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( Prof. M. Zonis )

E UROPEAN M ONETARY U NION AND E UROPEAN U NITY. T HE U NIVERSITY OF C HICAGO G RADUATE S CHOOL OF B USINESS. ( Prof. M. Zonis ). October 10, 2000 March 26, 2002. L.G. Beckers, Chairman, LOBO n.v. lobo@lobo.be. C ONTENT. 1. Introduction : Relevant Left-overs.

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( Prof. M. Zonis )

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  1. EUROPEAN MONETARY UNION AND EUROPEAN UNITY THE UNIVERSITY OF CHICAGO GRADUATE SCHOOL OF BUSINESS ( Prof. M. Zonis ) October 10, 2000 March 26, 2002 L.G. Beckers, Chairman, LOBO n.v. lobo@lobo.be

  2. CONTENT 1. Introduction : Relevant Left-overs 2. European Agendas compared 3. Constructing the European Pyramid 4. Excerpts from the Political Agenda 5. Excerpts from the Economic Agenda 6. Concluding remarks lobo@lobo.be ã LOBO

  3. RELEVANT LEFT-OVERS • The broader perspective • Membership of EU and EMU • The European Single Market • Outlook for the $/€ exchange rate • Reasons for optimism in Oct. 2000 : three lobo@lobo.be ã LOBO

  4. THE BROADER PERSPECTIVE € < EMU < ESM < EU the euro the Economic and the European the European Monetary Union Single Market Union currency the monetary the economic the political as a medium framework dimension system $ Federal Reserve Interstate USA System Trade - UCC lobo@lobo.be ã LOBO

  5. EU - EMU EU Enlargement EU EMU Members Austria Ireland Belgium Italy France Luxembourg Finland Netherlands Germany Portugal Greece Spain Hungary Poland Estonia Czech Rep. Slovenia Cyprus Romania Slovak Rep. Latvia Lithuania Bulgaria Malta Turkey Non-members EMU Denmark Sweden United Kingdom Non - EU Members Norway Switzerland Iceland lobo@lobo.be ã LOBO

  6. THE REAL OBJECTIVE IS THE ESM enhanced global competitiveness effective single market coordinated economic policy single monetary policy single currency € EMUESMEU lobo@lobo.be ã LOBO

  7. OUTLOOK – I ( as of October 2000 . . . ) A) Short term: • the euro is likely to remain weak : - certain US fundamentals are more positive, although not all (i.e. the public sector deficit and over-all level of government debt) - inflationary pressure by high oil prices will be felt, although comparatively speaking not necessarily more than in the USA - institutional credibility is not yet firmly established • but also : - the euro clearly is a cost-saving factor and enhances financial efficiency, and - the single currency shelters individual countries from the potentially adverse effects of purely domestic developments lobo@lobo.be ã LOBO

  8. OUTLOOK – II (as of October 2000 . . . ) B) Medium to longer term: • likely to strengthen - the euro zone will become comparatively more competitive - institutional credibility will improve - the new economy has great scope for fast growth in Europe - governments in the euro zone will have a better track record of coordinated economic policy and will be addressing the real issues like structural reforms of the public sector and labor mobility lobo@lobo.be ã LOBO

  9. EUROPEAN AGENDAS COMPARED lobo@lobo.be ã LOBO

  10. CONSTRUCTING THE EUROPEAN PYRAMID 28 Security & Defence Fiscal harmonization EU Enlargement 2000 Socialchapter Euro EMU ESCB 1999 EMI Singlemarket 1992 Treaty of Maastricht 1990 Single Act 1980 E.M.S. C.A.P. 1970 E.C.C.S. 1960 Euratom Treaty of Rome 1950 lobo@lobo.be ã LOBO

  11. EXCERPTS FROM THE POLITICAL AGENDA • External representation, defence, foreign policy • Enlargement • Intitutional reform, voting power, role of existing EU institutions • Moving closer to the citizen • Preparatory constitutional initiatives, the Convention lobo@lobo.be ã LOBO

  12. EXCERPTS FROM THE POLITICAL AGENDA • External representation, defence, foreign policy - Foreign policy making - European defence structure - External representation lobo@lobo.be ã LOBO

