Western Europe Prepares for Euro Debut


NEW YORK -- The only certainty about the common currency slated for introduction in much of western Europe is that it will take some romance out of travel, much in the way that passport-free borders took some adventure of out it, industry officials agreed.

In interviews here and in Europe, trade group executives, ground suppliers and industry observers generally prefaced any positive remarks about the currency -- called the euro -- with a cautionary note that the effects of anything untried is anyone's guess, especially in a political hotbed like western Europe.

Less than a year from now, the treaty that put Maastricht on the map in 1992 will bring the euro into the European banking system. And by 2002, the national currencies of an estimated 11 countries no longer will exist, as euro coins and notes will have methodically spread from financial institutions into the pockets of ordinary people, including tourists.

Neil Martin, of the New York-based 28-member European Travel Commission, said tourists will have the advantage of locked-in exchange rates. "They'll know that in any of the [participating] countries, so many dollars will get them so many euros, unlike now, when they might get more German marks, say, than French francs [when exchanging the same] value of dollars."

What is unknown, Martin noted, is whether the euro will be weak or strong, and whether Europe's central bank will routinely shrink the supply to increase demand. Conversely, it is unknown, but widely considered unlikely, whether the central bank occasionally will "loosen things up" to ease any one country's fiscal woes.

Generally, Martin said, the euro will save tourists from having to fork over currency exchange fees, and those who work at exchange kiosks in western Europe might begin considering a new line of work.

ASTA's director of communications, Steve Loucks, said the changeover will "just make it easier" for clients to move around. "The euro has not, to my knowledge, caused any consternation to travel agents. But the romantic side of me says it's sad," he added.

Ground suppliers in Europe, most of whom were interviewed during last November's World Travel Market in London, shrugged off any serious impact the euro might have on the travel industry, either here or in Europe.

In fact, no one interviewed at the Earls Court exhibition pretended to have any clue about the ramifications of the euro and, moreover, none seemed to be even mildly curious. "In theory," said Ed Griffin, executive vice president and chief executive officer of Dallas-based Meeting Professionals International, "the euro seems to be a good idea."

"It would allow the exchange of money in the meetings markets to be greatly simplified, especially if you have attendees from different areas of the continent." The biggest question, he added, is whether Europe can successfully implement anything that has such potential for affecting each country's monetary system. "The jury is still out [on that]," Griffin said.


Qualified Countries

NEW YORK -- The European Commission, an administrative arm here of the European Union, provided a list of countries likely to qualify for "first-round" inclusion in the common currency plan. Each nation must meet strict financial criteria with regard to national deficits, inflation rates and national debt.

According to a spokesman for the European Commission, the list could change before the euro enters the European banking system next year, as each country's fiscal health will continually be monitored for deficiencies in the criteria.

Some countries, such as Great Britain and Sweden, would qualify under the current criteria but have bowed out of the plan, at least for now, he noted. Others, like some in the former eastern bloc, must first become members of the Brussels, Belgium-based European Union before being considered for the euro.

He said those most likely to join the single currency plan -- perhaps in the next decade, provided they are first granted European Union membership -- are Estonia, Hungary and Poland.

Countries currently poised to abandon their national currencies in favor of the euro are:

  • Austria
  • Belgium
  • Finland
  • France
  • Germany
  • Italy
  • Ireland
  • Luxembourg
  • Netherlands
  • Portugal
  • Spain
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