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Text File | 2014-09-23 | 9KB | 125 lines

<HTML>Banks in some non-zone countries (e.g. Great Britain) are offering euro-denominated accounts, advantageous to persons and firms who do much business in the zone. Of some practical interest to others: if you've seen the item in another country also priced in euros, it will be easy to see which is the better buy. As well, if you know the euro rate to the local currency you'll be able to see if the item is priced the same in both local currency and the euro. No, it's not a typo for "era", though the euro's birth does usher in a new era in travel to Europe. What is the euro? A common European currency worth (on 1.1.99) about $1.17 (US) which will replace the franc, the mark and most other European curencies. But it's a virtual currency for now. It has little impact on most travelers, yet. Though you'll begin seeing it on pricetags and elsewhere on your next trip to Europe. Where The euro arrived on January 1, 1999 and will, over the next three and one-half years, replace the existing currencies within the eurozone comprised, initially, of: Germany France Italy Finland The Netherlands Portugal Spain Ireland Austria Belgium Luxembourg Missing? Great Britain, Switzerland, Sweden, Denmark, Norway ... Greece, and eastern Europe. Great Britain, Sweden and Denmark will almost certainly participate ... some day. Greece must improve its economic performance before being permitted to join. Norway and Switzerland will have to resolve EU (European Union) membership issues before considering EMU (European Money Union) participation. One speculates some eastern bloc countries will join the EU and eurozone in the future. How Much How much is a euro? How many to the lira, mark or franc? On December 31, 1998 the EC (European Community) through Council Regulation No 2866/98 set the following rates: One euro = 40.3399 Belgian francs 1.95583 German marks 166.386 Spanish pesetas 6.55957 French francs 0.787564 Irish pounds 1,936.27 Italian lire 40.3399 Luxembourg francs 2.20371 Dutch guilders 13.7603 Austrian schillings 200.482 Portuguese escudos 5.94573 Finnish marks These rates are set irrevocably, fixed and will not change in the future. We expect standard currency exchange postings in newspapers and on the Internet will soon include the dollar to euro rate (and of course pound, ruble, krona, etc. to euro as well). No official rate to non-zone currencies as yet. Assume for now, 1 euro = approximately $1.17 US Dollars (USD); 1 US Dollar = approximately 0.85 (EUR) To repeat: the rate of exchange between the euro and non-eurozone currencies (e.g. dollars, pounds,rands) will fluctuate: the euro to eurozone national currency rates have been fixed irrevocably. The eurozone currencies themselves will cease to be legal tender after 30.6.2002. When and What Until 2002 the euro will be a virtual currency used within the eurozone for such paper transactions as corporate financial statements, banking, stock and bond trading, and for the settlement of international payments. Many will be able to write checks denominated in euros. For those outside the eurozone, credit-, charge- and cash- card statements will show transactions made within the eurozone in euros, rather than the local currency marked on the pricetag. But there will be no euro currency in circulation until January 1, 2002. For those considering buying euro-denominated travelers' checks (TCs): they can't be spent as such. They will have to be converted to local currency. If you have any left over you'll take an exchange loss back home reconverting them to dollars. At least for the moment our advice remains: buy US dollarTCs. Visitors will immediately see some price tags carrying two prices: one in the local currency; one stated in euros. This practice may begin slowly but will proliferate during the 3-1/2 year transition period. Shops adopting the practice and adhering to certain requirements will display signs reading "We accept payment in euros" in 8 languages. France is already printing a dual-denominated postage stamp and euros have begun showing up on pricetags in French shops. Banks in some non-zone countries (e.g. Great Britain) are offering euro-denominated accounts, advantageous to persons and firms who do much business in the zone. Of some practical interest to others: if you've seen the item in another country also priced in euros, it will be easy to see which is the better buy. As well, if you know the euro rate to the local currency you'll be able to see if the item is priced the same in both local currency and the euro. For most of us, though, the major change won't occur until euro currency appears in 2002. Note the euro should not be confused with ECUs or Eurodollars. The latter is a specialized financial instrument that has been around for years and fundamentally reflects the influence and presence of the US dollar in Europe. The ECU (European Currency Unit) has been used as a virtual currency by European Union institutions until the end of 1998, as well as by many other intra-European entities. Also, the introduction of the euro has no effect on tax rates. As in the US, sales and value-added taxes (e.g. IVA, Mwt) as well as others (e.g. car rental, hotels) will continue to vary from country to country despite the common currency. Six-month Changeover Euro notes and coins will appear January 1, 2002, and by July 1, 2002 will have entirely replaced the national currencies in eurozone nations. (Presumably you'll be able to exchange leftover currency through government agencies.) How to Say It/Write It It's pronounced, in English, as "your-oh". The graphic symbol for the euro is a stylized "C" with two horizontal, parallel lines across it: , turning the "C" into a fancy "E". This suggests a combined "E/C" perhaps representing "eurocurrency". Unless you have fonts and operating system support installed (e.g. Win '98) which include the euro symbol you won't be able to type it or display it on your computer screen. The official abbreviation is EUR, congruent with DEM, FRF and USD, for example. Capitalization depends on the language of the country. Note euro is not capitalized except in German. Pluralization is also country-dependent. The plural of euro in England is euro, at variance to common English currency-name practice. In France, on the contrary, the plural is euros. We opine practice in the US will vary from the "mother" tongue and more than one cent will be called cents. Your guess is as good as ours on the euro, though we'd guess euros is (are?) likely to win out in the end. The fractional part of a euro (1-1/100th) is called a cent; capitalization and pluralization follow the eurolead. You'll find a language-by-language guide at the Error! Bookmark not defined.. Why Simply put, the European countries are, today, a single market. A single currency will make this even more so, and more efficiently. The eurozone, not to be confused with the erogenous zone, has more inhabitants than the US, though just slightly less economic mass (e.g total GNP). Many believe a common currency will lead to improved economies in participating countries, greater availability of capital, more jobs and lowered prices. In the short term it will likely cause some temporary dislocations as more efficient producers replace the less efficient. For the traveler, the convenience of a single currency on a multi-country trip should be obvious. As well, we suspect some myths of "good buys" will disappear, and sources of truly good buys will become more obvious over time as common items are priced in a common currency. Paper Money and Coins There will be seven varieties of paper notes: 500, 200, 100, 50, 20, 10 and 5. The design will be common throughout the eurozone. Coins will be issued in eight denominations: 2 and 1 euro, and then, in euro cents, 50, 20, 10, 5, 2 and 1. Each denomination will have a common face throughout the eurozone. The reverse side, however, will be decorated uniquely by issuing countries. All will be valid throughout the participating countries regardless of state of issue or the particular design. (You may buy your wurst sandwich in Munich with a 2 euro coin bearing a likeness of the Louvre on the reverse.) You'll find this article on the web at http://twenj.com/euro.htm ... a page we will update as new information about the euro becomes available. Ed Gehrlein http://twenj.com euro@twenj.com</HTML>