The United States has long supported European integration as a means to build stability and prosperity on the continent. A stronger and more united Europe provides a better market for our products. At the same time, a united Europe is a stronger partner for the U.S. in tackling a host of global challenges, such as drugs, terrorism, organized crime and infectious diseases. A single European currency will reduce transaction costs for American companies exporting to and doing business in Europe. More profoundly, it is likely to create pressures for European governments to tackle some of the long-term structural problems in their economies, such as overly rigid labor markets.
Institutional change is a second important process now underway in Europe.
Under the new Treaty of Amsterdam, the powers of the EU's main institutional bodies have been redefined. The role of the European Parliament in decision making has been strengthened. The attitude that the European Parliament adopts toward international trade and investment issues will be something to watch very closely. The European Commission, too, is undergoing an evolution. The Amsterdam Treaty has increased the powers of the Commission's President.