45 % of new issues in the year 1999, which is roughly the same market share as that of new usd - denominated bonds. all in all, the first year of the euro ’ s operation has indisputably been a success. of course, one year is too short a period to allow a final judgement. economic and monetary union and the single european currency are meant to last - they are long - term endeavours. ladies and gentlemen, this conference is about the new and increasingly integrated europe which has begun to emerge gradually over the last decade, and it is also very much about the future prospects of our continent. let me therefore look beyond the confines of the eurosystem and the european union and develop some thoughts about the role of the euro in the context of europe as a whole. i would like to reflect on two connected issues that have to do with the approaching enlargement of the european union, undoubtedly the crucial challenge to europe in the course of the next years. the first issue is the role the euro plays in central and eastern europe today, and will play in the future ; the second issue is the nature of the link between emu and enlargement. in central and eastern europe, several currencies which were replaced by the euro, above all the deutsche mark, traditionally played a key role. the euro has assumed this role since the beginning of last year. the single currency has become particularly important as a unit of account in international goods and service trade in central and eastern europe. moreover, the euro is likely to play an ever larger role as an investment and issuing currency for private users in the central and eastern europe and, in the longer term, for pricing of goods and on the stock exchange. for the monetary policies of central and eastern european countries, the euro is a key currency already today. in most of the monetary policy strategies of central and eastern europe, exchange rates play a vital role and, wherever they are not a formal or informal intermediate target, they are at least a key monetary policy indicator. in nearly all cases it is the euro upon which the central and eastern european currencies are oriented, or to which they are formally linked. in the case of the managed float countries, among them the czech republic, this is reflected by the fact that since the beginning of 1999 all these countries have been using the euro as a reference currency. the countries which avail themselves of an exchange rate peg - be it a standard fixed peg, a

klaus liebscher : the euro area - an anchor of stability in europe and the world luncheon speech by mr klaus liebscher, governor of the oesterreichische nationalbank, at the east - west - conference, wien, 6 november 2001. * * * ladies and gentlemen, i am glad to have this opportunity to personally thank you all for your participation and all speakers for their active involvement in this year ’ s east - west conference, which centers on topics that are of long - term relevance for eastern, central and western european countries, of relevance to the growing integration and historic reunification of our continent, but certainly also of relevance outside europe. it is a pleasure for the oesterreichische nationalbank to continue the long tradition of offering our annual east - west conferences as a platform and a meeting place for debates on issues relevant to those countries – but not only to them – in order to help developing answers to the challenges ahead. since the very inception of transition, the oesterreichische nationalbank has had the opportunity to be an active partner for central banks in transition countries. at the same time, the oesterreichische nationalbank has been actively participating in another historic project, the realization of the european economic and monetary union ( emu ) and the introduction of the euro. the establishment of the euro as the single currency in 12 sovereign countries of the european union was certainly not a purely economic move, but rather another major step in the process of european integration that began more than half a century ago. ladies and gentlemen, the strong rise of commodity prices, in particular of the oil price, in 1999 and 2000, recent economic turbulences in some emerging markets and the tragic events of september 11 have not compromised stability in the euro area. on the contrary, and i would like to stress this especially, emu, among other factors, contributed to avoiding possible exchange rate or financial tensions in europe. however, the terrorist attacks on the u. s. have further dampened global economic activity in 2001 and will postpone an economic rebound at least for one or two quarters in 2002. apart from the irreplaceable human loss, the direct effect of the terrorist attacks on the overall u. s. economy is likely to be limited. however, the indirect effects on private consumption, investment and savings could be more significant as confidence of consumers and business has already stated to fade. due to increased uncertainty, investors have become more risk - averse.