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Why the Euro Was Created

The Euro is not just a currency, it’s an expression of a political ideal. Many of the chief architects of the Euro — such as the former EU commission presidents Jacque Delores and Jacques Santer; French presidents Francois Mitterrand and Jacque Chirac; and ex-German Chancellor Helmut Kohl — all either lived through or saw the aftermath of World War II in Europe. Never again would the continent come to blows like that, they said. The European Economic Community was formed in the 1990s, and this eventually became the European Union (or EU, for short). It was a key way that Europe’s political leaders thought they could secure peace and prosperity.

The big idea behind the EU (and ultimately the Euro) is a simple one. If you get nations to trade and share their institutions, then they are less likely to go to war. Cooperation rather than confrontation was the order of the day. It seems to be a valid principle, as Western Europe has been at peace for nearly seventy years and counting.

Throughout the 1960s, 1970s and 1980s, the EEC helped break down trade and cultural barriers between western European countries, including the big four (France, Germany, Italy and the United Kingdom). Generally, economies in Western Europe boomed and people got richer than they had ever been before. But with the collapse of Communism in the early 1990s, key political figures faced a choice. Either they carried on the EU as it was — merely a free trade zone — or they look ahead to a brighter European future of political and economic integration. They chose the latter by introducing a single currency; the Euro. Leaders of the majority of EU member states decided to go with the Euro and it was born in 1999.

There are 27 members of the European Union — which spans most of Europe, from Ireland in the west to the Russian border in the East. However, only 17 EU member states are also part of the Eurozone. These are the European Union states that have adopted the Euro as their sole currency. Some have not yet been allowed to join because their economies are weak (for example, Romania and Bulgaria); other nations have chosen not to for political and domestic reasons (for example, The United Kingdom and Norway).

The 17 nations of the Eurozone are

  • Austria

  • Belgium

  • Cyprus

  • Estonia

  • Finland

  • France

  • Germany

  • Greece

  • Ireland

  • Italy

  • Luxembourg

  • Malta

  • Netherlands

  • Portugal

  • Slovakia

  • Slovenia

  • Spain

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