Invention in response to February demonstrations[ edit ] Anti-war protests which were the impetus for the invention of the term.
Introduction of MME The Introduction of a new currency Is subject to a number of criteria and comes at a huge cost to each country Involved. The risks Involving the Introduction of a new currency are massive, not only for Individual countries but also for the economic survival of the EX.
Stage one of the process included a set of 5 convergence points set out by the Masochist treaty to ensure member states qualify for the MME. The CB would do reports every 2 years on the countries applying to ensure that those states applying were meeting the criteria, within in the first 2 years of the introduction of the convergence criteria only 3 of the 12 countries had met the arterial, but by11 of the 12 countries had met the criteria and were eligible to start using the Euro in an electronic form.
The only country not to meet the convergence criteria was Greece. Furthermore a timeline was established for the roll out of the new currency, which was to be instated on the 1st of January The final 11 states ad all been given the go ahead to introduce the Euro, except Greece.
Healed The change over of currencies across the 11 countries was a huge logistical challenge with over 14 billion bank notes being produced and 50 billion coins, the official conversion rates were established via inflation rates and are shown in a table on appendix two. The initial introduction of the Euro and the logistics of consumers to rid of the previous legacy currency caused some concern, with some businesses taking advantages of the currency change by increasing prices.
The legacy currency of each member state was legal for two months after the introduction of the Euro, in most countries, there after becoming illegal tender.
The most immediate effect of changing to a single currency is the elimination of risk, especially in exchange rates. By adopting the Euro, companies and individual consumers are able to invest in trade or business without any unexpected fluctuations in exchange rates, eliminating any price number of new opportunities for investors to seek business in countries, which previously were prone to fluctuating exchange rates.
Furthermore, the single currency allowed for big corporations, especially banks, to expand onto new territories, also creating a more competitive market. The increase in competition, not only for business moving across borders, but services offered are subject to pricing parity.
Unjustified prices are more easily recognized in new markets, resulting in businesses moving to cheaper prices, usually across borders.
Therefore, prices on commonly traded goods are likely to converge, causing inflation in some regions and fellatio in others during the transition. It allowed for countries such as Italy and Greece with complicated macroeconomics to stabilize to a certain degree.
The Euro offered stabilization through low inflation rates, however it was not always the case, especially for the aforementioned countries. The European Central Bank was established and modeled on that of the Bundestag, for the exact reason that Germany had the lowest and most stable inflation rates across the ELI.
As much as the Euro has been encouraging and beneficial in terms of trade, business expansion and competition, renders itself null and void if high inflation rates are present in certain countries.
High inflation rates act as a tax, discouraging investments. High inflation rates have an effect on the interest rates of countries too. Even with certain fluctuating inflation rates, trade within the EX.
Although the exchange rate within Europe is not affected, floating a new currency on he global market had profound effect and results. Appendix 3 shows the respective graphs of the Euro to each aforementioned currency. Healed explains that there are a number of reasons for this slump, mostly due to the slow economic growth of the EX.
Inthe Euro is at 1.
ICC to the Pound Sterling. Appendix 4 Beyond trade and the economic effect of the Euro, there are other industries that have had huge successful impacts by the new currency.
Tourism in Europe according to a study has increased by 6. Gill-Appear, Overall the introduction of the Euro has been beneficial to the ELI, especially in terms of promoting a single economic policy, leading to effect trade policies, and creating a sense of security and stability within in the ELI, albeit not for all countries.
Those hit hardest during the Euro zone crisis, such as Greece, are still suffering, although the argument can be made that not having met the initial convergence criteria counted against not only the individual countries but the EX.
Choose Type of service.Europe, the Second Superpower Uploaded by ace By: Andrew Moravcsik There are, and will remain for the foreseeable future, two global superpowers: the United States and Europe. Collectively these potential superpowers, and the United States, comprise % of global nominal GDP The term "Second Superpower" has been applied by scholars to the possibility that the People's Republic of China could emerge with global power and Europe, once the center of the West, became an extension of a West whose defining player.
Europe today is the world’s invisible superpower — rivaling and, in many cases, surpassing the United States and China. It has the resources to retain this status for decades and generations. I recently purchased a book by John McCormick entitled "The European Superpower".
I have been interested in this subject for many years now, and believe him when he says this superpower of Europe has already arrived.3/5(3). European Union as an emerging superpower. It is the status quo which condemns the people of Europe to an ongoing economic crisis and continuing decline." Osborne also said that the EU is facing growing competition with global economic powers like China, India and the US, and the European Union should "reform or decline.".
Case Title: Europe, the Second Superpower Facts of the Case: Europeans, both among themselves and in the transatlantic relationship, have experienced extraordinary amity, cooperation, and policy success.