Euro Statistics
- The European Central Bank has overseen production of:
- 10 billion euro notes
- 52 billion euro coins
- Total value: 664 billion euros
- Cost to business of preparing for euro: 11 billion euros
- Number of Coca-Cola vending machines in Europe modified to accept euros: 300,000
- Number of people for whom euro replaced national currency: 304 million
Overview
The arrival of the euro has been hailed by some as the most significant post-war development in European integration. European leaders agreed to introduce a single currency back in 1991 with the Maastricht Treaty, with the aim of strengthening European unity and promoting peace, stability and prosperity in Europe, and to aid the free movement of people, goods, services and capital.
Although European countries were able to trade electronically with euros from 1999, actual coins and notes were introduced on 1st January 2002. In fact, it was not in Europe, but New Zealand, half-a-day ahead time-wise, that the first coins and notes are reported to have been issued in exchange for New Zealand dollars on 1st January 2002, followed by the French colony of Reunion! During a transition period of up to two months both euros and the outgoing currency could be used, but by March 2002 the euro had become the sole currency for the 12 ‘eurozone’ countries.
Denmark voted by referendum not to adopt the euro, although there is talk of another referendum in 2003 to re-assess this. Sweden has not met the criteria required, although its government is in favour of the euro. Ten other countries in eastern and southern Europe may seek to join the eurozone, including the Czech Republic, Cyprus, Malta and Poland, if they succeed in meeting the required economic conditions. Andorra, Monaco, San Marino, the Vatican, and the French overseas territories, e.g., Martinique, Guadeloupe and Reunion, also use the euro. Kosovo and Montenegro have also already adopted the euro to replace the Deutschmark. In Switzerland, not a member of the European Union, some ATM machines issue euros as well as Swiss Francs, and euros are accepted in some stores and tourist spots.
The logistics of producing and distributing the new currency were massive and inevitably led to problems:
- French and Italian bank and post office workers launched immediately into industrial action in the first days of the euro although the effect was said to be limited.
- ATMs stopped working in Austria on 2nd January 2002.
- Robberies occurred throughout Europe, including a German driver of a security van delivering euros who robbed his own truck!
- Long traffic jams occurred on toll roads; outside Rome for example.
Heads or heads?
Polish statisticians claim that the euro coin is asymmetrically struck. In an experiment they found that when tossed 250 times, the Belgian euro coin came up 140 times with King Albert’s head.
Other issues and curiosities:
- Counterfeiters exploited unfamiliarity with the new currency, the first euro forgery being claimed by both the Germans (a twelve-year-old girl spotted a fake 50 euro note) and by the Irish (bogus 1 euro coins marked ‘eur’ instead of ‘euro’).
- A Frenchman successfully paid for his drinks with Monopoly money (which now comes in a euro edition) in the first days of the new currency.
- Complaints arose that some businesses rounded up their prices, particularly restaurants and cafes, although confusion sometimes worked in the customers’ favour.
- The 1 and 2 Euro coins have been found to cause an allergic reaction in some people due to nickel release from alloys.
Yet despite these hitches, the wider predictions of general chaos throughout Europe were not fulfilled and the transition ultimately deemed a success.
Out With The Old
An attempt at monetary union was made previously in 1865 when France, Italy, Belgium and Switzerland, and a year later Greece, signed up for the ‘Latin Monetary Union’, allowing for the mutual acceptance of each other’s currencies. This experiment was short-lived, with no central bank to exert any kind of control and too great a mismatch in economies.
French Franc
One of Europe’s oldest currencies, minted originally in the 14th century to pay a King’s ransom for the liberation of John the Good. American troops who liberated France from German occupation at the end of the 2nd World War brought 2F pieces minted in Philadelphia to return the Franc to circulation. In 1960, De Gaulle then introduced the ‘nouveau franc’ worth 100 old francs.
Deutschmark
Coins called marks have existed since the 9th century. In 1871 Kaiser Willhelm introduced a standardised Mark linked to the value of gold. The 1920s saw hyperinflation, when some 6000 towns, communities and companies were printing notes in the struggle to keep up with reparation payments in the wake of the First World War. In 1924 one American dollar was worth 4.2 billion paper marks. At the end of the Second World War Germany had no functioning currency. America printed Deutschmark and transported them to the Western zone. The Ostmark introduced to the Soviet occupied zone became obsolete in 1990 on reunification.
