Speeches

Mr W. Duisenberg' s speech at the Euro Information Conference of 17 October 2001

17/10/2001 - Speeches

 

Euro 2002 Information Campaign

 

the EURO. OUR money

Speech delivered by

Dr. Willem F. Duisenberg,

President of the European Central Bank,

at the conference hosted by the Bank of Greece

on 17 October 2001 in Athens

 

Ladies and Gentlemen,

First of all, thank you very much for having invited me to speak at this Euro 2002 Information Campaign conference hosted by the Bank of Greece. This conference concludes the series of conferences organised by the European Central Bank (ECB) and the national central banks of the euro area, which have brought together more than 5,000 key players in the euro cash changeover process. These key players, which include several partners of the Euro 2002 Information Campaign, have benefited from the exchange of views and information, as this has enabled them to enhance their own preparations for the cash changeover. Moreover, the media attending these conferences have made the public more aware of the impending introduction of the euro banknotes and coins. My colleagues on the Executive Board and myself have been pleased to actively contribute to these conferences.

In just over 75 days, “the EURO. OUR money”, will be in our pockets, and will finally become an everyday reality for all of us. In just over 75 days, we will be able to travel from one euro area country to another, from Athens to the Atlantic, without having to change our money. We will be able to compare prices for products and services much more easily – an enormous step that will give a major boost to competition and price transparency. In just over 75 days, companies and organisations will be able to expand their markets and pursue their activities without the cost and inconvenience of dealing with several currencies, even more so than after the irrevocable fixing of the exchange rates on 1 January 1999. In just over 75 days, Europeans will feel more at home in all Europe because, for the very first time, they will share the same banknotes and coins.

Some people may not realise that the euro has in fact existed as a currency since 1 January 1999. The euro is already OUR money. Whenever we buy something with the current national banknotes of the euro area, we are in fact already paying for it in euro.

The introduction of the euro banknotes and coins represents an unprecedented logistical challenge for all parties involved: almost 15 billion banknotes and around 50 billion coins are being produced, and a major proportion is being distributed first to the banking sector and then to the retail sector before finally reaching the public. These two steps, known as frontloading and sub-frontloading, started on 1 September and entail a gradual supply of euro banknotes and coins to different sectors of the economy in order to make the cash changeover process as smooth as possible. Of course, there will be a considerable demand for euro banknotes from outside the euro area and we have therefore adopted general principles and a guideline for the frontloading of euro banknotes to non-euro area residents.

On 30 August, I unveiled the seven denominations of euro banknotes and their security features at a press conference in Frankfurt. The banknotes all show windows, gateways and bridges – symbols of openness and communication. They reflect Europe’s artistic and architectural heritage and will, at the same time, help to promote a feeling of solidarity, to bring about new opportunities and to strengthen ties and transactions between the nations of Europe.

But transactions need to be secure. The new banknotes include state-of-the-art security features, which will make the euro one of the world’s safest currencies. The strength of the euro cash actually lies in the combination of these security features, several of which have already proved effective in many national banknotes. These features will provide reassurance: they will enable both the public and professional cash handlers to check the banknotes quickly and easily. Three simple tests – FEEL, LOOK, TILT – which were described at the unveiling of the euro banknotes on 30 August and are being communicated in the context of the Euro 2002 Information Campaign, will enable the public to identify genuine euro banknotes in a matter of seconds. Particular care has also been taken with regard to the security features of the euro coins. The needs of the blind and partially sighted have also been carefully considered: they will be able to identify the banknotes with ease. The seven euro banknotes differ in size and colour, and the value of each banknote is printed in large, bold numbers. This will make it easier for all of us to recognise the banknotes when they enter into circulation on 1 January 2002.

Ladies and gentlemen, this will be a watershed in Europe’s history; it will be a unique event that requires our fullest support.

It is crucial that we, the European Central Bank and the 12 national central banks of the euro area, do our utmost to ensure that the euro banknotes and coins are well received by the public. Their rapid acceptance will very much depend on how well we communicate on the subject of OUR money with the public at large. The more effectively we communicate, the more we will convince Europeans that Europe is not some abstract and remote idea, but an immediate and dynamic reality. The quality of the information we provide will determine how well people cope with the cash changeover and become accustomed to denominations that may differ from national ones.

That’s why the Governing Council of the ECB has launched an information campaign. We have the support of Publicis, a communications agency we selected for this historic task, and the national central banks of the euro area, which are implementing the information campaign and are also supplementing it with their own euro-related communications at a national level.

Our campaign covers the practical aspects of the introduction of the euro banknotes and coins. It is not aimed only at people inside the euro area, but also at those outside it, such as tourists, travellers and citizens of countries where the predecessor currencies to the euro are used widely as parallel currencies. In order to reach such a broad public, the information campaign uses various groups and institutions as partners or “multipliers”. These include banks, retailers, educational institutions, the tourism industry and the media.

I would like to emphasise the key role these partners have been playing and are continuing to play. Here in Greece, as in the rest of Europe, partners of the Euro 2002 Information Campaign from both the public and private sectors are contributing to this important communication effort by conveying information on the euro banknotes and coins to their staff, customers and other target groups. More than 3,000 organisations have signed a partnership agreement with the ECB and the 12 national central banks of the euro area.

I would also like to stress that the media are receiving special attention in the context of the campaign. For them, we have produced a total of six media kits, each marking a specific milestone in the countdown to the euro. These have been and will be distributed to more than 3,000 media representatives in the euro area in the course of 2001. The next media kit, E-50 (e minus fifty) or 50 days to go until E-day, which will be released in mid-November, will give an insight into the life cycle of a euro banknote. Furthermore, we are paying particular attention in the context of the campaign to vulnerable groups who need and will receive tailor-made information and training.

