ABSTRACT
This chapter devoted to the common external trade policy, one to the objectives and instruments and the other to the specific relations with different groups of trading partners. It describes the international institutional setting in which the European regime has evolved. The chapter reviews labour and capital movements, international economic and monetary coordination and development aid. It explores on external policies less associated with economic issues, such as foreign and defence policy. The importance of the categories of an economic union’s external relations can be derived from its balance of payments, which is the financial record of its transactions with the rest of the world. The EU trade regime is based on a number of theoretical principles. Indeed, the literature on external trade relations indicates the importance of a regime of openness as most conducive to growth. A particularly important matter in the context of a European external policy is defence.
