De Silguy meets McCreevy on euro

The Republic is well-placed to benefit from the launch of the euro, but dangers of overheating require continued strict fiscal discipline, the EU Commissioner for Economic Affairs, Mr Yves Thibault de Silguy, will tell the Minister for Finance, Mr McCreevy today.

Mr de Silguy is in Dublin to brief Mr McCreevy and the Governor of the Central Bank, Mr Maurice O'Connell, on preparations for the launch of the single currency. He will also be speaking to a meeting of the Association of Corporate Treasurers.

At a briefing here ahead of his visit, Mr de Silguy said he had three basic messages to bring: first, that the euro was already a reality, legally, technically and even in the markets. The technical preparations were complete, he said. The challenge was to reinforce the economic co-ordination of the euro-11 with the preparation of individual member-state stability programmes, he said. Second, Mr de Silguy will reiterate his contention that the euro is already protecting European economies from the effects of the global crisis. That was evidenced by the degree of exchange-rate stability which would almost certainly not have been there if agreement had not been reached in May on the first participants and the pre-fixing of rates of entry.

Finally, he will reinforce the importance to keep inflation under wraps. The Republic's successful tapping of the European market potential would depend on adherence to budget targets, he said.

Mr de Silguy hoped to get Irish views on whether the proposed six-month launch in 2002 of the euro banknotes in parallel with domestic currencies would be unnecessarily long.