by Anthony Parente

On January 1, 1999 a new single currency was implemented in 11 participating countries. These 11 countries are: Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Portugal, and Spain. Two years after it was implemented Greece adopted the euro and became the 12th country to participate in a single currency system. The single currency unit was brought about by Title II of the Maastricht Treaty. In order for Member States to participate in this system they must achieve certain conditions set forth by the treaty. Each country needs to reach a desired range on exchange rates, inflation, interest rates, public debts, and public deficits. These are important areas that must be met. If one country faces an economic crisis than all countries using the euro will also feel the effects.

It wasn't until January 1, 2002 that the euro became the official currency of the participating Member States. This is when all bank accounts, pensions, bonds, salaries, etc. were to be converted to the new currency. There is however a two-month transition period in which you can use either the new euro or your national currency as legal tender. Just note that if you use your national currency you will get euros back as change. The official last date to use your old currency as legal tender is February 28, 2002, but there has been some talk of extending this deadline. Once the deadline has arrived you will only be able to exchange lira for euros at the bank. You can calculate how much euro you will have by using the fixed conversion rate, which has been set for each participating country. For Italy 1 EUR = 1936.27 Lira.

A project of this magnitude is not going to go off smoothly. There is always going to be some problems that you may encounter. The biggest problem will be to familiarize yourself with the new currency. This will help you prevent people from trying to give you the wrong change or even the wrong currency. In all there are seven new euro notes and eight new euro coins. The seven notes consist of a 5, 10, 20, 50, 100, 200 and 500 euro. Each bank note has various security features, which will help you to ensure that you are not receiving counterfeit euros. The eight coins will be a 1, 2, 5, 10, 20 & 50 euro cent plus a 1 and 2 euro. The front of each coin will have the same exact design for all member states. The back of each coin will contain a different design for each country. The coins are still interchangeable and can be used in any participating country regardless of what image is located on the back. It is important to look at what you are getting back. It appears that some of the new coins have the same characteristics as coins from old currency or other countries. The distinct difference will be the design located on the front and back of each coin.

I am sure many people are opposed to this new currency and will resist change as long as possible. There are some benefits to this new system. The one major advantage will be the ability to travel to member states without the worry of exchange rates, price comparisons, shopping around for the best rate or commission on exchanges. What are your thoughts on this new currency system? Stop by the Italian Culture forum and voice your thoughts and concerns about the euro.