3  BIS Review 113/1999  The first of these criteria, generally known as the “political criterion” calls for a candidate country to have stable institutions which guarantee democracy, the rule of law, human rights, and respect for and the protection of minorities. I shall not comment on this criterion as its purpose and meaning are quite clear to us all. The “economic criterion”, as the second of these criteria is termed, requires the existence of a functioning market economy as well as the capacity to cope with competitive pressures and market forces within the European Union. The economic reasoning which lies behind this criterion is also quite straightforward and requires little elaboration. However, I should like to add that for the accession countries, while it is no doubt a difficult and sometimes painful task, fulfilling this criterion is an essential step towards creating a solid basis for future non-inflationary economic growth. And, finally, there is the third criterion concerning the adoption of the so-called “acquis communautaire”. This requires that a candidate country be able to take on the obligations of EU membership, including the adherence to the aims of political, economic and monetary integration. It is this last point which is of course most relevant to the Eurosystem. EU enlargement and the Eurosystem As I understand it, it has been decided that no new “opt-out” clauses, such as those negotiated by the United Kingdom and Denmark, shall be available to new Member States.
This is in the interest of the countries which have already introduced the euro, but even more so in the interest of new countries entering the euro area. Without having achieved sustainable convergence, the loss of the exchange rate and interest rate instrument could cause costly tensions in the economy at the expense of growth and employment. The determined efforts of Greece to achieve such convergence have to be commended. However, it is too early to reach a firm conclusion. Next year, the European Central Bank (ECB) will produce a convergence report to analyse what has been accomplished. Let me repeat and underline that achieving convergence is not a process which ends with adopting the euro. On the contrary, being a member of the euro area and being able to benefit from the potentially great opportunities that offers call for ongoing adaptation to the new environment and the new rules of the game. It is like in sports: reaching the top is difficult, but staying there is even harder. 1  BIS Review 113/1999  Integrating one or more of the EU Member States which have not previously introduced the euro will be a challenge for the euro area. However, an even greater challenge for Europe as a whole lies ahead. I am referring to the enlargement of the European Union. First, I shall deal with that process in general. Then, I should like to say a few words about how the Eurosystem (i.e.