Updated: 30/09/2020

Chapter 17- Economic and Monetary Policy

Content of the Chapter

The Chapter on Economic and Monetary Policy mainly covers the independency of central banks in Member States, prohibition of monetary financing of public sector by central banks and prohibition of privileged access of the public sector to financial institutions.

The legislation in this area is arranged mainly by the Article 119 (Ex-Article 4) and Articles 120-144 (Ex-Articles 98-124) under “Economic and Monetary Policies” Chapter.

In addition to the legislation in this area, alignment with the principle of open market economy based on free competition, single currency policy and the price stabilization targets compose the basis of this chapter.

The framework of coordination in the area of economic and monetary policy is set by the Economic and Monetary Union (EMU). In the context of EMU, Member States are expected to harmonize their economic policies gradually and are subjected to the financial surveillance conditions of the Stability and Growth Pact. Moreover, candidate countries are expected to accept Euro as their unit of currency after accession by achieving alignment with the Maastricht convergence criteria.

After the global financial crisis of 2008, there have been crucial changes in the economic governance of the EU. In this regard, the conditions of the Stability and Growth Pact have been strengthened via Six Pack, Two PackTreaty on Stability, Coordination and Governance in the Economic and Monetary Union (Fiscal Compact) and a stricter fiscal surveillance mechanism has been introduced. Moreover, new mechanisms such as European Semester have been created to improve economic policy coordination within the Union.  

As part of the EU's pre-accession financial surveillance procedure, candidate and potential candidate countries prepare and submit their Economic Reform Program (ERP) to the European Commission annually. Then, the Commission publishes its horizontal assessments on the ERPs of all candidate and potential candidate countries and its assessment on the country's ERP. Later, the Joint Conclusions of the Economic and Financial Dialogue between the EU and the Western Balkans and Turkey, which includes country-specific policy recommendations, is adopted.

This chapter is closely related with Copenhagen economic criteria (existence of a functioning market economy and capacity to cope with competitive pressures and market forces within the Union). Therefore, the progress achieved in the context of this Chapter also has positive implications in the area of economic criteria. 

Current Stage of the Negotiations on the Chapter

Turkey’s Negotiation Position Paper on the Economic and Monetary Policy Chapter, which was decided to be opened on 24 January 2007, was transmitted to the EU side on 9 March 2007. Since it is asserted by France in the EU Summit on 26 June 2007 that this Chapter has direct relationship with full membership, Turkey’s position paper on this Chapter has not been discussed and the Common Position of the EU has not been prepared. 

With the French reorientation, efforts for opening the Chapter to negotiations have been accelerated in 2015 and Turkey’s Negotiation Position Paper on Economic and Monetary Policy, which was updated in the light of developments since 2007, has been submitted to the EU on 20 March 2015. The Common Position of the EU was received on 30 November 2015. 

The Chapter was opened to negotiations with the Intergovernmental Accession Conference on 14 December 2015. Turkey’s institutional framework including organizational and human resource infrastructure necessary to implement the acquis in the framework of this chapter is in place. In addition to the full, non-discriminatory implementation of the obligations of  of the Additional Protocol to the Association Agreement, two closing benchmarks are set fort his Chapter. .

Closing Benchmarks

1. Turkey has aligned its legal framework in order to ensure full central bank independence, the prohibition of monetary financing of the public sector, the prohibition of privileged access by public authorities to financial institutions, and the full integration of its central bank into the ESCB, including the compatibility of the central bank's objectives with the objectives of the ESCB.

2. Turkey has aligned its legal framework in order to ensure compliance with requirements for national budgetary frameworks as laid down in Council Directive 2011/85/EU.

Relevant Subcommittee Meetings

Subcommittee No 4 on Economic and Monetary Issues, Capital Movements and Statistics


For detailed information about state of play of European economic governance and new mechanisms:


For Maastricht Criteria:


For information about EU's policies and legislation on economic and monetary affairs:


For "Reflection Paper on Deepening Economic and Monetary Union" by Commission:


For European Commission Directorate General for Economic and Financial Affairs:


Screening Process

Presentations at Explanatory Screening Meeting (16 February 2006) 

Presentations at Bilateral Screening Meeting (23 March 2006)

Screening Report 









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