Emerging Countries and Jobs and Wages in Europe: An Introduction

Abstract

Business between Asia and the European Union (EU) is booming. Economic interdependence between the two has been deepening rapidly since the early 1980s and has meanwhile spread over many sectors of economic activity. It has been accompanied by unilateral, bilateral and multilateral liberalisation of trade in goods, services and — selectively — direct investment, which, no doubt, has had a stimulating effect.¹ However, this success story and the implied structural adjustment are not always applauded in Europe. At times, it has been fiercely resisted. In the early 1980s when the EU economy suffered from high unemployment, stagflation, Euro-sclerosis (various deeply entrenched rigidities, identified as slowly paralysing the EU economy) and ‘lost’ competitiveness, the EU resorted to no less than ten voluntary export restraints vis-à-vis Japanese exports, some new restrictions at the Member States’ level and a significant tightening of the third Multi-Fibre Arrangement (MFA) (1982-1986). The idea of a new GATT Round was also shot down by the EU in 1982.