3rd Price:

Written by Josep A. Xurigue, European University Institute, Firenze, Italia.

THE ECONOMIC AND MONETARY UNION: AN OPPORTUNITY FOR ECONOMIC AND SYMBOLIC PROGRESS

After January 1st of the year 2002 at the latest, the Euro, the new single currency will have become the banknotes and the coins in use throughout most of the countries of the Union, in the citizens' pockets, and this will be reflected in the national budgets and in the balance sheets of every company.

The dream of a new single currency will be added to the row of landmarks through which is going through this human and political device that the European Union represents. The Treaty of Rome, The Single Act, The Common Market, The European Monetary System, Robert Schumann, Jean Monnet, Aldice De Gasperi, Konrad Adenauer are instruments and personalities that have forged our common past, our inheritance.

In this historic path, the Euro is a new step which generates certain doubts and feeds some hopes. The people of Europe are getting ready to abandon their old currency, the symbol of their national identity.

The distant formation of the Nation in the Cities of today's central Italy has had its foundation in the appearance of a currency and in the formation of an army and a diplomacy. The currency, therefore, has a high symbolic value and is a depository of trust in a given economic and banking system.

The Euro can overcome the reluctance felt by some of the Union citizens, if it is capable generating growth and general economic progress. It is in its efficiency that it will establish its identity. The reduction of the costs attached to the rate of exchange and the greater facility to stimulate the creation of scale economies can result in the creation of employment.

From the multiculturalism of municipalities within the Union, the collective identity must be supported by future material progress, and the Euro must represent its best catalyst tool. This is what is hoped for. This it has been an incentive for European governments and citizenship have assumed the financial and social sacrifices that will make this convergence possible. Governments, economic and social agents, citizens, will have to increase their efforts in order to take advantage of the impetus for renewal that the new monetary unit could represent on the process of constructing the Union and on economic growth. Were it not so, an identity crisis could surface on the very project of European integration. This is a critical moment.

As the new currency is put on the market, it will create, in the life of the citizens, the assurance of greater freedom and comfort during their travels. Aside form their cultural differences, all citizens will be able to see that they belong to a common community, as the single currency will accompany them all in their economic transactions.

Prices will converge and will be established everywhere in the same monetary unit. And, without a doubt, the strength in the sharing of the activities of daily living, added to national and linguistic diversity, has a high unifying value for a shared reality. In this sense, the Euro will act as a cohesion maker of the daily economic reality as perceived by citizens.

For years, the citizens have observed the process of European construction like something remote of their day. The single currency, in this direction, approaches the European project of their lives. It allows them to internalize it, making it inseparable of their activities. In a certain sense, this process of approaching the European integration towards citizenship through the restoration of the Euro produces a tangible proximity of Europe.

Our new currency will be able to encourage the creation of new "borders" if the difficulties of some states to fulfill the convergence criteria will not be solved in the short and medium term. Although mechanisms of flexibility in space and time are anticipated for the less convergent implementation of the currency, economies, and their voices or sectors, could doubt the pertinence of the cession of the monetary policy to the new European Central Bank. The resource to the monetary policy to reduce the inflation and to make products competitive won't be possible to us, but the adjustment would have to take place in terms of jobs.

The Euro, the criteria of convergence, the European Central Bank and the common monetary policy, are instruments and institutions that can grant to the Europe of century XXI the capacity to compete and to progress as a society with the same speed, in which the United States and Japan do. In addition, from the point of view of our international projection, the circulation of the Euro will transmit an image of communitarian unity.

In the context of globalisation, the Union must be equipped with instruments that allow it to continue progressing in a horizon of ethical quality. This presumes not to lose itself in the conquests and the distinguishing elements that our societies characterize, including the European social model. The architects of the process must make an effort in vanishing the doubts - that they could erode the credibility and the complicity of the citizens in the Euro - in which the necessary macro-economic conditions for the implementation of the currency, can harm the social cohesion that is the ethical and material angular stone of our identity.