The value of money worldwide
What could be more American than the dollar or more British than the pound or more French than the franc? Next to food, probably nothing identifies a country quicker in a person's mind than the money of that particular country.
This is certainly as true in the United States as it is in Europe where the French buy goods in francs, the British in pounds, the Germans in marks, the Dutch in guilders, and the Italians in liras.
What is more, the value of any money in the world depends on the value of all other currencies in the world.
In other words, all these currencies, as we call the money of different countries, have a relationship to each other. That is why we sometimes say the dollar is strong and its value is high. What we mean by that is that the dollar is stronger in comparison to say the Japanese yen or the British pound or the German mark. If, for instance, you are an American in Japan a strong dollar would buy more cameras or computers because for every dollar you have you trade it for more yen.
If a country is very prosperous we say its economy is strong. Usually that means its currency is strong too. By contrast, if a country does badly its currency may also be weak forcing its government to bring down the value of its money. When the value of a country's currency is reduced we say that country has devalued its money. France, for instance, has just devalued the franc by 2.5 percent. West Germany whose economy right now is stronger than that of France revalued its currency, the West German mark, by 5.5 percent compared to other European currencies. To revalue a currency means the currency rises in value compared to other currencies.
The decision to devalue the French franc and revalue the German mark settled a difficult problem facing the members of the Common Market. The Common Market is also known as the European Economic Community or EEC for short. The Common Market or EEC, together with the European Coal and Steel Community, and the European Atomic Energy Community, make up what is known as the European Community or Communities. It is often shortened to EC.
The Common Market is the world's largest trade bloc in the world - bigger even than the United States. It is also the world's largest single market representing roughly the 270 million people in the 10 countries that now belong to the Common Market or EC.
The Common Market was formed in 1958 as a result of the signing of the Treaty of Rome the year before by the six original members of the Market. Those six countries were France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg. In 1973, The Six as they were then known became the Nine when Britain, the Republic of Ireland, and Denmark joined. Today there are 10 in all, the latest member is Greece which joined in 1973. Portugal and Spain would also like to join. The Common Market has its headquarters in Brussels, the capital of Belgium.
The idea of forming a Common Market was to help the economies of Western Europe grow faster by making trade among the countries easier. This has been done by removing quotas and tariffs. Quotas and tariffs are trading restrictions which one country will apply to other countries to prevent their goods coming in and competing with their own. Removing these barriers makes trading easier for all the countries concerned. Other restrictions were also lifted so that the peoples of one Common Market country can move to another member country and find work there.
A great hope among some Europeans is that one day the Common Market and its larger umbrella organization the European Community will be changed into an united states of Europe so that Europe could act more easily as a single unit in economics as well as in politics. But this dream of a united political Europe is still a long way off even though on some political issues the Common Market does take common stands.