There is much press coverage about the testing times the euro will face in the coming weeks. In true French/Italian fashion, a bank strike - supposedly over pay and conditions - meant that some people faced problems getting hold of the new notes as ATM's ran out.
In the western French town of Nantes, ATM’s refused to give anything out over the New /Year period. In Spain, queues outside banks were long and frustrating. In the Canaries, it was virtually impossible to get hold of peseta coins over Christmas as banks horded them for sending off to smelting plants.
The German public has made it clear they don’t want the euro anyway and it is expected the transition will take longer than the two to three weeks predicted by Deutsche Bank. But if these ‘teething’ problems were not bad enough then for the man in the street, worse is to follow.
Twelve versions of the same coin
The new coins are very confusing for anyone travelling inside the eurozone because each country has its own version of the coinage. Although they are all the same size and made up the same way, one side of each coin is individual to each country. So even though one can use euros anywhere among the 12 participating countries, individuals and traders will need to become familiar with 12 ‘versions’ of the eight coins in circulation.
At first glance, the one-euro piece is very similar to the one-franc piece and can be used interchangeably in shopping trolleys to remove them from their supermarket cages – despite the fact the one-euro is worth 6.65 francs. To make matters worse, the two-euro coin looks as though the same people that do chocolate coins minted them.
The dual-currency phase
The most confusing aspect is the current hiatus while we go through the schizophrenic dual-currency phase. This is a rotten idea. Petrol station customers for example are getting confused between litres bought and the amount to pay. Last week I saw a customer who came perilously close to paying for 60 litres of fuel…for his scooter!
Some organisations like airport and railway station car parks are suggesting people use their bank or credit cards as a way of avoiding handling the currency. That’s one way of doing it.
Will it get any better? Those old enough to remember the time when the UK went for pounds, shillings & pence to pounds & pence will recall there was a short period when folk struggled but we quickly got used to the new coinage. The real struggle is in figuring out the extent to which prices have changed. Despite the inclusion of codes of conduct designed to avoid profiteering some organizations, especially hotel and retail organizations, are rounding up. It’s only a small amount in some countries but on average some people reckon the general level of price hike will be around 2 per cent.
Using the euro by default
The burning question now will be the extent to which UK retailers end up using the euro by default. Traders in the Ashford area for example have said they will accept euros alongside sterling. But that assumes currency fluctuations between sterling and the euro are minimal. One can safely assume that traders who accept the new currency will see this as an opportunity to make a few extra bob (sorry pence) by operating their own exchange rate.
By the time you read this, I will have travelled using at least three currencies inside the eurozone so I’ll let you know just how confusing it really is – especially in Italy where I am confident I’ll be handing over lira and euros in the same transaction. I have my trusty euro converter calculator safely packed, just in case.
Oh yes – there is an upside to the change. The now defunct European coins and notes are already becoming collectors’ items. Check your change!