ARTHUR Student ID : 08120868

DIETRICH Course : European Business L3

EUROPEAN BUSINESS

ASSIGNMENT N°2

THE EURO

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TUTOR : Lynda Harrison 2005 words

University of Lincoln

The introduction of the Euro has had success in promoting trade and price stability; it has had only limited success in promoting structural reform across the Eurozone. Discuss about it

The single currency has been mentioned for the first time during the Maastricht treaty on the 7th of February in 1992 and was finally established the 1st of January 1999, this date is also the final step of the European monetary Union. The main objectives of this currency were to avoid the speculation and risks of instability of currencies between different member states; to increase the exchange between the different members of the Eurozone; to have a minimized inflation; to improve the functioning of the market of goods, services and capitals and to make the final step of the common european market to create the biggest common market in the world - and the most important point was to have a currency that competes against the dollar.
Does the Eurozone can be considered as an optimal currency area?
In order to be able to understand the issue it is necessary to define the main terms such as Eurozone which is a group of countries which used the Euro as a common currency composed by 16 European union states and 3 non-EU members (Vatican, Monaco and San Marino). The other main term in the issue is structural reform, which can be defined as a economic and politic issue; the aim is to improve in a sustainable way the functioning of the economy of a sector or a country. They can be used for example to reduce the unemployment or the inflation, support an innovative environment or unlock business potential.
The first part of this assignment will be devoted to give a explanation about the success of the Euro concerning the rise of trade and improvement about the