setting. in the end, competition should also contribute to lowering the prices in the short - to - medium term. • second, we must closely monitor the risks of counterfeiting of notes and coins : the information campaign of the eurosystem “ the euro. our money ” was aimed at familiarising all the european citizens with their new banknotes and coins ( and their security features ) and, by doing so, it helped them identify the obviously fake banknotes. all institutions concerned, both national and european, are co - operating closely to prevent and fight counterfeiting. right now, counterfeit banknotes are scarce and conspicuous. the credibility of the eurosystem and of the single monetary policy, and the successful changeover to the euro represent major achievements. they certainly contribute to the efficient functioning of emu and to european economic and financial integration, as i will explain it right now. * * * emu : a balanced concept fostering economic and financial integration emu is an economically sound and well - grounded concept. a few years ago, it was necessary to convince a great number of sceptics that the euro would really be launched. the opinion that the single currency would never exist has of course been disproved by the facts. nevertheless, objections are still being raised from time to time, on the alleged grounds that the euro area economy comprehends inconsistencies that could endanger and challenge the viability of emu, all the more so since the european union is about to welcome new members. some observers thus claim that the lack of co - ordination between european economic policies, in the absence of a political federation, is likely to deprive the area of an appropriate policy - mix. others blame the lack of instruments allowing us to tackle asymmetric shocks that may arise, and underline the lack of flexibility or the absence of mobility of the european labour force. others claim that the presumed economic divergences and structural gaps among euro area countries are too large to ensure a viable monetary union. how do we respond to these important objections? ( 1 ) it is not disputable that for emu to function well, member states, especially the major ones in terms of gdp, must be aware of the spill - over effects that national economic policies may trigger. the existence of spill - over justifies the implementation of a close co - ordination between national economic policies. this is embodied in the treaty itself, which obliges member states to consider national

bank of france reports industrial output continued to increase in all sectors in february 1997 bank of france, monthly business survey, 17 / 3 / 97. in february, according to the business leaders surveyed by the banque de france, industrial output continued to increase in all sectors. the capacity utilization rate rose slightly. overall demand grew at a moderate pace. there was strong demand from foreign markets, particularly from northern europe, including germany and the united kingdom, and from the united states and asia. the rise in the dollar and in sterling reinforced the competitiveness of french products. growth in demand on the domestic market was much more moderate. order books are deemed to be satisfactory in all sectors, with the exception of the food - processing industry, where they declined slightly and appear to be insufficient. inventories of finished products are still somewhat above normal levels. in particular, they are considered to be above desired levels in the food - processing, intermediate goods and automobile sectors. in the coming months activity should continue to increase in all sectors, with the exception of the automobile sector. commodity prices were stable overall. however, price rises were recorded in certain parts of the intermediate goods industry, such as the rubber and plastics, metal - working, and wood - processing sectors, and in the food processing industry owing to the appreciation of the dollar. intense competition prevented these increases from being passed on to sales prices, which scarcely changed, except in the automobile sector, where they declined. the business leaders surveyed continued to be cautious in their investment plans. there were few plans for large - scale investment, and they mainly concerned the renewal of modernization of existing equipment. retail sales contracted in february, after posting a substantial rise in january. employment levels remained stable in industry, except in the automobile sector, where they declined. the retail and market services sectors showed little change, but employment fell in the building industry. increasing use was made of flexi - time, annualized working time and part - time working to respond to variations in demand.