es participating in EMU is about 300 million, and the euro zone accounts for around 23% of world trade and world GDP. The decisions about which member states would participate in the euro were made on May 2, 1998 at a special meeting of EU leaders in Brussels. The decisions were based on each member state's ability to meet the economic convergence criteria set out in the Maastricht Treaty. The Maastricht criteria require sound management in the areas of public finances, price stability, exchange rates and interest rates.EU Countries Not in Euro ZoneThe EU countries currently not in the euro-zone are Denmark, Sweden, and the United Kingdom. However, the currencies of these member states not in the EMU have the opportunity to be linked to the euro under a successor to the former Exchange Rate Mechanism (ERM). The original ERM established bilateral conversion rates between the national currencies and in relation to the European Currency Unit, the forerunner of the euro. The new ERM ensures close monetary relations between participating member states and the euro zone. Denmark is a member of the Exchange Rate Mechanism II (ERM II), which means that the Danish Krone is linked to the euro, but the exchange rate is not fixed.Euro Stages A three-stage process was launched in 1990 as EU member states prepared for the single market aimed at boosting cross-border business activity. These stages are: Stage One - (July 1,1990) The first stage towards Economic and Monetary Union (EMU) lifted restrictions on movements of capital across internal EU borders. This would allow capital to flow freely between Member States, and between Member States and third countries. Stage Two (January 1, 1994) The second stage set up the European Monetary Institute (EMI) in Frankfurt to pave the way for the European Central Bank (ECB). Stage Three (January 1, 1999) The third stage begins the final transition to full Economic and Monetary Union (EMU). Marks the start...
