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Economic and Monetary Union and the Euro

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Economic and Monetary Union and the Euro From the Treaty to application The Treaty of Maastricht (1992) enshrined the principle of a single European currency On 1 ... – PowerPoint PPT presentation

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Title: Economic and Monetary Union and the Euro


1
Economic and Monetary Union and the Euro
2
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

3
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

4
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

5
Criteria
  • Curbing inflation
  • Cutting interest rates
  • Reducing budget deficits toa maximum of 3 of GDP
  • Limiting public borrowing
  • Stabilising the currencys exchange rate

6
Opting out
  • Denmark and the UK reserved the right not to move
    to the third stage of EMU (adoption of the euro)

7
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

8
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

9
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)

10
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

11
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

12
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

13
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)

14
Someting about the euro
15
The name
  • The name euro was adopted on December 16, 1995

16
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

17
  • Renaissance for the 50
  • Baroque and rococo for the 100
  • Iron and glass architecture for the 200
  • Modern 20th century architecture for the 500

18
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

19
  • The design of euro coins differs in
  • Common side
  • Colour
  • Edge
  • Diameter and thickness
  • Mass in grams

20
Banknote security features
  • The raised print
  • The watermark
  • The security thread
  • The see-through register

21
  • F oil stripe/foil patch
  • Iridescent stripe/colour- shifting ink
  • Micro lettering
  • Ultra-violet properties
  • Infra-red properties

22
The euro today
  • Read and discuss the text The failure of the
    euro (handout)

23
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)

24
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?

25
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.

26
Thank you for your attention!
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