hristmas cost more in some European countries in 2002. In Italy, Christmas trees and decorations as well as traditional holiday treats such as panettone sponge cake, tortellini, sparkling wine and chocolate all cost at least 10% more than the year before. Some people are blaming the euro.

The one currency for common use was adopted by 12 nations last January ("Smart Solutions or Smart Marketing?", The Green Sheet, issue 02:01:01), and on its first anniversary its success was being debated. For the most part, the conversion to the euro has met expectations and is working, but some problems remain with implementing the switchover and are being felt throughout the participating countries.

The euro has been a success at easing cross-border business transactions and saving travelers time and the expense of changing money. Many objections to the euro come from consumers using it to pay for everyday items, such as food. According to the Wall Street Journal, many Europeans curtailed their holiday spending this Christmas; consumers were said to be worried about the economy and unemployment and irritated at perceived euro-related inflation.

While there have been price increases, European economists said that actual inflation is not as high as what consumers perceive it to be. Estimates say the changeover raised prices by 0.2%. In January 2002, merchants in all 12 countries had to translate prices from the old ones, and many gave themselves a generous cushion in the process, nudging prices upward. Those prices have not come down since.

In Germany, holiday spending was expected to drop 0.6%. In Italy, spending was expected to grow by only 0.2%, France's growth was estimated to be 1.9% and Spain's 2%. By comparison, holiday spending growth estimates in the U.S. were between 2% and 3%.

Britain was one country that did not adopt the euro. Its economy fared better in 2002 than others in Europe. In fact, retailers there were expecting to end the year with a solid holiday season and consumer spending up at least 4.1%.