Originally created 01/01/02

Countries make final preparations for switch to the euro

FRANKFURT, Germany -- For the last time, Europeans in 12 countries used only their old familiar money to catch the train, get breakfast or shop on Monday, with the midnight arrival of euro cash - the largest currency changeover in history - just hours away.

Signs of the impending changeover were visible all over, as many vending machines and other coin-operated services were already equipped to take euros, although the currency would not become legal tender in 12 of the 15 European Union countries until the stroke of midnight.

A one-euro coin (88 U.S. cents) dropped into a vending machine in Frankfurt, Germany, produced a bottle of Evian mineral water. Airport luggage carts in Austria, shopping carts in France, and cigarette machines in Germany were also equipped to take both national currencies and euros.

"I like the Deutsche mark well enough, but I think it's super that they're introducing the euro, that you can go to any country in Europe and pay with the same currency," said Dagmar Gruber, an optician's technician in Frankfurt.

Manfred Obels, a district manager for Burger King, said his restaurants were ready. "We ran some tests last night, no problem," he said.

His personal view was more skeptical. "There is a lot of show when they say this is of economic benefit," he said.

Banks might find it easier with one currency, but Obels pointed to his experience buying a croissant: the price in marks was 1.75, but the bakery converted that to one even euro, or 1.96 marks.

European Central Bank officials say as many people will lower prices as raise them when they round figures to euros during the transition, but consumer groups and many ordinary people are skeptical.

ECB and European Commission officials have staked their hopes for a rapid, hassle-free transition on two key measures.

First, almost all of the euro zone's 170,000 automatic teller machines should give only euros on New Year's Day or a day or two after. And second, most merchants will be giving change only in euros, under agreements between governments and major retail associations.

That should vacuum most of the old currency out of the economy within two weeks, if all goes as planned, though the old cash can still be used for up to two months depending on the country. National central banks will exchange the old money for years afterward. But the European Central Bank predicts most transactions should be all in euros by Jan. 15.

Officials in Germany on Sunday downplayed a story in the mass-circulation Bild newspaper that many merchants would refuse to accept marks after Jan. 1. Alone among euro countries, Germany made the euro its sole legal tender as of Jan. 1, meaning that legally businesses would be within their rights to not accept marks.

But the government has persuaded the major merchant associations to accept marks until Feb. 28, and officials at the influential Bundesbank say that the distinction has little practical significance.

The euro was actually introduced in 1999, when national currencies were pegged to it at fixed rates and ceased to be traded independently on currency markets. Since then, marks, francs, guilders and lire have essentially been local versions of the euro.

Bank account balances, stock prices and companies earnings reports, among many other things, are already spelled out in euros. But for many people, the psychologically important moment is when they can hold a euro in their hand.

European officials hope the introduction of the euro will boost economic growth by eliminating the costs and risks of currency fluctuations in crossborder trade, and will lead to closer integration of member countries' economies.

Around 15 billion banknotes have been printed for the occasion, with about 10 billion to go into circulation and the rest to be held in reserve. Some 52 billion coins have been minted. The total amount: 646 billion euros, worth $568 billion.

The 12 countries participating in the euro are: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain.


Trending this week:


© 2018. All Rights Reserved.    | Contact Us