European Union (Eu) Response to Economic and Financial Crisis

Topics: European Union, Euro, European Central Bank Pages: 4 (1220 words) Published: April 22, 2013
European Union (EU) Response to Economic and Financial Crisis By
Dragan Kosanovic

The European Union (EU) is a family of democratic European countries, committed to working together for peace and prosperity. It is not a State intended to replace existing states, but it is more than any other international organization. The historical roots of the European Union lie in the Second World War. The idea of European Union was perceived to prevent destruction from ever happening again. It was first proposed by the French Foreign Minister Robert Schuman in a speech on 9 May 1950. This date, the "birthday" of what is now the EU, is celebrated annually as Europe Day. The EU is unique; its member states have set up common institutions to which they delegate some of their sovereignty so that decisions on specific matters of joint interest can be made democratically at European level. The EU has established Economic and Monetary Union (EMU) whose currency is Euro. The creation of the EMU and the introduction of the euro were milestones of European integration. The EU’s highest achievement is euro and one of the Europe’s defining symbols across the globe. Euro is the world’s second largest reserve currency, and the integral part of the global economy. Such integration has enabled immediate price comparisons for goods and services across countries. By eliminating exchange rate risk and foreign transaction costs, the euro facilitates a more efficient distribution of resources, and makes price of goods and services fully transparent across all the European Union countries. Thanks to rapid technology development this single market is a powerful tool for growth, and the stability. The stability of the currency has made the euro area and attractive investment destination. These trade and investment gains have increased growth and jobs. Euro area is set to increase in the future, Slovakia joined the single currency in January 2009 and Estonia joined in January 2011....
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