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Birth of a currency

How the euro developed from idea to reality

Monday 31 December 2001 01:00 GMT
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1957: Treaty of Rome identifies exchange rate policies as a "matter of common concern".

1969: Heads of state agree to economic and monetary union (Emu) by 1980.

1970: Pierre Werner, Prime Minister of Luxembourg, draws up Emu plans.

1972: Currencies linked through "monetary snake", which allows them to move against each other within defined limits.

1979: Snake replaced by European monetary system (EMS) based on exchange rate mechanism (ERM).

1989: Chancellor Kohl, President Mitterrand and Jacques Delors, President of European Commission, agree to implement Emu in three stages.

1990: Stage 1 begins with liberalisation of capital transactions.

1991: Maastricht treaty sets out path to single currency. Britain opts out.

1992: A run on overvalued pound forces John Major to take Britain out of ERM.

1994: Stage 2 begins with setting up of European Monetary Institute (EMI) as forerunner to European central bank (ECB).

1995: "Euro" agreed as currency name.

1998: EU Commission approves 11 countries for first wave of union. Greece follows two years later. ECB set up in Frankfurt.

1999: Euro comes into effect; ECB is responsible for monetary policy.

2000: ECB props up euro, which loses 30% of value against dollar. Danes vote against single currency.

2001: Final designs for euro notes and coins unveiled. Banks receive currency.

1 January 2002: The euro becomes legal tender in 12 countries.

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