THE EUROPEAN UNION How do individuals, businesses and economies benefit from using the Euro?
The Euro • In 1999, the euro area was established as a currency in eleven of the then fifteen EU Member States. • Of the 28 EU Member States today, seventeen have adopted the euro. Estonia most recently joined in 2011, and Latvia is expected to adopt the euro in 2014. • In response to the economic and financial crisis, the EU created a new set of rules on enhanced EU economic governance which entered into force in December 2011. € € €
Before the Euro: a multitude of currencies • Cumbersome inter-state trading • Comparing prices more difficult • Currency exchange can be unpredictable • in contracts/ loans
The Euro: a single currency for Europeans The 12 countries that introduced the Euro in 2001: • Austria • Belgium • Finland • France • Germany • Greece • Italy • Ireland • Luxembourg • Netherlands • Portugal • Spain
The Euro: a single currency for Europeans Can be used everywhere in the 17-country euro area Coins:one side with national symbols, one side common Notes:no national side New Euro countries since 2001: EU countries using the euro in 2013 EU countries not using the euro • Slovenia (2009) • Estonia (2011) • Cyprus (2006) • Malta (2006) • Slovakia (2008)
Some of the Euro’s benefits • International • trade is • facilitated • Currency • exchange costs • are eliminated • European Central • Bank keeps price • inflation low so • interest rates also • remain low • Travelling is made • easier • Comparing prices • is made simpler
European Central Bank • The European Central Bank (ECB) is the central bank for Europe's single currency, the euro. • The ECB’s main task is to maintain the euro's purchasing power and thus price stability in the euro area. • The ECB operates independently from Member State governments. • The euro area comprises the 17 European Union countries that have introduced the euro since 1999. The euro was introduced in 1999