Italian Lira
The monetary system of the Roman Empire dates back to 212 BC. ‘Lira’ was the name of a currency in use in the Middle Ages, but the lira became a national currency in the 19th century, when the lira that Napoleon had reintroduced to Sardinia was subsequently chosen as a national currency upon unification of the Kingdom of Italy in 1860. Italy also saw inflation during the 1920s, and following the Italian invasion of Ethiopia, when Italians were urged to donate their gold, including their wedding rings, to the government. Surveys showed that Italians were amongst the most enthusiastic Europeans in favour of the Euro. The Vatican has issued 670,000 of its own euro coins, featuring the Pope. They were snapped up almost immediately by private collectors and are consequently very valuable, so if you should come across one, hold onto it!
Spanish Peseta
During the civil war of 1930, inflation was high under Franco’s dictatorship and the Spanish currency was divided into Nationalist and Republican peseta. After the war all remaining silver coins were taken out of circulation and notes issued by Bank of Spain. Again, Spaniards enthusiastically welcomed the euro.
In With The New
The euro notes are identical throughout Europe. Images of imagined but representative European architectural features were chosen, but one note had to be redesigned when it was realised that it depicted a real bridge in India. The European face of the euro coins was designed by a 39-year-old computer scientist from the Belgian Royal Mint. Each country has chosen its own national symbols for the reverse side, although they can be used in any country.
Names considered for the new currency included ‘florin’ and ‘ecu,’ the name of the currency previously used for official EU business, but the Germans rejected the latter, pointing out that it sounded too like the German for cow – ‘Kuh!’ Nevertheless, the word ‘euro’ apparently sounds similar to the Greek for urine! The Euro symbol was inspired by the Greek letter epsilon, in reference to cradle of European civilisation and also first letter of Europe. The parallel lines represent the stability of the euro. The official abbreviation is EUR.
What’s On The Back Of Your Euro Coins?
- Belgium: King Albert II
- Germany: Federal eagle; Brandenburg Gate; oak leaf
- Greece: Europa and Zeus; owl; ships
- Spain: King Juan Carlos; Cervantes; Santiago de Compostela
- France: Tree symbolising life; Marianne; revolutionary motto
- Ireland: Celtic harp and ‘Eire’
- Italy: Images by da Vinci, Raphael, Botticelli; Marcus Aurelius; Flavius amphitheatre
- Luxembourg: Grand Duke Henri
- Netherlands: Queen Beatrix
- Austria: Bertha von Suttner; Mozart; St Stephen’s Cathedral
- Portugal: Symbols and seals of 1st King of Portugal
- Finland: Heraldic lions; flying swans; cloudberry flowers
The UK Debate
The euro is still the subject of much contention in the UK, which is still to decide for or against its adoption. The government has set five tests to assess the success of the euro: whether the euro is good for jobs, foreign investment and the City, how the UK economy is faring in comparison to other eurozone economies, and whether there is enough flexibility for the UK economy to adjust when necessary. The government is also committed to a national referendum on the subject.
Opponents argue that the single currency erodes national sovereignty and ability to shape policy; that the policies of the European Central Bank may not be suitable for all countries, and that voters have less power to hold those making economic decisions to account. They point to the generally weak performance of the euro since its launch as a further reason not to join and that Britain has fared better than eurozone countries, particularly Germany, the eurozone’s largest economy, since the post-September 11th economic slowdown.
Those who disagree say that the adoption of the euro would allow British firms to be more competitive in Europe, as a strong pound is currently making exports unprofitable, and that it would enable a clearer comparison of prices and wages within Europe. The pro-euro lobby also argue that joining the euro is essential for the UK to assure its influence in European policy-making. As some large British retailers such as Marks and Spencer and Virgin Megastore begin to accept euros in the UK, and with some 40 million trips made by Brits to the eurozone countries every year, the euro is already becoming a fact of life in the UK, a process its detractors term ‘eurocreep.’