Wed, 02 Jan 08
In the first major currency shift since the introduction of the
Officials hope admission to the euro zone can help bring together the economies of the divided island, split along ethnic lines since a Turkish invasion in 1974 triggered by a brief Greek-inspired coup.
"The foundation is laid for a unified economy with a common currency," President Tassos Papadopoulos said in a state address.
Use of the euro applies only to the southern part of
A new dawn
Les Calvert of Property Abroad commented: "When the euro comes in it will make the property market a lot more open and I expect the market to rise quite healthily
The island of just under one million inhabitants represents 0.2 percent of the euro zone's GDP. To qualify for euro zone admission, Papadopoulos's administration successfully wrestled down budget deficits and tackled burgeoning public debt.
The island is slated to return a surplus - the first time since 1971 - of 1.5 percent of GDP in 2007 and a debt of 60 percent of GDP. In 2008, the surplus is expected to be 0.5 percent and public debt is forecast to fall to 48 percent.
"This is the dawn of a new era and a change to our way of life," said Papadopoulos.
The pound will cease to be legal tender in cash transactions at the end of January. From midnight Monday, businesses are obliged to use euros.
Authorities hope that within the first 15 days of January most
Inhabitants of the British-administered Sovereign Base Areas (SBA), including some 4,000 troops and 7,000 dependents, will use the euro in transactions
The former British colony of some 400,000 people qualified for euro adoption after cutting its budget deficit from almost 10% of gross domestic product in 2003 to just over 2%.
It successfully overcame a last-minute struggle to rein in inflation caused by galloping oil prices, and in November
A Euro Changeover Committee has successfully allayed fears of inflation caused by euro adoption by reaching price-freeze agreements with most importers and retailers.
Prime Minister Lawrence Gonzi and Malta Central Bank Governor Michael Bonello crowned the moment by withdrawing euro banknotes from an ATM.
"This is a historic day in the life of the country and if we face up to the challenge and exploit the new opportunities which monetary union offers, the step we are taking today should lead to stronger, more sustainable economic growth," said Bonello.
Euro zone states are
The opposition Labour Party, which had opposed EU membership for
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