Finding your way in Euroland

Currency: For travelers, here's a primer on the European Union's new monetary system.

Destination: Europe

January 20, 2002|By James Toedtman | James Toedtman,Special to the Sun

Between tables at his Ristorante La Tavernetta in Rome, a hundred yards from the famous Spanish Steps, Daniele Pepi serves up his assessment of the euro, the new currency now being used across Europe.

"For me it's good," he says. "I like to travel, and this will make it easier." Then he points to the checkout counter of the small family restaurant in which his mother prepares the pasta each morning and he and his father serve it at night. "For the business, it is no good. I have to do this calculation for each customer."

"This calculation" is the conversion of lire to euros -- dividing the total lire by 1,936.27. "It's a number I have memorized," Pepi says, showing off the new calculator he carries.

Keep his perspective in mind as you ponder your own trip to Europe this year. Unquestionably, travel will be simpler. In more than a dozen European nations, the euro, with a common value and a single exchange rate, is replacing a dozen currencies, each with its own coins and bills and exchange rate.

That means fewer calculations and fewer pockets bulging with unused money as you travel from Italy to France to Holland. But there's another component: spending money and converting it in hotels, shops, taxis and trains, at tolls, parks, museums and landmarks.

From shopkeepers clinging to the traditional currency, to shortages of the euro, to confusion over where the euro is and isn't traded, and how to tip for good service, there are red flags.

To help, here is a travelers' guide to the euro:

* The basics: Since Jan. 1, the euro has become legal currency in 12 European nations: Austria, Belgium, Finland, France, Ireland, Italy, Germany, Greece, Luxembourg, Netherlands, Portugal and Spain. The Vatican and three small countries, San Marino, Monaco, and Andorra have followed suit. (Great Britain, Denmark, Norway, Sweden and Switzerland are not participating in the conversion.) Each of the converting currencies has a euro exchange rate that was set two years ago.

The euro-U.S. dollar conversion rate fluctuates, but in recent weeks, one euro has been worth 90 U.S. cents, and one U.S. dollar has been worth 1.12 euros.

* Transition period: There will be parallel currencies for about five more weeks in all the countries -- business can be done in either euros or the old currencies. But by the end of February, the exchange of $600 billion worth of marks, francs, lire, drachmas, pesetas and other currencies for the new euros is to be complete.

Until then, at shops, banks, post offices and money changers, all shoppers pay for their purchases in the old currency, and change is given in new euro bills and coins.

Except for the Netherlands (Jan. 28), Ireland (Feb. 9) and France (Feb. 17), the two-currency transition period ends at the end of February. After that, the old currency can only be exchanged at commercial banks, and they can charge a nominal service fee.

After next Jan. 1, old currency can only be exchanged for euros in the 12 nations' central banks.

* Don't get stuck: When you convert dollars at the start of your trip, get euros. They're readily available at European airports as well as at most U.S. airports with originating international flights. But fees for the exchange may be less at banks in Europe.

* Watch out for old labels: Christophe Agesilas has two words of warning for travelers: Be careful. On the weekend before the official conversion, Agesilas, a clerk at Les Minereaux in the pyramid complex of shops underneath the Louvre in Paris, was busy doing the franc-to-euro calculation and sticking new price tags on what he estimated was 25,000 pieces of rock, fossils, gems, precious and semiprecious stones, jewelry, artwork and wall pieces.

"Don't pay euros for francs," he says, pointing to franc price tags that were nearly seven times higher than the price in euros. Most merchandise will continue to show prices in both euros and the old currencies, even though the old currencies are being terminated.

* Check the calculations: This may be tedious, but it can pay off. Across Europe, there was speculation that many merchants have used the occasion of the conversion to spike their prices. The French responded by randomly sending government inspectors into shops to double-check conversion rates. Austria threatened criminal charges against any merchants caught inflating prices.

Some stores responded with sales and advertisements with parallel price tags "proving" that they were cutting prices below the actual conversion rate. Both Agesilas in Paris and Pepi in Rome showed off their calculations to assure customers they were getting accurate conversions.

"I'm rounding off and down," Agesilas says.

You can minimize the problem by converting your dollars to euros early in your trip. But if you're still dealing with the old currencies, or if you have any doubt, carry your calculator. Don't expect much cooperation from merchants.

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