Policy Paper 86
 

Towards a common external representation for the eurozone ?

Daniela Schwarzer, Head of Research Division EU Integration, SWP, Federico Steinberg, Senior Analyst for Economy and International Trade, Real Instituto Elcano and Diego Valiante, Research Fellow, CEPS ? Since the introduction of the euro in 1999, the external representation of the eurozone has been incrementally developed, but no formal amendments have been made. This contribution discusses the case for a consolidated representation of the eurozone in international economic fora, analyses the obstacles to achieving it, and puts forward proposals to solve some of the existing obstacles. It argues that there is a strong case for creating a single voice for the euro in the world in general and in the IMF in particular, especially after the global financial crisis and the emergence of the G20 as the main forum for global economic governance. However, some eurozone countries are unwilling to give up sovereignty and transfer more power to Brussels. In addition, the functioning of the IMF, which is based on high majority voting, may induce major euro area countries not to give up their individual influence over IMF decisions. Nevertheless, the recently created European Stability Mechanism could act as a catalyst for solving some of these problems.

|   12/03/2013             |   Daniela Schwarzer   |   Federico Steinberg             |   Economics and finance
Policy Paper

This Policy
Paper is a contribution of  Daniela Schwarzer (SWP), Federico Steinberg (Elcano) and Diego Valiante (CEPS), to the project Think Global – Act European (TGAE). Thinking strategically
about the EU’s external action
directed by Notre Europe –
Jacques Delors Institute
(report available in May 2013, dir. Elvire Fabry, Senior Research Fellow, Notre
Europe – Jacques Delors Institute).

Since the
introduction of the euro in 1999, the external representation of the eurozone
has been incrementally developed, but no formal amendments have been made. This
contribution discusses the case for a consolidated representation of the eurozone
in international economic fora, analyses the obstacles to achieving it, and
puts forward proposals to solve some of the existing obstacles. It argues that
there is a strong case for creating a single voice for the euro in the world in
general and in the IMF in particular, especially after the global financial
crisis and the emergence of the G20 as the main forum for global economic
governance. However, some eurozone countries are unwilling to give up
sovereignty and transfer more power to Brussels. In addition, the functioning
of the IMF, which is based on high majority voting, may induce major euro area
countries not to give up their individual influence over IMF
decisions. Nevertheless, the recently created European Stability Mechanism
could act as a catalyst for solving some of these problems.

Before the publication of the final report presenting the key recommendations of the 16 think tanks involved in the project, 5 series of policy papers address the following key challenges: migration, EU neighbourhood, CSDP, strategic resources and economic policy .

This Policy Paper is part of the series entitled “Promoting EU economic interests abroad” which
includes contributions by John Springford (Centre for European
Reform), Richard Youngs (FRIDE), Agatha Kratz and Jonas Parello-Plesner (ECFR) ,Pawel Swieboda (demosEuropa),Yiannis Tirkides ( CCEIA), Filippa Chatzistavrou and Dimitris Katsikas (ELIAMEP).

Go to the other contributions of the economic policy series >>

This project is led with the contribution of