ABSTRACT
This chapter discusses the potential implications of the euro for Arab countries and presents a brief background on the euro and describes implications of the euro for Arab countries in a number of areas. It focuses on the implications of the introduction of the euro for Arab countries. Adopting a non-technical approach, the chapter essentially attempts to identify the direction of these implications rather than their specific magnitude. Introduction of the euro is expected to bring about major changes in the economies of the European Union-11, which, in turn, will have both direct and indirect implications for non-European Monetary Union (EMU) members. The launch of the euro is a new event, which makes assessment of its implications for non-EMU countries a difficult task. Analysis of the impact of EMU on non-EMU countries revolves around issues covered extensively in the literature on international trade and finance.
