The Maastricht Treaty (officially called the Treaty on European Union) was signed on February 7, 1992 and entered into force on November 1, 1993. The Maastricht Treaty was created by the following countries: Belgium, Denmark, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Portugal, and the United Kingdom.
The treaty established a European Union (EU), with EU citizenship granted to every person who was a citizen of a member state. EU citizenship enabled people to vote and run for office in local and European Parliament elections in the EU country in which they lived, regardless of their nationality. The treaty also provided for the introduction of a central banking system and a common currency (the euro), committed members to implementing common foreign and security policies, and called for greater cooperation on various other issues, including the environment, policing, and social policy.
States participating in the creation of the Maastricht Treaty agreed on strict criteria (called Maastricht Treaty criteria or short Maastricht criteria) for joining. Every state that wants to use the euro and be part of the Union needs to comply with the Maastricht Treaty and these criteria.
The criteria are:
They impose control over inflation, public debt and the public deficit, exchange rate stability and the convergence of interest rates.
• Inflation rates:
No more than 1.5 percentage points higher than the average of the three best performing (lowest inflation) member states of the EU.
• Government finance:
a) Annual government deficit:
The ratio of the annual government deficit to gross domestic product (GDP) must not exceed 3% at the end of the preceding fiscal year. If not, it is at least required to reach a level close to 3%. Only exceptional and temporary excesses would be granted for exceptional cases.
b) Government debt:
The ratio of gross government debt to GDP must not exceed 60% at the end of the preceding fiscal year. Even if the target cannot be achieved due to the specific conditions, the ratio must have sufficiently diminished and must be approaching the reference value at a satisfactory pace. As of the end of 2014, of the countries in the Eurozone, only Estonia, Latvia, Lithuania, Slovakia, Luxembourg, and Finland still met this target.
• Exchange rate:
Applicant countries should have joined the exchange-rate mechanism (ERM II) under the European Monetary System (EMS) for two consecutive years and should not have devalued its currency during the period.
• Long-term interest rates:
The nominal long-term interest rate must not be more than 2 percentage points higher than in the three lowest inflation member states.