The experts on the change-over to a single currency, drawn from private sector organisations, academia and banking, delivered their interim report in Brussels. They are charged with setting out the practical demands of a single currency. The European Monetary Institute - the forerunner of a European central bank - is already preparing guidlines for a European monetary policy.
The first possible date for a single currency is 1 January 1997. Though monetary officials and bankers had tended to play down this possibility, in the past few months hopes have been rising that it might be possible. "I am confident that we will be ableto meet the necessary conditions," Jacques Santer, the new president of the European Commission,said yesterday.
The group of experts said technical preparations could just be in place by then, but their report indicates that the second date in the Maastricht treaty - 1 January 1999 - is more likely, because of the complexity of the process.
The report says that a "big bang" - replacing all notes, coins and accounting systems overnight - is not feasible. "Although exchange rates will be irrevocably fixed on the first day, national currencies will keep their functions for a while before the single currency can be introduced physically," it says. But this period should be no longer than six months. "That is already quite a big bang," Cees Maas, the Dutch banker heading the group, said.
Britain has an option to refuse monetary union, depending on a decision by the Government. But it cannot stop other states from proceeding or prevent any of the ancillary decisions being taken. Monetary union is already agreed in the Maastricht treaty, which was signed and ratified by all 15 members of the European Union. The treaty states that a decision on a start date must be made by the end of 1998.
The group of experts said a series of decisions needed to be made between now and the start date. "Early decisions are indispensable on the main features of Ecu notes and coins," the report says. A study group is already examining practical questions like the size, design and denominations of Ecus.Reuse content