International Role of Euro and European Integration

DOI: 10.20542/0131-2227-2020-64-5-33-41
A. Polivach (,
Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (IMEMO), 23, Profsoyuznaya Str., Moscow, 117997, Russian Federation


The euro was introduced 20 years ago and then quickly and confidently took the place of the second important global currency. In that times there were a number of works forecasting that the euro in the next 10–15 years may surpass the US dollar as the dominant global currency. By now, usage of the euro in the world is significantly wider than the next currencies, the pound and the yen. However, the US dollar is still much more popular. Moreover, in the last decade we noticed a slowdown in the usage of the euro worldwide and even a decrease in some segments in favour of the dollar. Therefore, this article investigates factors that may be causes of this slowdown. The most popular factors determining prospects of currency internationalization are the market share of an exporting country and differentiation of its export goods. As differentiation of the goods exported from the USA and from the euro zone is in general similar, so the author first checks their market shares dynamics. Despite both economies were losing their market shares in the last 20 years still volumes of the exports from the euro zone was always much bigger than from the USA. The ratio even increased from 1.28 in 1999 to 1.67 in 2017 in favour of the euro zone. However, the usage of the euro slightly declined in the last decade. Therefore, new factors should be taken into consideration. They include volume of imports (as we consider this is a natural and easiest way for a currency to migrate into international usage), size of GDP (as it influences on the size of imports), cumulative total sales of the largest transnational corporations (TNCs) and cumulative total assets of the largest transnational financial institutions (TNF). Given their exceptional size and global operations, the last two can seriously increase or decrease usage of particular currencies worldwide. We found that the dynamics of all four new factors were quite in line with the progress of the international role of the euro. During the 13 years of 20, the imports to the euro zone were smaller than to the USA, including the last five years. The GDP of the euro zone was always smaller than the USA’s one. Though its dynamics in 2000–2008 gave a chance and the euro zone was about to catch the level of the USA, but then the US GDP more and more surpassing it. In addition, the cumulative sales of the largest TNCs headquartered in the euro zone surpassed their competitors headquartered in the USA in 2005–2013 and then the US TNCs took the lead. Cumulative assets of the largest TNFs from the euro zone were always larger than the US TNFs. However, from 2010 the latter were narrowing the gap. Additional factor emerged in the last decade was a quick growth of Chinese TNFs, which became the largest in the world. As Chinese corporations prefer to work with the dollar, so this was a negative factor for the euro. Also, statistics show that possible participation of the UK in the euro zone might have reverted all the above factors in favour of the euro zone. As there is no evidence that considered factors will change, so it looks that now the euro is near its maximum playing the international role. Unless unprecedented actions will be taken by the European Union, there are no chances for the euro to surpass the US Dollar in the foreseeable future.


euro, dollar, global currency, export, import, transnational corporations


1. Bacchetta P., van Wincoop E. A Theory of The Currency Denomination of International Trade. ECB Working Paper No. 177, 2002. 51 p. Available at: (accessed 17.10.2017).

2. Strengthening the International Role of the Euro. European Commission, 2019. 29 p. Available at:‑2019_en.pdf (accessed 20.12.2019).

3. Gopinath G. The International Price System. NBER Working Paper No. 21646, 2015. 59 p. Available at: (accessed 27.03.2017).

4. Butorina O.V. Ekonomicheskaya istoriya euro [Economic history of the euro]. Moscow, Ves’ Mir, 2020. 576 p.

5. Eichengreen B. Sterling’s Past, Dollar’s Future: Historical Perspectives on Reserve Currency Competition. NBER Working Paper No. 11336, 2005. 29 p. Available at: (accessed 21.06.2009).

6. Chinn M.D., Frankel J.A. The Euro May over the Next 15 Years Surpass the Dollar as Leading International Currency. NBER Working Paper No. 13909, 2008. 24 p. Available at: (accessed 26.03.2010).

7. Gasparotti A., Kullas M. 20 Years of the Euro: Winners and Losers. Centre for European Policy, 2019. 18 p. Available at: (accessed 26.10.2019).

8. Pishchik V., Kuznetsov A., Alekseev P. Evropeiskii ekonomicheskii i valyutnyi soyuz: 20 let spustya [European Economic and Monetary Union: 20 Years After]. Mirovaya ekonomika i mezhdunarodnye otnosheniya, 2019, no. 9, pp. 76-85. Available at: (accessed 05.01.2020).

