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Tuesday, 26 February, 2002, 21:17 GMT
Coining a new Europe
Europe's currencies have carried the heavy weight of history

It is one of the dates that will go down in modern European history.


In one way or another, war and revolution have accompanied the birth of most of Europe's currencies

On 28 February 2002 our old friends the franc, mark, peseta, lira, drachma, escudo, guilder, schilling and punt, see the end of an era, and this is an event of more than sentimental significance.

For these were more than names, more indeed than currencies. Their histories ran in parallel with the states they served, and so these currencies have become powerful political symbols.

The end of national currencies in the eurozone marks the end of a political era.

Revolutionary fervour

This era began, arguably, with the French Revolution.

The French franc was born in the modernising fervour of the new political order, and it was a runaway success.

Even Napoleon's defeat at Waterloo could not spoil the franc's good standing
Its stable silver quality, regulated in grams, its racy new decimal basis, and the military conquests of Napoleon in the late 18th and early 19th centuries swiftly turned the franc into a currency of central importance within Europe.

Even the fall from grace of Napoleon and the French Empire in 1815 did little to dent the franc's reputation.

The new kingdom of the Netherlands founded in that year turned its back on the franc, adopting the guilder as the currency of the new state, thus, so to speak, nationalising the currency that existed in the Dutch provinces before Napoleon.

But elsewhere the franc became the model for many of the currencies of the states that were beginning to coalesce in the nineteenth century.

Franc interest

The kingdom of Belgium, created by its secession from the Dutch kingdom in 1830, adopted the franc as its currency, in both name and silver-content.

Luxembourg too, when it finally adopted a single currency for official accounts in 1848, also took to the franc.


Crowned heads fell all over Europe in the 20th century, and along with them their old royal currencies

In Greece, which had achieved independence from the Ottoman Empire in 1828, a new royal dynasty was introduced in 1832 and along with it a new currency, the drachma.

In name this currency looked backwards to classical antiquity. In practice, however, it was a modern currency: one drachma weighed the same as one franc.

A similar pattern emerges in the history of two other states of southern Europe.

In 1861 the united kingdom of Italy was created out of the smaller kingdoms, principalities and states that had previously characterised the area.

The numerous local currencies were swept aside in favour of a new single currency for the kingdom: the lira.

This too was based on the franc, and indeed immediately entered a monetary union with the francs of France, Belgium and Switzerland.

In Spain, on the other hand, the 1860s saw the ousting of the royal house when Queen Isabella II was forced into exile in 1868.

The new republic adopted a new currency, the peseta.

Once again the franc was the model.

One peseta weighed the same and had the same silver content as the franc.

Out of the dust

Soon thereafter, the late 19th and 20th centuries were scarred by major wars that reshaped the map of Europe and shook up its currencies, beginning in 1870 with the Franco-Prussian War.

This heralded the foundation of a united German Empire and the introduction of the mark as a common currency for all the member states of the Reich, replacing the seven different monetary systems they had used beforehand.

The end of war saw new nations and new currencies
The two World Wars saw the fall of old imperial powers and the rise of new nation states, usually now as republics, with new currencies.

In 1860 the Finns, already autonomous within the Russian Empire, were granted their own currency, the markka, a foretaste of the independence that would follow in 1917.

The collapse of the Austro-Hungarian Empire saw the rebirth of Austria in 1918 as a rather diminished republic, while the rampant hyper-inflation of 1923 finished off the old imperial currency, the krone.

This necessitated the introduction of the schilling in the next year at an exchange rate of 10,000 kronen to one schilling.

In 1921 the Irish Free State won its independence from Great Britain and introduced its own coins and notes in 1928, although the Irish pound remained tied to sterling until 1979.

Crowned heads fell all over Europe in the 20th century, and along with them their old royal currencies.

In 1910 Portugal overthrew its 700-year-old monarchy and proclaimed itself a republic, in the process doing away with the old royal currency, the rei - 'king' - and introducing the escudo as its successor.

The mark briefly outlived the fall of the German Empire and the foundation of the Weimar Republic in 1918, but was ruined by the inflation of the early 1920s.

It was reborn as the Reichsmark in 1924, and lasted until the fall of the Third Reich after World War II.

The D-mark, or Deutsche Mark, its last incarnation, was introduced by the Allies in 1948 and became the strongest of the European currencies.

Emotional euro

In one way or another, war and revolution have accompanied the birth of most of Europe's currencies.

But will the next generation carry on the enthusiasm?
In this respect the euro's peaceful arrival is genuinely exceptional and is felt as a real triumph by its supporters.

This helps to make sense of the emotive sentiments recently expressed by former German Chancellor Helmut Kohl, who declared that the fathers of the euro wanted Europeans to stop having to visit any more war cemeteries.

Yet whether this passionate feeling of historical commitment to the euro project will endure among younger Germans let alone other Europeans is doubtful - it was anyway never really present in Britain.

The future success of the European Union as currently constituted now rests more than ever on the euro's fortunes as a world currency which in turn depends on the strength of Europe's economy.

And success in this area is in no sense a given.

Andrew Meadows is the curator of Greek Coins at the British Museum

Links to more Europe stories are at the foot of the page.


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