Differentiated integration from the perspective of non-euro area member states

Introduction Economic and Monetary Union (EMU) and differentiated integration were already a fascinating combination long before the Eurocrisis. This is not only because EMU can be seen as the paradigm of differentiated integration, or as the field in which differentiated integration is most relevant and complex. It is also because EMU blends the constitutional and instrumental differentiation logics. According to the logic of constitutional differentiation, differentiation originates from treaty revisions that transfer national competences to the Union (deepening) and is motivated by concerns about national sovereignty and identity. This logic explains why the United Kingdom and Denmark still have their own currencies, as they negotiated an exemption from the legal obligation to join the euro. To a lesser extent, this also explains the position of Sweden. According to the logic of instrumental differentiation, it has its origins in enlargement rounds (widening) and is motivated by efficiency and distributional concerns. This can explain why the 10 new Member States that joined the Union in 2004 and 2007 were not allowed into the euro area immediately and why those that have not since joined the euro have a legal obligation to do so once they meet the relevant convergence criteria. So not only is there differentiation between euro ins and euro outs, there has traditionally also been differentiation among the outs. It is clear that the non-euro area Member States have hardly ever been in the same position, either with regard to their legal obligations or with regard to their political intention to join the euro. Indeed, it seems that the group of outs is best defined in the negative: they are Member States who are not a member of the euro area. The Eurocrisis has even led to different obligations among euro ins: the conditionality imposed on Greece, Ireland, Portugal, Cyprus and Spain being a prominent example. In fact, the Eurocrisis and euro-crisis law have made the differentiated status of European integration in the field of EMU substantially more complex, both among ins, between ins and outs, and among the outs.

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