21 MAY 2003

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UK opposition to euro hits record high

British Prime Minister Tony Blair's plans to bring the euro to Britain suffered another blow yesterday morning when a poll revealed a record number of Britons stand firmly against the move.
According to a Guardian/ICM poll published yesterday, opposition to Britain adopting the single European currency has reached its highest level yet, with 45 per cent of respondents saying that they would certainly vote "No" to the euro in a referendum.
A further 14 per cent said they were against the move but might be persuaded to change their minds, with less than one fifth coming out in favour of dropping the sterling.
Blair and euro sceptic Chancellor of the Exchequer Gordon Brown are this week meeting Cabinet members on an individual basis to plot out the government's stance on the euro. The meetings, expected to be spread over the next three days, give ministers their first proper chance to put their view to the two men seen to control the referendum decision.
The cabinet is due to reach its verdict in the first week of June, following three weeks of discussions based on 18 Treasury studies on the implications of the euro and the chancellor's own five tests.
"The five tests effectively define the national economic interest for our country," Brown said. "It is a guarantee that we can ensure jobs, investment and the future profitability of industry and the prosperity of the country."
Each minister goes to their meeting fresh from receiving 2,000-odd pages of Treasury background studies looking into the implications of the UK replacing the pound with the euro.
The face-to-face talks will conclude today, just ahead tomorrow’s cabinet meeting, which the euro is expected to dominate.
Brown also said that if the tests are met and the Cabinet decides to call a referendum, he would urge the public to back the nation's participation with the euro.
But many commentators believe this week’s ministerial meetings are meaningless, as the Chancellor is almost certain to announce in June that the five economic tests for euro entry have not been met.
Without the tests, a referendum on the euro will not take place in Britain.
Far East threat
Meanwhile, it is believed that Far East investors could pull out of Britain unless they get a clear signal that the government is preparing the groundwork to enter the euro, one foreign office minister warned on Monday.
Gordon Brown was told that if he delivers a "no" verdict in June he must show how he was working towards the objective of joining and "in the not too distant future". Investors had to be assured that Britain was trying to get ready, and if possible when it expected to be ready, the minister emphasised.
The intervention in the euro debate came from the minister responsible for the Far East, Bill Rammell. Rammell said that if the government gave the impression that it was ruling out the euro indefinitely that would be seen as a "significant U-turn" in the Far East.
Most of the key investment decisions made by Japanese and Korean investors up to now had been built on the premise "that we would go in before too long", he said. His remarks were a further indication of how Labour’s pro-euro ministers have become emboldened to press their case.
Rammell said that business in the Far East needed some degree of certainty in its planning. "They don’t want a situation in which there are sharp variations in interest rates and exchange rate between Britain and the eurozone," he said.
He added that if it the answer were a "No" it would be important to make clear that the delay is not forever, otherwise there would be a risk that they "start becoming anxious and reconsidering their positions. If it is a no we have to explain to foreign investors how we get to the point where we are ready and, if possible, when we expect to be ready."

Copyright © Newsworks Ltd. Malta.
Editor: Saviour Balzan
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