European Free Trade
Association (EFTA)
Purushotam Sharma 06
Renuka Dalal 09
The European Free Trade Association (EFTA) was established on 3 M
ay 1960 as a trade bloc-alternative for European states who were either
unable to, or chose not to, join the then European Economic Community
(now the European Union (EU). The EFTA Convention was signed on 4
January 1960 in Stockholm by the “outer seven states” which includes
Austria, Denmark, Norway, Portugal, Sweden, Switzerland and UK.
Today only Iceland, Norway, Switzerland, and Liechtenstein remain
members of EFTA.
EFTA and the EU
1960 Austria, Denmark, Norway,
Portugal, Sweden, Switzerland and
the UK establish EFTA
1970 Iceland becomes a member of
EFTA
1972 Denmark and the UK leave
EFTA to join the EEC (EU)
1985 Portugal leaves EFTA to
become a member of the EEC (EU)
1986 Finland becomes a full
member of EFTA
1991 Liechtenstein becomes a
member of EFTA
1995 Austria, Finland and Sweden
leave EFTA to join the EU
- Currently, the EFTA States have established preferential
trade relations with 20 States and Territories, in addition to
the 27 Member States of the European Union.
- EFTA FTAs establish a free trade area between the partne
r countries, by providing for free trade in industrial goods, i
ncluding fish and other marine products and processed agric
ultural products
- Trade in basic agricultural products is covered in bilateral
agreements between the individual EFTA States and the par
tner country, which form part of the instruments establishin
g the free trade area.
- The Free Trade Agreement between EFTA and Canada entered into
force on 1 July 2009.
- The EFTA-Canada Free Trade Agreement, which is focused on trade
in goods, has the potential to yield significant benefits for exporters in all
five participating countries.
- It provides new links between European and North-American supply
and value chains.
- The areas of services, investment and government procurement are
the subject of reviews foreseen within three years after the entry into
force.
- The EFTA States’ main exports to Canada are mineral fuels,
pharmaceutical and chemical products, as well as machinery.
- Canada primarily exported nickel, aircraft, pharmaceutical products,
machinery and mechanical appliances to EFTA.
Contributions from the EFTA States to the 2017
EFTA budget
Member StateContribution (in CHF)Share (as %)
Member State Contribution (in Share (as %)
CHF)
Iceland 610 682 2.77
Liechtenstein 209 318 0.95
Norway 12 074 003 54.53
Switzerland 8 974 997 41.75
Total 21 869 000 100.00
Global leaders in merchandise trade 2016 ( in billion USD )
Rank Economy Total Share of Exports Imports
world total
1 EU 10 636 33.02 5 379 5 256
2 U.S 3 701 11.49 1 451 2 250
3 China 3 686 11.44 2 098 1 588
4 Japan 1 253 3.89 645 608
5 Hong Kong 1 064 3.30 517 547
6 Korea 902 2.80 495 406
7 Canada 807 2.50 390 417
8 Mexico 771 2.39 374 398
9 EFTA 745 2.31 397 348
10 Singapore 630 1.96 338 292
11 India 624 1.94 264 360
Total of 29 507 91.60 14 797 14 710
World1 32 214 100.00 15 985 16 229
– EFTA’s merchandise trade: 2017
Country Total Total EU Total Exports EU share Total Imports EU share
trade trade share of exports to the of total imports from the of total
with the total EU exports from the EU28 imports
EU trade in in % world in %
%
Switzer 518 268 51.8 273 132 48.3 244 136 55.8
land [1] 065 474 853 186 211 288
[2]
Norwa 146 103 71.0 80 63 78.1 65 40 62.2
y 494 952 883 136 611 816
Iceland 9 013 5 557 61.7 4 026 2 946 73.2 4 987 2 611 52.4
Liechte 4 895 3 197 65.3 3 078 1 795 58.3 1 817 1 403 77.2
nstein
[2]
EFTA 678 381 56.2 361 200 55.3 316 181 57.2
Total 466 180 % 840 062 % 626 118 %
Global FDI* stocks, inward 2017
Global FDI* stocks, outward 2017
http://en.wikipedia.org/wiki/European_Free_Trade_Associ
ation#EFTA_and_the_European_Union
http://www.efta.int/
http://www.efta.int/content/free-trade/trade-statistics/canad
a-commodities.pdf
