engleski

The EU Economy After Euro Introduction: Experiances and Future Challenges

The presentation will comprise two main issues. First, the first four years of experience with the EMU will be discussed. Both the economic achievements in terms of growth, productivity, employment creation, and inflation, as well as the economic policy i.e. fiscal, monetary and exchange rate developments will be assessed. It turns out that EMU has mastered well a sequence of economic shocks such as the consequences of the terrorist attack at September 11th, the burst of the stock market bubble, the confidence slowdown in the wake of the Iraq crisis and largely volatile commodity prices. However, the first years have also shown that EMU is not without challenges. In particular, economic differences between participating Member States have widened to some extent. The issue of the adequate policy mix at both the euro area level and at the level of individual Member States remains crucial. The second part of the presentation will try to draw some lessons of what has happened in EMU so far for the issue of how quickly acceding countries should join EMU or even aim at focussing economic policies to fulfil the famous Maastricht criteria immediately. The assessment starts from the recognition that the process of integration in the EU, which ultimately led to EMU, reflects 40 years of integration of the real economy, sectoral adjustment and the harmonisation of institutional arrangement and agreeing on common economic policy targets. Only at a relatively late stage, in the mid-1980s, was financial integration pushed forward by the internal and external liberalisation of financial markets. In this respect, the Maastricht Treaty on Economic and Monetary Union is the conclusion of this process of integration.

EMU; economic policy targets; Maastricht criteria

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