maurice o'connell : the euro changeover in the irish context statement by mr maurice o'connell, governor of the central bank of ireland, to the irish parliamentary joint committee on finance and the public service, in dublin on 18 july 2001. * * * chairman we are now less than six months away from the launch of euro banknotes and coin, three years after the introduction of the euro as a currency. the period of transition has been very long but this has been unavoidable because of the complex production and distribution process that is required. the st euro will at last become a fully fledged currency on 1 january. for the first time the public in general will be able to relate to it as their own currency. this should have a very positive impact in terms of gaining acceptance of the new currency. the changeover is a big undertaking for all countries of the euro area. the individual national central banks have worked closely together through the european system of central banks. there has been regular monitoring of production to ensure uniform quality of banknotes across the euro area. the overall production requirement for launch of the new currency is 15 billion banknotes and 50 billion coins. these figures are so large as to be almost incomprehensible. each national central bank is charged with the responsibility of meeting requirements in its own country. in our case this means that we will provide more than 200 million banknotes and more than 1, 000 million coins. members of this committee will be familiar already with the banknote and coin denominations and the conversion rate against the irish pound. may i remind you that the smallest coin ( one cent ) will have a value of less than a penny and the largest banknote ( 500 euro ) will have a value close to £400. traditionally the demand for high value banknotes in this country has been quite small. the central bank of ireland has three main functions in relation to the changeover : · it must provide sufficient quantities of the new currency to meet the launch requirement and ongoing demand · it must provide sufficient quantities of irish currency right up to the end of this year and meet the peak christmas demand · it must withdraw the old currency after 1 january in an orderly manner. st the central bank is on course in the production of new banknotes and coin. frontloading of coin to bank branches and major retailers will begin in september and frontloading of banknotes will begin in november. contracts for distribution are being negotiated. for security reasons i would not wish to go into

been evident in the economy. being a very open economy has meant that ireland is very much affected by international competitive forces. the eu internal market and the wide range of measures taken to implement it are a strong influence. at home, the powers of the competition authority have been strengthened and it has been quite active and effective in pursuing its agenda. nonetheless, there is scope for considerable progress. there are a number of areas, common to ireland and a large number of other european countries, where such progress could be made. the national competitiveness council has drawn attention to our very high utilities ’ prices in its reports. because of their structure and characteristics, utilities sectors are highly concentrated, and their operations must be subject to special competition and regulatory arrangements. we also have a long way to go in introducing more competition to the services area generally. in its assessment of ireland ’ s progress with the eu ’ s broad economic policy guidelines, the eu commission has drawn attention to the need to foster competition in professional services, retail distribution and insurance. there still are significant barriers to entry in many professional services in particular, and, as a consequence, prices here are very high by international standards. fostering entrepreneurship a dynamic economy requires an environment that is supportive of entrepreneurship. there are a number of aspects to this. at one level, the administrative burden of establishing and running a business should be kept to a minimum ; “ red tape ” should be eliminated where possible. where necessary, public sector efficiency should be improved. educational policies should be supportive of entrepreneurship, and there may be a need to improve access to finance. ireland would seem to score well in this area. although there is, no doubt, always room for improvement, the oecd has confirmed that the regulatory burden on business in ireland is low. there is also the fact that our business taxes are low by international standards. the expansion of the economy, new business start - ups and employment growth are indicative of our positive performance in this area. promoting employment and greater social cohesion the eu ecofin council last year emphasised the importance of a number of labour market reforms. these highlighted the need for greater flexibility of labour markets, to adapt employment protection where necessary to improve employability, and to adapt tax and benefit systems to improve work incentives. it was recognised that employment was the best way to ensure social inclusion. wage flexibility and adequate infrastructure were seen as desirable for coping with regional differences, and the social partners were urged to balance the interests of both insiders -