A look at the euro ... then and now.

• Author: Hollein, Marie
• Position: President's page - Column

Since much of my career has been spent working with treasury matters and foreign exchange--I was literally there in 1999 as the euro was introduced to European Union countries--I thought it would be a good idea to present some of my thinking on the current status of the euro to our members and readers, particularly as we watch the troubles it's experiencing.

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The euro unified European currencies in ways that none of us working in foreign exchanges probably could have imagined even a few years earlier. I remember the days leading up to the launch. It was history in the making, a remarkable period. Different countries, each with different forms of currency that were an integral part of national cultures and traditions, coming together to create something truly special. Getting France and Germany to agree on the euro, after fighting for decades on so many other issues, was extraordinary in its own right.

That feeling of cooperation--of forging a bond on the creation of a currency system so important to the advancement of the globalized economy--was invigorating for everyone who cared about building a more seamless, international economic system. As the euro took hold, it simplified the exchanges, leading to the transparency it was designed to promote.

In the ensuing years, the euro has brought needed simplicity, clarity and transparency to international trade and commerce. It has, to my mind, delivered on its promises from the start. Initially, there was talk about the euro emerging as a second reserve currency--not necessarily overtaking the United States dollar, but perhaps over time establishing itself as that second reserve. I've been surprised over the years that it's had as much strength as we've seen.

One bump in the road was the lack of tax harmonization by country but for any large multi-national company, the euro helped simplify transactions. As recently as six months ago, it was still holding its own, and then some, against the U.S. dollar.

Things 'Inevitably Change'

Of course, things inevitably change. Over recent months--following the global financial crisis--we've watched with growing anxiety and concern the instability of some of the more vulnerable economic systems of the EU. We've seen key member countries stumble toward insolvency--Greece was near the precipice, with Portugal and Ireland not far behind. There is no guarantee that the EU will survive the economic forces currently sweeping across Europe...