The introduction of the euro as the common currency in 11 European Union countries will lead to rapid growth of the bond market, create a new reserve currency, contribute to Europe's competitiveness and growth prospects, and have positive repercussions around the world, including the countries of Latin America and the Caribbean.
That was the consensus among senior government and private sector financial leaders at a seminar on the new currency held in conjuction with the IDB's annual meeting in Paris last March.
Reflecting on the first 100 days of the new currency, IDB President Enrique V. Iglesias described the introduction of the euro as another major advance in Europe's approach to integration and a possible model for Latin America.
"We are following this very closely," said the IDB president.
Eugenio Domingo Solans, a member of the executive board of the European Central Bank, called the launching of the euro "fully satisfactory." He cautioned that the success or failure of the currency should not be measured in terms of its value compared with other currencies "but in terms of price stability," which he said was "the priority objective."
Charles de Croisset, president of Crédit Commercial de France, after acknowledging that the euro's introduction had resulted in high transition costs for the banking sector, said that many financial institutions will be tempted to seek growth through mergers and acquisitions to compete in the new, enlarged financial market.
French Finance Minister Dominique Strauss-Kahn said the euro opens new prospects for growth of a "high-value service" economy in Europe, while Jacques de la Larosière, former president of the European Bank for Reconstruction and Development and ex-managing director of the International Monetary Fund, predicted an explosive growth of the European bond market.
Jacques Delors, former president of the European Commission, and Roberto Zahler, president of the Board of Siemens of Chile S.A., both supported the idea of common currencies as an eventual objective that can help discipline and deepen the integration process in Latin America and the Caribbean. But Zahler argued that neither Latin America nor its respective subregions are ready for a common currency.