The Outlook for the Euro Changeover: A Summary and General Analysis (original) (raw)

1999, Journal of Consumer Policy

In this paper, the procedures and problems of the changeover to the euro are reviewed. The legal elements involved are discussed as are the psychological aspects. Various practical problems and proposed solutions are described. The possibility of resistance from the consumers in certain segments of the Member State populations is also addressed. One reason for any such resistance might be that for many citizens, the change of currency appears to have little bearing on their everyday concerns. Particular attention is devoted to the scenario for the period 1 January to 1 July 2002, during which coins and notes in euros and national monetary units can be in circulation at the same time. BACKGROUND The changeover to the euro on 1 January 1999 as provided for by the scenario adopted by the Madrid Council in December 1996 and the national arrangements in place launches a genuine dynamic process of transition. On 1 January 1999, the entire wholesale monetary environment and the exchange, financial and stock markets changed over to the euro. From this date, all types of enterprises, banks and financial institutions are able to change their accounts and activities into euros and to offer their goods and services legally in euros. Theoretically, the same is true of consumers and especially those who can benefit from using the euro, namely tourists, cross-border populations and savers. The monetary law, the Madrid scenario and the market mechanisms should therefore trigger off a dynamic process, leading to widespread use of the euro between 1999 and 2002, including among consumers for a whole series of economic, legal and sociological reasons. At the same time, there are many banks and companies which would like to take things more slowly and to wait until 1 January 2002 to make the changeover. The same is true of consumers, many of whom have no economic or political interest in changing over to the euro