  13. EXCERPTS FROM THE POLITICAL AGENDA • Enlargement - Short-term costs, long-term benefits - The enlargement / candidacy process - Frontier issues lobo@lobo.be ã LOBO

  14. EXCERPTS FROM THE POLITICAL AGENDA • Institutional reform - Powers of nation-states and European institutions - Voting rights in European institutions - Simplifying the Treaties - Reforming the 6-month Presidency - Role of national and European Parliament lobo@lobo.be ã LOBO

  15. EXCERPTS FROM THE POLITICAL AGENDA • Citizens’ concerns - The democratic deficit - Need to reform or rewrite the Treaties - Governance issues / transparency - Charter of Rights / human rights lobo@lobo.be ã LOBO

  16. EXCERPTS FROM THE POLITICAL AGENDA • Preparatory constitutional initiatives: the Convention 1. Objectives of the Convention 2. Membership of the Convention 3. Recent and future hurdles 4. New pitfalls and booby traps lobo@lobo.be ã LOBO

  17. CONTENT 1. Introduction : Relevant Left-overs 2. European Agendas compared 3. Constructing the European Pyramid 4. Excerpts from the Political Agenda 5. Excerpts from the Economic Agenda 6. Concluding remarks lobo@lobo.be ã LOBO

  18. EXCERPTS FROM THE ECONOMIC AGENDA • Make Monetary Union work • From EMU of 12 to an EMU of 15 • Liberalisation / privatisation of key industry sectors • The next M & A wave? • Strategic responses to the ESM • External role of the euro lobo@lobo.be ã LOBO

  19. EXCERPTS FROM THE ECONOMIC AGENDA • European Monetary Union - Disappearance > appearance - Serious snags? No - Monetary policy - Expected further developments lobo@lobo.be ã LOBO

  20. EXCERPTS FROM THE ECONOMIC AGENDA • From EMU 12 to EMU 15 - United Kingdom - Denmark - Sweden Additional comment: 1. Organizational consideration 2. The € and EU candidate member countries lobo@lobo.be ã LOBO

  21. EXCERPTS FROM THE ECONOMIC AGENDA • Liberalisation of industry sectors / privatisation - Telecommunications - Energy / electricity - Banking and finance - Rail transportation - Airlines / aerospace lobo@lobo.be ã LOBO

  22. EXCERPTS FROM THE ECONOMIC AGENDA • The next M & A wave? - ESM prompts the need for re-sizing - will finance be available? • the IPO and US market segments • the bond markets • the credit markets • the equity markets lobo@lobo.be ã LOBO

  23. EXCERPTS FROM THE ECONOMIC AGENDA • Strategic responses Mission • finance / investments • human resources • technology • knowledge Target Market Execution Client Segments Organic Growth External Growth Products / Services Non-financial objectives Delivery Channels and Systems Financial objectives Pricing Advertising and Marketing lobo@lobo.be ã LOBO

  24. EXCERPTS FROM THE ECONOMIC AGENDA • The external role of the euro: - New signs of growing external credibility - Failed dollarization compared to the eurozone experience - How many international currencies in 2010? lobo@lobo.be ã LOBO

  25. CONTENT 1. Introduction : Relevant Left-overs 2. European Agendas compared 3. Constructing the European Pyramid 4. Excerpts from the Political Agenda 5. Excerpts from the Economic Agenda 6. Concluding remarks lobo@lobo.be ã LOBO

  26. Concluding remarks • New transatlantic issues and challenges - trade disputes - ‘ militarization of foreign policy ’ - several national elections in Europe - ENRON / ABB backlash • Renewed optimism - the euro: collateral benefits to arrive - relative harmony in diversity - influential agents of change lobo@lobo.be ã LOBO

  27. LOBO N.V. EUROSTRATEGIES EIKELENBERGSTRAAT 20, DILBEEK/Brussels B - 1700, Belgium Tel. : (32-2-)466.8626 Fax : (32-2-)466.3347 e-mail : lobo@lobo.be Lode G. Beckers, Chairman & Managing Director Ronny Noerens, Research Associate

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