At a weekend gathering of EU finance ministers and central bank governors in Dublin, broad agreement was reached on three critical areas of economic and monetary union (Emu).
A Stability Pact designed to ensure spending discipline among governments inside Emu, a new Exchange Rate Mechanism (ERM) linking the Euro currency to those not participating and greater legal certainty for banks and businesses in advance of the 1999 start date all received a solid push forward.
This meeting has been one of the most productive we have attended, Bank of France governor Jean-Claude Trichet said on Saturday. Although important details remain unresolved, particularly on the Stability Pact, there was a strong commitment to have much of the remaining work completed when EU leaders meet here in December for a summit.
The momentum behind the project, which has been punctuated by occasional periods of doubt and scepticism, appeared to owe much to the close partnership between France and Germany.
The two countries, whose participation in Emu is seen as essential, have shown a remarkable degree of political will and cooperation at a time their economies have laboured under the weight of high unemployment and poor growth. German finance minister Theo Waigel, the spark behind the Stability Pact, came away from the gathering relatively pleased at the progress his colleagues made in nailing down the details of a mechanism expected to instill budgetary discipline.
Waigel's plan to sanction Emu members which run budget deficits above three percent of total output was given less than an even chance of success only nine months ago, when Emu itself appeared to be little more than wishful thinking.
