New EU States And The Adoption Of The Euro

3551 words - 15 pages

Table of Contents
The Three Phases of Monetary Integration........4
ERM II......... 4
Maastricht Convergence Criteria.........6
Threats and Opportunities for the New States Joining the Euro.......8
Target Dates for Euro Adoption
The Convergence Issue
Real vs. Nominal Convergence

        5-Year Perspective on the 10 States' Currencies against the Euro

        Cyprus Pound (CYP) foreign exchange rate

        Latvian Lats (lVl) foreign exchange rate

        Maltese Lira (M ...view middle of the document...

In 1992 the EU decided to implement Economic and Monetary Union (EMU), incorporating the introduction of a single European currency managed by a European Central Bank. The single currency - the euro - became a reality on 01 January 2002, when euro notes and coins replaced national currencies in twelve of the fifteen countries of the European Union (Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland). ERM II is an exchange rate mechanism for EU countries who are currently not taking part in the monetary union. It is up to each individual country to decide when to enter ERM II. Participation means that the domestic currency is locked to the euro. The purpose of this is to prepare the country for full membership of the monetary union.

The main purpose of this report is to show the progress of the ten new accession countries towards adoption of the European single currency. We will assess the threats and opportunities that arise for these countries, and also view the perspective of the established EU countries on these issues. The report will also describe the pathway each country must take to successfully adopt the European single currency.
The Three Phases of Monetary Integration

The EU sees the adoption of the euro by the accession countries as the final phase of their process of economic and monetary integration with the EU. The process of their monetary integration is divided into three distinct phases:

The first phase, the pre-accession phase, preceded and ended with their EU accession in May 2004. This phase left much room for independent monetary and exchange rate policy to the accession countries. In particular, they were able to choose their own exchange rate arrangements. However, they had to fulfil the acquis communautaire in the area of EMU (Economic and Monetary Union), such as making their central banks independent and completely liberalising their capital flows. Also, they had to share the aims of EMU, which means they must join the euro, but only when they have fulfilled all preparation criteria. In other words, they cannot opt out of the euro as did some current EU member countries.

The second phase, the accession phase, started with the new states' EU accession in May 2004 and will last until they finally adopt the euro. The duration of this phase is, at this moment, difficult to predict, it could be at minimum two years or considerably more. In this phase, the exchange rate policies of the accession countries become the matter of common concern.

In the process of monetary integration of the accession countries, particular attention is devoted to ERM II, which can be described as a waiting room for the adoption of the Euro.

ERM II is an interim exchange rate mechanism, devised for the accession countries (EU member countries which are not yet ready for joining the euro area). By participating in this interim exchange rate arrangement for at least ...

More like New EU States And The Adoption Of The Euro

Describe The Relationship Among The Rise Of European Nation States, International Commerce, And The Exploration Of The New World

699 words - 3 pages ... Late in the fifteenth century, changes began to arise in Europe. The public began to demand more after numerous brief brushes with the exotics lands of the Orient. Society had begun to unite, prompting nation states ruled by a solitary monarch to appear. This demand for goods as well as the control needed to carry out the necessary operations led to an age of exploration, conquest, and discovery.Trade was the catalyst by which this new age ...

The Trials And Tribulations Before And After Adoption

451 words - 2 pages ... The trials and tribulations I have faced and fought through, before and after adoption have shaped me into a compassionate, creative, and well rounded woman. The environment I grew up in before I was adopted consisted of young and unreliable parents and heavily unstable living situations. During this time in my life, I learned very early on to take care of myself and received a bitter taste of the real world. My parents, never home and ...

Globalization And The EU: Will France Integrate And Cooperate?

1541 words - 7 pages ... compromised by the push for European integration spearheaded by the EU. This compromise of values, combined with the lack of a bipartisan system and large-scale protests, has created a huge political backlash that is currently the number-one political challenge in France.Since the 1960’s, intellectual and political leaders such as Charles de Gaulle have strongly advocated France’s independence from the rest of Europe. Gaullism is defined in ...

Analyze The Contributions Of Washing And Jefferson In Helping Establish A Stable Government After The Adoption Of The Constitution

495 words - 2 pages ... In 1789, the first person was elected to become the first president of the United States of America under the Constitution. The first person was Washington. Following Washington years later was the third president, Jefferson. The first few presidents of the United States contributed to establish a stable government after the adoption of the Constitution. They stabilized the government through international affairs and internal affairs.Washington ...

Should The UK Join The Euro Or Remain Master Of Its Own Fiscal Destiny. What Are The Arguments For And Against?

3005 words - 13 pages Free ... Capital and reduced cost. Likewise efficient risk Capital markets will encourage innovative high growth Small or Medium Enterprises (SMEs) creating new, sustainable jobs.A Negative Euro?The advocates of the single European currency presume a symmetric Europe, wheremember states experience similar economic conditions at roughly the same time. Inreality Europe is asymmetric. The states are not homogenous; each nation hascomparative advantages and ...

