Tariffs for chilled boneless beef in the EU will decline from 20 per cent plus ECU 4700 per ton to 12.8 per cent plus ECU 3034 per ton bone in pork legs, from ECU 1215 per ton to ECU 778 per ton boneless chicken cuts from ECU 1600 per ton to ECU 1024 per ton.

Europe s Easy Money Endgame

Monetary policy and institutions

The proportion of investments in North American currencies was increased to 54 per cent from 48 per cent, in European currencies it was increased to 33 per cent from 30 per cent, and investments in Asian currencies were decreased sharply to 11 per cent from 20 per cent.

Back in 1997 1998, during the Asian crisis, the G 7 flatly rejected Japan s proposal for an Asian Monetary Fund. Now the IMF has even accepted a minority lender role, with the bulk of assistance coming from the European Stability Mechanism (ESM), a new institution often viewed as an embryonic European Monetary Fund.

Before the advent of the euro, there were many fiscal crises in individual nation states in southern Europe, which produced waves of high inflation. But, with the single currency in place, the road to solving a fiscal crisis through inflation has been closed, as the European Central Bank (ECB) now stands watch over monetary policy.

Some United Nations organizations located in Europe adopt their budgets in a European currency.

Europe today has a common currency and the European Central Bank (ECB), which have proven to be bulwarks in defending monetary stability during the financial crisis. Any weakening of these two institutions would cause severe damage to common European interests.

African Centre for Monetary Studies

Above all, it would have enabled the IMF to move beyond being the instrument of status quo powers the United States and Europe. From an Asian perspective, by defying its European shareholders, the IMF would have gone a long way toward heralding the emergence of a new institution a truly International Monetary Fund, in place of today s Euro Atlantic Monetary Fund.

BRUSSELS A key question confronts the four presidents of Europe s major institutions (the European Commission, the European Council, the European Central Bank, and the Eurogroup) as they prepare their report on how to reform the common currency Does the eurozone need its own budget?

27. The European Union welcomed the establishment by IMF of the Emergency Financing Mechanism and the new arrangements to borrow.

With its loans to Hungary and Latvia, the European Commission has already revived a credit facility which was dormant since the European Monetary System crisis in 1992 and for countries outside EMU. The support is huge.

He is a former Managing Director of the International Monetary Fund and has served as Chairman of the Paris Club and Chairman of the Monetary Committee of the European Economic Community.

The budget reserved for disaster preparedness activities in 1995 amounted to ECU 4.2 million.

The ECB can curb the euro s appreciation through purchases of foreign currency. But, ultimately, it would have to do so by inflating its own currency until confidence in the euro falls back to the level that it had before the assurances were made.

16. As mentioned in the report of the Secretary General, the United Nations was holding a retention bond and monies of ECU 1.25 million and ECU 250,000, respectively, pending completion of repairs by the contractor.

There had been a prior attempt to create an institution that would deal with short term support mechanisms for member states the European Monetary Cooperation Fund, launched in 1973 and governed by a board of central bank governors. Designated as a European Community institution, it was regarded as being dangerously political.

Likewise, none of the external agencies (the World Bank, IMF, the African Development Bank, the European Union, etc.) to which the National Transitional Government of Liberia owes 3 billion, have received any repayment except the token amount of 50,000 per month to IMF on its outstanding debt in excess of 718 million.

Richard Nixon s treasury secretary, John Connally, once told a group of European leaders that while the dollar was America s currency, its misalignment was Europe s problem. Today, the misalignment of the dollar and the euro against the renminbi and other Asian currencies is increasingly becoming Asia s problem.

11. In 1997, much of the African continent was bypassed by the Asian currency crisis.

The euro would, however, have to be accepted as legal tender in the UK, alongside the pound, and in the commonwealth countries, and this would demand close cooperation between the Bank of England and the ECB. Such a compromise would increase the EMU s weight both inside and outside Europe.

The euro s current problems are, instead, a reflection of unresolved Europe wide and global problems. The common currency is the canary in the mine of the global exchange rate system.

