The journey to the euro 20 years of the euro
07.02.1992 | Maastricht Treaty signed
The heads of state and government of the Member States of the European Community sign the Maastricht Treaty on 7 February 1992. It comes into force in 1993 and lays the foundations for European Economic and Monetary Union.
The Maastricht Treaty sets out the introduction of Economic and Monetary Union in three stages. The first stage begins with the abolition of restrictions on capital flows between the Member States, retroactively on 1 July 1990.
01.01.1994 | European Monetary Institute
With the establishment of the European Monetary Institute (EMI) on 1 January 1994, the second stage of Economic and Monetary Union begins. The EMI is the forerunner of the European Central Bank and is based in Frankfurt am Main. Its members are the central banks of all EU countries that have decided to introduce a single currency. The EMI is tasked with preparing monetary union in regulatory, organisational and logistical terms. Furthermore, the EMI is responsible for improving the coordination of monetary policies between the Member States in light of the forthcoming monetary union. However, responsibility for monetary policy remains with the national central banks until the start of the third stage of Economic and Monetary Union on 1 January 1999.
15.12.1995 | The euro is born
At the Madrid European Council, the heads of state and government agree on a roadmap for introducing the single currency. The final stage of monetary union is to begin on 1 January 1999 and a name has also been agreed: in future, the currency that Europeans from Lisbon to Berlin will use is to be called the “euro”.
03.12.1996 | Draft designs of euro banknotes
“Ages and Styles in Europe” – that is the theme chosen by the EMI for the design of euro banknotes. The EMI asks all central banks to put forward designs. Ultimately, the design by Robert Kalina of Austria is chosen. The graphic designer from Vienna had already designed the Schilling for the Oesterreichische Nationalbank. For his euro banknotes, he chooses windows, doorways and bridges as the main elements. While these look realistic, they do not depict actual monuments or bridges, as no country should feel disadvantaged.
01.06.1998 | Establishment of the European Central Bank
The European Central Bank (ECB) starts work on 1 June 1998 as the successor to the EMI. The ECB’s headquarters is in Frankfurt am Main. Monetary policy decisions for the euro area are made by the ECB Governing Council. This is made up of the ECB President and Vice-President, the four other members of the ECB Executive Board, and the governors of all Eurosystem national central banks. Wim Duisenberg from the Netherlands becomes the first president of the ECB.
13.10.1998 | The ECB’s monetary policy strategy
In October 1998, the ECB Governing Council agrees on a common monetary policy strategy for the euro area. Just like the Bundesbank, the ECB pursues a stability-oriented monetary policy from the very start. The Eurosystem’s primary objective is to maintain price stability. The ECB Governing Council defines price stability as an increase in the Harmonised Index of Consumer Prices (HICP) of below 2% compared to the previous year. In May 2003, the Governing Council specifies that this objective should be reached in the medium term and that inflation should be below, but close to, 2%.
The ECB Governing Council also decides in autumn 1998 that initially eleven EU Member States will be allowed to participate in the third stage of Economic and Monetary Union. These countries fulfil all the requirements – known as the convergence criteria – for introducing the euro as a currency. Alongside price and exchange rate stability, these include a predefined maximum amount for long-term interest rates and an upper limit on a country’s government debt.
01.01.1999 | The euro as book money
1 January 1999 marks the beginning of the third stage of Economic and Monetary Union, with the introduction of the euro as book money. From now on, all euro area countries issue their government bonds in euro and the financial markets also list most prices in euro.
At the same time, responsibility for monetary policy is transferred from the national central banks to the Eurosystem. From this point onwards, many prices are shown in both the national currency and in euro so that consumers can get used to the new currency in advance.
01.09.2001 | Frontloading begins
In September 2001, the Bundesbank begins providing banks with euro cash in advance of the euro’s official launch. This frontloading is important for logistical reasons, to ensure that all banks have sufficient euro cash for the first few days of January 2002. Banks are already allowed to pass on the money to their business customers if they so wish. The Bundesbank estimates the frontloading requirement to be €68 billion in euro banknotes and about 4.4 billion euro coins.
17.12.2001 | Euro starter kits
On 17 December 2001, banks begin issuing starter kits of euro coins to citizens. These are intended to help people familiarise themselves with the new coins. The starter kits contain 20 coins with a total value of €10.23. This is worth the equivalent of 20 Deutsche Mark.
01.01.2002 | The euro as cash
As of 1 January 2002, the euro is legal tender in initially 12 Member States of the European Union. From this point onwards, people in Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain use euro notes and coins to make payments. In Germany, payments can still be made using Deutsche Mark until the end of February.
By the end of 2001, roughly 15 billion euro banknotes with a nominal value of €630 billion had been printed and over 51 billion euro coins with a total value of €16 billion had been minted.
Many Germans are initially sceptical about the introduction of the euro. Critics fear, above all, for the stability of the currency – after all, the Deutsche Mark had proven to be stable for over 50 years. However, approval of the euro rises significantly not long after its introduction.
September 2003 | The Europa series
In September 2003, the ECB Governing Council decides to introduce a second banknote series. Two reasons drive this decision: new and improved security features mean that counterfeits will be easier to recognise, and the lower denomination banknotes (€5 and €10) will be more resistant to soiling and able to remain in circulation for longer.
Consumer protection associations as well as experts from cash-in-transit companies, retailers and manufacturers of banknote handling machines are to be involved in the development of the new banknotes. In 2007 the ECB Governing Council finally selects the security features of the new banknote series.
The second series is called the Europa series because two of the security features contain a portrait of Europa, a figure from Greek mythology. She is featured in both the watermark and the hologram stripe of the new banknotes. Reinhold Gerstetter, a banknote designer from Berlin, is to design the new banknotes.
01.01.2007 | The euro area expands
As of 2007, ever more European countries join the euro area. On 1 January 2007, Slovenia introduces the euro as its currency. Cyprus and Malta follow suit one year later, with Slovakia doing the same in 2009. As of 1 January 2011, payments in Estonia are also made using the euro. On 1 January 2014, Latvia joins the euro area, followed exactly one year later by Lithuania. From this point onwards, the euro area is made up of 19 Member States.
02.05.2013 | First banknotes of the Europa series are brought into circulation
The introduction of the new banknote series is a major challenge in organisational, logistical and production-related terms. This is why the individual denominations are introduced one by one.
On 2 May 2013, the €5 banknote becomes the first banknote of the new Europa series to be brought into circulation. Consumers can pay with the new €10 banknote as of 23 September 2014. The new €20 banknote is brought into circulation on 25 November 2015. The new €50 banknote enters circulation on 4
The introduction of the new €20 and €50 banknotes, in particular, leads to considerably fewer counterfeits being in circulation in Germany. The new and improved security features are more difficult to forge. In 2017, the number of counterfeits fell by 11% compared to the previous year to a nominal amount of €4.1 million.
The €100 and €200 banknotes will complete the Europa series and will be issued as of 28 May 2019. The Europa series no longer features a €500 banknote.