The most historic event last week was the European Union summit in Copenhagen - the results of which will be playing out over the next several years. The EU agreed to accept 10 new member countries from eastern Europe after years of tortuous negotiations. The new Europe will stretch from Portugal to the borders of Russia, taking in Latvia, Lithuania, Estonia, Poland, Hungary, Czech Republic, Slovakia, Slovenia, Malta and Cyprus. The new members will bring an extra 75 million people into the EU. Bulgaria and Romania are set to join in 2007. Turkey gave clear signals that it sees its future with Europe in spite of disappointment at not getting a fixed date for the start of accession talks. The summit marks the last act in the reunification of eastern and western Europe. Now that the accession talks have been completed, the EU will expand to 25 countries in 2004, provided that the electorates ratify accession agreement referendums in the candidate countries. But there will be tough years ahead before many of the new entrants join the western club, including reforms to nationalized industries and improvements to the judiciary and public administration just to name a few.

The ECB is devising a new Governing Council voting scheme in preparation for the new members. At present, each national central bank of the 12-member eurozone votes on monetary policy. Clearly, the potential membership would be too large to continue this procedure. Other procedures will also have to be changed to avoid voting gridlock. And surely the one-size fits all monetary policy will be more challenging than it is today due to the varying stages of development and growth among members.

But one thing is certain as all this unfolds - new opportunities will be opening up to savvy investors in the years to come!

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