Political calm heralds launch of the euro

The storms that have buffeted Ireland in the last few nights could not be in more marked contrast to the political serenity of…

The storms that have buffeted Ireland in the last few nights could not be in more marked contrast to the political serenity of Brussels during the last few days before the launch of the single currency on Thursday night.

Last week, before the doors of the Commission closed for Christmas, there were just a few euro crumbs thrown to journalists - the more insignificant the better - to convey the message that the work is done and the calm assurance that all will be well on the night.

So we were told that negotiations were to be undertaken by Spain and Italy on behalf of the EU with Andorra, San Marino, and the Vatican, to confirm their participation in the great project and agree on their eventual right in 2002 to have their own euro-coinage. And Paris still has to make a decision about how the midnight, local time, launch of the single currency would apply in its outre-mer territories - would Martinique lead the way, or should metropolitan Paris-time prevail?

They almost didn't bother with Thursday's meeting of Finance Ministers. Someone had suggested the business they have to do could be done in a five-minute conference call. Wiser counsel prevailed - history could not be marked by a blip on a dealing room screen.

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So they will gather, each speak briefly of the momentous times we live in, give the nod to fixed parities agreed in May but fine-tuned by the Commission that morning, release 3,000 blue balloons - to symbolise "soar-away inflation", according to the man from the Sun - and then pour copious quantities of champagne down the throats of the press corps.

But the truth is - and this is part of the explanation for politicians' somewhat blase attitude to the launch - that politically we already live in the era of the single currency.

The institutional structures evolved to enforce the Maastricht convergence criteria have been reinforced by a euro-11 committee that is fast becoming the locus of key economic policy co-ordination debate. Yet for Ireland there are still important dangers if Ireland's crucial trading partner, Britain, does not keep that pace, even from outside.

The international financier Mr George Soros, among others, has been warning recently that the inauguration of the euro will mark the start of a period of instability for sterling which could find itself caught between the dollar and the euro.

What of the man in the street? Initially, the euro will not be used for cash transactions, and new notes and coins will not begin circulating until January 1st, 2002.

But there will be some instant changes - most noticeably in the Irish Stock Exchange, where dealings will be conducted in euros from next Friday onwards.

In the words of the exchange manager, Mr Tom Healy: "All of the European stock exchanges decided the sensible thing was to change over right away. The euro is here and here for good."

Patrick Smyth

Patrick Smyth

Patrick Smyth is former Europe editor of The Irish Times