You will still have to buy Deutschmarks or francs until 2002

If you live in one of them, you may think that the euro will not affect you, especially as the colourful euro notes and two-tone coins won't be in circulation before January 2002. So even if you visit the eurozone on business or as a tourist you will still have to exchange your national currency for escudos, pesetas, French and Belgium francs, guilders, punts, lira, schillings, Deutschmarks and Finnish markkas.

However, there is a high probability that the single currency will affect your life - and even if you stay at home you may do some transactions in euros.

More competition

Goods could cost more outside Euroland

Because of increased competition within the eurozone, Euroland consumers can expect lower prices. For non-EMU consumers this is a two-edged sword:

On the one hand you could suffer financially. Multinational companies could be tempted to make up for price wars in Euroland by increasing their profit margins in non-EMU countries. UK consumers, for example, are already paying over the odds for many products; this could get worse over the next few years.

On the other hand there is a chance that Euroland companies try to move into other markets in the EU as well, and the increased competition could help you. Some financial analysts, for example, predict that UK consumers could take advantage of cheaper euro-based loans and mortgages. But beware: euro loans can become a victim of currency fluctuations, and you will be the one who has to pay more if your national currency suddenly loses value.

Stability

If the euro is strong, outsider currencies could lose value

If the euro is weak, Euroland is yours for the taking. If the euro is strong and the value of non-euro currencies plummets, shopping in most European countries will be quite expensive.

In the months after its launch, the euro took a hammering, making the eurozone an attractive shopping destination. But financial experts are still divided on the issue, with most of them predicting that the euro will be stable and strong in the long-term.

Others, meanwhile, suggest that economic tensions between Euroland's regions could bring the euro down. Nobody has ever tried a venture like EMU before, so only time will tell who is right.

However, you should bear in mind that many European currencies were buffeted during the financial crisis of 1998 - with the exception of the currencies merging into EMU.

Euro cash

Many banks in non-EMU countries have begun to offer their customers euro accounts - but do you need one? Probably not.

Unless you travel widely across Europe, or have large sums of money that you want to protect against currency fluctuations, you will not need a euro account.

If you want to travel in the eurozone, just go to your bank and buy bank notes for the country of your destination, as euro cash will not be introduced before January 2002. Alternatively you can use the new euro travellers cheques, which will be accepted all across Euroland.

Euro threats

As mentioned earlier, EMU is expected to increase economic competition. This can affect you directly.

Eurozone companies may try to enter your home market. As competition heats up, shops and manufacturers are bound to get burned.

Furthermore, if the business you work for is exporting to the eurozone it may lose market share, because it will find it more difficult to compete with companies that do not have to worry about currency transaction costs anymore.

In both scenarios your company could be put out of business - and you out of a job.

Using the euro

All four EU countries outside EMU have at most one land border with the eurozone. Therefore border hopping for a quick shopping trip in Euroland will be rare.

Online shopping, meanwhile, will give you access to the whole of the eurozone, and savvy Online retailers will price their goods in euros. However, because you live in a country outside the eurozone, your payments will be subject to exchange rate fluctuations.

If you travel to Euroland in 1999, you will be using the euro, even though the old national bank notes and coins are still in circulation. The reason is that all exchange rates within the eurozone are "irrevocably fixed". There will be a fixed amount of escudos or guilders to the euro - just as there are 100 pennies to the British pound and 100 oere to the Danish krone.

Retailers displaying this logo have signed a code of conduct on euro pricing

The other thing you will notice is dual pricing. Many shops, restaurants and banks in the eurozone have already begun to display prices in both the national currency and in euros. More and more will join during the next couple of years, and retailers and consumer associations across Europe have signed agreements giving guidelines designed to make the transition as easy and painless as possible.

If you travel across the eurozone, you should be able to swap your francs for pesetas for free

So if you travel across the eurozone, you will be able to compare price levels directly in all EMU countries.

As you know, national currencies in the eurozone are just denominations of the euro. So if you change pesetas into French francs you do something akin to swapping a five pound note for five one pound coins. According to the rules of European Monetary Union, banks in the eurozone are obliged to exchange Euroland currencies for free, so you should have no extra costs travelling and shopping across borders.

Shareholders

If you own shares, it is highly likely that your local stock market will now display two prices for your equity: in your national currency and in euros. The size of your share in the company will not change, but the euro pricing will make it easier for companies listed on your local stock market to attract investors from the huge eurozone.

A word of caution: If you invest in mutual funds based in eurozone countries, be very careful if they claim extraordinary performance during recent years and list their achievement in euros. The euro figures may be distorted by currency fluctuations during the years prior to monetary union. In order to recognise a good illustration of past performance, look out for the disclaimer describing historical data "as reported" and currency adjustments as "converted" or "restated", and it is recommended that you seek independent financial advice.

The taxman cometh

One euro-related issue that could affect all countries in the EU is tax harmonisation. This may sound like a nice thing, but it is unlikely to be so.

There are different tax levels across the eurozone. High taxes make companies less competitive, and high-tax countries will urge others to raise their taxes to the same level.

There is already a drive to close tax loopholes across the European Union. Tax havens like Luxembourg and some of the British Channel Islands could face a clampdown on untaxed accounts holding billions of pounds, francs, and Deutschmarks from dubious sources.