By CHRIS GRAEME
On the day that Portuguese Prime Minister José Socrates and the Governor of the Bank of Portugal, Vítor Constâncio, admitted Portugal had entered a recession, the European Union celebrated the 10th Anniversary of the Euro in Lisbon on Monday.
The Commissioner of the European Union, José Manuel Durão Barroso, joined Portugal’s Prime Minister, José Socrates, Finance Minister, Fernando Teixeira dos Santos and Governor of the Bank of Portugal, Vítor Constâncio to extol the benefits of the single currency and monetary union.
They opened an exhibition in the atrium of the Ministry of Finance in Lisbon’s Praça do Comércio which aims to outline the history of the Euro currency and explain its relevance and benefits to the general public.
Durão Barroso called the single currency a “resounding success” which had without doubt “brought untold benefits for EU member states.”
He said that the protection provided by an international currency with a market of 320 million people, supported by sound public finances and stable macroeconomic policies had proved important “in times of economic uncertainty.”
Further cuts
It was a sentiment echoed by the Governor of the Bank of Portugal, Vítor Constâncio, who said that while the single currency could “not completely shield European member states from the effects of the credit crunch and financial crisis, it did mean that countries like Portugal were better able to withstand the storm.”
Vítor Constâncio also said that Euro Zone countries like Portugal could also “expect further cuts in the European Central Bank interest rates in 2009 and inflation at around two per cent.”
The Euro had delivered sustained price stability on a scale that many of its members had never previously enjoyed despite last year’s spurt in energy and food prices.
Interest rates had come down to record lows from around nine per cent in the 1990s and the abolition of exchange rate costs and speculative risks had spurred internal EU trade which accounted for one third of the Euro Zone’s GDP.
Ivo Schmidt, Information and Communication Officer for the European Commission explained to the Algarve Resident how the exhibition was “set up to inform the public about the benefits of the Euro, the history of the Euro, EU economic policies, and to take the opportunity of the 10th anniversary of the Euro to show what it has done for us.”
The exhibition, which is free, is open from 8am until 8pm daily and runs until January 30.
Euro factfile
When the Euro was launched 10 years ago it became the official currency for 11 member states of the European Union, marking an end to Germany’s Deutschmark and the French franc.
It began trading on January 4, 1999, at 71p against the pound and has since traded at an average of 67p against the pound.
The Euro hit an all-time low against the pound of 57p in May 2000 but this week stands at 91p.
It is now the official currency for 15 countries and around 320 million EU citizens.
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