Economic and Monetary Union and the Euro

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Economic and Monetary Union and the Euro
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From the Treaty to application

• The Treaty of Maastricht (1992) enshrined the
  principle of a single European currency
• On 1 January 2002 the euro started circulating in
  12 European countries

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The origin

• In 1970 the Werner Report proposed a convergence
  of economies and currencies of the six EEC
  countries
• In 1979 the European Monetary System (EMS) was
  set up
• In 1986 the Single European Act implied the
  convergence of European economies

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Economic and Monetary Union

• In 1989 Commission President Jacques Delors put
  forward a plan and timetable for bringing about
  economic and monetary union (EMU)
• The Treaty of Maastricht laid down a set of
  criteria to be met by member states if they were
  to qualify for the EMU

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Criteria

• Curbing inflation
• Cutting interest rates
• Reducing budget deficits toa maximum of 3 of GDP
• Limiting public borrowing
• Stabilising the currencys exchange rate

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Opting out

• Denmark and the UK reserved the right not to move
  to the third stage of EMU (adoption of the euro)

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European Central Bank

• In order to ensure the stability of the euro, an
  independent European Central Bank (ECB) was set
  up, based in Frankfurt, and given the task of
  setting interest rates to maintain the value of
  the euro

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Economic union

• The euro has replaced currencies that were
  traditional symbols and instruments of national
  sovereignty (f. e. German mark)
• It moved Europe considerably closer to economic
  union
• The need for monetary stability

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Stability pact and economic growth

• In Amsterdam, in June 1997 the European Council
  adopted two important resolutions
• 1. Stability and growth pact (maintaining
  budgetary discipline)
• 2. Economic growth (employment as priority)

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Coordinating economic policies

• In Luxembourg, in December 1997, the European
  Council adopted a resolution on coordinating
  economic policies to establish stronger ties
  between countries that adopted the euro

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Stability of the euro

• In spite of turbulent world situations and
  crises, the euro has enjoyed that kind of
  stability and predictability that investors and
  consumers need

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The worlds second most important currency

• The first one is US dollar
• The euro is increasingly being used fort
  international payments and as a reserve currency

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Benefits of a single currency

• The euro has given European citizens a much
  clearer sense of sharing a common European
  identity (free movement of people, goods and
  capital)

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Someting about the euro
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The name

• The name euro was adopted on December 16, 1995

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Euro banknote designs

• a design competition ? winning design by Robert
  Kalina ? theme Ages and styles of Europe
• Classical for the 5
• Romanesque for the 10
• Gothic for the 20

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• Renaissance for the 50
• Baroque and rococo for the 100
• Iron and glass architecture for the 200
• Modern 20th century architecture for the 500

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Euro coin designs

• a design competition ? winning design by Luc
  Luycx
• Avers of all euro coins are same, but revers are
  different for each European Union Member Stete
• Italy

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• The design of euro coins differs in
• Common side
• Colour
• Edge
• Diameter and thickness
• Mass in grams

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Banknote security features

• The raised print
• The watermark
• The security thread
• The see-through register

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• F oil stripe/foil patch
• Iridescent stripe/colour- shifting ink
• Micro lettering
• Ultra-violet properties
• Infra-red properties

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The euro today

• Read and discuss the text The failure of the
  euro (handout)

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Vocabulary

• Inevitable neizbježan
• Adverse- negativan
• To plague muciti, ometati, stvarati teškoce
• Austerity measures mjere štednje
• To clash sukobiti se, ne slagati se
• Impetus- poriv, pobuda, poticaj
• To instill usaditi, uliti, ulijevati
• The Common Market tržište EU (zajednicko
  tržište)

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The History of the Euro

• http//www.youtube.com/watch?vPdLr3lTSyns
• What was contemplated by the League of Nations in
  1929?
• What does ECU stand for?
• Which countries opted out?
• Did the euro help tourism?

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Countries that use the euro

• The following members of the European Union use
  the euro
• Austria, Belgium, Cyprus, Estonia, Finland,
  France, Germany, Greece, Ireland, Italy, Latvia,
  Luxembourg, Malta, The Netherlands, Portugal,
  Slovenia, Slovakia, Spain
• The following members of the European Union do
  not use the euro
• Bulgaria, Czech Republic, Denmark, Croatia,
  Lithuania, Hungary, Poland, Romania, Sweden and
  the United Kingdom.

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Thank you for your attention!