4%); these five sectors represent the (80%), of the total imported (2014). In disaggregated form are: machinery and equipment, agricultural tractors, transport vehicles (Bolivia); cargo vehicles, radiotelephone apparatus, machinery, chemical products (Colombia and Ecuador); transportation vehicles, machinery and planes (Peru). In addition, tour buses, cars, trucks, cranes and boats. Imports from the European Union by country of origin are: Germany is the most important market (24%), followed by France (22%), Spain (14%), Italy (11%), United Kingdom (6%), The Netherlands (5%), Belgium (4%), and Sweden (3%) in (2014). These eight countries represent approximately (90%) of the imports from the Andean Community.
The commercial structure of the Andean Community has not changed, exports maintain a high relative weight in raw materials (agricultural and mineral), equally imports from the European Union, are basically industrial goods with a high technological content (machinery and equipment). The Andean countries present a model of primary development that exports raw materials, exports depend to a large extent on extractive activities and the fluctuation of prices in the international market. The great challenge for the Andean countries is the change of their productive structure, an aspect that implies diversifying exports with higher value-added products.
Foreign direct investment (FDI) in the Andean Community, in the last decade has shown a growing trend, among the main factors that attract investment in the Andean region, are its natural resources reserves, such as oil, gas, minerals, fishing and forest. European companies have made large investments in extractive industries, promoted by the high price cycle and by the demand of emerging countries. In the Andean region, investment in activities associated with natural resources predominates; investment is directed to the mining and oil sector.
The European Union as a trade bloc continued to be the most important source of (IED) in the Andean Community. The origin of European investment is concentrated in five countries: Spain is the leading investor (36.2%), followed by the United Kingdom (34.2%), Sweden (9.5%), France (8.7%), and Italy (5.5%), together these five countries contribute more than (90%) of the total (FDI) in the period (2003-2012). However, Germany being one of the largest economies, its investment is very small, highlighting that it is the main import market of the Andean countries (24%). In concrete, the European Union is the second commercial partner of the Andean Community, the first source of foreign direct investment (FDI) and the first donor of cooperation and development resources.
The European Union was founded in 1957 with six countries, at present they are 29 members, it is a geopolitical union, with a hybrid system of community government. The European Union is the most advanced regional integration block in the world. It has overpassed the "common market" phase and is consolidated, as an economic and monetary union, aspiring to form a political union. In many aspects, the European Union can be seen as a "microcosm" of globalization. In no other area of the world has so much liberalization and integration of markets been achieved in the interests of economic efficiency (Sanahuja, 2008). The Andean Community was created in (1969), similar to the European model. Today, it is in an institutional crisis, it needs to redefine its approach to integration and has not managed to advance in the different stages of regional integration. However, despite the weaknesses of its integration schemes, Latin America remains the only area in the world that together with the European Union encourage economic regional integration.
Keywords: international trade, export, import, investment, raw materials, manufactures, regional integration, diversification, capital, technology, free trade, globalization, common market, comparative advantages, Andean Community and European Union. | es |
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