The International Relations of the Euro Area

Abstract

The subject of the international relations of the European monetary union (EMU) raises different questions.
One concerns the respective role of the political institutions of the European Union and of the European Central Bank in the conclusion of exchange rate and monetary agreements. It is a topic that was prominent in the negotiations of the Maastricht Treaty and led to a compromise laid down in article 111, paragraphs 1 to 3 of the EC-Treaty. If it is for the Council to conclude, the European Central Bank has an important say in the matter.
Another one concerns the allocation of competences between the Member States and the Community or its Central Bank. Is there an exclusive or a shared competence of the Community? The answer is clearly that due to the singleness of the monetary policy, within the meaning of Article 4, paragraph 1 of the Treaty, the external competence has to be exclusive in favour of the Community. Article 111, paragraph 5 on the possibility for the Member States to conclude or keep international agreements, does not allow concluding to the contrary.
A third one is related to the vexed question of participation and representation of the European Union or the Euro area in International Organisations and caucuses. Article 111, paragraph 4 bears on that question but this provision that also asks for common positions to be adopted by the Union in fields related to EMU, has not been applied. Pragmatism has been the keyword in the conclusions of the European Council on that topic and in the practice of the institutions. Informal talks within the Euro Group, where Finance, Ministers seat with the Commission and the ECB, have evolved as a substitute for the application of formal procedures as provided by the Treaty. Hence the proposals made by the Commission, France, Germany and the Benelux countries to recognise in the future constitutional treaty the existence of this informal grouping.
The trickier question in that context concerns the relations with and the participation to the International Monetary Fund (IMF). It raises important political and legal questions. Let us quote the relations with the United States, the reluctance of the Member States of the European Union to loose visibility on the international scene, the specificities of the IMF: the composition of the constituencies and the allocation of the quotas, the vast spectrum of competences exercised by the IMF. These elements make difficult the realisation of what is not a dream but a necessity for one of the three most important international currencies, the full and exclusive participation to this organisation. Requests of a “single chair” for the European Union become more and more common but resistances are still there. As often, the biggest opposition to European solidarity towards the external World does not come from outside but from within the Union.
The contribution concludes with the expression of the hope that reality will triumph on nostalgias.