We have now reached a crucial period in terms of our communications concerning the euro. Our mass media campaign, with TV and print ads across the euro area and beyond, has just been launched. The communications drive will continue into the first weeks of 2002, when the changeover will be under way and people will have the euro banknotes and coins in their hands and pockets. They will then be even more receptive to messages about the euro.

In Greece, you have been able to see our TV commercials since 17 September and our print ads since 24 September. The creative concept here focuses on the positive spirit that comes from being part of a broad community with a single currency, and is reflected in the slogan the EURO. OUR money.

Since we cannot afford to miss a single opportunity to inform 300 million Europeans, 200 million public information leaflets, in 11 languages, have been produced, enough for every household in the euro area. The leaflet is entitled Getting ready for the euro, and shows the euro banknotes with details of the security features and of the changeover plan for each country. The leaflet is tailored to the needs and circumstances of each country and will be distributed by the national central banks through a variety of channels.

I would also like to mention our initiative to help the children of the euro area learn about the euro banknotes and coins. Seven million posters, each including a competition designed to raise awareness of the euro, are being distributed to primary schools. The competition, which runs until mid-November, must be one of the largest ever held for children aged between 8 and 12 in Europe. The lucky winners, our 24 “euro superstars”, two from each euro area country, will receive their prizes at an event that will take place in Frankfurt on 31 December.

Let me turn to the ECB itself. At just over three years old, it is still a young central bank. Its mandate is to guarantee price stability by conducting a single monetary policy for the 12 countries and 300 million people in the euro area. The public perception of an institution sometimes differs sharply from, and even oversimplifies, complex reality. This is also the fate of the ECB. Its tasks are indeed complex, involving monetary policy decisions and operations, statistics, payment systems, legal issues, etc. However, its primary objective, as laid down in the Treaty establishing the European Community, is very clear, namely price stability in the euro area. In other words, safeguarding the value of the euro banknotes and coins and keeping inflation under control. Keeping control of inflation was and remains our main focus. The ECB has so far fulfilled its mandate successfully and aims to do so in the future for the benefit of Europe’s citizens. Of course, the impact of the cash changeover on price developments in the coming months needs to be carefully monitored. Price transparency and market competition are likely to limit inflationary pressures stemming from the cash changeover. Still, I would like to appeal to all economic agents, including the governments, to strictly apply the rounding rules. We cannot afford such a momentous event being overshadowed by unjustified price increases. Any increases would undermine confidence in the euro and damage the credibility of those taking advantage of the cash changeover in such a way. The ECB is also asking the public to keep a close eye on prices during the changeover period and is encouraging consumers and various organisations to follow up any – may I say – abuse of the occasion.

Another issue will become a major challenge for Europe once Stage Three of Economic and Monetary Union has been finalised with the introduction of the euro banknotes and coins. I am referring to the enlargement of the European Union and, subsequently, of the euro area. Currently, 12 countries from central, eastern and southern Europe are negotiating to become members of the EU and eventually the euro area. Integrating such a large number of new applicants in the European Union – which would almost lead to a doubling of the current number of Member States – will be an enormous task for all parties involved, not least given the significant diversity of the economic conditions of most of these countries in relation to the current Member States. EU enlargement would not only have substantial implications for the accession countries, but also for the European Union itself. Considerable efforts are required to adapt the EU institutions and to adjust common policies in order to enable the EU to fully integrate the accession countries and, at the same time, retain its capacity to act. In preparing for enlargement, the Eurosystem has thus far contributed in its field of competence by initiating and maintaining an in-depth policy dialogue with the central banks of the accession countries and by offering technical assistance, mostly in the form of training courses and workshops: since January 2000 the Eurosystem has organised more than 400 activities with the accession countries’ central banks, mainly in the area of payment systems, legal issues and statistics.

As I have already mentioned, EU enlargement also has significant implications for the accession countries themselves. Let me briefly mention at least some of the main economic challenges which these countries are facing in this historic process. For them, the overriding goal of accession is indeed to catch up with the EU, both in real and in nominal terms. Thus, the accession countries are aiming to achieve the European Union’s standard of living and macroeconomic and financial stability. This entails profound and comprehensive adjustments of the real economies and in the design of economic policies. While significant progress has already been made, further structural reforms are needed in the accession countries in order to transform their economies into fully-fledged market economies, so as to enable them to cope with competitive pressures and provide the conditions for sustainable and non-inflationary growth. Given the positive impact of structural reforms on the countries’ disinflation processes, real and nominal convergence should preferably be pursued in parallel. In this context, sound fiscal policies also play a crucial role. Although the overall fiscal policy stance is satisfactory in most accession countries, some countries have recently experienced worrisome developments of their budget situations that seem to have become derailed from the path of sound fiscal policy. In this case, further efforts towards fiscal consolidation become crucial. The determined pursuit of fiscal consolidation is all the more necessary as the accession process and the completion of the transition phase are likely to place further demands on the budgetary situation, for example in relation to higher infrastructure investments or future reforms of the countries’ health and social security systems.

The magnitude and importance of the tasks that lie ahead undoubtedly represent a key challenge for all of us. However, this should not cloud our understanding of the forthcoming enlargement round as a historic opportunity and a step towards the “unification” of Europe.

Ladies and Gentleman, let us look again at today’s challenge, one which we are close to meeting. I know I am repeating myself, but it is important to be aware that on 1 January 2002 we are not introducing the euro. The euro has been OUR money since 1 January 1999. What we are doing is introducing the euro banknotes and coins. Then, for the very first time, 12 countries in Europe will share one currency: the EURO. OUR money. Or, as you say in Greek: ΕΥΡΩ Το ΔΙΚΟ ΜΑΣ νόμισμα [phonetically: «evro, to dikomas nomisma»].