Finally, political union means transferring the prerogatives of national legislatures to the European Parliament, which would then decide how to structure Europe s fiscal, banking, and monetary union. Those responsible for the EU s day to day operations, including the Board of the European Central Bank, would be accountable to the Parliament, which could dismiss them for failing to carry out their mandates.

The European single currency has been a major success, but it remains a work in progress. A decade after the euro s introduction, we must follow the example of its founders and turn crisis into opportunity by uniting in a spirit of cooperation and ambition and thereby reinforce the EMU s foundations.

This is not the type of volatile monetary policy that Europe wants or needs.

In other words, the financial crisis now reflects a political crisis of the eurozone one that calls into question the very existence of the European project as a whole. If Europe s monetary union fails, not much of the common market, or of European institutions and treaties, will be left.

Instead, Europe developed the euro, which solved the problem of speculative attacks and monetary credibility by replacing individual currencies with a new one. It was impossible to short the lira or the franc because there were no more lire or francs.

The Unit and the Council have exchanged information about various NHRIs within Europe.

Against this background, it seems anachronistic to consider the possibility of establishing anything like a unified currency in Asia, where institutional disparities are far deeper, and the variety of economic shocks far greater, than in Europe. To hope for a unified currency in Asia seems almost like hoping for the region s own Greek crisis.

Almost 80 per cent of Africa's debt is owed to official institutions, about one third of which is multilateral debt owed mainly to the International Monetary Fund (IMF) and World Bank.

Trust in European institutions has collapsed, and political parties skeptical not just of the euro, but of the entire European project, are on the rise. And yet most economists, even those who were never keen on EMU in the first place, have been reluctant to make the argument that the time has come to abandon a failed experiment.

Finally, while monetary union obviously requires greater sharing of sovereignty, there should also be a greater Europe that includes the United Kingdom and others. This implies two tier institutions that can accommodate both types of countries the euro ins and those that prefer to preserve their monetary sovereignty in a larger Europe built around a vibrant single market and common democratic values.

Cuban steel producer Antillana de Acero makes 80 per cent of its purchases on European markets, paying in euros and consequently losing over 25 per cent because of currency exchange costs.

Within the framework of the International Monetary Fund (IMF) and the Asia Development Bank (ADB)

(b) European Meeting of National Institutions

But the current economic crisis may provide a severe test of the euro s ability to survive in more troubled times. While the crisis could strengthen the institutions provided by the EMU, it could also create multiple risks, of which member countries need to be aware if they want to avoid them.

European politicians who insisted on introducing the euro in 1999 ignored the warnings of economists who predicted that a single currency for all of Europe would create serious problems. The euro s advocates were focused on the goal of European political integration, and saw the single currency as part of the process of creating a sense of political community in Europe.

But the euro is no longer a strong common currency that reinforces a shared European identity. On the contrary, it is now a source of deep resentment among European peoples resentment that, 70 years after the end of World War II, was supposed to have been eliminated.

Chronicle of a Currency Crisis Foretold

Juncker s changes, however, may portend genuine progress on this front, as well as toward monetary and energy union. Indeed, the new Commission s structure suggests that Juncker hopes to enhance its role in guiding the European Monetary Union and related policies, control over which largely rested with the European Council and EU member governments (especially Germany) during the crisis.

The single currency was conceived as an answer to the upheavals of the postwar period double digit inflation, high unemployment, and speculative attacks on the pound, the lira, and the French franc. It was the crisis of the European Monetary System that drove the euro s launch on January 1, 1999.

There have, of course, been many examples in history in which currency unions or single currency states have broken up. Although there are technical and legal reasons why such a split would be harder for an EMU country, there seems little doubt that a country could withdraw if it really wanted to.

Coupled with all this is northern European discontent with the central bankers, specifically with the ECB and the euro. It is not that the end of European Monetary Union is on the agenda it is merely that people have begun thinking about possible low probability futures in which the end of EMU might be placed on the agenda.

Centre for Latin American Monetary Studies