FRANKFURT, Germany — Ten years ago, Europe launched its grand experiment with a shared currency — and watched it plunge in value before recovering.
As the anniversary approaches of the Jan. 1, 1999, arrival of the euro, economists say the new currency is finally fulfilling its promise as a way to lower borrowing costs, ease trade and tourism, boost growth and strengthen the European community.
And it's doing it amid a global financial crisis that, for the moment, underlines the safety in numbers that comes from joining one, big currency.
"After 10 years it has truly created a zone of security and stability," French Finance Minister Christine Lagarde said in mid December. "From all these points of view, the euro has in fact proven wrong the forecasts some made against the euro 10 years ago."
When it was launched for non-cash purposes in 1999, just 11 countries were on board — Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain. Notes and coins were added on Jan. 1, 2002, and the original 11 have been joined by Cyprus, Greece, Malta and Slovenia, with Slovakia slated to join Thursday, bringing the total to 16.
Otmar Issing, a former board member of the European Central Bank, said the euro's appeal has been its ability to provide a sense of stability and shelter from the storm of global crises. The bank, created specifically to oversee the euro, has taken a strong anti-inflationary stance that mirrors that of its chief predecessor, Germany's Bundesbank central bank.
Since its launch, the euro has soared in strength and value, rising to as high as $1.6038 against the dollar this year. It's down to around $1.40, but has risen strongly against the British pound.