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In order to qualify for membership of EMU, the Treaty requires Member States to aim for certain targets for their budget deficits, public debt, inflation, and interest rates and exchange rates. Since inflation, interest and exchange rates are crucially influenced by the size of budget deficits, special surveillance procedures are applied by the Council and the Commission.
Under the 'excessive deficit' procedure, as it is known, the focus is on a country's total outstanding public debt as a percentage of its gross domestic product (GDP) and on its budget deficit as a percentage of GDP. The targets laid down in a protocol to the Treaty are 60% of GDP for outstanding debt and 3% for the annual budget deficit.
Financial integration
The main barriers to integrating these markets were exchange controls (regulating the import and export of capital) and different regulatory frameworks in the Member States which were a barrier to the supply of such services as banking, insurance and accounting across national borders. Regulations and restrictions had tended to limit the efficiency of these sectors in many Member States and, therefore, add to their costs.
The Union's strategy for the liberalization of financial services has followed three paths:
removing exchange controls;
harmonizing essential regulations combined with mutual recognition of other national regulations. In the case of banking, this means that banks can operate across border under the supervision of their national home country authorities;
harmonising of tax rates.
Exchange controls have been removed and financial services deregulated but little progress has been made in the harmonization of tax rates. The fact that Council decisions on tax rates must be taken unanimously, the importance of the national interests at stake and the wide differences in national taxation systems have been powerful constraints on the Commission's efforts to move harmonisation forward.
Laws and procedures
Role of the Council of Ministers: the European Council sets macroeconomic policy guidelines; 0the Council of Economics and Finance Ministers adopts legislative instruments, drafts policy guidelines and coordinates macroeconomic policies.
Role of the European Parliament: the Parliament debates economic policies and issues reports and recommendations.
Role of the European Commission: proposes legislation and policy initiatives. Monitors Member States' economic policies and proposes macroeconomic policy guidelines and recommendations under the excessive deficit procedure. Participates in the G7 meetings of the world's leading industrial powers.
External relations
By negotiating as one, the Member States of the European Union have achieved far more success in promoting free trade in the world than they could have done by operating as single countries. In the process, they have opened many markets for their companies and secured many jobs for their people. The EU is the world's largest trade grouping and its exports support one job in 10 in the Member States.
Laws and procedures
Legislative procedures: important international trade agreements are adopted by the Council and require the assent of the European Parliament. Association agreements need the assent of the Parliament before they can be implemented.
Role of the European Commission: on a mandate approved by the Council, it negotiates multilateral external commercial agreements in the World Trade Organization as well as bilateral arrangements, applies EU trade legislation, proposes new legislation.
Реферат опубликован: 4/03/2009