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Mandelson insists Britain WILL join the euro despite worst crisis in its history


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Mandelson insists Britain WILL join the euro despite worst crisis in its history



By James Chapman

Last updated at 12:52 AM on 27th February 2010





Lord Mandelson continues to espouse the benefits of the euro despite questions about its survival


Lord Mandelson prompted uproar last night by declaring Britain wanted to join the European single currency even as it is suffering the worst crisis in its history.


Labour's Business Secretary insisted the Government would eventually take Britain into the euro just a day after German Chancellor Angela Merkel warned Greece's debt crisis has left it in a 'dangerous situation'.


Lord Mandelson, who is now the second-most powerful man in the country, has become the first senior minister to enthuse repeatedly about the benefits of euro entry, putting him at odds with Gordon Brown.


But the timing of his latest remarks caused consternation as soaring debt levels in Greece and other countries has raised questions about the survival of the currency.


Economists say euro membership has acted as a straitjacket in the downturn for struggling countries.


But the Business Secretary, speaking at a university in Paris, said: 'We already have the eurozone providing a single central bank, currency and monetary policy, which one day I believe Britain will be part of.


'Don't ask me when. It's not going to be soon, but we will do it.'


Tory Europe spokesman Mark Francois said the recent crisis had shown 'how right we were to keep the pound'.


'We have not been tied into interest rates or exchange rates that don’t suit us. So it’s incredible that Peter Mandelson still thinks it’s a good idea for Britain to join the euro.


It shows how Labour can’t help themselves putting ideology before what’s good for Britain,' he added.


Shadow foreign secretary William Hague has pledged that there are 'no circumstances' in which the next Conservative government would propose joining the currency.







Euro MP Paul Nuttall, chairman of the anti-EU party UK Independence Party, said: 'He has got to be kidding.


'First he would have to convince the British public that they wanted such a thing, which to put it politely would be unlikely.


'Then he would have to hope that the euro was still around at about the time that hell freezes over, which looking at the state of Greece and other countries is highly unlikely.


'The political elite of this country are so wedded to their love affair with the EU that nothing - especially economic reality - will get in the way.'


Critics have questioned Lord Mandelson's motives, since he is not supposed to criticise the European Union if he wants to keep hold of his £31,000-a-year pension as a former European Commissioner.


Under the terms of the deal, he will receive an index-linked pension of £31,000 a year when he turns 65. The cost of buying such a deal on the private market would be £550,000.


This is in addition to more than £234,000 of 'top-up' salary payments and a £15,000 resettlement fee which he will receive over the next three years.


In 1997, Mt Brown set five economic tests that must be met before ministers would recommend UK euro entry and hold a referendum.


Current policy is that the Government 'sees benefits in euro membership' but will not join unless the tests, such as convergence of interest rates and impact on employment, were met.


The key test is whether the UK economy is coming together with those of countries in the eurozone and whether this can be sustained in the long-term.


The second test is whether there is sufficient flexibility to cope with economic change. The remaining three tests assess the impact of joining the euro on jobs, foreign investment and the financial services industry.


Downing Street insists the Government's position on the euro is 'long-standing and remains unchanged.'


Read more: http://www.dailymail.co.uk/news/article-1254179/Mandelson-insists-Britain-WILL-join-euro-despite-single-currency-crisis.html#ixzz0gjEXmxKy

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The Euro is done for. Germany is basically propping it up with its fiscal responsibility. Greece is in the process of being "bailed out" via bond sales.


It's like everybody's trying to climb into Germany's little lifeboat after the Titanic sank. There's not enough room.

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