EuroIS/PraxIS 10 Dec. 2001
Managing reality in Information Systems - strategies for success
Systems Modelling Ltd. http://www.sysmod.com
IN THIS ISSUE
This is a mid-month update as we get close to the final days.
Pictures of euro coins of 15 currencies (download)
The press reports below are extracts, a link is provided to the full article.
Pictures of euro coins of 15 currencies (download)
http://www.daimi.au.dk/~viralbus/coins/ Thomas Widmann shows 15 designs - the twelve eurozone ones plus San Marino, the Vatican, and Monaco. You can also download the picture as a 566K PDF file http://www.sysmod.com/euro15coinsa4.pdf
EU press releases and surveys (Europa)
More recent information concerning preparation for the changeover to the €
Monthly monitoring concerning the preparation for the changeover to the € (December 2001)
Flash Eurobaromètre 111 - SME and the €
Survey carried out in October and November 2001 to measure public opinion throughout euro-area countries during the months preceding the introduction of euro banknotes and coins. IP release 01/1589
Irish insurers help SMEs
by David Croughan, Chief Economist, Irish Business & Employers' Confederation
In Ireland it is emerging that insurance could have become an impediment to retailers accepting significant amounts of euro cash to store on their premises. As it is logistically impossible for all retailers to be front-loaded with euro in the last few days of December, retailers are being asked to take euro coin as early as possible. They will be asked to take delivery of notes - more valuable, but easier to transport - in the last two to three weeks of December. However, typical insurance cover for cash on premises amounts to around E6,500. With Christmas takings and euro stocks the amount of cash on the premises is likely to be well in excess of this amount.
At the request of the Euro Changeover Board of Ireland, the insurance industry is in the process of formulating additional cover on these basic policies, which will give automatic uplift at no extra cost. Discussions are still ongoing but what is emerging is an automatic uplift in cover from E6,500 to E25,000 for the period from 20 December to 15 January.
Monthly Monitoring - Preparation for the changeover to the Euro - Eurogroup, 3 December 2001
Worrying threat to business as usual for a period following the changeover to euro throughout the Eurozone
Survey of 320 Organisations - November 2001 - Euro Partnership, John Shuttleworth
Bus and train fares in Ireland all to be rounded down (FT)
In the first PraxIS of December, I quoted the Sunday Telegraph on the proposed "rip-off" rise in bus prices. News just in ....
EURO NOTES & COINS Economists speculate on euro psychology Will a strange new currency boost or diminish consumer demand? Opinions are divided, report Our European Staff
Ireland is the only member state where both wages and prices will appear to have gone up because of conversion. As a result the country is preoccupied with the risk of inflation being triggered by changed perceptions, which could be exacerbated by the rounding up of prices by retailers.
Last week, in what it described as "setting a good example" to the private sector, the Irish cabinet ruled that bus and train fares at the state-owned Coras Iompair Eireann would all be rounded down.
David Croughan, economist with the Irish Business and Employers Confederation, pointed that if a straight conversion were applied to the common Pounds 1.05 bus fare, the equivalent of Euros 1.33, a commuter would need to carry at least 5 coins, given bus drivers' insistence on exact change.
Christy Dorman, Dublin bus spokesman, says the government ruled "we should be whiter than white". CIE calculates the move will cost the company Pounds 3m.
No consultants for euro symbol
EURO NOTES & COINS Euros is for economy as Brussels settles for do-it-yourself design There were no expensive consultants; a humble bureaucrat chose the euro symbol, reports Peter Norman
Financial Times; Dec 5, 2001
Among the hundreds of policy makers and officials who have participated in the creation of the euro, a special place belongs to Jean-Pierre Malivoir.
In 1996 when Yves Thibault de Silguy, then commissioner for economic and monetary affairs, suggested a publicity tool to increase the euro awareness of leaders and journalists attending December's Dublin summit, Mr Malivoir took up the challenge. He decided to invent a euro symbol to put on tee-shirts for journalists and scarves for heads of government.
