Economic and Monetary Union (EMU) represents a major step in the integration of EU economies. It involves the coordination of economic and fiscal policies, a common monetary policy, and a common currency, the euro. Whilst all 28 EU Member States take part in the economic union, some countries have taken integration further and adopted the euro. Together, these countries make up the euro area.
The decision to form an Economic and Monetary Union was taken by the European Council in the Dutch city of Maastricht in December 1991, and was later enshrined in the Treaty on European Union (the Maastricht Treaty). Economic and Monetary Union takes the EU one step further in its process of economic integration, which started in 1957 when it was founded. Economic integration brings the benefits of greater size, internal efficiency and robustness to the EU economy as a whole and to the economies of the individual Member States. This, in turn, offers opportunities for economic stability, higher growth and more employment – outcomes of direct benefit to EU citizens. In practical terms, EMU means:
Within EMU there is no single institution responsible for economic policy. Instead, the responsibility is divided between Member States and the EU institutions. The main actors in EMU are:
Following the outbreak of the economic and financial crisis, the European Union took unprecedented measures to improve the economic governance framework of EMU (such as the strengthening of the Stability of Growth Pact or the adoption of new mechanisms to prevent economic imbalances and better coordinate economic policies).
However, these emergency measures needed to be consolidated and completed in the long-term so as to avoid that a new crisis could affect EMU so strongly. Therefore, the Presidents of five European Institutions – the European Commission, the European Parliament, the European Central Bank and the European Council (as President of the euro summit) – laid down a roadmap to deepen the Economic and Monetary Union in two stages as of July 2015 and complete it by 2025 at the latest.
In October 2015, the Commission began implementing the "Five Presidents’ Report" by adopting a package of measures. More details, including the full report are accessible on the 10 priorities website of the Commission: A Deeper and Fairer Economic and Monetary Union