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The Euro
Who's costing who what?
To changeover to the Euro will imply significant changeover costs. Accountants Chantrey Vellacott have estimated the costs to be around £36bn, though many other estimates are lower. However, once in the Euro zone, transactions costs for businesses will be much lower as there will be no need to change currencies anywhere in Europe.
Foreign exchange risks for companies will also be significantly reduced. The high value of sterling recently has cost many businesses significantly. Even more expensive for business can be the fluctuations in the value of sterling. Companies can find that their profit margins on sales can be almost completely eradicated by adverse changes in exchange rates. If we are a part of the
Euro, then these risks will be completely eradicated for trading in Europe (which is now well over half our trade) and also reduced for trading elsewhere as the Euro.
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