Economic Performance N RECENT YEARS MANY countries have

N RECENT YEARS MANY countries have adopted or made progress toward adopting legislative proposals removing their central banks from government control, that is, making them independent. Between 1989 and 1991, New Zealand, Chile and Canada enacted legislation that increased the independence of their central banks. The 1992 Treaty on European Union (Maastricht Treaty) requires European Community (EC) members to give their central banks independence as part of establishing the European Monetary Union. As a result, EC countries that do not yet have strongly independent central banks have introduced legislation or announced their commitment to make their central banks more independent.1 Furthermore, in recent months the governments of Brazil and Mexico have announced their intentions to introduce legislation to create more independent central banks.