, trade, profits and losses. however, the eu is much more than that : the european union is the most important and successful peace project europe has ever seen. today, the european union not only comprises countries from the western part of europe, but also free and democratic countries from central, eastern and southeastern europe. and the integration process of the southeastern european candidate and potential candidate countries is moving on. some 15 years ago, such a development appeared highly unrealistic, if not impossible. yet, visionaries, determined policymakers and the people of europe have translated this project into reality. erm ii is a multilateral arrangement of fixed, but adjustable, exchange rates with a central rate and a standard fluctuation band of + / – 15 % against the euro. this success reminds us not to lose sight of our long - term goals and visions. yet, a sustainable catching - up and integration process requires strenuous preparations, hard work and a lot of discipline. as a consequence, the southeastern european countries which have gone through this process will be in better shape and in a stronger position than before. and not only the people in these countries, but all europeans are going to gain as integration is advancing and thus stability and prosperity are progressing in europe!

multi - country monetary union. if applied appropriately, the framework ensures long - term sustainability and sufficient room for an automatic smoothing of business cycles. the governing council agrees with the commission that the implementation of the stability and growth pact could be further improved, in particular in terms of the analysis of structural imbalances and the strengthening of incentives for sound fiscal policies during good economic times. the clarity and enforceability of the fiscal framework should be enhanced. let me, as an aside, note that austria successfully managed to implement its fiscal consolidation as planned over the past four years. the austrian example shows that structural cuts in fiscal deficits need not entail below - average macroeconomic growth. as recent research by the european commission shows, fiscal consolidation through cuts in expenditures is less likely to entail short - run growth - dampening effects than consolidation which relies on raising taxes. while recent tax cuts by a number of european governments, including that of austria, are in principle appropriate given high public expenditure - to - gdp ratios, governments should use the coming economic upswing to bring their budgets into balance mainly through cuts in expenditures. there is a general consensus that the euro area urgently requires further structural reforms in financial, product and labor markets. the lisbon strategy provides the appropriate blueprint for progress. i think we can very much compare the current situation of the lisbon agenda with the state of emu in the mid - 1990s. • then as now a project of historical dimensions and of the highest priority for the eu ’ s further economic development was at stake. • then as now there was a lot of scepticism about the project ’ s viability and timetable. • then as now there appeared to be lackluster support from some european leaders. the decisive move that brought emu back on track in the mid - 1990s was the meeting of the euroepan council in madrid in december 1995. at that meeting, the date for the introduction of the european currency, january 1, 1999, the further steps necessary to reach this goal and the name “ euro ” were decided. this important guidance from european leadership established a “ pioneering mood. ” it triggered the necessary work at the various technical levels dealing with the preparation of emu. and, most importantly, it created confidence in european leadership and problem - solving capacity in the general public. i therefore welcome that the forthcoming spring meeting of the european council is set to give renewed impetus to the lisbon agenda, speed up the pace of reforms and strengthen the effectiveness of the