The Eurozone

January 1, 2002 was the dawn of a new era, opening a new chapter in European history as twelve of the countries in the European Union issued their new euro banknotes and coins. It was the culmination of a six year programme to design and print over 14 billion euro banknotes and mint 50 billion euro coins. A mammoth undertaking! Around ten billion banknotes were put into circulation immediately, replacing national banknotes, while the rest were held in reserve to replenish stocks.

Though they are not members of the EU, Monaco, San Marino and the Vatican City (but not Andorra) also have euro coins featuring a national side. These coins only occasionally end up in general circulation as their scarcity leads to greater interest from coin collectors.

Although the euro was only formally put into circulation on January 1, 2002, the idea of creating "an ever closer union among the peoples of Europe" has been around for decades-as stated in the Treaty of Rome in 1957. In 1979, the European Monetary System (EMS) was introduced and locked exchange rates among participating countries. On January 1, 1999-the euro was born when the participating countries established exchange rates between their own currencies and the euro creating a monetary union. It took three years of transition, where the euro was only used as electric money, until actual euro notes and coins were used.

Non-Participating EU countries

Denmark: Obtained an opt-out of joining the euro after voters initially rejected the Maastricht Treaty in a referendum in June 1992. A referendum held in September 2000 to detitleine whether to join the single currency was rejected by 53 to 47 percent. The Danish government announced in January 2002 that a second referendum on the issue will be held, although no date has yet been set. The Danish currency is still participating in the Exchange Rate Mechanism (ERM-2) and is pegged within a 2.25% band against the euro.

Sweden: Joined the EU in 1995 with no opt-out on adopting the euro. The Swedish government announced in January 2002 that it intends to hold a referendum in 2003. The date for the Swedish referendum has now been set as 14th September 2003.

United Kingdom: Negotiated an opt-out of joining the euro in the Maastricht Treaty. The current Labour government is committed to holding a referendum when it detitleines that the economic conditions for joining are right.

New European Union members

Potential new European Union candidates must, just as the past members, go through a two-year rate of exchange phase first, before they are taken up to the monetary union. This means, that it will take quite a few more years before coin collectors start looking for euro coins from the new participating countries. According to Heinrich Wollny, responsible for European Union extension matter in Brussels, the introduction of the common currency in a member state requires that clear conditions are fulfilled. The preparation on the euro takes place in three phases:

• The pre-entry phase, in which the entry candidate must prove that he made unreversible progress toward a functioning free-market economy and competitive ability, as well as lasting macro-economic stability
• The time between the entry and the adoption of the euro, in which the new member participates in the domestic market. In this phase the candidate country must make progress to fulfill the necessary convergence criteria
• The entrance into the monetary union, provided that the candidate country fulfills the convergence criteria, which apply to all member states. This can happen at the earliest 2 years after the European Union entry, as the candidate country must participate for at least two years in the exchange rate mechanism.