On the 10th birthday of the European Union’s Economic and Monetary Union (EMU) the Lisbon Treaty was rejected by the Irish voters. Most politicians in favor of the Lisbon Treaty concluded that rejecting this Treaty put a break on the necessary reforms the Union needs after its enlargement to 27 member states—up from 6 in 1957.
Knowing that the euro area is about to welcome its 16th member—Slovakia will adopt the euro on January 1, 2009—one could ask whether the EMU needs the Lisbon Treaty as well. Will EMU enlargement hurt the euro without this Treaty?
In a paper published by Euredia, three ECB experts pose a similar, but more neutral question, “How will the Treaty of Lisbon affect EMU?”
They conclude that like the Treaties of Amsterdam and Nice, the Lisbon Treaty will leave the EMU’s detailed framework untouched.
That said, the authors continue by pointing out that the Lisbon Treaty “on the whole, make[s] more significant change to the Union’s general structures … and can therefore be expected to have a more significant impact”, because “a successful EMU requires a successful Union.”
However, the Lisbon Treaty “will have little if any impact on the day to day or indeed medium-term workings of the ECB.” Hence, the authors conclude that “History is unlikely to record the Lisbon Treaty as a particularly memorable chapter of EMU.”
But “if [history] does, it will probably highlight that [the] Lisbon [Treaty] provides the euro area with certain new tools and sharpens the potential of existing ones.” In particular, so the authors continue, the Lisbon Treaty “will [likely] increase the amount of integration between [the Euro Group members] in the field of economic policy”; it will do so “in a cautious and incremental way.”
This is not very encouraging in times of global economic uncertainty when quick action is needed.
Baron FRANKAL, Inigo ARRUGA OLEAGA and Wouter COUSSENS, “How Will The Treaty Of Lisbon Affect EMU?”, Eurodia 2007-2008/2, 121-159
