Christian Noyer: Building on Euro area achievements to prepare for enlargement Speech by Mr Christian Noyer, Governor of the Bank of France, at the 2007 Annual Conference on Macroeconomic and Economic Policy Issues, Bank of Latvia, Riga, 10 October 2007. *  *  *  Ladies and gentlemen, It is a great pleasure and honour for me to address this conference hosted by the Latvijas Banka. Having just passed the European Union 50th anniversary, it is an appropriate time to reflect upon the essence and future of this extraordinary endeavour. Never before, in the whole history of mankind, have democratic nations pursued and reached, through peaceful cooperation, such a close degree of interdependence, involving, in many crucial areas, deliberate pooling of sovereignty. Of course, the process has not been without difficulties and tensions, many of which are still apparent and acute. Of course, numerous challenges remain. But, for the first time in more than a thousand years, Europe is at peace and prosperous, with democratic regimes everywhere. This is, by historical standards, an exceptional achievement. The whole process of European integration was based on a strong intuition: by sharing the instruments and policies underpinning economic prosperity, European nations would create an irreversible situation of interdependence and solidarity where conflicts and wars of the past would become impossible. The creation of the Euro area is the natural consequence of this original intuition. It results both from a political vision and an economic and financial necessity.
Far from being a closed Club, the Euro area is open and has a true calling for covering all the EU members, in so far as they fulfil the convergence criteria. Indeed, adopting the Euro can be seen as a legal obligation for all EU members once they have fulfilled the Maastricht convergence criteria. Monetary union is an on-going process. Starting in 1999 with 11 members, the Euro area has regularly expanded. On the 1st of January 2001, Greece joined the Euro area. More recently, on the 1st of January 2007, Slovenia was the first of the New Members States which entered into the EU since 2004 to adopt the Euro; this brought the current number of members of the Euro area to 13. Two more NMS – Cyprus and Malta – will join the monetary union in 2008. At this stage, the relevant question for the new EU member states is thus not whether but when to join the Euro area. The answer of this question is clear: the New Members States have to achieve strict and sustainable fulfilment of the Maastricht criteria whose economic rationale is very strong. Why strict and sustainable?