The currency
The European Union (EU) has several currencies-11 to be exact; however, there is one primary currency called the Euro that is widely used across the EU. The Euro was introduced in 1999 and was such a major success that now more than 337.5 million citizens in 19 countries in the EU enjoy the benefits of this currency. These benefits include smooth integration into a single economic market.
Not for all members
Only 19 of the 28 EU member states utilize the Euro. Both Denmark and the United Kingdom (England) have what is called an opt-out clause in their treaties that allow them to be exempt from the requirement of this single currency. Several of the more recently added member states and Sweden have not yet met the criteria to adopt the single currency.
Who uses the Euro?
Over half of the EU uses the single currency. The following members of the European Union use the euro:
- Austria
- Belgium
- Estonia
- France
- Cyprus
- Finland
- Greece
- Italy
- Ireland
- Germany
- Latvia
- Luxembourg
- Lithuania
- Malta
- Portugal
- The Netherlands
- Slovenia
- Slovakia
- Spain
Although these countries use the Euro as their home currency, there are non-EU countries and small sovereign states that accept the Euro.
The non-EU countries that accept the Euro are the following:
- Kosovo
- Montenegro
The small sovereign states that also accept the Euro are as follows:
- Andorra
- Monaco
- San Marino
- Vatican City
If you are in Switzerland, the Euro is considered foreign currency; however, it will be accepted and your change will be given in Swiss francs.
The bank
The bank in charge of the Euro is the European Central Bank (ECB). This one bank is under the governance of the Economic and Monetary Union (EMU). This union is the representation of a huge step in the continuation of integrating all the member state economies into one single market. The decision to form this one union was made in December of 1991 and was then later consecrated in the Treaty on European Union.
The integration of a single currency allows greater size and efficiency to the economy as a whole and to individual economies of the member states. This single union brings opportunities for more employment and greater economic stability to member states.
The EMU allows for easy coordination between member states on the making of new economic policies. This union also brings about single coordination between the member states on fiscal policies through limits on deficits and government debt.
Location
The headquarters of the ECB is located in Frankfurt, Germany.
Overall takeaways
The euro is not the sole currency throughout the entire European Union, but it is the primary one. Two of the EU member states have opt-out clauses in their treaties, meaning they are still full-fledged members but they are not required to use the euro. These countries are Denmark and the United Kingdom. There are quite a few non-EU and small sovereign states that accept the euro as payment. The European Central Bank is in charge of the euro and the headquarters are located in Frankfurt, Germany. The Economic Monetary Union is the governing body of the bank and brings multiple benefits to the EU, including coordination in policy making measure along with economic stability.