THE EUROPEAN UNION

1
THE EUROPEAN UNION
Lesson 6 How do individuals, businesses and
economies benefit from using the Euro?
2
The Euro

• In 1999, the euro area was established as a
  currency in eleven of the then fifteen EU Member
  States.
• Of the 27 EU Member States today, seventeen have
  adopted the euro. Estonia is the most recent
  member, having joined in Jan. 2011.
• One of the striking benefits of a single European
  currency are low interest rates due to a high
  degree of price stability.
• The euro is as stable and credible as the
  best-performing currencies previously used in the
  euro area countries.

3
Before the Euroa multitude of currencies

• Diversity of currencies
• Cumbersome inter-state trading
• Comparing prices more difficult
• Currency exchange can be unpredictable
• in contracts/ loans

4
The Euroa single currency for Europeans
The 12 countries which introduced the Euro in
2001

• Italy
• Ireland
• Luxembourg
• Netherlands
• Portugal
• Spain

• Austria
• Belgium
• Finland
• France
• Germany
• Greece

5
The Euroa single currency for Europeans
Can be used everywhere in the euro area 4Coins
one side with national symbols, one side
common 4Notes no national side
New Euro countries since 2001
EU countries using the euro in 2011EU countries
part of ERM II (in between) EU countries not
using the euro

• Cyprus (2006)
• Malta (2006)
• Slovakia (2008)

• Slovenia (2009)
• Estonia (2011)

6
Some of the Euros benefits

• European Central
• Bank keeps price
• inflation low so
• interest rates also
• remain low
• Currency
• exchange costs
• are eliminated

• International
• trade is
• facilitated
• Inflation remains
• low and stable

• Travelling is made
• easier
• Comparing prices
• is made simpler

7
United in Diversity - The uro
8
United in Diversity - The uro
9
European Central Bank

• The European Central Bank (ECB) is the central
  bank for Europe's single currency, the euro.
• The ECBs main task is to maintain the euro's
  purchasing power and thus price stability in the
  euro area.
• The euro area comprises the 17 European Union
  countries that have introduced the euro since
  1999.
• The ECB operates independently from Member State
  governments.

The euro was introduced in 1999