The Euro

THE EURO

Kitane, Mapoy,

Oblepias

HISTORY OF EURO

● 1992 - The euro was established by the provisions in the

Maastricht Treaty.

● 1995, Aug 4 - Esperantist Germain Pirlot sent a letter to then

President of the European Commission, Jacques Santer to

name the currency as “Euro”

● 1995, Dec 16 - The name "Euro" was officially adopted in

Madrid

● 1998, May 2 - to establish the fixed conversion rate for each

national currency, they used the bilateral rates of the

Exchange Rate Mechanism(ERM). In order not to modify the

external value of the European Currency Unit (ECU).

HISTORY OF EURO

● 1999, Jan 1 - introduced in non-physical form (traveller's

cheques, electronic transfers, banking, etc.)

● 2002, Jan 1 - Euro notes and coins became legal tender

● 2002, July 1 - The German Mark, French Franc, Italian Lira,

and other local currencies ceased to exist

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the European Central Bank started implementing

monetary policy of the countries using Euro as

currency.

MEMBER COUNTRIES

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Austria

Belgium

Cyprus

Estonia

Finland

France

Germany

Greece

Ireland

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Italy

Latvia

Luxembourg

Malta

The Netherlands

Portugal

Slovakia

Slovenia

Spain

HOW DOES IT WORK?

Countries who wished to participate in the euro had to pass some economic tests referred to as convergence

criteria:

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The country's annual government budget deficit cannot exceed 3 percent of gross domestic product

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The total outstanding government debt cannot exceed 60 percent of GDP.

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Country's rate of inflation must be within 1.5 percent of the three best performing EU countries.

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(to push down inflation rates and encourage more stable prices)

The average nominal long-term interest rate must be within 2 percent of the average rate in the three

countries with the lowest inflation rates.

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(Interest rates are measured on the basis of long-term government bonds and/or comparable...