9. Worldwide Currency Usage and Trends. SWIFT, 2015. 20 p. Available at: (accessed 25.09.2018).

10. Direction of Trade Statistics Dataset (DOTS). International Monetary Fund. Available at: (accessed 05.01.2020).

11. International Financial Statistics Dataset (IFS). International Monetary Fund. Available at: (accessed 05.01.2020).

12. Ilzetzki E., Reinhart C.M., Rogoff K.S. Exchange Arrangements Entering the 21st Century: which Anchor Will Hold? NBER Working Paper No. 23134, 2017. Available at: (accessed 15.01.2018).

13. IMF DataMapper. Available at: (accessed 10.01.2020).

14. Towards a Stronger International Role of the Euro. Brussels, European Commission, 2018. 15 p. Available at: (accessed 20.12.2019).

15. UNCTAD. World Investment Reports for 1997, 2002, 2005, 2007, 2010, 2014, 2016, 2018, 2019. Available at: (accessed 14.01.2020).

16. Global‑2000 World’s Largest Public Companies. Available at: (accessed 20.01.2020).

Registered in system SCIENCE INDEX

For citation:
Polivach A. International Role of Euro and European Integration. Mirovaya ekonomika i mezhdunarodnye otnosheniya, 2020, vol. 64, No 5, pp. 33-41.

Comments (0)

No comments

Add comment

Current Issue
2021, vol. 65, No. 1
Topical Themes of the Issue:
  • Globalization and Nation-State: Yesterday, Today, Tomorrow
  • Global Value Chains (GVCS) and COVID 19 Pandemic
  • Middle East Conflicts Today: Between Religion and Geopolitics
  • Beijing’s Pain Points – 2 (Glance from Mid 2020)
  • Social Sciences and Global Turbulence: Rebooting the Mainstream
View This Issue (2021, vol. 65, No. 1)
Submit an Article

Dear readers!
Please note that free access to full-text issues of the Journal is being opened at our WEB-site after 6 months of the date of publications.The work on deepening the open archive of full-text issues will be continued.

Dear colleagues, authors and readers!
We kindly request you to turn to editor-in-chief and executive secretary directly concerning reviewing scientific publications in our journal. Only editor-in-chief takes decision on order and publication the reviews!

Dear readers!
This is to inform the researchers of the Institute of World Economy and International Relations that electronic versions of the I, II, III issues of 2020 of French magazine Politique étrangère are now available. Those who are interested, please personally address to the editorial staff of MEMO Journal (room 18-17) with an electronic media.

In response to the challenges of our time the Editorial board continues to open new thematic rubrics:

“World Energy Sector after Pandemic”. We plan to publish articles presenting in-depth analysis of influence of Pandemic on the global energy sector and forecasts of further developments in its various branches.

“Civilization processes of modern development” is a new rubric opened by MEMO Journal in 2020. It will be devoted to the analysis of the influence of civilizational factors and inter-civilizational interactions on the political and socio-economic development of the world at whole, regions and countries.

“Africa today and tomorrow”The rubric devoted to contemporary issues of Africa which is attracting growing interest of the world's leading actors. We plan to publish the articles analyzing the status of statehood, socio-economic and political development of the countries of Black continent, as well as the integration processes between them.


"World Eсonomy and International Relations" announces a contest for the best joint academic publications of domestic and foreign researchers and experts in topical issues of the world economy and international relations. The winners will be selected according to the results of peer reviewing and discussion at the Editorial Board. The articles will be published in priority order.


The print version of “World Economy and International Relations” journal is distributed by advance subscription only, and is not offered for retail sale. To subscribe please address to any post office in Russia by referring to the Federal Postal Service Union Catalogue, section “ARSMI”, the journal index is 70542. The subscription may be made for the whole subscription period or starting from any nearest available month for desired number of issues.

To purchase the full-text electronic version of the journal’s issue/article please address to the WEB portal of Scientific electronic library or URL:

In journal
2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 | 2007 | 2006 | 2005 | 2004 | 2003 | 2002 | 2001 | 2000 | 1999 | 1998 | 1997 |

The author’s opinions may not coincide with the position of editorial