Currencies of the European Union
There are twelve currencies of the European Union as of 2014, the principal currency being the Euro. The Euro is used by the institutions of the European Union and by the Eurozone states, which account for 18 of the 28 member states of the European Union. All but two states are obliged to adopt the currency; Denmark and the United Kingdom, through a legal opt-out from the EU treaties, have retained the right to operate independent currencies within the European Union. The remaining eight states must join the ERM II and attain the third stage and adopt the Euro eventually.
The euro is the result of the European Union's project for economic and monetary union which came fully into being on 1 January 2002. and it is now the currency used by the majority of European Union's member states, with all but three bound to adopt it. It is the currency used by the institutions of the European Union and in the failed European Constitution it was to be included with the symbols of Europe as the formal currency of the European Union. The euro is also widely used by other states outside the EU.
||This article possibly contains original research. (January 2012)|
||See below||1999/2002||Used by the institutions|
||Currency board||2007||Euro target date cannot be before 2017|
|British pound sterling
| United Kingdom
||Floating||2013||no current target date|
|Czech koruna||Czech Republic||Kč||
||Floating||2004||no current target date|
||Floating||2004||No current target for euro|
||ERM||2004||1-1-2015 official target date |
||Floating||2004||No current target for euro|
||Floating||2007||Euro target date cannot be before 2017|
||Floating||1995||De facto opt-out|
|Swiss franc||Campione d'Italia (Italy)||Fr.||
||Floating||1957||Also unofficially used in Büsingen am Hochrhein, Germany. Swiss Franc is issued by Switzerland.|
- Note that there are other currencies used in overseas territories of member states. Those territories however are not part of the European Union proper (legally subject to all its law) so are not listed here.
EU law and treaties application to Northern Cyprus is currently suspended. Its territory is claimed by the Republic of Cyprus, one of the EU member states, but currently Northern Cyprus is under Turkish Republic of Northern Cyprus (TRNC) control. TRNC isn't recognised by the Republic of Cyprus (which claims jurisdiction over the whole island) and the European Union.
Presently, the TRNC government has declared the Turkish lira (TL,
TRY) to be its legal tender. TL is not issued by any EU member state, but by Turkey and it has a free floating regime. Nevertheless usage of the Euro in Northern Cyprus is already high in practice.
The United Kingdom was given an opt-out from the euro in the Maastricht Treaty when it became the only state not to reach a compromise regarding currency issues. Denmark gained its opt-out after the Danish electorate rejected the treaty in a 1992 referendum and Denmark was given four opt-outs in order to pass the treaty.
Sweden then held a referendum in 2003 even though it was obliged to adopt the currency and it was rejected by the Swedish electorate. The European Commission stated it would respect this decision for now but not tolerate similar moves from countries that join the EU after the euro is introduced. Hence, the British, Danish and Swedish currencies are not obliged to be retired, however Denmark is considering dropping its opt-out (see future below).
Those European Union states that have adopted it are known as the eurozone and share the European Central Bank (ECB). The ECB and the national central banks of all EU countries, including those who operate an independent currency, are part of the European System of Central Banks. Before a state adopts the euro, its currency has to spend at least two years in the European Exchange Rate Mechanism which pegs it to the euro within a fixed band. Currently two currencies are in ERM, including the Danish Krone which has an opt-out. The Bulgaria lev is also pegged via a currency board.
|Austrian schilling||Austria||S or öS||
||1999/2002||40.3399||Interchangeable with Luxembourgian franc (BLEU)|
|Dutch guilder||Netherlands||ƒ or fl.||
|French franc||France||₣, F or FF||
||1999/2002||6.55957||Linked to Monegasque franc, both valid in France, Andorra and Monaco.|
|Greek drachma||Greece||Δρχ., Δρ. or ₯||
|Italian lira||Italy||₤, L. or LIT||
||1999/2002||1,936.27||Linked to Sammarinese & Vatican lira, all valid in Italy, San Marino and the Vatican City.|
|Luxembourgian franc||Luxembourg||fr. or F||
||1999/2002||40.3399||Interchangeable with Belgian franc (BLEU).|
|Maltese lira||Malta||₤ or Lm||
|Portuguese escudo||Portugal||or $||
|European Currency Unit||Accounting only||₠, ECU or XEU||
||1999/2002||1||Accounting currency alongside national currencies until the euro introduction.|
Except for the two states with opt outs, all current and future members of the EU are obliged to adopt the Euro as their currency, thus replacing their current ones. Denmark, which has an opt out, is expected to hold a referendum on its opt-outs due to increasing pressure to adopt the Euro. The Danish Kroner is already pegged to the Euro, and Denmark has fulfilled all the requirements for adoption.
- Who can join and when? - European Commission
- Swiss franc is the official currency and euro is widely accepted.
- But capped as of September 2011
- Euro is the officially currency, but the Swiss franc is commonly used
- Protocol 10 to the Treaty of Accession 2003 (OJ L 236, 23.9.2003, p. 955).
- De Facto Classification of Exchange Rate Regimes and Monetary Policy Frameworks, IMF 2008
- Hadjicostis, Menelaos (30 December 2007) In north Cyprus, the Turkish lira is the official currency, but euro is embraced, International Herald Tribune
- Cyprus and Malta adopt the euro BBC
- Cyprus' isolated north will be enthusiastic – if unofficial – euro users
- cite web|http://www.investopedia.com/terms/c/currency_board.asp
- Replaced alongside French franc with euro
- Replaced alongside Italian lira with euro
- The euro - European Commission