Role Of The EU In Enforcing Environmental Laws - Law - Assignment

1047 words - 5 pages ... The European Union (EU) is concerned with the protection of the environment. The union has adopted various measures with the aim of improving the quality of the environment for the European citizens. Provision of high quality environment ensures provision of high quality of life for the people (Booth et al 2015). The conservation of the environment is made through adherence to the environmental laws and regulations that have been set. The EU ...

Poland Concessions To The EU

719 words - 3 pages ... labour market remains closed to the new members for at least two years - after which individual member states can make their own arrangements. Up till now, the Polish attitude was one of total lack of understanding of the German, Austrian and EU positions. Now, Warsaw is showing some flexibility: The new foreign minister, Wlodzimierz Cimoszewicz, has said he still doesn't like the idea of a ban on the free flow of labour of up to seven years, but ...

Does The EU Undermine UK?

1006 words - 5 pages ... Parliamentary sovereignty is a constitutional relic. It has been rendered permanently obsolete, in particular, by the supremacy of EU law and the UK's statutory recognition of human rights. This doctrine can never be restored to the UK constitution.' Critically discuss this statement. In order to fully discuss this statement, we must first define 'Parliamentary sovereignty', according to 'Sovereignty' is used to describe 'the power of law ...

"the National Parks Under Siege" - New York Times Editorial: Consider The Editorial In Light Of Federalism And The Concept That The National Parks Are Held In Trust For The People Of The United States

404 words - 2 pages ... be predominant." In some ways, I think the states could better manage the individual parks. I think the states may be less likely to change policies. State parks are sometimes a reflection on the state. Why would a state want to destroy their park by letting snowmobiles and off-road vehicles tear it up instead of take pride in it and continue to conserve and protect it for many more generations to come? On the other hand, the state could make ...

United States And The Great War

1439 words - 6 pages ... There are several reasons for the United States entering The Great War. However, most Americans preferred to stay out of the conflict. President Wilson publicly and formally stated that the United States would adhere to a policy of neutrality., However, in three short years, the United States would find itself involved in the conflict which would later became known as the first World War.As war raged in Europe, America sympathies undoubtedly ...

Is The EU Good For Integration? - EU Relations With Latin America - Essay

486 words - 2 pages ... . Those in favor of Brexit argued that maintaining their position as a member state of the EU would add little to an economy which was the fifth-largest is the world, and had long been governed by a complex system of laws (Bruszt and Campos). On the other hand, opposers of the Brexit movement hold that the integration brought about by being a member of the European Union played an essential role in fortifying the United Kingdom’s antitrust laws ...

Government Of The United States - Government - Essay

2084 words - 9 pages ... formed ■ Challenging segregation ● All new issues for the Supreme Court where they would act without restraint A Fourth Era? Reasserting Judicial Review and a Return to States’ Rights ● Surrendered to Congress and presidency to decide what is ‘interstate commerce’ ○ Civil Rights Act of 1964...said that segregation disrupts interstate commerce ● Interstate commerce can basically be any local commerce ○ Took away powers from the states (nationalization ...

Analyze The Causes Of And The Responses To The Peasants' Revolts In The German States, 1524–1526

1188 words - 5 pages ... , they "drunk up and consumed all" (Doc 11), then burned some houses down. These sorts of actions illustrate why the peasants were looked upon as savages. However, it is possible that the count gives a bad eyewitness statement because he wants to lower the peasants' reputation. Nonetheless, more stringent laws were instituted (Doc 12) so that no revolts would happen in the future. These new laws were another mechanism by which nobles retained and ...


2491 words - 10 pages ... MERGER AND ACQUISITION ACTIVITES IN THE UNITED STATES Course: Master of Business Administration in Banking and Finance Module code and title: ASB-4437 Merger and Acquisition Module Tutor: Mr. David Goh Student Name: Nguyen Thuy Lien- G1868358Q Nguyen Tran Viet- G1868661P Dang Thanh Hang- G1874508P Due date: 18 April 2019 TABLE OF CONTENTS 1. INTRODUCTION 2 2. COUNTRY PROFILE 3 4. HISTORICAL WAVES OF M&A 3 4.1. The first wave (1897-1904) 3 4.2 ...

The Difference Between Cuba And The United States

427 words - 2 pages Free ... Osorio KarinaSeptember 29, 2014The Difference between Cuba and the United StatesThe united states is the worlds largest national economy. The U.S dollar is the currency most used in international transactions and is the worlds foremost reserve currency and in many others it is the de facto currency. It's the sixth largest trading partners are Canada, China, Mexico, Japan, Germany, and the united kingdom.The U.S is the worlds largest producer of ...