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Both Montenegro and Kosovo have unilaterally (?) decided to use euros as their official currencies. I think that most of their capital exists only as records in bank registers, so there is not much problem with that, but what about physical notes and coins that are in circulation? Where do they get them from?

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  • $\begingroup$ Did you see Montenegro and the euro and Kosovo and the euro ? $\endgroup$ – keepAlive Dec 13 '18 at 23:12
  • $\begingroup$ @Kanak In fact I did and did not find any conclusive answer there. The article on Kosovo mentions that almost 20 years ago ECB transferred some cash to Kosovo (the fact it supported introduction of Euro baffles me and it was why I have written "unilaterally (?)" in my question). It does not however explain the situation of Montenegro and I do not really believe that Kosovo did not need new notes and coins after the initial transfer. $\endgroup$ – lukeg Dec 13 '18 at 23:38
  • $\begingroup$ Do you speak french? This source is actually explaining that Kosovo, still isolated in terms of trade flows (actually, not having a sufficient level of exports) considers the possibility of making its own money, having difficulties to maintain a good level of physical liquidity in its economy, on the verge of anemization. $\endgroup$ – keepAlive Dec 14 '18 at 0:12
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Countries can get foreign currency from tourists, exports or intergovernmental aid programs. (And several other ways, but these should suffice here.)

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  • $\begingroup$ Tourism is an export. And Kosovo's or Montenegro's balances of trade are negative... Intergovernmental aid is a possibility, but this is far from being unequivocal. Please, would you mind sharing your sources? $\endgroup$ – keepAlive Dec 13 '18 at 21:19
  • $\begingroup$ @Kanak I have no sources. I also don't see what the balances of trade have to do with of this? The question is how they actually get the physical banknotes. These are several channels to get them. If they have debt, some countries/institutions are obviously willing to give credit, but that is a separate issue. $\endgroup$ – denesp Dec 13 '18 at 22:28
  • $\begingroup$ Know that when you are talking about exports, you are actually talking about one of the two components of balances of trade. Then the mecanism you are involving via exports cannot be at the source of the circulation of physical banknotes in these regions, one first reason is that having a neg. tr. balance means that you sell more your currency than you are holding it. Search for economy of montenegro or of kosovo on wikipedia, and read the main import and/or export partners sections. You will see that those two countries mainly deal with non-euro nations (less clear for Kosovo). $\endgroup$ – keepAlive Dec 13 '18 at 23:03
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    $\begingroup$ Dear Denesp, please stay calm and polite. With no national central bank, the only possible and sustainable channel through which physical banknotes can exist in these countries is the bank system as such. Read the articles I have mentioned in the OP's comment-section. Sorry, I didn't want to bother you. $\endgroup$ – keepAlive Dec 13 '18 at 23:29
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    $\begingroup$ @Kanak "Dear Denesp, please stay calm and polite." I have no idea what you are referring to. $\endgroup$ – denesp Dec 14 '18 at 6:38
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Both countries used the German mark before the creation of the Euro. After the Mark was replaced by the Euro, they had no choice but to adopt the Euro. So it was not unilateral. Therefore, the Euros in circulation in these countries are "German" Euros as far as I understand the situation. The coins initially introduced there and most commonly found today certainly seem to be the German versions of the Euro coins.

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