The euro is the official currency of the Eurozone, a monetary union of 20 European Union (EU) member states. These countries have replaced their national currencies with the euro, representing a significant step in European economic integration. All EU Member States are part of the Economic and Monetary Union (EMU) and coordinate their economic policies, but the Eurozone countries have adopted a single currency for deeper economic cooperation.
The euro was initially introduced in 1999 as ‘book money’ for non-cash transactions. At that time, 11 out of the then 15 EU member states formed the euro area. Greece joined in 2001, before the physical euro coins and banknotes were introduced in 2002. The Eurozone has expanded over the years to include Slovenia in 2007, Cyprus and Malta in 2008, Slovakia in 2009, Estonia in 2011, Latvia in 2014, Lithuania in 2015, and most recently, Croatia in 2023.
However, not all EU members are part of the Eurozone. Denmark negotiated an ‘opt-out’ clause, allowing it to remain outside the euro. Sweden has not yet met the criteria to join. Other EU member states that joined the Union in 2004, 2007, and 2013 committed to adopting the euro once they fulfill the necessary economic conditions. These countries are considered to have a ‘derogation’ from euro adoption, similar to Sweden’s current status.
Beyond the EU, several microstates like Andorra, Monaco, San Marino, and Vatican City have also adopted the euro as their national currency. This adoption is based on specific monetary agreements with the EU, and they are permitted to issue their own euro coins within certain limits. Despite using the euro, these countries are not part of the Eurozone as they are not EU Member States.
