| Commission takes stock of euro preparations |
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A recent report from the European Commission reveals that the state of preparation for euro changeover across the continent is patchy. According to Pedro Solbes, the Commissioner responsible for economic and monetary affairs, the report represents ‘mixed’ news. ‘The good news sits alongside continuing sources of concern. Urgent efforts must be made to encourage SMEs and gradually to step up information campaigns for consumers.’
Overall the report found that preparations by large businesses across Europe are making satisfactory progress. However, SMEs are still lagging behind. Just under half of them, for example, still do not have an action plan for the changeover to the euro. Almost one business in three has not yet realised that 1 January 2002 is the final date for operating entirely in euros. Solbes calls for the information campaigns directed at SMEs to be continued and stepped up.
According to the report the European banking community has followed the Commission’s Recommendations of 11 October 2000. The industry ‘is pursuing a very active policy of preparing for the euro that generally includes an early switchover to it in relations with their customers. The adaptation of automatic cash dispensers in 2002 should be very rapid, if not immediate, in most participating Member States and, as a rule, they will dispense small-denomination notes, thereby helping to reduce the problems that traders encounter in giving change. The exchange of national notes for euro notes will be free of charge and unlimited in most participating countries during the period of dual circulation. In practice, banks have played a leading role in the changeover to the euro and have helped significantly to enhance the ‘euro awareness’ of economic factors.’
Despite significant progress in raising consumer awareness of the timetable (60 per cent of individuals know the exact date on which euro notes and coins will be introduced), the arrangements for the changeover to the euro have still not been properly taken on board and consumers are still not familiar with the new currency. For example, one person in five does not know that the introduction of the euro will be accompanied by the withdrawal of the old national currency units, and most consumers say they do not pay attention to the dual display of prices.
The Commission observes that the numerous information campaigns have so far had limited impact because of a lack of genuine interest on the part of consumers. The situation will doubtless evolve at the beginning of the second half of the year, with the early changeover - advocated by the Commission last October - of bills issued by the main utilities, of bank accounts and of non-cash means of payment. All of this will help to immerse individuals gradually in a euro environment and to awaken their interest in the new currency.
Public administrations are generally ready and provide businesses and the general public with quite a broad range of euro options. However, they could play a greater role by adopting a pro-active approach aimed at imparting a knock-on effect to the economy as a whole, for example by switching over public contracts and civil servants’ salaries to the euro. Few Member States have so far made any move in this direction.
The report goes onto suggest 20 ways to smooth the changeover process. |
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| Article appeared in the April 2001 issue.
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