New year brings new money across Europe

FRANKFURT, Germany (CNN) -- Nearly 300 million Europeans started their new year with a new currency, crossing a "symbolic bridge" toward economic unity in the most ambitious currency swap in history, according to the president of the European Central Bank.

Fifty billion coins and 14.5 billion bank notes -- totaling $568 billion -- became legal tender on midnight on Monday from Finland in the north to Greece in the south.

The switch marked the end of national currency frontiers across the 12 nations in the eurozone: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain.

The old currencies will continue to be legal tender in the eurozone countries until the end of February, when the euro becomes the sole currency.

Three European Union countries -- the UK, Sweden and Denmark -- have yet to sign on to the euro and are retaining their own currencies.

In Frankfurt, home of the European Central Bank, dancers joined bankers and politicians on New Year's Eve in a series of events to mark the occasion.

IN-DEPTH Ready or not How the single currency will affect you On the Scene  Reports from correspondents around Europe   VIDEO The president of the European Central Bank says the new Euro currency is more about politics than economics. CNN's Richard Quest reports (December 31) Play video (QuickTime, Real or Windows Media) Out with the old - getting nostalgic over money. CNN's Jim Bittermann reports (December 31) Play video (QuickTime, Real or Windows Media)

"The euro has clearly demonstrated it can achieve its main objectives -- price stability, market transparency and facilitating commerce," said ECB President Wim Duisenberg.

"Some problems are bound to occur here and there, but I'm convinced they will be limited and we will tackle them."

In Paris, the city's oldest bridge, the Pont Neuf, was illuminated in the colors of the European Union, blue and gold.

"The bridge's 12 arches symbolize the number of countries which have joined the euro," said Finance Minister Laurent Fabius.

European Commission President Romano Prodi told reporters a new era had dawned.

"The euro is your money, it is our money. It's our future. It is a piece of Europe in our hands," Prodi said.

Meanwhile, officials were keeping their fingers crossed that the switch for banks, shops and cash machines would go smoothly.

The euro was introduced in 1999 when national currencies were pegged to it at fixed rates and ceased to be traded independently on currency markets. Since then, marks, francs, guilders and lire have essentially been local versions of the euro.

Bank balances, stock prices and companies earnings reports, among many other things, are already spelled out in euros. But for most people, the psychologically important moment is when they can hold a euro in their hand.

Most of the eurozone's 170,000 cash machines should dispense only euros on New Year's Day or a day or two after. Major shops will be giving change only in euros, under agreements between governments and major retail groups.

If everything goes according to plan, these measures will remove most of the old cash from the economy within two weeks, although it can still be used for up to two months depending on the country.

National central banks will exchange the old money for years but the ECB predicts most transactions should be all in euros by January 15.

German Chancellor Gerhard Schroeder planned to give a euro coin to a tramp. Austrian Chancellor Wolfgang Schuessel and the EC's Prodi said their first purchases would be flowers for their wives.

Schroeder used his New Year's address to try to persuade Germans reluctant to part with the mighty deutschemark, on which his country's postwar prosperity was founded, to embrace the euro.

"Many will also be a bit wistful. The German mark meant a lot to us. We link the mark with memories of good times in Germany," Schroeder said. "But you can be sure: Even better times are ahead.

"We are witnessing the dawn of an age that the people of Europe have dreamed of for centuries: borderless travel and payment in a common currency," the German leader said.

U.N. Secretary-General Kofi Annan congratulated European leaders Monday on their adoption of a single currency as an example to the world that "uniting in a common cause can bring benefits to all."

The adoption of the euro "represents a bold and visionary choice for unity over division, cooperation over conflict and a common future over a divided past," Annan's spokesman Fred Eckhard told Reuters.

"History will record the adoption of the euro as much more than an economic decision. To see peoples and nations which once were enemies come together in the cause of prosperity for all -- and to share one currency -- is to witness a political act of unity and integration," Eckhard said.