Eurozone politicians may fret about the euro rising to record levels but businesses in the 13-country region, while concerned, are not panicking -- and can even see positive benefits.

BusinessEurope, the Brussels-based employers’ lobby, last week warned “a pain threshold for European companies” had been reached. The currency had appreciated against the yen as well as reaching record levels against the U.S. dollar and on a trade-weighted-basis.
Its comments came ahead of Monday night’s meeting in Luxembourg of finance ministers from eurozone countries, expected to seek a common line ahead of the Group of Seven meeting of leading industrial nations in Washington later this month.
Among the noisiest in demanding action have been businesses in France, where the European Central Bank has come under regular attack for not stopping the euro’s rise.
“French companies are more and more handicapped by the euro-dollar exchange rate,” said Laurence Parisot, head of the Medef employers' lobby group.
“The question is not so much the discourse of the ECB, even if more detailed communication would be welcome. But it is really about the capacity of the heads of state and governments of the world's strongest economies to take hold of the problem.”
Airbus, the aircraft maker, has warned that the stronger euro might force it to find additional savings under its restructuring plans.
However, in Ireland Danny McCoy, director of policy at the Irish Business and Employers’ Confederation, said the rise against the dollar was important “but is not the only show in town”.
Among Europe’s most open and fastest-growing economies, Ireland relies on the U.S. for 18.5 percent of its exports -- more than even the UK -- but is also heavily dependent on the UK market, for historic reasons. On a trade-weighted basis, the euro’s appreciation this year has been less dramatic than against the dollar.
In Spain, where fast growth has been accompanied by a soaring current account deficit, companies have also remained upbeat about export prospects. If polls by the Spanish foreign trade secretariat are to be believed, Spanish exporters are among the biggest optimists on the planet.
Choruses of protest have also been noticeably absent in Germany. Dieter Brucklacher, president of the VDMA engineering association, warned last week that “the strong euro is creating an increasingly strong headwind for us with exports”.
But the VDMA revised its forecast for output in the German engineering industry in 2007 to show the first year of double-digit growth since 1969.
The country’s VCI chemicals industry association has stressed the importance of trade within the European Union and the impact of a stronger currency in lowering import prices.
In the Netherlands, Jan Klaver, economist at the VNO-NCW Dutch business association, pointed out that a high euro “also hampers our exports to France, Germany, and other EU countries, where our companies are competing against cheaper American rivals”.
Complaints about the impact on Dutch exports would increase if the euro rose further, he said, “but in some ways it helps . . . several companies in the Netherlands, for example if they are importing U.S. products”.
Italy falls more into the French camp. Its industrialists have spoken out against the “super euro” and urged ECB action, but they recognize that Italy will not be able to return to the days of a constantly devaluing lira.
As Italy’s main trading partners are mostly in the eurozone, the threat to Italy’s exports will be seen more from the knock-on effect of any weakening in Germany’s performance.
“Such a strong euro is not helping the European economy or the timid recovery in Italy,” said Paulo Scaroni, CEO of Eni, the energy company.
Vittoria Merloni, chairman of Indesit, Europe’s second largest maker of household appliances, said: “A super euro up against an ever weaker dollar is certainly worrying, even if in this monetary mechanism it's always possible to pick out advantages and disadvantages.”
But Fernando Napolitano, managing director of Booz Allen Hamilton Italia, said: “Overall the alarm level is still moderate. On the contrary we should enjoy benefits as we buy oil and gas in dollars.”
(Source: Financial Times)