Economics / History

‘An historic step for Europe’

On 23 November 1998, a full-page advert in the Financial Times urged the British government to join the European single currency as soon as possible. It was signed by a range of business leaders, from James Dyson to Baron Haskins of Skidby, representing companies from Kettners Restaurant to Rentokil. Their words are as important today as they were then and – in the spirit of public service – we republish them here:

‘In a recent independent survey, 63 per cent of UK businesses said that it was in their companies’ best interest to join the single currency as soon as possible, or after the next election. This majority view from the UK business community is today endorsed by over 100 business leaders who have put their names to the statement that follows:

‘On January 1st the European single currency will come into existence. This is an historic step for Europe, but one from which Britain has decided, at least initially, to stand aside.

‘There are, of course, risks in any course that Britain might choose to take. But from a business point of view, we have to weigh up the practical arguments on both sides and form a balanced judgement. The best judgement is that the British government should aim to join the single currency as soon as the conditions for successful entry are in place.

‘Some would prefer the EU was not embarking on the creation of a single currency at this time. But business judgements have to be made in the real world. And in the real world, there are clear economic advantages to British membership, and clear disadvantages to long term self-exclusion.

‘The creation of the European single currency will be a force for economic stability. It will promote low and stable interest rates and low inflation, and encourage prudent fiscal management. It will strengthen the single market and free companies trading within the euro area, our major market, from the uncertainties of exchange rate fluctuations.

‘Membership of single currency, if it works well, will promote trade, investment and economic growth. Each of these help to create jobs.

‘A decision to remain outside the single currency indefinitely, on the other hand, would pose a serious threat to our future prosperity and to our influence in the world.

‘Outside EMU, British business would be burdened with higher interest rates and a more exposed currency than its currency. Moreover. Britain’s exclusion from the Euro-X council would mean that we had little influence over European monetary policy which itself would have a decisive effect on our domestic market conditions.

‘The government’s decision that Britain should not join in the first wave gives us the ability to EMU’s progress in the early stages from outside and to assure ourselves that the necessary criteria are met. But Britain’s best economic interest is likely to involve joining soon after EMU is established, and the best policy for Britain is one based on the assumption that we will join.’

And here’s the list of signatories:

The Single Currency - the View of British Business - signatories FT 23-11-1998


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