Currency unification refers to act of adopting a single accepted form of payment among regions or trading blocs. Such an initiative is agreed upon by the member states such that a single permissible form of payment is recognized in all the member states. In Europe, economic integration has been a chief factor of change in the Western world ever since the Second World War came to a halt. Among its eventual goals in the region involves the institution of a single currency in addition to central bank amongst contributing countries. Even though trade barriers have been lessened, capital and labor are moderately liberated to move about the region, the circumstances compulsory to institute a universal currency have been intricate to meet.
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This research paper scrutinizes the pitfalls and potentialities of currency unification in Europe. Most of the history of the currency unification association is argued along with its financial and opinionated ramifications. This essay enlightens that, even though there are discrepancies involving the states, the EU, which has by now fused its currency, can be used as an exemplar for the GCC. Paolo points out that the soaring echelon of economic heterogeneity in Europe is among the causes that the euro-zone has done fine; the subsequent deficiency in economic heterogeneity in the GCC affirms that there may be considerable obstacles for these nations in accomplishing the kind of economic steadiness and victory needed in practicing currency unification.
According to Von, the current European multi-currency position, there exists an extensive selection of exchange rates involving European currencies. The troubles connected to currency unification are multifaceted and entail a diversity of interconnected "institutional, economic, and political considerations". Primarily, these troubles involve the absolute number of currencies which would have to be incorporated. There exists no substantiation to analyze whether European economic and monetary union (EMU) is either a certainty or that it is not prone to be realized.