"business leaders in the non-participating countries are regretting their governments' decision to stay out"
Tietmeyer Foresees Euro-Spurred Job Growth
Paris, Wednesday, December 30, 1998
By Barry James International Herald Tribune
PARIS - The president of the Bundesbank, Hans Tietmeyer, predicted Tuesday that the European single currency, due to go into effect Friday, would help create more jobs by stimulating cooperation among regions.
Mr. Tietmeyer said the currency, the euro, could promote more investment and greater dynamism, thus creating jobs. But he added in an interview with German radio that the 11 nations adopting the currency would have to cooperate more closely in order to reap its benefits.
''We need a higher degree of political cooperation on the European level,'' he said. ''If everyone takes a separate path, this could lead to a conflict with supranational monetary policy.''
European Union finance ministers will meet in Brussels on Thursday to set the irrevocable rates at which the currencies of the 11 participating countries will enter the single currency.
The euro will be roughly equivalent to the present European Currency Unit, which is based on a basket of currencies. Some recalculation will be necessary because the British pound, while part of the ecu, will not be among the currencies that will vanish as independent entities to make way for the euro.
The finance ministers also are scheduled to confirm Denmark and Greece as members of the European exchange rate mechanism, or ERM, as a prelude to their possible entry into the single currency at a later date.
With the imminent arrival of the currency, many business leaders in the non-participating countries are regretting their governments' decision to stay out. ''Our main competitors are in the euro zone, and if Sweden would have joined the single currency, our costs would have been several hundreds of millions of kronors less,'' said the carmaker Volvo AB's director of European strategy, Lars Persson.
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