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The impact of the euro on Mediterranean partner countries

The impact of the euro on Mediterranean partner countriespdf Choose translations of the previous link 

Summary and main conclusions

The paper discusses the impact of EMU on the 12 Mediterranean partner countries. It argues that the introduction of the euro is likely to have a positive, albeit limited, impact on the region. The Mediterranean partners will benefit from a more predictable and transparent external environment that will allow them to better exploit their comparative advantage in the long run. They will also benefit from stronger-than-otherwise output growth in Europe, as well as a potentially more competitive source of external financing. With the introduction of a stable nominal anchor in Europe, Mediterranean partners will have the opportunity to review their exchange rate regimes and policies. In a broader sense, the sound European policy framework under EMU is likely to spill-over on to the formulation of economic policy in the Mediterranean. It will provide the partner countries with incentives to conduct prudent fiscal and monetary policies and to implement far-reaching structural reforms to further integrate the region in the world economy.

(Euro Papers. 24. June 1998. Brussels. Tab. Ann. Free.)

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