Introducing the € A Practitioners Analysis Michael Grosse (EuroCommerce), Adviser on SMEs & Enlargement and Integration of New Member States Budapest,

Agenda 1.Introduction 2.EuroCommerce 3.Political topics 4.Preparation checklist 5.Experience Conclusions

1. Introduction Adopting the €: What role do retailer play ? How do the Hungarians feel about the € ? What are the benefits and the costs of introducing the € ?

2. Who is EuroCommerce? EuroCommerce was founded in 1993 Merger of the European associations formerly representing retail, wholesale and international trade “a single voice for Commerce in Brussels”

EuroCommerce Members EuroCommerce represents a unique mix of companies - from world leading international companies all the way down to the corner shop NCHC SESME VOSZ Reál Hungária NRZHIU Svensk Handel

Membership EuroCommerce represents more than 100 members from: –national trade associations –individual companies –European sectorial trade associations in 29 countries

Commerce in the EU 13% of EU GDP 5,5 millions enterprises (95% SMEs) Interface between industry and the 450 million consumers across Europe Providing jobs for 26 millions people from all parts of society “A thriving sector bringing wealth to the European economy”

The mission of EuroCommerce To promote the common interests of the sector vis-à-vis the EU institutions To lobby throughout the legislative process on behalf of commerce To educate EU decision makers to the impact of future legislation on commerce To provide timely and comprehensive information to members

3. Political €-topics Frontloading of banknotes & coins Dual pricing Dual circulation period €-day: Choice of date and scenario Inflation?!

Frontloading 2002: Fear of counterfeit money Starter-kits: only coins Getting familiar with € ATMs Early 2002: Cash payments

Starter-kits in Austria

Starter-kits for consumers

Dual pricing 1998 Euro logo agreement: Voluntary agreement Retail sector and consumer organisations Inform customers about € Guarantee price stability Legislation only in AUT; POR; GRE

Dual circulation period 2002: Maximum 6 month HU: 1 month Give change only in € ATMs and frontloading essential Backflow of national currency

€-day: Date and scenario Avoid 1 January!! Busiest time for retailers Why not take 1 February? Bing-bang is best option

Inflation?! Gap between actual and perceived inflation Only some prices have gone up (tourism; restaurants; some low- cost goods) « Euro profiteering » ?!

Statistics

4. Preparation Checklist Appoint„€-Coordinator”! Check the IT system! –Test-run –Storage –New software? Accounting –Rounding rules

Preparation Checklist (2) Training of staff Labeling & pricing Contracts Cash handling on €-day –Calculate change needed after €- day (“€-calculus” in Austria) –> Download Archive

5. Experience 2002 Smooth process Quick change-over Consumers €-phoric Costs for retailers ~ 1% of turnover

6. Conclusion Political decisions necessary Preparation on time essential Benefits outrange costs

European Parliament, 7 January 2002 « Retailers are the real heroes of the euro changeover! » MEP Jules MAATEN; Nl The retail sector is a « champion of transition. » MEP Marianne THYSSEN; BEL

Thanks for your attention! Michael Grosse