Blogging from the Highlands of Scotland
'From fanaticism to barbarism is only one step' - Diderot

Tuesday 1 January 2008

Two more join the club - Cyprus and Malta adopt the Euro

Two of the recent (2004) intake into the European Union, Cyprus and Malta, have adopted the Euro as their currency from midnight last night, taking the currency union from 13 to 15 of the 27 EU members. The fixed converion rates to the new currency are €1.71 for 1 Cyprus Pound, whereas a Maltese Lira is fixed at €2.34 . The Cypriot Euro coins will be inscribed in both Greek and Turkish and the two British 'sovereign bases' on Cyprus will become the first two British sovereign territories to adopt the Euro as legal tender, a practical measure resulting from the fact that roughly 10,000 Cypriots live or work there. (NB/ For those not aware of it, the Euro banknotes are standard throughout the Eurozone and do not vary from country to country; only the coins vary on one side depending on which Eurozone member country has issued them.)

Joaquín Almunia, European Commissioner for Economic and Monetary Affairs, remarked:

"Today with the adoption of the euro, Cyprus and Malta have become even more integrated in the heart of the European Union, less than four years after they joined the EU. This is thanks to the stability-orientated economic policies pursued by both countries, which I hope will continue after they adopted the euro. I encourage the Cypriots and the Maltese to embrace our shared currency with confidence because they are entering a monetary union that has proven its worth in terms of price stability and low interest rates."

With inflation beginning to rear its ugly head in some of the Meditteranean EU members and economies which have become severely over-heated (e.g. Spain), things are not quite so rosy for some of the existing countries which use the Euro, though. Nevertheless I expect the change will make life easier for both Cypriots and Maltese and for those visiting the two countries, specially from other countries within the currency union.

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