The Eurozone

Although the creation of the Eurozone in 1999 is considered to be a political move by some and an economic move by others, there is no question it dramatically changed the world’s currency landscape.

The Eurozone consists of 13 members of the 27-country European Union (EU) that use the euro as their currency. The euro was launched on Jan. 1, 1999, marking the end of, among others, the Deutsche mark, the French franc, and the Italian lira.

Eleven countries — Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Portugal, and Spain — joined the Eurozone at the outset, while Greece (2001) and Slovenia (2007) joined later.

Monaco, San Marino (quick — find it on a map), and Vatican City also use the euro, although they are not members of the EU. A few other countries also use the euro because they have no official currency of their own and previously used that of another European country that switched to the euro.

As a result, the euro is now the native currency for more than 480 million people, and the Financial Times reported in late December the euro has surpassed the U.S. dollar in terms of the value of cash in circulation.

The creation of the Eurozone also eliminated the need for member countries to have a central bank. The European Central Bank sets the interest rate and decides monetary policy for the entire Eurozone. And while individual countries still track and report economic data such as unemployment, GDP, etc., those statistics are also kept for the Eurozone as a whole.