THE DUBLIN European summit last night crowned the success of the Irish EU Presidency with a decisive step in the direction of monetary union.
A controversial agreement on the budgetary rules to apply in the single currency system, brokered by the Minister for Finance, Mr Quinn, allowed the summit to wrap the key preparations for the move to monetary union in 1999.
The agreement was given extra symbolism with the unveiling of the proposed euro banknotes.
The Taoiseach, Mr Bruton, expressed delight at an "exceptionally successful day... when we agreed to everything we set out to achieve". But, speaking at a press conference last night, he made clear that formidable challenges lay ahead for the Union. Welcoming the wide support given to the Irish draft outline for a new treaty, the Taoiseach warned that "over the next six months we are going to need the sort of inspiration of those who framed the Declaration of Independence of the US - a large sense of vision".
And he returned to a central theme of his perspective on the presidency - the need to make the Union appear more relevant to its citizens. "The EU is not only a market, but a human institution. I believe this summit, in the way it is delivering decisions on unemployment, drugs and the battle against crime, is bringing Europeans to know that it is their Europe," he said.
The Irish draft treaty won nothing but plaudits - France's President Chirac opened his contribution to the debate with the words "Bravo to the Irish presidency" while the British Prime Minister, Mr John Major, echoed the sentiment. "The Irish have done a very good job," he told journalists.
But Mr Major too warned of the challenges - and arguments - ahead and specifically of the dangers involved in what many see as the key likely constitutional innovation of the current treaty reform - flexibility.
"The wrong sort of flexibility... would blow the EU apart," he told fellow leaders.
Agreement by the leaders to the deal on the post-single currency stability and growth pact, to ensure continued financial disciplines, came only after late-night arm-twisting by Mr Quinn and, through the good offices of the Prime Minister of Luxembourg, Mr Jean-Claude Juncker, to whom Mr Quinn paid tribute.
Mr Quinn said that "as a consequence of this deal, the Irish presidency, with a lot of help, is now able to say to citizens and markets that we have agreed the legal basis of the euro, the structure of ERM2, and the terms and conditions for the stability pact".
The agreement had earlier been delayed because of the German wish to ensure that procedures for applying fines to member-states whose deficits exceeded 3 per cent were as automatic as possible, leaving little discretion to the political whims of the Council of Ministers.
Others, led by the French, insisted that the treaty discretion of ministers could not be overruled.
In the end, the deal balanced the two requirements with a package that included a solemn commitment by member-states not to seek a derogation from deficit rules unless faced by serious recession.
Mr Quinn said: "We are talking about serious economic discipline. . We are not talking about a procedure that could be applied to the bottom end of the normal business cycle."
The German Finance Minister, Mr Theo Waigel, welcomed the agreement and insisted that Germany had never been isolated in its demand for strict rules.
"We have achieved a good result and I am satisfied. The stability pact is ambitious but it has to be if all member-states are to be given equal protection. This is especially true for smaller states."
Mr Waigel claimed that Germany's efforts to achieve a tough, stability pact received support from the Irish presidency and from a number of member-states, but he declined to name any of these allies. "We would not have got the result we did if we did not have broad support for our position. We are not doing this to annoy others but to secure the currency in the future," he said.
Although the deal agreed, yesterday falls short of Germany's original demand, Mr Waigel believes he can persuade the German public that he has won an important victory. When asked if the euro, will be as strong a currency as the deutschmark, he, replied: "Jawohl!"
