ECONOMIC AND MONETARY UNION

1
ECONOMIC AND MONETARY UNION

• EURO?

2
WHAT IS IT?

• ECONOMIC UNION - DELORS
• (i) SM
• (ii) competition policy
• (iii) structural change regional development
• (iv) macroeconomic policy
• MONETARY UNION

3
HISTORY

• 1960S
• 1969
• WERNER - 1980?
• EMS EUROPEAN MONETARY SYSTEM 13/3/79
• 3RD ATTEMPT

4
EMU

• HANOVER 1988 DELORS
• STRASBOURG 1989 1990IGC
• TEU
• TIMETABLE
• CRITERIA
• SYSTEM

5
TIMETABLE AND CRITERIA

• TIMETABLE
• 3RD. STAGES
• CRITERIA 5
• (i) budget deficit 3
• (ii) national debt 60
• (iii) no devaluation
• (iv) inflation rate
• (v) interest rates

6
System

• 13
• ECB
• GUARDIAN OF PRICE STABILITY
• 1100 STAFF
• GOVERNING COUNCIL
• EXECUTIVE BOARD
• INDEPENDENCE
• ACCOUNTABILITY

7
BRITAIN /-

• S ECONOMIC
• BUNDESBANK
• 1/3
• DEVALUATION
• INFLATION
• NO REAL SOVEREIGNTY
• TRANSACTION COSTS

8
-S

• COST OF EXCLUSION
• DISCRIMINATION
• BENEFIT OTHERS
• INWARD INVESTMENT

9
Political

• EUROPEAN CREDENTIALS
• INSULARITY
• POOLED SOVEREIGNTY

10
ECONOMICALLY

• -S
• LOSS OF EXHANGE ADJUSTMENT
• SINGLE INTERET RATE
• NO CONVERGENGE
• TAX SPEND
• RESOURCE TRANSFERS

11
POLITICALLY

• -S
• STATE
• RATE-CAPPED Tebbit
• FEDERAL
• DEMOCRATIC DEFICIT
• POLITICAL