Discuss the arguments for and against the UK joining the European single currency. 1. Introduction
Smimou,K (2011, p 88) observed after analyzing relationship between the times prior and after the introduction of the Euro currency that after the introduction, it has enhanced and improved the former economic abilities. It is noteworthy to say that the Euro has subsequently eliminated thirteen currencies which most of the currencies were individual national symbols and icons. As a result of it, people now travel and trade across large swathes of Europe using a single currency that represents a remarkable achievement (Wetherly,P & Otter,D,2008,p 249). However, one question is given, whether or not the United Kingdom (UK) eventually participates in the single currency, how it will affect UK’s financial services, employment and other economical and political issues. Therefore, in this essay, the economic arguments will be emphasized that are made for and against UK to get involved in the single European currency. Firstly we should identify that the concept of the EMU spreads throughout the countries which uses the same currency where generally do not have close relationships regarding trade, business and monetary correlation even though they share the same geographical borders. In addition the European Central Bank executes a single monetary policy and furthermore institutes a permanent exchange rate within the region (Smimou, K, 2011, p 88-89). 2. Arguments for
As a starting point, joining a single currency probably creates greater inward investment and international trade. Fundamentally having a single currency facilitates the member economies to accelerate investments and in the event of the single currency being successful, it stabilizes the macroeconomic zones and minimises the inflation level. This paves the way for business ventures to make investments and preparations which would ultimately result more investment opportunities and higher...
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