European Union

Introduction

The European Union (EU) is one of the greatest series of attempts to integrate Europe after the World War II and it currently hosts 28 countries. After the war, some countries sought closer cooperation in economic ties to achieve economic growth. The union has developed over the decades with its involvement in different activities since 1945 during the post-war cooperation to the current issue of COVID-19. Its future focuses on promoting green Europe, protecting the citizens and developing economic base. The process of enlargement of the European Union is also referred to as European integration. The EU has severally expanded throughout its history through accession of new members. The waves of integration include admission of Denmark, UK and Ireland in 1973, Portugal and Spain in 1986, Sweden, Finland and Austria in 1995. In 2004, Slovenia, Slovakia, Poland Hungary, Estonia, Cyprus, Latvia and Slovenia joined the union. The 2007 wave involved Bulgaria and Romania. Countries that qualify to join the EU should fulfill the economic and political requirements by the union. The enlargement contributes to intensification of cooperation between the EU members as their governments allow for harmonization of laws.

Firms Benefits from Enlargement

The enlargement of the EU implies admission of new country members who meet the criteria of membership. Enlargement is significant to the firms operating in the member states due to harmonization of business laws (Toshkov, 2017). The enlargement of the union is significant to the business sector due to the expansion of the trading environment. The firms enjoy the increasing size of market and opportunity for expansion of firms in other countries. They also enjoy from efficient allocation of human resource from the members states and improved technology and management techniques. Therefore, EU has greatly contributed to the economic development of the member states thus continue to attract other countries from Europe.

EU makes it easier, safer and affordable for firms to purchase and sell products within the union block. Member states have the freedom to trade among themselves with few legal requirements. Firms can import and export products to the member states freely thus reaching a wider market. The enlargement of the union increases the number of member states in the union thus expanding the block market. As more countries join the union, the market for firms in the member states also increases (European Union, n.d). Moreover, use of euro which is a common currency makes it easy and cheaper for firms to trade within the union area.  Price stability among the member states has also contributed to expansion of market for the firms. The use of one currency among member states makes it easier for the firms to maintain stability in prices thus enjoying a wider market in the different member countries due to elimination of rate fluctuation of exchanges within the area. For instance; accession of Bulgaria and Romania on 2007 made the EU the largest global market hosting over 500 million individuals (European Commission, n.d). The union also improves the market size for firms since they assist them in engaging with the rest of the world with the support of the union.

Enlargement of EU has significantly contributed to development and reforms in the labour markets. Every new member state that joins the EU is required to follow certain policies on labour-market thus the firms in these states enjoy efficient allocation of labour (European Commission, n.d). Enlargement increases the area where the member states can source their labour from, hence availability of experts. The EU gives the freedom to member states to source workforce within the union block thus enhancing importation and exportation of skilled manpower. EU focuses on the issues such as wages, financial incentives and labour taxation (European Commission, n.d). The union encourages its labour force to work in the region through the reforms. For instance; UK imports labour force from Denmark. The European social policy enhances international transfer of entitlements for few workers who have migrated to other member states. Therefore, enlargement of EU is befitting the firms in the union area by facilitating supply of adequate labour force.

The enlarged EU promotes expansion of firms due to addition of member states which increases the operation base of the businesses. Private businesses from the earlier EU states can establish branches in the new member countries without much legal restrictions (Nuroglu & Kurtagic, 2021). Firms can enjoy the diverse market across several member states where there target population is located. The enlargement makes it possible for the firms to migrate to other markets thus increasing its income levels which consequently improve the profits. The existing jobs are maintained and the new ones are created through the expansion. The enlargement makes it possible for the firms to link with the neighboring states in the Eastern region (Nuroglu & Kurtagic, 2021). The expansion gives the investors the confidence to continue investing in Europe due to availability of space to expand which is crucial to any firm with an objective to grow in future. Therefore, enlargement of the EU has enabled growth of firms especially by venturing in the additional member countries.

Enlargement of the EU increases the competitive advantage of the regional firms. The position of the union among the global competitors has improved with the enlargement. Third world counties joining the EU bring with them additional trading options which makes the EU accession members more attractive to foreign and local investors (Press and Information Office of the Federal Government, 2022). Both the older and the new investors enjoy the higher capital, improved capital transactions and availability of jobs in the accession countries. The firms in the member countries benefits from the capital and availability of human resources thus increasing their productivity. The firms based in the new state members start to enjoy the benefits of the EU like improved management and technological knowledge (European Commission, 2003). The improved firms get more attractive to the market thus competing favorable with other similar businesses in Europe. Moreover, the EU benefits helps firms to expand their operations globally thus competing with foreign companies dealing with similar products. Therefore, the enlargement of EU pivot firms from member states to better competitive positions in the global business sector.

Recommendations

Firms should invest in digital infrastructure to improve their competitive advantage in the global market. Connectivity is the key to global competitiveness because it shapes the market structure in favor of the business. Connectivity enhances effective sharing of information which is a crucial factor in business (Medlin & Ellegaard, 2015). Moreover, digitalization of processes pivots the business to a higher level compared to competitors. Technology enables firms to access the global market and apply online transactions. The firms with such access have more competitive ability than those using traditional methods. Technology is an effective method of promoting business to a larger population than the use of analogue promotion approaches. Use of digital marketing will enable a firm to access a wider market in specific regions that the target population is concentrated (Jain & Yadav, 2017). For instance; technology assists a corporate to assess the region with the appropriate target population to consume certain products thus making it easier to access the market. Connectivity infrastructure also improves the efficiency of the supply chain due to digitization of firms` operations.  

Firms should consider collaborating with strategic partners to improve their competitiveness. Collaboration among firms increases the monetary and physical capital necessary for investments. Any firm that want to become more competitive in the global market need to collaborate with the rights business partners (Abdulwase et al., 2020). Partnership among firms makes it easier for them to pool resources together to invest in more sophisticated operating methods to improve their productivity. Collaboration of firms in the market strengthens the involved businesses thus facilitating effective operations and competition with the rivals. The firms can acquire quality raw materials, machineries and more sophisticated technology using the available vast capital resources (Liu et al., 2021). Therefore, any firm that wants to increase its competitiveness in the global market should understand that good alliances produce great results. Moreover, collaboration also enables firms to get into new markets through expansion due to availability of the necessary resources. However, firms should be very cautious when selecting the best partners to collaborate with in the market.

Conclusion

EU is one most effective union in the world comprising some of the most developed countries. Enlargement of the European Union is an added advantage to the older and member states in terms of economic benefits. The enlargement promotes corporates by increasing market size where the union forms can trade their products.  It also increases source of labour for the firms since they can acquire experts from the various member states. The increase in number of members also promotes the competitive advantage of the firms with the rivals.  It is also necessary for the firms to ensure they apply appropriate approaches to compete favorably with other businesses in the global market. Use of technology in business is among the most appropriate approaches that a firm can use to increase its competitive powers in the market. Bibliography

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