European Union single market where ideally people, goods, services and capital will be able to move freely between countries with minimal restrictions. The intention is that the European Monetary Union will create a framework for economic growth and stability.Economic and monetary union is based on two concepts; theses are the co-ordination of all economic policies along with an independent monetary institution in the form of the ECB, European Central Bank.The ECB is independent of all political and private institutions of the European Union and member states and has its own budget, independent of that of the European community.The main objective of the ECB is to maintain price stability, it sets a medium term target inflation rate at between 0 and 2 per cent, and this has already been criticised for being too strict.Gordon Brown the UK Chancellor has indicated that he prefers our own British system under which the UK government asks the bank of England to meet an inflation target of 2.5 per cent, with a leeway of 1 percentage point on either side.Many companies currently operating within the eurozone have already experienced a reduction in many of their costs, particularly those in treasury management and foreign exchange transactions, as there has now been an elimination of foreign exchange risk.With the conversion of the Euro currency increased price transparency should now prompt strong competition within many business sectors.The general expectation is that consumers will now be able to shop around for bargains, as it becomes increasingly easier to seek out price comparisons between countries, as all goods will be valued in Euro. This should result in a reduction of some costs within those markets that will inevitably be passed on and so benefit the consumer.Smaller companies may have in the past experienced anxieties about the complexities of pricing calculations, foreign exchange risk and cross border transactions. The introduct...
