European Monetary Union and its euro effects: With a focus on the UK

Abstract

<p>The European Union came into existence on November 1, 1993 with the Maastricht Treaty, also known as the Treaty of the European Union (TEU). The ultimate goal of the European Union is "an ever closer union among the peoples of Europe, in which decisions are taken as closely as possible to the citizen."¹ Its objective is to promote economic and social process, which is balanced and sustainable, assert the European identity on the international scene and introduce a European citizenship for the nationals of the Member States. During its brief history, the European Union (EU) has grown greatly, presently covering fifteen Member States in its economic and political areas. The Union's main objectives for the coming years are:</p> <ul> <li>Implementation of the Treaty of Amsterdam (which focuses on strengthening the institutions of the European Union and rights for citizens.)</li> <li>Agenda 2000 (which concentrates on the enlargement of the EU by considering applicant countries from central and eastern Europe.)</li> <li>The creation of the euro.²</li> </ul> <p>This thesis examines the history of economic integration in Europe, with a special emphasis on the European Monetary Union (EMU). Furthermore, I will specifically evaluate the European Union efforts to launch the euro. To show how these efforts have been received in a particular country, I will discuss the United Kingdom's (UK) standpoint. This case study will examine the issue of British participation in the EMU, and the debate over the benefits or disadvantages to the British economy.</p> <p>In the conclusion, I will offer some thoughts of how EMU may succeed in the future and what factors can contribute to a successful monetary union. EMU's future will depend on the European Community, as it will attempt to survive an integrated monetary union, surrounded by different cultural values and political institutions. These differences of values and institutions must be counterbalanced by a dynamic economy. Furthermore, I will discuss how governments and businesses can prepare for the single currency, as the euro is introduced on January 1, 1999 in Continental Europe.</p>