A brief history of the euro

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Three euro bills over a grayscale map of Europe, setting the tone for explaining the history of the euro

On Wednesday, July 13, 2022, the euro hit a one-to-one exchange rate with the dollar. This ratio between the two currencies hasn’t existed since December 2002. So, StatsFind investigated the history of the euro.

When and why did the euro enter the scene?

Highlights:

  • The history of the euro traces back to the end of World War II.
  • Milestones following World War II kept uniting Europe economically, leading to the euro’s creation and adoption.
  • As of July 2022, the euro is the monetary unit of nineteen European Union countries and Kosovo and Montenegro.

Events leading up to the creation of the euro

The history of the euro traces back to the end of World War II. Then, each decade marked events that kept uniting Europe economically, leading to the euro’s creation and adoption.

The 1940s

May of 1945 saw the end of the war in Europe. There was so much devastation, including the deaths of an estimated six million Jews from the Holocaust. Several prominent men who had lived through two world wars worked to establish a peaceful Europe that valued “human rights, democracy, and the rule of law.” These included Winston Churchill, the Prime Minister of Britain, Paul-Henri Spaak, Prime Minister and Foreign Minister of Belgium, and Robert Schuman, French Republic Minister for Foreign Affairs.

The pioneering work of these men led to ten European countries establishing the Council of Europe in 1949.

The 1950s

The Council of Europe drew up The European Convention on Human Rights and Fundamental Freedoms in 1950 and started enforcing the convention through a court on September 3, 1953.

Shuman proposed creating the European Coal and Steel Community (ECSC), where countries would agree to share management of their coal and steel industries. That way, no one country can make weapons to use against the others. Six countries signed the treaty in 1952 (Germany, France, Italy, the Netherlands, Belgium, and Luxembourg), becoming the founding members of the ECSC.

Pleased with the accomplishments of the ECSC, the six countries expanded their collaboration to other economic areas. They signed two treaties in Rome in 1957, forming the European Economic Community (EEC) and the European Atomic Energy Community (Euratom). Among the goals of the EEC was to “reduce the economic and social differences between the EEC’s various regions.”

The 1960s

In 1962, the EEC established the first common agricultural policy, giving the member countries shared control over food production. As a result, there was sufficient food across these countries, and farmers’ quality of life improved.

Then, in 1968, the member countries of the EEC removed customs duties on products imported from each other, initializing free cross-border trade. Furthermore, they applied the same duties on imports from non-EEC countries. This act rapidly increased trade among the six countries and the rest of the world.

The 1970s

On January 1, 1973, three more countries joined the European Community (the term used when referring to the EEC, ECSC, and Euratom as a group). These countries were Denmark, Ireland, and the United Kingdom.

Following the 1973 oil crisis, EEC leaders agreed to create a fund under European regional policy. This fund aimed to shift money from wealthier regions to poorer ones. The funds went to improving infrastructure, attracting investment, and creating jobs.

Between 1974 and 1975, Portugal, Greece, and Spain saw the fall of their dictatorships and the establishment of democracy. These countries then qualified for membership into the European Community.

The list of the three components of the European Community

The 1980s

On January 1, 1981, Greece became the 10th member of the European Community. Spain and Portugal joined in 1986.

July 1, 1987, saw the Single European Act come into force, aiming to create a single market in the European Community.

The 1990s

On February 7, 1992, representatives from the member countries met in Maastricht in the Netherlands and signed the Treaty on European Union. It was a momentous occasion, establishing clear criteria for several policies, including the future single currency. The European Community became the European Union (EU) with this treaty.

On January 1, 1993, the single market went into effect, permitting the free movement of people, money, goods, and services.

January of 1995 saw the addition of Austria, Finland, and Sweden to the EU, bringing the total member countries to 15. 1995 also revealed the name of the EU’s future currency: the euro.

The birth of the euro

On January 1, 1999, 11 countries adopted the euro. Initially, the new currency was available for electronic commercial and financial transactions. The printed form of notes and coins became available in 2002.

The following table list each country that adopted the euro in date order:

CountryOld currencyYear of euro adoption
AustriaAustrian schilling1999
BelgiumBelgian franc1999
FinlandFinnish markka1999
France, Monaco, AndorraFrench franc1999
GermanyGerman Deutschmark1999
IrelandIrish pound1999
Italy, San Marino, Vatican CityItalian lira1999
LuxembourgLuxembourgish franc1999
NetherlandsDutch guilder1999
PortugalPortuguese escudo1999
Spain, AndorraSpanish peseta1999
GreeceGreek drachma2001
Kosovo (not EU)Deutsche Mark2002
Montenegro (not EU)Deutsche Mark2002
SloveniaSlovenian tolar2007
CyprusCypriot pound2008
MaltaMaltese lira2008
SlovakiaSlovak koruna2009
EstoniaEstonian kroon2011
LatviaLatvian lats2014
LithuaniaLithuanian litas2015
Map and list of EU countries using the euro

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