Seite - 139 - in Austrian Law Journal, Band 2/2018

ISSN: 2409-6911 (CC-BY) 4.0 license www.austrian-law-journal.at Fundstelle: Hofmeister, The Commission’s Proposal to Establish a European Monetary Fund: A Critical Analysis, ALJ 2018, 139–158 (http://alj.uni-graz.at/index.php/alj/article/view/126). European Monetary Fund The Commission’s Proposal to Establish a European Monetary Fund: A Critical Analysis Hannes Hofmeister,* Bozen Abstract: On December 6, 2017, the European Commission published a set of proposals to reform the euro area. These proposals include, inter alia, the creation of a post of European Finance minister, a euro area budget-line and the establishment of a European Monetary Fund (EMF). The latter will be at the centre of this article. The Commission does not intend to set up the EMF anew from scratch. Rather, the new EMF is to be built on the well- established structure of the European Stability Mechanism (ESM). The new EMF will thus succeed to and replace the ESM, with the latter’s current financial and institutional structure essentially preserved. However, the new institution will also take on a number of additional functions, such as providing a financial backstop for the Single Resolution Fund (SRF), enhanced monitoring tasks and the responsibility to report regularly to the European Parliament. But will these changes make EMU more efficient, coherent and democratic? And has the EU the competence to establish such a mechanism at all? The objective of this article is to answer these complex questions. Keywords: EU Law, Economic and Monetary Union, Eurozone crisis, Reform proposals. I. Introduction The banners at the entrance to the Bank of Greece museum in Athens promise a ‘fascinating journey through Greece’s economic and monetary history. Inside the museum ranks of glass cases enclose an array of coins and old bank notes, as well as the paraphernalia used to make them. The bills range from 5 drachma up to 100 million drachma, a reminder that Greece has had problems with inflation in the past. The end of history, at least for this exhibition, is 2001 when Greece adopted the euro. But the country’s present troubles suggest an important chapter to the story of Greek money is still to be written. Some reckon the drachma may roll off the presses again’.1 In order to prevent that from happening a number of measures have been taken both by the EU and the euro area Member States. For instance, major bail-out mechanisms were established – the * Hannes Hofmeister is Assistant Professor at the Free University of Bozen. The author would like to thank Professor Arnold and the anonymous reviewer for their comments. 1 Greece and the euro - An economy crumbles, THE ECONOMIST, Jan. 28, 2012, available at http://www.economist.com/node/21543522 (last visited Jan. 3, 2019). DOI:10.25364/01.5:2018.2.4