Openess of European regions, 2008


Observations for policy

Globalisation is characterised by increasing exchanges across economies of the globe and by a growing integration of these economies, illustrated by the assertion of Multinational corporations (MNCs) and transnational finance. Ratios comparing the value of each region’s extra-European exports to its total GDPs provide an indication of their integration and participation in a global trade. The present map considers manufacturing industries only.

Regions have different rates of openness to the global economy. Different factors characterise the openness of European regions, for example, the presence of a harbour or a specific industry such as Airbus in Toulouse or telecommunications in Finland.

The integration and participation to the global economy has different impact on European regions. Strongholds of internationally competitive, European manufacturing production areas, such as the Benelux, Southern Germany, Switzerland and Northern Italy might benefit from more integration, stimulating the trade of merchandise, while other regions are more vulnerable by re-locations of labour intensive industry as a consequence of globalisation.

Policy context

The effects of globalisation have become more visible during the recent crisis, and EU policies increasingly focus on improving the competitiveness and resilience of European regions in the face of global economic pressures. The social, economic and environmental implications of a stronger economic integration into global economic circuits vary depending on the region considered. This is linked to each region’s economic specialisation, the way in which and the extent to which it participates in the global economy. As a result, each region has different capacities to resist increasing competitive pressures and to take advantage of new opportunities. The Europe 2020 strategy is inter alia adopted to enhance the competitiveness of European regions. The strategy compares the economy of Europe to strong economies as the US and Japan and emerging markets such as Russia and China.

The Territorial Agenda 2020 addresses the economic competitiveness, which can be enhanced by the development of globally integrated economic sectors and strong local economies. Global and local strands are reinforcing and interlinked, integrating in global economy reduces the vulnerability to external forces.

Map interpretation

The map shows the openness of European regions in terms of extra-European exports of manufacturing goods as a percentage of regional GDP. Openness to non-European regions is an indicator for the countries’ positions in the world. Strongholds of internationally competitive, European manufacturing production areas, such as the Benelux, Southern Germany, Switzerland and Northern Italy but also Finland, Ireland, Upper Normandy and Midi-Pyrénées (Toulouse / Airbus) are among the most open regions in Europe. There are however significant differences in the participation and integration of European regions in the global economy. The openness of European regions ranges from 0,1% in Corsica to 31% for Flanders.

Regions participate in different ways in the global economy and participation in global trade is only one of them. Some regions of Europe are open because of their capacities to be competitive in high technological products: Midi-Pyrenees (Airbus in Toulouse); Southern Germany (machinery sold in Eastern Asia for example); Finland (telecommunications). On the other hand, the weak openness of Southern Europe to extra-European markets partially reflects their weak competitiveness in both technological and more labour intensive industries, with the exception of more developed regions as Northern Italy and the Basque region.

The geography of regional openness to trade is the result of the combination of national belonging of the regions (related notably to the country’s size, and historical links with extra-European markets), of EU border effects, of the presence of important harbours and of competitiveness in medium and high technological goods.

Concepts and methods

The ratio between extra-European exports and regional GDP is used as a proxy for the degree of openness of each region. Extra-European exports include only merchandises and exclude the trade with other EU countries and neighbourhood states, to avoid an EU border effect. This border effect mostly affects the Baltic States, trading with Russia and to a lesser extent Southern European countries, despite their proximity to Northern Africa and the Middle East. National data have been used for most countries in Northern, Eastern and Southeast Europe, as no regional figures were available.

It should be noted that this proxy only reflects some aspects of the openness of European regions to the global economy. The openness of London is, for example, underestimated due to the fact that exports of services are not considered. Furthermore, two thirds of trade in the EU can be classified as intra-European trade.