Couple of questions regarding the Euro:
Anyone know when the currency for the European Union is scheduled to begin full circulation for the member nations (those that have opted to use the Euro, that is)?
What other member nations are still debating the switch to the Euro besides the U.K.?
THere’s another thread on this, but the euro currency becomes available on January 1, 2002. There was originally to be a transition of six months during which both euro and local currencies would be available, but that is probably going to be shortened to a matter of weeks.
Meantime, you can open bank accounts, write checks, or obtain travellers checks in euro … you just can’t cash 'em for euro, have to cash for local currency.
Off the top of my head, a few of the other countries about to join the euro are Greece and Denmark. The U.K. will eventually come along; it’s endorsed by businesses and politicians, but popular opinion is against it, so we shall see how courages the politicians are in pushing through an unpopular (but economically desirable) measure.
The wise and benevolent CKDextHavn has already answered your question, but you can read further here:
The site says
P.S. The website also says:
The UK and Denmark were not part of the first wave of countries to adopt the euro because they decided to use the “opt out” clause of the Maastricht treaty.
Greece and Sweden were not part of the first wave of countries to adopt the euro because the European commission decided that they failed to meet all of the “economic convergence criteria”.
Thanks, CKDextHavn and Arnold…I saw the similar thread and didn’t read through all the replies. I was primarily interested in the exact date when the Euro becomes “official” in terms of it being used as currency/coin in day-to-day transactions.
As a follow up, are there are sources, links, etc. discussing the political/economic ramifications if the British do NOT decide to use the Euro or delay its introduction beyond its present timeline? Granted, they probably will, but wanted to know if there had been any commentary/analysis on what would occur if they didn’t.
What happens if the UK doesn’t join the euro? There seem to be two answers floating around the political scene here…
(pro-euro) The UK economy will collapse. All foreign-owned businesses will pull out of the country, resulting in a depression which will put about 90% of the population out of work.
(anti-euro) The UK economy will boom. Foreign investment will pour into the country, and the UK will be saved from the Europe-wide depression which will put about 90% of its population out of work.
Take this into account when you’re reading through the euro-debate…I would suggest you read what The Economist has to say about it, but also keep in mind that anything anyone in the UK has to say about the euro is talking in hypotheticals.
Well, the Pound has held its own while the Euro has been falling like a rock.
How would the UK not adopting the Euro be any different than the US not adopting it(OK, so maybe we should adopt it, too)? Britain has historically considered itself as separate from the Continent, anyway, right? And besides, as sailor points out, the pound is one of the strongest currencies in Europe, if not the strongest. It seems to me that if they joined the EU, they’d be weighted down by stabilizing everyone else.
But that’s not necessarily a good thing, because it means that Sterling is appreciating against the currency of its major trading partner, the rest of Europe. This means that various export industries haver to contract.
Bear in mind that different groups in society want differnt things for the currency: exporters and import competitors want depreciation, importers and would-be outgoing tourists want appreciation. Over the long term, the “strength” of a currency is pretty much irrelevant to economic performance.
If the UK is going to continue to focus its trade within the EU, then it needs to be in the Euro if everyoine else is. On the other hand, the first time that there is a regional shock and the various electorates of the region release their national governments cannot adopt an independent fiscal policy the whole thing may well collapse.
picmr
The adoption of the Euro has cost the Bundesbank several hundred billion dollars. This is due to the need for the strong economies (Germany, Holland, etc.) to prop up the weak ones (Italy, France). The Eurpo really is about redistribution of wealth within Europe.
I would not care to be a German taxpayer at this point-they are subsidizing the Italian who is officially unemployed, but holds two (untaxed) jobs in the underground economy.
The message is clear to Denmark and the UK-stay out!
Yes, there has been a bit of a backlash in Germany against the euro for fear of giving away too much. Nevertheless, most Germans seem to support it nowadays, or at least feel resigned to it. Many who travel a lot (most Germans, in fact) are looking forward to not having to convert their money within the eurozone, and you can already convert at no commission or extra charge at official state banks (I did this myself once). Besides which, being anti-euro in Germany has something of a negative, right-wing/nationalistic image.
There was even a “Pro-DM Party” but it was run by an apparent charlatan and no one took it seriously.
Btw, only Greece was kept out of the euro-group for economic reasons. All others who aren’t yet in it (UK, Sweden, Denmark) have refused to join so far.
As one of the Member states, Ireland has suffered from the recent downturn in the Euro’s fate. The UK have reserved judgement on the Euro so that they can pick the best situation for themselves further down the road. Euro Member states that are refusing to enter into the Euro are only holding back the currency. If the Euro had full backing, It would be very strong indeed.
The “official” Euro website (see my link above) has a different opinion on Sweden. The way I understand what I read, Sweden was turned down by the European Commission. From the website:
but it used to be the Germans were initially against the Euro because they did not want the stability of the mark contaminated by other currencies. Then they joined the Euro and their bailing out East Germany has been the major cause of the fall of the Euro so, in effect, it has been the other currencies that were devalued by the Mark.
It is endorsed by some businesses and politicians and opposed by others.
As for whether or not it’s economically desirable, opinion is divided on that as well. There’s no question of joining at the moment, anyway, since the pound is way too strong and if we went in at current exchange rates it would cripple us.
Correction accepted, Tom.
And timing is everything. However, long-term, it’s hard to imagine the UK staying in the EU and yet having a different currency.
I’m sure we will eventually, but I suspect we’ll be one of the last Member States to join, if not the last.
Why should th UK join the euro ?
Surely the best place for a trading nation like ours is snugly in the middle of competing markets ( the USA and euroland .
If we can’t find a way to earn a quid or two from such a situation, then perhaps we should give up our democracy and join the european union .
The UK is already a member of the European Union. I don’t see our political system getting really any more or less democratic as a result.