Euro

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Euro Zone After introducing the Euro, the single currency in Europe raises questions that are of vital importance to Britain’s interest. Whether or not Britain will eventually participate in the unified currency is another question and it’s affect on the rest of the European Union and Western Civilization. A unified or single currency has several impacts that the United Kingdom must consider before instituting the euro. A single currency will affect the financial markets and services, employment, and business. Europe has embarked on an extraordinary undertaking: to create a single European currency. Although the Maastricht Treaty committed the European Union to the goal of economic and monetary union (EMU) several years ago, debate over the matters still continue to rage in several countries. Britain is not the only country reluctant to conform to this unified monetary system, although Sweden and Denmark have announced their intention of holding referendums in 2003. As of January 1, all other European Union states have began to accept this “simplified” currency. These states include: Belgium, Germany, Greece, Spain, France, Italy, Ireland, Luxembourg, The Netherlands, Austria, Portugal, and Finland. The opposition states that the introduction of the euro is merely nothing more than an ill-advised and disastrous undertaking. Opponents also see it as a distraction from the two most urgent tasks facing the European Union: completion of the single market and enlargement of the Union to the east. Supporters of euro argue that the EMU is as essential to creating a stronger European Union, with greater economic, political and social cohesion. This, they believe, offers the only hope for helping former communist-bloc countries: closer integration among the current European Union members helps the prospects for enlargement. Without the unified currency, the reality of the single (unified) market will not be achieved and Europe’s economies will remain divided and weak, unable to compete internationally either with the low-wage economies of Asia or with the large, integrated high-waged economy of the United States. Supporters argue that only a stronger and integrated Europe will be able to exercise leadership on the global issues facing the world e... ... middle of paper ... ... would be more constrained within EMU. Whether this should be seen as a disadvantage or benefit depends on one’s confidence in the national monetary authorities to use a monetary independence wisely. This is an area of policy in which a government has a great capacity to get it wrong. The point has wide application: modern governments retain great powers, but in a modern interdependent world, many of these powers are negative ones to mess things up, not positive ones to direct events for the good. The EMU will determine the future development of Europe over the coming decades, for better or worse; and that the uncertainties about the EMU process are such that no single forecast is worth a great deal since it is too unreliable. On the positive case for EMU, there is very real risk that exchange-rate variability will limit the development of the single market, and that the EU will stagnate. While there is much debate about the euro and Britain’s decision not to adapt to the unified currency, this will remain a changing part of western civilization.

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