What’s the future for monetary unions?
About this episode
The episode discusses the implications of Bulgaria joining the eurozone and explores the concept of monetary unions historically and in contemporary contexts.
At the beginning of this year Bulgaria, considered as one of the poorest countries in the European Union, became the latest to officially join the eurozone. Bulgaria’s legal tender since 1881 had been the lev, but since the mid-1990s it had been pegged to other European currencies, first to the German deutschmark and now to the euro. But it remains to be seen if the country’s economic policy can take advantage of the opportunities that joining the single currency can afford, in terms of trade and economic development. Monetary unions are not a new concept, some like the Scandinavian monetary union date back to the 19th Century, involving Denmark, Sweden and Norway. It established a fixed exchange rate system based on the gold standard, whilst member countries still had their own currencies before it was gradually dissolved from the outbreak of World War One onwards. Today, the biggest monetary union is the eurozone, used by around 358 million people across 21 European Union countries. It has one monetary authority for all the members and a standardised currency and coinage. And now the Economic Community of West African States, known as Ecowas is actively planning a monetary…
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