Italians to Lira: Hello Again

Wim Duisenberg admits that he still calculates in Dutch guilders sometimes, his country’s currency before it was replaced by the euro. “Why not? It’s perfectly normal,” concedes the president of the European Central Bank (ECB).

He’s not alone either. Ernst Welteke, head of Germany’s central bank, and German President Johannes Rau, have both confessed to not being entirely comfortable with the euro either. Like 300 million other Europeans, they don’t have much choice -- unless they live in Italy.

Hope for the lira yet

Italian Premier Silvio Berlusconi announced on Tuesday that he wants to reintroduce price tags showing both euro and lira amounts. Since March 1, 2002, the lira has been out of circulation, but like many Europeans, Italians blame the euro for higher prices.

The Italian government hopes that labelling goods both in euros and liras will contribute to more price transparency. The plans will have to be approved by the European Union before becoming mandatory.

According to Italian government statistics, the yearly inflation rate in stands at 2.9 percent, though Italian consumer organizations believe that inflation is well over 3 percent, the German news agency DPA reported.

An opinion poll published recently in the Roman Catholic weekly Famiglia Cristiana found that 54 percent of Italians wanted their lira back and 79 percent of those queried said they felt poorer since the euro entered their wallets.

Shopkeepers see opportunity

When the Christmas season started off sluggish, Italian businessman Marco Pizzi took advantage of the zeitgeist by allowing customers at his shoe and clothing shops in Lombardy and Piedmont to pay in lira.

"We've had a real boost in sales since [we started accepting the lira]," Pizzi told the Italy Daily newspaper. "After all, everyone had some old lira hanging around in their drawers."

Pizzi says he was inspired by the German town of Kropp, where shopkeepers have been accepting Deutsch Marks for months. They aren't the only ones either.

Department store chain C&A began accepting deutsche marks in late November. The response was so great -- with customers spending millions of marks within a week -- the firm extended the offer until Dec. 24.

Rocky reception

On Jan. 1, 2002 euro notes and coins were introduced in 12 European Union countries, three years after the common currency first became legal tender in the euro zone.

Over the year consumers in many euro zone countries complained the euro had brought with it price increases. In Germany, the euro has been dubbed the “teuro” (teuer means expensive in German). And a recent poll by Emnid, a leading German market research institute, showed that 54 percent of Germans want the deutsche mark back, while only 44 percent think that it was good to introduce the euro.

In a tongue-in-cheek editorial, leading Greek newspaper Eleftherotypia named the euro personality of 2002 on Tuesday. “Mr. Euro brought us closer to the other 11 countries, ignored the urgings of government officials and was rounded off upwards, sending prices through the roof and making the high cost of living possibly the major issue for the average person,” the paper wrote.

In France, too, the financial newspaper La Tribune said the euro had been a disappointment to the French, who, before its introduction, were among the most enthusiastic supporters of the common currency. “If the euro isn’t instilled with a new dynamic, some countries could conceive calling for the reintroduction of their national currencies,” the paper suggested on Tuesday.

Disagreement from up high

But Europe’s bankers and politicians maintain that, contrary to reality, Europeans merely perceived the euro as making their lives more expensive.

“Overall the euro was not a teuro in Germany,” German Finance Minister Hans Eichel said in a New Year’s Day interview, “Germany is the euro zone’s anchor of stability with a price increase rate of 1.1 percent at the moment.” Eichel contended that “some black sheep” in the restaurant and service industries did take advantage of the situation, but consumers brought them to order by spending their money elsewhere.

ECB head Duisenberg (right) confessed that he, too, was annoyed by price increases. “When I used to park my car at Frankfurt’s main train station, it cost one deutsche mark for 30 minutes. Since Jan. 2, I have had to pay one euro. Of course that irritates me as ECB president,” he told the German tabloid Bild am Sonntag.

However, he insisted that many things didn’t go up in price, while others even got cheaper. Besides, Duisenberg added, without a common currency the European economy would be in worse shape.

Despite the reassuring words coming from Frankfurt and Berlin, discontent is continuing to grow. Still, chances are the euro is here to stay -- especially as it sees its strength grow against the dollar.