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The Expanding Role of the Euro

The expanding role of the Euro is an issue of immediate importance to countries throughout Western Europe, the Middle East, developing countries in Eastern Europe, and foreign competitors in Asia and the United States.   The impact of the Euro's advent and subsequent rise in power has spawned controversy over its spread and the consequences it may have on the global economy.   Most recently, the UNECE has been addressing, in particular, the effects of the newest applicant nations of the European Union itself, and the refusal of some member nations to acquiesce their current monetary system in favor of the new one. Furthermore, they have been carefully monitoring and reporting on the effect this switch is having on the fragile or corrupt economies in “Countries in Transition,” or those formerly under Soviet sovereignty in Eastern Europe.

In the past few years, the UNECE has focused on trying to predict the outcome that the pending EU enlargement will have on smaller countries with weak economies, and proposed possible solutions to integrating these newest members, as well as the many nonmember nations still in existence.   This focus has led to studies addressing topics ranging from expanding or creating unemployment benefits in Eastern European countries, to making adjustments to current labor systems aimed specifically at improving the status and independence of women, to regulating international trade in light of the expansion.   It has been decided, unanimously, by the UNECE, that the overall effects of the expansion of the European Union will be positive, both for member countries and those non-acceding and nonmember countries.  

The issue of new countries joining the EU will be further complicated if any of those nations opt to join the EU but refuse to change their monetary system, following the examples of Great Britain, which is still patriotically attached to the pound, and Sweden and Denmark, which have yet to make the switch.   Pressure from the EU continues to encourage these countries to participate in the EU monetary system, with the goals of ease of mobility and increasing the clout of the euro in the world market.   Currently travelers, be they businesspeople or tourists, must still exchange their money when visiting those countries; one of the original goals of the European Union was to create uniformity of currency.   Talks are making headway, and the UN is a crucial mediator in these talks.   The stress and pressures accompanying a country's economic overhaul are also issues with which this committee is concerned and is available to propose methods to make it go smoothly and offer aid during the transition.   Furthermore, as the prospects of broadening the EU continue, and the geopolitical climate of Europe continues to support increased trade and production, it becomes increasingly essential to address issues of economic cooperation, both between member nations and non-acceding countries.   Along with the dynamics of the actual fiscal transition for these new member countries comes the necessity of overhauling their existing tax systems and monetary policy framework.   The issue of poverty will inevitably be addressed, particularly but not limited to the newest member nations, as there are significant immigrant populations in some of the countries, among which are nations which are only very recently removed from a strictly government controlled economy.  

The changing political and economic climate of the EU countries and the surrounding areas is also posing new challenges as it fosters a knowledge-driven economy unlike any Europe has seen before.   This has led to booming competition and growth in some countries, unfortunately leaving others far behind.   In order to stimulate economic growth and competition in these countries, the ECE has generally advocated implementing supportive public policy and public institutions to replace inefficient or obsolete ones.   The ECE is also involved in the various facets of issues that affect countries and their peoples, including human rights, the environment, trade, technology, travel and industry; all of which relate to their economies on a very basic and yet very profound level.   Emphasis is currently placed, however, on promoting healthy ways to bring stagnant or fledgling economies up to speed and identifying ways for them to become effective competitors in the broadening world arena.   In doing this, the ECE emphasizes the role of each country's government in helping create an environment that fosters the ability to compete and focus on the growth of the private sector, which obviously can not be accomplished until basic human rights and needs are accounted for and the infrastructure secured to accommodate such growth.

The UNECE is a focused committee with wide-ranging interests and goals, one of which continues to be the various effects and outcomes of advocating the growth of the European Union and the changes that occur when member nations adopt the euro as their national currency.   With countries such as Great Britain, Denmark, and Sweden yet to make the switch, pressure mounts.   Smaller countries, particularly those of the former Soviet Block, need UN help in establishing business and trade ties while simultaneously adapting their governmental systems to a new fiscal identity.   As outside concerns grow over the increasing size and power of the EU and the success of the euro, the ECE will fall under close scrutiny and be forced to take a large role in easing the logistics of the merger and in following up with statistical analyses of the economics in each region.   A broad range of topics will be up for consideration for this committee relating to the expanding role of the euro.

The following links may be helpful in researching your country's stance on the expanding role of the euro:

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