1. History of the Euro
Ray McGuinness
BA 543 – 6/4/13

2. First, some numbers
Europe’s Population: 730 million in 47 countries
USA: 313 million in 50 states
European Union: 27 members states
17 use the Euro (€) officially
€ 920 billion in circulation worldwide
Second largest reserve currency
Used by more than 500 million people worldwide

3. How’d We Get Here?
1920s: League of Nations
1951: European Coal and Steel Community (ECSC)
1958: European Economic Community (EEC)
1979: European Currency Unit (ECU)
1992: Maastricht Treaty created the European Union and the Economic and Monetary Union (EMU)

4. Let’s Make a Currency!
Maastricht Treaty agreed to the formation of a central currency by 1999.
Euro name suggested by a Belgian teacher.
Member Nations would have to meet requirements

5. Creation
European Central Bank & European Commission assessed Member Nation health and fixed currency rates on December 31, 1998.
January 1, 1999
Euro is created in digital form
January 1, 2002 after minting €7 billion in bills and €38 billion in coins the Euro officially hit the streets

6. How’d that go?
Countries had to abandon their sovereign currency after two months
ATMs, Banks, and Vendors
Central Bank monitors and controls monetary policy for all member nations
Surprisingly smooth transition
Little to no raise in prices

7. A decade later…

8. Current State of Eurozone
17 Members Nations
No member nation has ever withdrawn.
GDP: €9.5 trillion
European Central Bank & the Euro Group
Bailouts and the Sovereign Debt Crisis

9. Struggles
No centralized government
Two Speed Economies
Raise or Lower Interest Rates?
Loss of sovereignty and control

10. Advantages
Elimination of exchange-rate fluctuations 
Price transparency
Transaction costs 
Increased trade across borders
Increased cross-border employment
Expanding markets for business 
Financial market stability 
Macroeconomic stability 
Lower interest rate 
Structural reform for European economies