DURING the transition period for the introduction of EMU, businesses will work with two currencies. The Minister for Finance, Mr Quinn, said that for about four years, there is likely to be mandatory dual pricing.

Companies selling goods or services will have to give their prices in both pounds and euros. This is to protect against businesses which try to take advantage of the transition, in order to increase their profit margins. There is an "inherent" inflationary element in the move from the pound to the euro, Mr Quinn has said.

The transition to the decimal currency in February 1971 was accompanied by such opportunistic price increases. However, if the low inflation of recent years persists, it will militate against such increases.

The timetable for transition is not yet written in stone. However, Mr Quinn says he is confident that on January 1st, 1999, the exchange rates of the countries joining EMU will be irrevocably fixed against each other and so the euro will come into being. Ireland will be among the member states which join EMU on this date, Mr Quinn says.

National currencies will continue to be used, up until January 1st 2002, at the latest. The euro will then be issued and the two currencies will be in circulation at the same time, for a period. The national notes and coins will be withdrawn by July 1st 2002, at the latest.

Mr Quinn said he believes the mandatory pricing will last for approximately four years. This would allow for the 3.5 years outlined above, with a margin at each end.

The ESRI, in a study on the implications for Ireland of EMU, concluded that, irrespective of whether Britain was among the first group to join, EMU would be of net benefit to the economy. The "lift" to the economy should be worth 1.4 per cent of GNP if Britain is in early, and 0.4 per cent if it stays outside.