Banking and investment services: EMU Summit decisions

United Kingdom

The Council of the European Union, meeting in the composition of Heads of State or government, following the recommendation of the Commission, the European Monetary Institute and the European Parliament has named eleven Member States for the start of the single currency on 1 January 1999. The Council decided that Belgium, Germany, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland fulfil the necessary conditions for the adoption of the single currency. The Council concluded that all Member States, except Greece, do not have an excessive government deficit.

The Council also adopted, on 3 May, a recommendation on the appointment of the President, the Vice President and other members of the executive board of the European Central Bank. Wim Duisenberg has been formally adopted as President of the ECB for an eight year term of office. However, he has made a political agreement to step down after the transitional arrangements for the introduction of Euro bank notes and coins is completed. This suggests that he will serve a term of approximately four years. EU leaders also agreed that Mr. Duisenberg's successor would be a French national, and it is thought most likely that this will be Jean-Claude Trichet, governor of the Bank of France. Ogmar Issing, a member of the Bundesbank's executive board, is to become chief economist of the ECB, and is the only member of the board to be appointed for the full eight-year term. The ECB's Vice President will be Christian Noyer, a former French Treasury director. The three other appointments include an Italian economist, the governor of the Bank of Finland, and a board member of the Bank of Spain.

The recommendation was confirmed on 26 May by a Council decision taken by common accord of the governments of the Member States adopting the single currency, following consultation with the European Parliament and the European Monetary Institute. This formal nomination of the board by the EU Heads of State has facilitated the transformation of the European Monetary Institute into the European Central Bank.