page_title: Euro
section_title: Eurozone crisis
hierarchical_section_title: Euro / History / Eurozone crisis
caption_attribution_description: English: Comparison of government surplus/deficit (2001-2012) of Eurozone, United States and United Kingdom. 1998-2000 data from Trading economics (see http://www.tradingeconomics.com/government-budget-list-by-country) 2001-2007 data from Eurostat (see http://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&amp;init=1&amp;language=en&amp;pcode=tsieb080&amp;plugin=1) 2008 data from OECD Economic Outlook No. 90, September 2011 2009-2010 data from OECD Economic Outlook No. 91, May 2012 (see http://www.keepeek.com/Digital-Asset-Management/oecd/economics/oecd-economic-outlook-volume-2012-issue-1_eco_outlook-v2012-1-en) 2011-2014 data from Eurostat (see http://ec.europa.eu/economy_finance/eu/forecasts/2012_autumn_forecast_en.htm#) 2012-2014 Winter forecast (1/2013) (see http://ec.europa.eu/economy_finance/publications/european_economy/2013/pdf/ee1_en.pdf)
context_page_description: The euro is the official currency of 19 of the 27 member states of the European Union. This group of states is known as the eurozone or euro area and includes about 343 million citizens as of 2019. The euro, which is divided into 100 cents, is the second-largest and second-most traded currency in the foreign exchange market after the United States dollar.
  The currency is also used officially by the institutions of the European Union, by four European microstates that are not EU members, the British Overseas Territory of Akrotiri and Dhekelia, as well as unilaterally by Montenegro and Kosovo. Outside Europe, a number of special territories of EU members also use the euro as their currency. Additionally, over 200 million people worldwide use currencies pegged to the euro.
  The euro is the second-largest reserve currency as well as the second-most traded currency in the world after the United States dollar.
  As of December 2019, with more than €1.3 trillion in circulation, the euro has one of the highest combined values of banknotes and coins in circulation in the world.
  The name euro was officially adopted on 16 December 1995 in Madrid.
context_section_description: Following the U.S. financial crisis in 2008, fears of a sovereign debt crisis developed in 2009 among investors concerning some European states, with the situation becoming particularly tense in early 2010. Greece was most acutely affected, but fellow Eurozone members Cyprus, Ireland, Italy, Portugal, and Spain were also significantly affected. All these countries utilized EU funds except Italy, which is a major donor to the EFSF. To be included in the eurozone, countries had to fulfil certain convergence criteria, but the meaningfulness of such criteria was diminished by the fact it was not enforced with the same level of strictness among countries.
  According to the Economist Intelligence Unit in 2011, "[I]f the [euro area] is treated as a single entity, its [economic and fiscal] position looks no worse and in some respects, rather better than that of the US or the UK" and the budget deficit for the euro area as a whole is much lower and the euro area's government debt/GDP ratio of 86% in 2010 was about the same level as that of the United States. "Moreover", they write, "private-sector indebtedness across the euro area as a whole is markedly lower than in the highly leveraged Anglo-Saxon economies". The authors conclude that the crisis "is as much political as economic" and the result of the fact that the euro area lacks the support of "institutional paraphernalia (and mutual bonds of solidarity) of a state".
  The crisis continued with S&P downgrading the credit rating of nine euro-area countries, including France, then downgrading the entire European Financial Stability Facility (EFSF) fund.
  A historical parallel – to 1931 when Germany was burdened with debt, unemployment and austerity while France and the United States were relatively strong creditors – gained attention in summer 2012 even as Germany received a debt-rating warning of its own. In the enduring of this scenario the Euro serves as a mean of quantitative primitive accumulation.
caption: Budget deficit of the eurozone compared to the United States and the UK.
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