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31 December 1998 was the highly awaited big day (or night to be more
exact), when the conversion rates between the member currencies and the
Euro were irrevocably fixed. This moment practically ment that well
known currencies such as the German marc, French franc, Austrian
schilling, Italian lire, Spanish peseta and so on, finished their
carreers. Although legally they still exist, from that moment only as
the „non-decimal sub-divisions” of the Euro, just like fillér to forint
in Hungary. But as the Euro did not exist yet in cash form, it could
only appear through the money transfers. At the same day (to be more
exact on 1 January 1999) the acts and treaties related to the Euro came
into legal force.
After the New Years’ Day of 1999 ECB took over the roles of the national
cenral banks. This organisation carries out interventions against other
currencies and executes monetary policy. From this time on member states
can only issue securities in Euro.
It was also the time when citizens started to become more interested in
the new currency. There were advertisements before 1999 too, but it was
the time when they really had to face the facts as every commercial unit
had to use double pricing, which means they had to indicate their prices
in both there normal currency and in Euro. For the exchange the exact
given rate had to be used with mathematically correct rounding to the
level of Eurocents. Demanding commission for the exchange was
prohibited, as the conversion between the currencies of the Eurozone and
the Euro is not considered a real exchange. From January 1999 it became
possible to have an account in Euro in any commercial banks. These
institutes had to use the same conversion method, meaning that no one
was supposed to suffer any monetary loss when changing the Eurozone
currency to Euro, except for that few Eurocents, which can not be
counted in.
Later the originally planned half-year period of coexistance
considerably shortened and there was no given date, everyone had the
right to decide the time of the final transition. The most extreme
choice was Germany’s. They picked the date of 31 December 2001 as the
deadline of accepting marc, which means theoretically there will not be
any moment when one can choose between using marc or Euro. The majority
of countries selected 28 February 2002 as the date of putting the local
money out of commission, while France, The Netherlands and Ireland chose
another date between the previous ones.
The main task of the following period seems to be to teach the citizens
to be familiar with operations using Euros. Although they had already
seen prices in Euros, they had not used it till then, so they still
calculated and compared prices in their traditional currency. The main
reason was that most of the prices looked „good” in the local money, but
looked „strange” in Euros.
The other big challange was to produce all the required cash amount,
then distribute it. But apart from the local transition, when the 12
Eurozone states’ 300 million inhabitants had to be supplied with Euro,
they even had to carry out the replacement for anyone possessing an EMU
member currency, for example someone in Hungary with schilling, marc,
lire or any of the others. Of course, this one was not as urgent as it
was in the region where Euro became the official money, but in one or
two months even they had to face the difficulties of the transition.
Notes and coins
There are 15 denominations of the new European currency. 8 coins ranging
from 1 cent to 2 Euros, 7 notes from 5 to 500 Euros. The design of the
notes is the same in every state, while the coins have the same front
side, but different backside showing the countrys’ national symbols. It
does not mean that there will be different coins in every states, but it
allows them to still have their symbols on some of their money.
The notes were designed by the graphic artist of the Austrian National
Bank, Robert Kalina, the coins by a 39-year-old Belgian computer
scientist, Luc Luycx. The design of the notes was accepted in the Dublin
Summit in 1996 and the coins’ in July 1997 in Amsterdam. The front side
of the coins features a map of the EU states (on the 1 to 5 cents The
Globe with Europe in the middle to be more accurate) and the back
different national symbols. The design and composition of the notes,
like many other European currencys’, is based on German marc.
The front side of the coins shows the continent from three points of
view. On the copper-coloured 1, 2 and 5 cents „Europe in the world”, on
the golden 10, 20 and 50 cents the „Nations of Europe” and on the
golden-silver 1 and 2 Euros „Europe without frontiers”. This last
description includes a little inconsistency, as even these coins
illustrate the Eu member states with slightly visible frontiers. The
back side of the coins causes the diversity of the Euro. In some cases
the features of the old coins were simply put on the Euro coins, but it
is really understandable, as they were the national symbols of the
states and they will be in the future too. By the end of the transition
more and more EU member states considered costumizing the new currency
and having their national symbols on the coins.
Euro accounts
Conversion of the bank accounts is another important element. This
procedure is far more simple than the cash conversion, as it only
requires technical operations. The only thing that the bank has to do is
to operate the account both in Euro and the local currency. Deposits
were converted to Euro during the summer of 2001 and from that time the
value in the local money only had informational purposes. Every state
could decide on the extents of freedom of their banks, but from 2002
every account has to be only in Euros.
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