This home-made approach saved the European tax payer at least Euros 425,000, estimates Mark Rollinson, managing director of Marstellar, the London design and advertising arm of the Burson-Marstellar public relations group.
Mr Malivoir's symbol is the object of a trade mark dispute before the European Court of Justice brought by Interpayment, a former subsidiary of travel company Thomas Cook and now owned by Travelex, the London-based currency exchanger.
Copyright The Financial Times Limited 1995-1998
What about legacy NCU cheques?
One of the Frequently Asked Questions is what happens to legacy cheques issued before Jan 2002 but presented to the banks for clearing after it. Yet a leaflet we received from the Bank of Ireland (a commercial bank, not our Central Bank) is silent on the issue. A phone call to a Allied Irish Banks branch gave the assurance that cheques dated before 01/01/2002 would be accepted, but that was not available in writing. This Sunday Business Post report quotes a bank using the words "probably" rather than a written guarantee.
EURO questions answered By Aileen Power Dublin, Ireland, 9 December, 2001
"As the currency is no longer legally defined we are not obliged to accept cheques after December 31, but the likelihood is that we would probably process them in the normal way, so long as they were written on or before December 31," said Michael Watson of the Bank of Ireland. "Any cheques written prior to December 31 will be honoured up until the end of June." Ulster Bank, NIB and AIB are adopting the same line, and there is overall agreement that Irish pound cheques written after the December 31 date will not be honoured.
Russian Central Bank confused about the euro? (Moscow Times)
The Strategic Forecasting web site reports
"Russia Central Bank Directive Harms Europe
Russia's Central Bank, apparently misunderstanding the euro changeover process, has advised Russians to dump all European currencies before the EU switches to the euro on Jan. 1. The move is a blow to EU pride, politics and economics."
As I have not seen the original text of the CB announcement, consider the agenda of those concerned (like the Telegraph story above). Stratfor's spin is that it is a "blow to EU pride". (A related analysis is entitled "Switch to Euro Will Scuttle Recovery of Ailing European Economy") But as Russia is not in the EU, it does not have to obey EU rules. The CB wants citizens to own rubles. Commercial banks there will be happy to change legacy NCU into rubles, and sell back euros, taking a commission each way. This will be their chance to make some money from the little guys who tried to beat the system. (For small amounts, it may be best simply to spend them - there is a cash boom in Dublin retailers this Christmas shopping season). The bigger guys can of course look after themselves.
The Moscow Times article can be found in English at
(it is available without a subscription for the next couple of weeks.)
CB Tells Russians to Ditch EU Cash
By Kirill Koriukin
Staff Writer The Central Bank on Tuesday urged Russians to get rid of European currencies to avoid problems when the euro is introduced Jan. 1. In a statement posted on its web site, the Central Bank advised people to convert their European cash into rubles or other "non-European Union currencies" or deposit their money in a bank. The Central Bank did not offer additional counsel, and some experts doubt that it has a clear picture of what is going to happen when the euro is introduced. With only a few buyers for a currency that is being phased out, many Russian banks may simply take advantage of the situation and gouge their clients Yekaterina Matveyeva, Promstroibank St. Petersburg's leading analyst, said people will just have to shop and compare to find the best option.
The Euro & UK Business -an explanatory booklet for UK Businesses trading with the Euro-zone (Download 595K PDF)
In December 2001 PraxIS, I mentioned the FEE document "The preparations that non-Eurozone companies should make" http://www.euro.fee.be/archive/be/tradingeurozone.pdf
The Institute of Chartered Accountants in Ireland kindly sent me their booklet "Getting ready for the euro - Issues for Northern Ireland business". It is available in print form only from the Ulster Society of Chartered Accountants ( http://www.icai.co.uk ). Related but less detailed content can be seen online at the NI Euro Preparations Forum http://www.euroforum-ni.org.uk
I expect the next issue of PraxIS to be early January, but if anything really interesting pops up, I'll forward it as an update.
Our Christmas greetings this year: