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  • As a response to the migrant crisis and growing terrorism worldwide, a number of European

  • countries have increased their border controls. The EU has long upheld the freedom to travel

  • between member countries. But these border restrictions are said to potentially threaten

  • the EU economy and specifically, the Euro. But could something like stronger borders

  • really affect the Union’s currency? Just how powerful is the Euro?

  • Well, the Euro is used as a primary currency by 19 out of 28 countries within the European

  • Union. Historically, European countries used their own private currencies, like the lira,

  • the marc, or the franc. But with the establishment of the European Union, it made sense to use

  • a common currency. Europeans would no longer need to exchange money between countries,

  • prices would be relatively transparent, and the economy would work more efficiently throughout

  • the region. Countries whose currencies were already stable were given the opportunity

  • to replace them with a unified currency called the Euro. This transition occurred on January

  • 1st 1999.

  • However, in the years since, 9 non-Eurozone countries have maintained their pre-European

  • Union currencies. For many this is due to the loss of control over interest rates or

  • currency policy. For others it is over fears of instability. However, with the exception

  • of the UK and Denmark, all EU countries are expected to eventually join the Euro once

  • their economies are good enough. Additionally, there are several countries and regions not

  • in the EU which also primarily use the Euro.

  • This is not all that surprising, as the Euro is used by more than 338 million people every

  • day, and is the second most used currency in the world. Since it’s physical introduction,

  • the Euro has been fairly competitive with the dollar, reaching a high of 1 dollar and

  • 60 cents per Euro during the financial crisis in 2008. But in recent years, the Eurozone

  • has been dealing with their own crisis, and today the two currencies are almost equal.

  • The problem has been that more EU members have been unable to pay their debts, and Iceland

  • even saw a total collapse of their banking system. This has made investors reticent to

  • rely on the currency, which is coupled with Greece, Italy, Portugal and others threatening

  • to tank the Euro’s value. Meanwhile, the US dollar has seen a slow but steady rise

  • as America’s economy recovers from the banking crisis.

  • Overall, the Euro is relatively new, somewhat unstable, and prone to influence from weaker

  • EU members. Still, it is an extremely popular currency, and has become the European standard.

  • The Euro is expected to continue its powerful role in the world economy, but as the Eurozone

  • crisis continues, nobody really knows what the future holds.

  • Many people have their doubts about the creation of the Eurozone. Learn more about the downsides

  • in our video at the top. Learn more about the instability of the European Union at large

  • in the video at the bottom. Thanks for watching! Don’t forget to subscribe for more videos

  • from TestTube News.

As a response to the migrant crisis and growing terrorism worldwide, a number of European

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How Powerful Is The Euro?

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