Twenty years earlier, on 1 January 2002, the franc and eleven other currencies were replaced by a single European currency. In two decades, the euro, which has gone through several crises, has become a benchmark currency in the world, behind the dollar. Here is his story.
January 1, 2002 marked the arrival of a single European currency, ringing and stumbling across consumers’ wallets. In fact, the euro has been in existence since 1 January 1999. It is already legal tender and is exchanged against the dollar, but it is still the currency of exchange for financial markets and companies. And their adventure began ten years ago in 1992.
1992-1999: Towards a single European currency of the future
7 February 1992 The signing of the Maastricht Treaty between the community’s twelve member states (Germany, Belgium, Denmark, Spain, France, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and the United Kingdom) structured the European Union around three pillars: the European Community. , general foreign and security policy, and police and judicial cooperation in criminal matters. The European Union’s founding treaty, which entered into force on 1 November 1993, provides for, among other things, the creation of an Economic and Monetary Union (EMU): the euro is launched.
in December 1995, Madrid European Council adopts the name of the single currency of the future.
in June 1998With the aim of bringing European economies closer together, the European Central Bank (ECB) and the European System of Central Banks were created.
1 January 1999 The euro becomes the single currency of eleven member countries: France, Italy, Germany, Belgium, the Netherlands, Luxembourg, Austria, Finland, Spain, Portugal and Ireland. Four EU member states do not adopt the euro, including three for political reasons: the UK, Denmark and Sweden. As far as Greece is concerned, it will remain on edge until 2001 because it could not meet the economic criteria of the Maastricht Treaty in 1999.
After Greece, Slovenia will join the euro area in 2007, Cyprus and Malta in 2008, Slovakia in 2009 and Estonia in 2011, Latvia in 2014 and Lithuania in 2015. Today, the euro area comprises 19 member states of the European Union.
2002: Launch of the Euro
1Is January 2002, Coins and banknotes of the new single European currency are in circulation in the twelve member countries of the euro area.
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2009-2012: Greek Crisis
The 2008 financial crisis gradually turned into a sovereign crisis in the euro area. Despite the easing of the Stability and Development Treaty in 2005 and the European Anti-Crisis Plan of October 2008, the Greek crisis broke out in 2009. In November Greece announced a reduction of 12.7% instead of 5.7%.
8 December 2009 While global and European news at the time was dominated by the Copenhagen climate conference – COP15 – which began a day earlier, ratings agency Fitch announced its decision to lower the rating of the Greek public debt from A to BBB+ . negative attitude. This date marks the beginning of the Greek state funding crisis, which we feared would end the euro area.
In May 2010, The 30 billion first aid plan for Greece has been increased to 110 billion in April, accompanied by the creation of the European Financial Stability Fund, while the crisis spreads to other European countries: Italy, Spain, Portugal, Ireland. Central banks buy back public debt, austerity plans are implemented.
21 July 2011Europe is implementing a rescue plan for Greece and other countries in the region. Despite new measures taken to restore confidence in October, from November to December, the heads of the Greek and Italian government resigned and new elections were held in Spain. This political upheaval is accompanied by new austerity plans.
February 21, 2012Europe adopted a new rescue plan for Greece.
1 March 2012, The Treaty on Stability, Coordination and Governance has been adopted in the EMU.
in july 2012The new president of the European Central Bank, Mario Draghi (currently chairman of Italy’s Council of Ministers), allays concerns about the strength of the euro by announcing that the ECB will do “whatever is necessary” to save the euro area. .
entered into force September 27, 2012, The purpose of the European Stability Mechanism (ESM), created in March 2011, is to provide financial assistance to member states that are facing or at risk of serious financial problems. It is a crisis management tool for euro area countries to maintain their financial stability.
Today Greece has returned to the markets.
No aid program has been launched since 2015, a testament to the re-stability of the euro area. However, in 2020 the pandemic once again exposed European stability mechanisms, particularly in Italy. And the United Kingdom left the European Union on January 31, 2020, as part of Brexit.
What is the European Stability Mechanism (ESM) used for?
This little-known institution in France, located in Luxembourg, is the equivalent of a fire station in the euro area. Since the beginning of its existence, the MES has come to the aid of five countries (Greece, Ireland, Spain, Portugal, Cyprus) for a total of approximately 300 billion euros, with repayment for some extended until 2070. Greece returned to the markets.
Today, in the event of a financial crisis in one of the member states of the single currency, the ESM is ready to quickly raise up to 410 billion euros to extinguish the fire (it has 80 billion euros in funds, and the rest can be borrowed in markets). Is).
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