Euro's slow start in Italy blamed on Berlusconi

The smooth introduction of billions of euro notes and coins was marred by a political row yesterday over the new currency in Italy – where the cash changeover has been slower than in any other country.

Giving its first official figures, the European Commission confirmed anecdotal accounts of a less than orderly changeover, saying only 3 per cent of Italian transactions took place in euros on Wednesday.

The lacklustre start for the euro in Italy was reflected in continuing queues at banks and recriminations as the government was blamed for a delay in the distribution of 670,000 special Vatican coins bearing the image of the Pope.

More seriously, Renato Ruggiero, Italy's pro-European Foreign Minister, complained of "scepticism" toward Europe's single currency from some ministers in Prime Minister Silvio Berlusconi's centre-right government. In an interview exposing the fault lines within the coalition, Mr Ruggiero told Corriere della Sera: "The differences of opinion aren't marked – they are very marked."

In Brussels, the European Commission said that, on Wednesday, Italy had the lowest level of euro transactions of all 12 countries – which had an average of one in five transactions in euros – and fell well below France and the Netherlands, where half of all purchases were in the new currency. Gerassimos Thomas, the spokesman for the European Commissioner for economic and monetary affairs, said that less than half of all cash dispensers had been converted in Italy before the 1 January launch of the new currency and that the take-up of starter kits of euros by small businesses had been relatively low, as had the number of kits of coins bought by the public in Italy.

That meant, he said, that "on the first day, fewer Italians had euros to go out and pay for their shopping". Another factor may be that consumers were off-loading quantities of "black" lire they had been hoarding.

In Frankfurt, Wim Duisenberg, the European Central Bank president, said the ease of the switch had exceeded hopes but also put Italy at the bottom of the class. He said that, across the eurozone, 96 per cent of cash machines had been converted, with all machines in Belgium, Germany, Greece, Ireland, Luxembourg, the Netherlands and Austria now dispensing new notes.

By yesterday about 90 per cent of cash machines in Finland and Portugal were distributing euros, with 85 per cent in Italy – although that figure was expected to rise later in the day.

A Vatican spokesman described the "technical problems" preventing distribution of its euro coins, adding: "First they [the Italian government] have to get the Italian euro in circulation, then comes the Vatican euro."

Italians may have taken their lead from their politicians. As his European counterparts spent their first euros before the TV cameras, Mr Berlusconi was at his villa in Portofino, ignoring the celebrations. Umberto Bossi, the far-right Northern League leader and Reforms Minister, said he "couldn't give a toss about the euro and neither did anyone else".

Giulio Tremonti, the Economics Minister, refused to praise the euro, saying that was over to "faith-healers, miracle-makers and bankers" and Antonio Martino, the Defence Minister, said judging by the launch the euro could fail. Only President Carlo Azeglio Ciampi spoke of the euro's importance.

The rhetoric from Rome underlines Italy's growing reputation as a more sceptical EU partner under Mr Berlusconi.

Claims of price inflation were commonplace but not, so far, acknowledged by the authorities. In Italy, figures from consumer watchdogs show coffee and pizza prices rising by as much as 30 per cent and 16 per cent respectively.

Mr Duisenberg dismissed claims of price rises when he told a press conference: "The Big Mac that I bought yesterday evening – and that was with a strawberry milkshake – cost €4.45 and that is exactly the same price [as before]. Le Figaro last week cost seven French francs and now I bought one for €1, which is a discount of seven per cent," he added.

Yesterday also produced the first case of counterfeit notes, albeit inexpertly forged ones.

In Germany, police said a 12-year-old girl had found a forged €50 note on a train, the first fake to come to light since the new cash was issued. Another man used a fake €500 note, stuck together from publicity pictures, to con a casino out of marks.