If you’re doing business internationally, Europe is too large to ignore. Together, the U.S. and Europe share more than 40 percent of the global economy and transact more than $1.5 trillion per year in trade and investment. Most large U.S. corporations have operations in Europe, and Europe is the largest source of foreign direct investment in the United States.
But the European market isn’t open only to large companies; small- and medium-sized enterprises do significant business with Europe as well. Europe is often among the first export markets for U.S. companies. When businesses look to Europe, they are looking to an opportunity unparalleled in any other region.
When asked, “What is Europe?” many businesses may point to the 27-member European Union. But Europe’s opportunities are much broader. For example, the European Economic Area and the European Free Trade Association countries have harmonized many of their regulations with the European Union. The EFTA countries (Norway, Iceland, Liechtenstein and Switzerland), though small in population, are among the wealthiest in the world on a per capita basis.
Bulgaria and Romania joined the EU on January 1, 2007 raising the EU's population to 500 million. These two countries will undergo an extensive process of harmonizing their laws with existing EU regulations; simplifying the requirements for market entry while expanding market potential. In addition to these two countries, there are other candidate countries including Croatia and Turkey.
The introduction in many EU Member States of a common currency, the euro, and mutual recognition of standards have made the European market both more competitive and more open. While the European market for U.S. goods and services is truly a single market for some items, it is still fragmented along country, language, cultural, or regional lines for others. With the ongoing consolidation of distribution channels and retailers, marketing for many goods can now be done with a pan-European perspective. But for other items – particularly specialty products – the retail outlets, distributors and end-users are still local, and the best coverage for such markets will likely be on a regional basis that might even divide Europe’s larger countries into more than one market. In many respects, the European market can be viewed as having several layers.
Learn more about Doing Business in Europe.