Amid crisis in Greece that brought about days of social unrest and paralyzed Athens, the European Union celebrated 20th anniversary of the Maastricht Treaty last week. The Maastricht Treaty enabled the creation of the euro and was designed to ensure that member states follow a common baseline: price stability, sound public finances, sustainable public finances, durability of convergence and exchange rate stability. It instituted convergence criteria: low inflation, low long-term interest rates, government deficit not above 3% of GDP, and accumulated public debt not above 60% of GDP. Many believe that if Eurozone countries implemented the Maastricht criteria in the first place the current financial crisis could have been avoided. The EU is now preparing for a new treaty to ensure tighter fiscal cooperation. Two countries out of 27 member states, UK and the Czech Republic, will not sign the treaty.
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