Cyprus is about to join the Euro zone.  The preparations are here and there, and this thing is in the atmosphere. Back in June (or was it July?) the exchange rate was fixed by the Central Bank. It will remain static until the Cyprus Pounds will disappear.
Starting from the 1st of September all prices must be displayed in both currencies. Cyprus Pound is still the main currency, but the Euro must follow.  Most places follow the regulation, and indeed you can see the CYP and EUR all over the place.
On the 1st of January 2008, Euro will become the main currency, but all prices will have to display Cyprus Pounds equivalent for the next month (until January 31st 2008).  After that, the Cyprus Pound is gone and it’s all in Euro. Or it’s at least how I understand the process.
Anyway. There is a lot of confusion in the masses, and that, I believe, is expected to a certain degree. One thing for example, is that many people don’t realize how to convert the currencies back and forward. The Central Bank gave the fixed rate of 0.585274. That means that for each 1 Euro you can get 0.585274 Cyprus Pounds. Or 59 Cyprus cents.  But with one rate, how does one get conversion the other way? That’s pretty easy. Instead of multiplying the amount by the rate, you need to divide it. So, for each 1 Cyprus Pound you’ll get 1 / 0.585274 = 1.70860144138 Euros. Or 1 Euro and 71 cents.
That was easy. But still many people have problems with this. Or with remembering the rate. Even a rough one.
There are shops that make it ever harder on us. Intentionally. Or maybe they are just trying to make it easier and it just comes out like this. Example. Today I went to the cinema. (I wanted to “The Simpsons movie“, but my timing was wrong and I ended up watching “Seraphim Falls“, which started of as a good movie, but slowly lost its way and closed as a bunch of non-sense). The K-Cineplex movie theater got me by surprise. And I’m sure I’m not alone.
The usual price of a ticket is 4 CYP. Today I paied 4.39 CYP. At first I didn’t realize why, but my attention was quickly drawn to a new price list, where 4.39 CYP was followed by a nice 7.50 EUR. Wow! A price update. Nice. Though if others will follow this lead, I’ll have to carry a lot of coins with me. Once inside, I decided to buy a small bottle of water. A surprise again. Instead of the usual 50 cents, the cash register was showing 59 cents. 1 EUR. Coins again.
It’ll be interesting to see how people and business react to a change like this. One thing that will ensure lots of fun is that it is illegal to round the converted price (from what I heard, no sources though). That means, that if a real estate agent has a house for 200,000 CYP, he’ll have to show the price of 341,720 Euro and 29 cents somewhere nearby.
Have you had any fun with Euro yet?
Things were even worse as my friends from Holland told me this summer.
Back in the days they had those 1 cent coins and so on.
The solution was very easy – rounding all the prices, in supermarkets, peripteros etc.
As far as I understood it, Cyprus sellers are not allowed to round prices. The conversion must be precise.
The euro introduction in Greece led to significant price increases. A drachma coin was next to nothing in value, but a euro coin is substantial. Yet, people have a psychological illusion that amounts for the same thing. So we saw tips rising from 50 drachmas (1/7 of a euro) to 1 euro.
Cyprus will not experience something similar, as the pound is of grater nominal value than the euro. Yet the rounding will lead to some price increases.
K Cineplex. Same thing happened to me.
The regulation states that price tags must be in Euro and Cyprus Pound for September 2007 until September 2008.
Some companies have stated that they will round down the prices which is allowed.
No fun with Euro yet. :(