Uncertainty on the implementation of the third and final stage of economic and monetary union (EMU) in Europe has grown, despite continuing strong public endorsement by decision-makers. Several observers have raised the once taboo issue of a possible delay due to severing problems to meet the convergence criteria, especially in Germany considered as the anchor country of the future Union. Uncertainty stems not only from current economic performance of EU member countries but also from the procedures that will determine the transition to EMU, from underlying goals of the whole integration process, and from the vagueness of life after 1999. The third round of our debate addresses some of these issues.
The first contribution, by Randall Henning, picks up on Benjamin Cohen's piece in the previous round, and points to one of the problematic aspects of life after 1999 -EU-US relationships and international monetary cooperation. Given the policy challenges created by the transition to monetary union, Henning argues that European and international institutions should be adapted before, rather than after, these policy challenges place heavy demands on international cooperation.
The second contribution, by David Cameron, highlights how procedures and the language of the Maastricht Treaty have largely contributed to the current uncertainty on the question of who will qualify for EMU. He also discusses the question of whether the member states will create for themselves the conditions to control economic policy and address such problems as low growth and high unemployment. His analysis suggests optimism for the first question and pessimism for the second one.
The third contribution, by Barry Eichengreen, broadens the debate to the ever-pervading issue of the connection between monetary integration and political integration. Eichengreen argues that the relationship between the two is contingent -path-dependent -with the final outcome sensitive to small variations in initial conditions. In particular, his analysis emphasizes the importance of the "accompanying fiscal constitution". The stronger the fiscal restraints, the more likely monetary integration is to generate pressure for political integration.