By Europe Correspondent, Alastair Wanklyn

It was the year that a hostage standoff in Moscow, and widespread flooding in much of Europe gripped attention worldwide.

In pop culture too - European heroes Harry Potter and James Bond entertained
audiences around the world.

But in finance, investors were less than amused by Europe's uneasy stock
markets.

And trades unions picked fights with the governments of France, Germany, Britain and elsewhere, when strikes by transport workers and others halted
infrastructure.

Then a shipping disaster in the Atlantic Ocean caused environmentalists to
accuse the European Union of dragging its heels over outlawing outdated vessels.

Oil that should have reached Singapore instead ended up on the coasts of Spain and Portugal, also damaging the local fishing economies.

But it was a good year for some nations in Europe - particularly those Balkan
states that grew used to such turbulence in the 1990s.

In Macedonia Nato-led peacekeepers wached against violence.

While in Bosnia and the international protectorate of Kosovo peacekeepers helped nation rebuilding.

International aid has been flowing into Serbia, Montenegro and Kosovo, to
encourage restructuring and economic growth in this, perhaps the last
corner of Europe to throw off its autocratic past.

As Channel News Asia reported at the time, the arrest of the former Yugoslav leader Slobodan Milosevic opened the way to international assistance.

Milosevic spent the year before the war crimes tribunal for Yugoslavia, and Serbia's economic sanctions disappeared.

Meanwhile nations agreed on the creation of a further, international criminal court, ignoring opposition from the United States and others.

But international agreement did reach substantial new milestones in Afghanistan, as nations tried to help that fragile state find its feet after the the
disappearance of the Taliban.

It was the beginning of a new period in Afghanistan's turbulent history, as we
can now see from the changes here in the capital, Kabul.

No longer does the gun rule the streets here. The International peacekeepers have seen to that.

And for women it's a truly new era, with some of them feeling free to hang up the blue burqa and dress more freely. "

But Afghan women were not the only ones to take a dressing down this year, and America's conduct of its war on terror proved controversial for some European allies.

Here, in America's rejection of the world criminal court, and in some aspects of
economic policy, analysts desribed Europe's frustration with US unilateralism.

Professor Margot Light, London School of Economics, "There is a sympathy still in relation to the primary war against terrorism, and that is the war against Al Qaeda. But a tremendous impatience against what is seen as American unilateralism and a tendency to see the United States not only as separate from but also deserving different treatment from other countries.

The North Atlantic Treaty Organisation was built as a coalition of equals.

But the disparity in capability is in focus after American high-tech weaponry won
the war in Afghanistan, and Nato took the political step of inviting much of the
former eastern bloc to join.

This year even former Soviet states Latvia, Estonia and Lithuania were invited
to join - nations that lack basic military equipment and skills.

Nato has suggested that they should forget building technical capacity - and focus instead on niche skills such as mine clearing.

Nato has a harder line with its wealthier European members though, demanding that they narrow transatlantic equipment gap and purchase for example these costly unmanned drones that can carry a missile or tv camera.

In civil aviation European manufacturers are reporting success.

Airbus, long-term competitor to America's Boeing, claims it's winning the sales battle, reckoning the winning ticket will be the super jumbo currently under
construction.

The A380 is already ordered by airlines such as Singapore Airlines and Quantas.

In Europe's political scene there were few great changes. Elections in France
and Germany returned the incumbent movements to power.

While in Turkey the success of a pro-islamist party was followed with its insisting that religion will play no greater role in that nation's administration.

But there were warning bells about the economies of some of Europe's
big-hitters.

Germany, more than a decade after reunification, has high unemployment and a gloomy economic outlook. Analysts say it;s proving harder than anticipated to spur productivity in the East.

Stefan Collignon, London School of Economics, "That will require additional investments, further transfers for many years to come, and it is likely that it will take at least two generations until one can say that the country will be fully integrated."

But there was good news in the broader European economic picture.

It was the year the single European currency attained parity with the US dollar.
The timing could not have been better.... Eurozone inflation was high - around
two percent - leading market analysts to predict a rise in interest rates.

Now they say the strength of the currency means that is no longer necessary

Hans Redeker, BNP Paribas, London, "We do see that long term capital flows are returning back into Euroland. We do see that Euroland is having a current account surplus. We are as well quite optimistic that economic reforms are taking place in Euroland once the German election is out of the way, so there are positive signs coming out of Euroland.

The Euro's record means too that some non-Euro nations, from the former eastern bloc to the gulf states, are considering better linkage to the currency -
threatening the US dollar's dominant position.

But in Britain it's the Pound Sterling that remains the currency of choice. That could change this year, when the British government announces whether it prefers the Euro.

Queen Elizabeth II, "My government will decide on whether to join the single European currency, on the basis of the five economic tests to be completed by next June."

This speech by the Queen, at the ceremonial opening of Britain's parliament for
its winter session, was a policy speech describing government plans for the
period ahead.

She gives no hint of personal opinion on the policies announced - and keeping
public emotions in check this year must have been quite a task according to some royal watchers.

It was a year of personal tragedies for the Queen.

Early this year the Queen lost her sister, Princess Margaret, who'd been
suffering from a sequence of illnesses.

Then the death was announced too of the Queen's mother, a widely recognised
symbol of the British establishment.

The death of the Queen mother, at 101 years old, prompted national mourning and a high cermonial funeral march through the centre of London.

But in spite of these sorrowful occasions, the Queen was seen to be more active than usual around and outside the UK, touring the Commonwealth in this her Jubilee year.

For the Queen, 2002 was a chance to compare changes worldwide over the fifty years that she has held the throne.