Germans lose appetite for euro

The franc, mark and lire vanished six years ago, but in their place is springing up a dense undergrowth of do-it-yourself currencies as recession-mired regions seek to pump purchasing power back into their communities.

The chiemgauer may not be up there with the pound or the yen, but in Bavaria it is considered hard currency. It was dreamed up by 30-year-old economics teacher Christian Gelleri in response to an unemployment rate of almost 11 per cent.

Backed by his pupils, Gelleri is issuing banknotes for use only in Bavaria. And elsewhere in Germany, 40 cities or regions have followed suit.

Eurosceptics in Britain may chuckle as communities try to reassert the control that passed to the European Central Bank in 1999. But money is no laughing matter at the school where Gelleri works in Prien, a market town set amid Alpine peaks,

Gelleri told Financial Mail: 'In this region, and throughout Germany, consumers were reluctant to spend. I was sure people would start spending again if they knew their cash would pump life back into the local economy.'

Gelleri's pupils designed and printed the currency - named after the local region of Chiemgau - and put it into circulation on the basis of one chiemgauer for one euro. It is sold in bundles of 50.

Katrin Schwedler, a civil servant, said: 'Since Germany introduced the euro, prices have skyrocketed and jobs vanished. Alternative currencies should be given a chance.'

Chancellor Gerhard Schroeder agrees. He told his ministers that regional currencies make excellent sense. Praise indeed.