Making change
January 3, 2002 - The Boston Globe
ROME - Like most of the rest of the world, Europe went back to work yesterday after the New Year’s holiday.
But from German hardware stores and French boutiques to Italian cafes and Spanish cinemas, it was hardly business as usual as the Continent cracked open its cash registers and pocketbooks to the new European single currency.
‘‘It’s not easy, you know,’’ said Edvige Rossi, the sole cashier at Pacioni grocery in southwest Rome. ‘‘I’m scared I will make a mistake.’‘
After becoming legal tender on Jan. 1, the euro faced its first true test with yesterday’s reopening of restaurants, stores, and other businesses in the 12 countries that have renounced their national currencies and exchanged them for the multicolored continental cash.
The euro, buoyed by this week’s long-awaited appearance of notes and coins, surged in value against the US dollar yesterday, rising above 90 cents for the first time since Dec. 20.
Clerks counted on calculators, and customers looked at the new loot sideways, slowing the pace of business and backing up the post-holiday traffic at tollbooths.
But the widespread chaos that many had predicted didn’t materialize, and the new currency began to circulate with relative ease through the hands of the 300 million or residents of what’s been dubbed Euroland.
Most of the dozen countries have given merchants and shoppers up to two months of crossover time when the the old currencies as well as the euro will be valid. Banks and public offices, though, are expected to dole out only euros when paying pensions and making change.
Francesca Argiolas carried New Year’s wishes and a government supplied euro calculator-converter into her usual late morning stop at the Pacioni market yesterday.
‘‘This is fun,’’ Argiolas said, after paying for pasta and prosciutto in liras and getting back 42.16 euros in change. ‘‘It’s like Monopoly money.’‘
But the mother of two was one of many who complained about the confusion of having two currencies in circulation during the transition period. ‘‘They should have just done it cold,’’ she said.
Hailed as the biggest single step - both economically and psychologically - toward European integration, the arrival of euro cash is a massive logistical undertaking.
National mints have churned out the first 633 billion euros, banks have had to restock their automated teller machines, and retailers have overhauled cash registers and repriced their merchandise.
On top of that, hundreds of thousands of vending machines and parking meters have needed refitting to accept euro coins.
But on the first day of business, the real challenge was with the human factor, as unavoidable - and avoidable - glitches popped up, from Paris to Portugal.
At a Madrid movie theater, for example, the cashier was giving change in pesetas, explaining that she was trying to get rid of the old coins.
‘‘I don’t have enough bills,’’ said Mourad Mahoudi, who was handing back Belgian francs at his grocery near EU headquarters in Brussels, after having failed to stock up on euros in the morning.
‘‘It slows us down quite a bit as we give change only in euros,’’ said Eeva Ekblom, a waitress at Cafe Via in Helsinki.
French bank workers had threatened to strike. But facing great pressure from their customers, they did not follow through, citing the difficulty of mobilizing strike supporters during the holidays.
One notable exception was La Poste, the national post office, which doubles as a bank. At the Rue des Capucines branch in Paris, a handwritten sign greeted patrons: ‘‘Due to a strike, no financial transactions will take place this afternoon.’‘
Across Paris and the rest of France, it was up to the individual branches of La Poste to decide whether to strike.
Ginette Groussain, who owns and runs a bakery near the Pompidou Center, was one of those stung. Visibly angry, she said Finance Minister Laurent Fabius ‘‘was on the radio this morning, saying how smoothly things were going, and due to the bank strike my bakery ran out of euros by noon.’‘
In Naples, Italy, police were called when retirees waiting for their first euro pensions became unruly. In Athens, Greek Premier Costas Simitis visited five banks and told customers to show patience.
European Union officials reported more than 80 percent of ATMs in the 12 countries using the euro had been converted by Wednesday, but the percentage varied from 100 in Germany and Austria to about 50 percent in Italy.
Few, however, could argue that there wasn’t enough warning. The introduction of a single currency came three years after the euro was officially born, with its value fixed against the national values on Jan. 1, 1999.
Three European Union members, Britain, Sweden, and Denmark, opted out, citing allegiance to their national currencies and doubts about being dragged down by the pact’s weaker economies.
Participating are Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, and Spain.
The new cash, which spells the end for currencies such as the Greek drachma and Italian lira, which trace their origins to ancient times, has been designed to avoid local references and to encourage European unity. The bills (from 5 to 500 euros) are free of real places and personalities. The coins (from 1 cent to 2 euros) have national references on one side and a continental design on the other.
Optimistic economists predict the euro will eliminate artificial price disparities and make the continent more competitive with the United States.
Despite yesterday’s boost for the euro on currency markets, the optimism failed to spill over to most stock markets in the 12 participating nations. Economic indicators published yesterday suggested continuing weakness in Germany and France.
Analysts cautioned that the euro’s rise might not be sustained unless forecasts of European growth improve.
The most immediate payoff is for European travelers, who will avoid having to make and pay for currency exchanges - and who can be at home with their cash, even when they are abroad.
Paris was the last stop yesterday on the winter tour for the marching band from the University of New Hampshire. In front of a McDonald’s, band member Kristen Doran of Douglas, Mass., said she was glad to be in Europe as history was being made. ‘‘It’s exciting to be here on the euro’s first days, ‘’ she said.
Atanasio Saratziotis got his first euro coins as he bought a train ticket in Cannes, France, to return to his home in Padua, Italy.
‘‘The other day, I bought a pack of cigarettes with 200 francs, and the guy gave me 100 francs change,’’ said the 28-year-old Greek-born doctor, speaking aboard the overnight train near the border town of Ventimiglia, Italy. ‘‘I knew it wasn’t right, but I was in trouble because I don’t speak French ... Now you’ll know it’s three or four euros, and that’s it.’‘
But there are short-term worries that store owners will take advantage of the switchover to increase prices.
Giuseppe Scaramuzzo, owner of Bar Pamphili in Rome, was charging two different prices for an espresso yesterday. Pay with the new currency, and it cost 60 euro cents; pay with the old, and it cost 1,100 liras - or 57 euro cents.
‘‘We rounded all the prices - some up and some down,’’ Scaramuzzo explained. ‘‘Anyway, today is just the first day. It’s like an experiment.’‘
