Eurozone

The euro area,^[8] commonly called the eurozone (EZ), is a currency union of 20 member states of the European Union (EU) that have adopted the euro (€) as their primary currency and sole legal tender, and have thus fully implemented Economic and Monetary Union policies.

The 20 eurozone members are: Austria, Belgium, Croatia, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain.

The largest economies in the eurozone are France and Germany, with a combined economical output accounting for almost half of the zone's one.^[9] A number of non-EU member states, namely Andorra, Monaco, San Marino, and Vatican City have formal agreements with the EU to use the euro as their official currency and issue their own coins.^[10][11][12] In addition, Kosovo and Montenegro have adopted the euro unilaterally, relying on euros already in circulation rather than minting currencies of their own.^[13] These six countries, however, have no representation in any eurozone institution.^[14]

The Eurosystem is the monetary authority of the eurozone, the Eurogroup is an informal body of finance ministers that makes fiscal policy for the currency union, and the European System of Central Banks is responsible for fiscal and monetary cooperation between eurozone and non-eurozone EU members. The European Central Bank (ECB) makes monetary policy for the eurozone, sets its base interest rate, and issues euro banknotes and coins. Since the 2008 financial crisis, the eurozone has established and used provisions for granting emergency loans to member states in return for enacting economic reforms.^[15] The eurozone has also enacted some limited fiscal integration; for example, in peer review of each other's national budgets. The issue is political and in a state of flux in terms of what further provisions will be agreed for eurozone change.

The eurozone comprises about half the countries in geographical Europe.^[16] Within the European Union (EU), seven member states have not yet adopted the euro and continue to use their own national currencies: Bulgaria, the Czech Republic, Denmark, Hungary, Poland, Romania, and Sweden. Of these, all except Denmark are legally committed to adopting the euro once they meet the required convergence criteria.^[17] Bulgaria has been approved to become the 21st eurozone member effective 1 January 2026.^[18] To date, no country has left the eurozone, and there are no formal provisions for either voluntary withdrawal or expulsion.^[19]