What Is a Euro?The euro is the newcurrency that manycountries that are partof the European Unionnow use. The symbolfor the euro is "€" andits abbreviation is"eur."
Europes Move Toward OneCurrencyStarting on January 1,2002, most Europeansexchanged theirchange and papermoney for a differentkind of coins andbanknotes. They tooktheir French francs,German marks, Dutchguilders, and othernational currencies tothe bank and tradedthem in for euros.
To help ease exchangerate volatility amongdifferent Europeannations, which hinderedinvestment bycompanies in variousstates, the EuropeanUnion (EU) developedthe European MonetarySystem in 1979. Thisconcept led to thecreation of the EuropeanCurrency Unit.
Over time, it became clearthat closer economicconvergence was neededamong European nations tobuild a stronger Europe. In1991, members of the EUapproved the MaastrichtTreaty, which called for asingle currency throughoutEurope for the 21st century.This currency came to becalled the euro and wasadopted by 12 of the 15member states of the EU onJan. 1, 1999. Theindependent EuropeanCentral Bank was created tooversee monetary policy.
The euro began life on January1, 1999, when exchange rateswith "legacy" currencies wereirrevocably fixed. For the first twoyears of its existence, it was onlyan electronic currency used bybanks.The first notes and coins wereissued with great fanfare onJanuary 1, 2002, when the eurobecame legal tender for alltransactions inAustria, Belgium, Finland, France,Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal and Spain. The old nationalcurrencies were phased out overthe next few months.
the euro became legal tender for all transactions in Austria, Belgium, Finland,France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal andSpain. The old national currencies were phased out over the next few months.The only EU states not to adopt the currency were Britain, Denmark and Sweden.The Danes rejected the euro by 53%-47% in a referendum in September 2000, butthe Copenhagen government is expected to call a second poll shortly. Sweden isdue to hold a referendum on September 14 this year.Many of the EUs 10 new members - Poland, the Czech Republic, Hungary,Slovenia, Slovakia, Estonia, Lithuania, Latvia, Malta and Cyprus - are expected toapply to join the currency when they become part of the Union in 2004.
• to create a more stable European economy thatwould invite competition and opportunity forbusinesses and markets• improve economic growth across Europe.• offer more integration among financial markets.• create a stronger European presence in the globaleconomy and develop a more politically unifiedEurope.
• While the euro has brought stability to European economies, thesystem does have limitations.• All nations that operate under the euro system must, by default, havethe same interest rate.• This has created strains on some economies, such as Germany. If itseconomy slows, the government cannot lower interest rates tostimulate growth.• Despite using a common currency, all European nations have notperformed equally economically.• While some nations experienced growth in exports, others were indecline.• While some have gained competitiveness, some have fallen behind.• The hope of some toward political unity is still far from the horizon.
Euro banknotes inall countries lookthe same, frontand back.
euro coins havedifferent designs onthe backs, dependingon which countrymade each one. thefronts are all the same,but each state uses itsown design on theback.
Notes, which come in denominations of500, 200, 100, 50, 20, 10 and 5 euros, areidentical throughout the EU.Coins carry national symbols on oneside and a map of Europe on the otherand are available in denominations of1 and 2 euros and 50, 20, 10, 5, 2 and 1cents.Notes and coins can be used anywherewithin the Eurozone, regardless ofcountry of issue.
• A recent poll found 45%of Britons want theQueen on euro coins ifthe UK joins up.• followed by 25%preferring Britannia.• 13% for the Houses ofParliament.• 5% for Shakespeare,• 3% for the Beatles and1% each for NelsonsColumn, Wembley andDavid Beckham.