When a country, say Greece, adopted the Euro as its currency, what happened to the debt that was based on the Drachma? Was it converted into Euros?


1 Answer 1


Yes, upon the introduction of the euro on January 1, 1999, all debt (indeed, all nominal contracts) in participating countries was converted from national currency to euros at a legally defined conversion rate. See this press release from December 31, 1998, which states:

In accordance with Article 109l (4) of the Treaty establishing the European Community, the irrevocable conversion rates for the euro were today adopted by the EU Council, upon a proposal from the Commission of the European Communities and after consultation of the European Central Bank (ECB) for effect at 0.00 on 1 January 1999 (local time). In compliance with the legal framework for the use of the euro, the irrevocable conversion rate for the euro for each participating currency is the only rate to be used for conversion either way between the euro and the national currency unit and also for conversions between national currency units.

The euro conversion rates are the following...

For the particular case of Greece, which joined the euro on January 1, 2001 instead, the conversion rate with the drachma was apparently set at 1 euro = 340.750 drachma by this regulation in June 2000.

  • $\begingroup$ Not apparently -that was indeed the conversion rate. $\endgroup$ Commented Dec 22, 2014 at 1:13
  • $\begingroup$ @Alecos, I didn't mean to suggest that the rate was in doubt; the "apparently" was about whether or not that particular regulation was truly responsible for setting the rate, which is always a little unclear. (i.e. the June 2000 regulation could have just been restating an official number that had already been bouncing around for a few months. I don't think so, but I'm not familiar with the exact sequence of events in 2000.) $\endgroup$ Commented Dec 22, 2014 at 3:12
  • $\begingroup$ Oh, I misread. Now that I think about it, if the word "apparently" was placed immediately before "by this regulation" and preceded by a comma, I wouldn't have thought the the conversion rate itself was maybe in doubt. But then again, English is not my native language, so all misunderstanding is mine... $\endgroup$ Commented Dec 22, 2014 at 3:35
  • $\begingroup$ No problem. My wording was a little ambiguous. :) $\endgroup$ Commented Dec 22, 2014 at 3:43

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service and acknowledge you have read our privacy policy.

Not the answer you're looking for? Browse other questions tagged or ask your own question.