New year will bring new currency for Europe

Beginning Jan. 1, 2002, the euro will become the official currency of 12 European countries.

The new bank notes will come in seven denominations (ranging up to a 500 euro bill). Coins are being minted in nine denominations.

The countries that will begin using the euro are Austria, Belgium, Finland, France, Ger-many, Greece, South Ireland, Italy, Luxembourg, Nether-lands, Portugal, and Spain. All other countries in Europe will continue to use their national currencies.

After Jan. 1, 2002, we will not be able to buy the currencies from these 12 countries. All purchases will be in euros. Na-tional currencies will still be accepted along with the euro through February 2002, except in Germany, which is going cold turkey.

At the level of international finance, the euro already ranks as one of the three major regional currencies in the world, along with the dollar and the yen.

Travelers who have leftover national currencies from previous trips to euro-zone countries will be able to exchange your currencies to euros at any bank in the zone, but only through December 2002.

It would be best to exchange your currencies before the end of this year, and if traveling to Eur-ope, get your euros in advance.

Traveler's checks have been available in euros since 1999.

An Aug. 31 article of The Fi-nancial Times Lim-ited by Jimmie Burns and Fran-cesco Guerrera re-fers to Travelex, the world's biggest operator of bureaux de change. "Travelex has warned that the foreign exchange retail sector will be hit hard by the introduction of the euro currency in Europe would fall by at least 60 percent next year after the arrival of the single currency."

Travelers can expect to pay higher fees and commissions upon exchange to make up for the losses. In the first days of the new currencies, ATM ma-chines will experience shortages.

Empty ATMs in the airports would mean that travelers would not be able to pay for their taxicabs or trains to their hotels.

Benefits to travelers will be that they won't have to negotiate francs, lire, marks, pesetas, and other European currencies. Travelers will pay their way around Europe with one currency, just as Americans use dollars in all 50 states.

The fees for changing to each currency will be eliminated. It will be easier to compare prices. Pricing for products like film, soft drinks, silk scarves and hotel rooms will become more transparent, so prices are likely to come down.

(Linda Strait is president of House of Travel Inc., a full-service travel agency in Springfield.)