Economic and Monetary Union and the Euro

Since 1 January 2002, more than 300 million European citizens have been using the euro as a normal part of daily life. It took only 10 years to get from the Treaty of Maastricht (February 1992), enshrining the principle of a single European currency, to the point where euro notes and coins were circulating in 12 EU countries. This is a remarkably short time to carry through an operation that is unique in world history. The euro has replaced currencies that were, for many of the countries concerned, centuries-old symbols and instruments of their national story/" class="wiki-link" title="Viac o: anglictina">anglictina/sovereignty/" class="wiki-link" title="Viac o: sovereignty">sovereignty. In doing so, the new currency has moved Europe considerably closer to economic satan/" class="wiki-link" title="Viac o: essay">essay/" class="wiki-link" title="Viac o: union">union. It has also given EU citizens a much clearer sense of sharing a common European identity. With euro cash in their pockets, people can travel and shop throughout most of the Union without having to change money.

How was the idea of a single European currency born? As long ago as 1970, the Werner Report, named after the then Prime Minister of Luxembourg, proposed a convergence between the economies and currencies of the six EEC countries. The first step in this direction was not taken until March 1979, when the European Monetary System (EMS) was set up. The EMS was designed to reduce variations in the exchange rates between the currencies of the member states. It allowed them fluctuation margins of between 2,25 % and 6 %. But its mechanisms were weakened by a series of crises caused by the instability of the US dollar and the weakness of some currencies that became prey to speculators, especially at times of international tension. The need for an area of monetary stability was felt increasingly as Europe made progress in completing the single market, The Single European Act, signed in February 1986, logically implied convergence between European economies and the need to limit fluctuations in the exchange rates between their currencies.

How could a single market, based on the free movement of people, goods and capital, be expected to work properly if the currencies involved could be devalued? Devaluing a currency would give it an unfair competitive advantage and lead to distortion in trade. In 1989, Commission President Jacques Delors put forward a plan and a time­table for bringing about Economic and Monetary Union (EMU).