Eurozone and European Union
EUROZONE AND EUROPEAN UNION
Euro area, with its other well known name ‘Eurozone is an economic monetary union with its seventeen members. This EU members all accepted euro, as their currency. (Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxemburg, Malta, Netherlands, Portugal, Slovakia, Slovenia, Spain). This EU members switched their currency to euro which is common currency of EU member states. Reason of this change in their currency comes with many logical reasons like trade relations, free trade agreements, free traveling and schengen zone norms. If we look the situation, EUs basis and solutions, common currency and switching to euro issues, with the control of European Central Bank, makes sense and seems logical in theory. I want to discuss about how eurozone effected the countries, which are already members or will be become a member of eurozone.
After switching to euro, with first eleven members of eurozone, countries all removed the old prices which were writing with their old currency and converted them to euro. Of course with this all currency switching was on every part of the state economy, starting with the government budget till the salaries. All seemed okay about budgets, salaries and peoples purchasing power. It was just about math and first rule of math is, ‘Numbers are always say the truth. But strangely people were disturbed from that euro switch and they claimed that, with the euro switch, their purchasing power is degreased. How could it be possible in simple currency converts. The thing was people forgot to count on was ‘reminder fact. While governments switching all to euro, they removed reminders especially in the service industry, which is the sector, all people have to spend it in daily to survive. If I try to explain that with simple math rules, governments wanted to calculate circumference of the circle but while they are calculating it they put the ‘pi number as 4, instead of 3.1415926… This calculations reflected to government and citizens purchasing power directly, especially in the service industry. Even the German Economy (which is one of the strongest economies in Europe) effected bad and its inflation rate increased 0.3 just because of currency switch to euro, according to Bundesbanks research.
Switching to euro and eurozone is an important issue for hiding boundaries between the EU countries, business cycle, hiding currency problems in free trade area. But my first question is if eurozone and common currency norms are for all EU countries benefits at the same rate. I started my op-ed with the Germany example and all as we know, Germany is one of the strongest economies in Europe and even if Germany is effected that currency switch, visibly, how did the other countries effected after. If we take a look smaller populations and more sensitive economies,