Welcome to IPE's first special sponsored supplement examining the implications for the investment industry of the arrival of European Monetary Union. It ishard to believe that at last we are within hailing distance of this momentous event, which will change the daily lives of all of Europeans involved in investing, whether we belong to an 'in-country' or not.
But the imminence of monetary union has already been felt within asset management as the convergence process has relentlessly brought interest rates of the EMU aspirants into its vice-like grip. That this has happened is a good portent for success when introducing the euro and a good indicator as to how resolved the 11 countries are to meet the deadlines. So as a test of member states' commitment, convergence has been a heartening precursor of the next stage.
The final run-up to the 'Big Bang Weekend' is when some experts are expecting periods of instability. Certainly, we are going through a phase when global uncertainties are multiplying fast, though not on account of EMU which may yet turn out to be a stabilising force. But long nights of pre-wedding nerves cannot be ruled out between now and the end of the year, though these pre-nuptial fears do not mean that the marriage should be put off.
In this supplement, we have asked our contributors to look ahead to what the conversion weekend will entail, if relevant to their topic, and, of course, the new 'Euroland' that lies beyond. They have risen to the challenge of assessing the impact they see EMU having on their marketplaces.
And they do cover a wide spectrum, ranging from detailed reports on most of the individual markets of those countries set to inhabit this terra nova to the broader issues of asset allocation, custody, currency management and the implications for fixed interest assets as well as equities, and the question of information supply.
IPE hopes that the post-EMU Europe will be something less of a terra incognita for investors as a result of these articles and that readers will have a keener appreciation of the contours and general lie of the land ahead, though inevitably there are bound to be some misty patches for some time yet.
In addition, and perhaps more importantly, we hope that the note of confidence that the contributors show in the euro-project overall and their optimism about the eventual success and the opportunities it will bring investors are lessons that will be taken from the supplement's pages.
Already pre-EMU convergence has brought significant changes to some markets as the articles point out and there is no doubt that these are likely to be dwarfed by what lies ahead as Europe takes this giant step forward. As investors we know that our real rewards come more from life's uncertainties than certainties and this is why we should be eager for the new world of monetary union. Fennell Betson