Joel wrote an excellent article on handling different charactersets in software.

In this article I'll fill you in on exactly what every working programmer should know. All that stuff about "plain text = ascii = characters are 8 bits" is not only wrong, it's hopelessly wrong, and if you're still programming that way, you're not much better than a medical doctor who doesn't believe in germs. Please do not write another line of code until you finish reading this article.