the reforms will - in the medium to long term - accelerate the pace of economic growth and enhance the attractiveness of the euro area as well as the single currency. what will be a crucial factor, therefore, is that policymakers commit themselves in a credible manner to tackling the necessary changes and, at the same time, to safeguarding the stability of the euro. as monetary history has repeatedly shown, a stable internal value is the precondition for gaining that sustained confidence of international investors, which also gives a currency its external stability. one of the main tasks of the national central banks of the eurosystem at present is preparing for the cash changeover on january 1, 2002. this is a tremendous logistical task. it is a great challenge to all of us. but i am confident. we will have a smooth transition from national currencies to the euro. i am also convinced that the issuing of the euro in physical form will help to improve acceptance of the new currency in europe and in particular in germany. the results of the latest eurobarometer opinion survey show already a growth in support for the euro. in the euro area, 66 % of the people support the single currency. germany is still lagging behind, with 53 % in favor of the euro ; however, this is a significant improvement compared with the previous opinion survey. from an economic point of view the changeover is a non - event ; but it is not a merely technical process. it is the final and historical step towards further political integration in europe. at least, i hope that the euro will also function as a catalyst in that direction. after all, history tells us that normally the territory of a political entity and the monetary area is identical. this is not - or nor yet - the case in europe. as a consequence, monetary union cannot stand alone. in the medium term, emu will need to be underpinned by political union. in particular, the stage of intergovernmental cooperation must be overcome in foreign and defense policies, and in domestic and legal policies. that means national interests have to become manageable and ultimately to be overcome in order to move on to truly common european policies. the deepening of european integration and the enlargement of eu offer a unique opportunity to integrate europe peacefully and to create a region of stability and prosperity. slowly but surely europe is beginning to liberate itself from political standstill. political processes take time since they need to be supported by a public

to europe next year, you will meet the euro wherever you go – because in just a few weeks it will exist in physical form. paris, rome, brussels or berlin : in most of europe, you will be able to pay with a single currency – euro bills and coins – starting on january 1, 2002. for you here in the united states, it is natural that the dollar is legal tender in all fifty states of the union. for us in europe, though, monetary union is a quantum leap, both politically and economically. in my speech i would like to address the following issues : 1. the historical background of the euro. 2. the essential features of the new system and its ramifications. 3. the future outlook for the euro – the political agenda. the historical background of the euro the euro is not quite as new as the title of my speech would lead you to believe. in fact, the euro is already a reality. the new european currency was born nearly three years ago when europe entered stage three of economic and monetary union. however, compared with the dollar and its long tradition, the euro is a “ rookie ” in the monetary policy league. however, this “ rookie ” took the field after going through a tough “ training camp ” on the field of stability. nearly five decades ago, far - sighted european politicians kicked off the drive toward european unification. sure, this drive has repeatedly been hampered by setbacks. however, the thrust towards greater integration has ultimately been unmistakable. european economic integration has been firmly established according to the principle of an “ open market economy with free competition. ” this was not as obvious back then, as it seems today. here in the united states, in particular, people might say “ what else? ” in europe, though, it would behoove us to keep reminding ourselves of what it takes for a market economy such as ours to function properly. only by paying attention to fundamental principles - personal responsibility, individual initiative, entrepreneurial spirit, and competition – can social equity be achieved ; and this is what is needed to overcome the severe structural problems that still beset europe. we europeans can learn much in this sphere from the united states. the latest and greatest step towards integration in europe has been entry into stage three of economic and monetary union. the euro - area countries have entered into a community of solidarity without any “ exit. ” there is no precedent for this unique project. in fact, it can rightly be called the