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EU: Danes Voting On Whether To Join Euro Currency

  • Anthony Georgieff

If public-opinion polls are reliable, tomorrow's vote in Denmark on whether to adopt the European Union's common currency, the euro, is likely to be close. On the day before the vote, polls suggest an almost equal divide between "ja-" and "nej-" sayers in a country that -- along with Britain and Sweden -- is considered quite skeptical about further integration with the EU. Correspondent Anthony Georgieff reports from Copenhagen.

Copenhagen, 27 September 2000 (RFE/RL) -- The fate of the Danish krone in tomorrow's (Sept 28) referendum on whether to adopt the euro will in all probability be decided by the 11 percent who tell pollsters they have not yet made up their minds.

But analysts in Copenhagen warn that the polling results should not be considered definitive. They recall similar data in 1992, just before Danes voted against the Maastricht Treaty that created the Union, provoking a political crisis in the EU. Polls then suggested a lead by those who supported the treaty, but the official result was "no."

The well-funded pro-euro camp in Denmark -- which includes all mainstream political parties, the media, business and industry, and the major trade unions -- is led by Prime Minister Poul Nyrup Rasmussen's ruling center-left Social Democrat minority government. Those in favor of joining the euro argue that, after 28 years in the EU, Denmark now enjoys a low unemployment rate -- 5 percent -- sends two-thirds of its exports to other EU countries, has no security worries and would be less vulnerable inside the euro-zone than outside.

Joining the euro, the government says, is the only way to guarantee Denmark's financial stability and its political influence in Brussels. Losing the krone, its says, would be a small price to pay for greater influence within the euro-zone which -- with Greece's joining in three months -- will soon comprise 12 of the EU's 15 members. If it opts out of the euro, the government warns, Denmark will risk being relegated to the EU's margins as a bit player, excluded from the big club and defenseless in the face of globalization.

The anti-euro camp is a rag-tag alliance of right- and left-leaning parties. It enjoys the advantage of a broad, cross-party platform, but suffers from the disadvantage inherent in cooperation between the far right and the far left.

On the right, the "no" sayers say that losing the krone would inevitably entail a loss of sovereignty and national identity. They say the euro is a symbol of what many Danes dislike about the EU: the interference by centralized authorities in Brussels. The anti-euro-right parties cite the example of Austria, a small country -- roughly the size of Denmark -- which, they say, was recently bullied by large EU countries because Austria's democratically elected government included a far-right party.

For their part, left-wing "no" sayers argue that adopting the euro would allow the EU's European Central Bank to set financial policy. That, they say, would mean a reduction of taxes -- Danes pay as much as 60 percent in income tax -- and therefore a steep reduction in Denmark's extensive welfare services.

Some analysts say the referendum is not a question of policy -- right or left -- but simply a confidence vote in the government. Toger Seidenfanden, the editor-in-chief of the major Danish daily Politiken, goes so far as to say that the vote has nothing to do with Brussels or the economy, but [rather] with a confidence gap between Danish politicians and Danish voters.

John Schmidt, a counselor to the Foreign Minister, sees the issue differently. He says things may not change much in economic terms regardless of how the vote turns out. He tells RFE/RL:

"There is broad political consensus in the Danish parliament to follow the euro, to have a fixed exchange rate policy to the euro -- even if the result of the referendum is a 'no.' We've had that for 16 years now [the Danish Krone having being fixed to the German mark]. The obvious argument is since we are following it anyway, why do we not put our foot forward instead of having to follow what others decide."

The vote is likely to have important consequences for Britain and Sweden, the two other EU countries that have voluntarily stayed outside the euro-zone.

Analysts say if the Danes vote to join the euro, Britain would be further marginalized inside the EU, while Sweden would be encouraged to join, possibly by setting a firm date for its own referendum. Sweden is due in January to become the first non-euro member to take over the EU rotating presidency.

Further, if the Danes say "no," currency markets may lose confidence in the euro and the broader process of European integration may be jeopardized. The split between EU members in the euro zone and those outside would continue, and possibly even deepen over the years. A "no" vote could also complicate current negotiations on a new EU treaty, hoped to be concluded at the Union's December summit in Nice, France.

A "no" outcome could also have implications for the 10 EU applicant states in central and eastern Europe. Lithuania's ambassador to Denmark, Raimundas Jasinevicius, tells our correspondent:

"For my country, the result is of great importance, very great importance. There are two reasons. First of all, now Denmark is a very influential advocate for our aspiration to join the EU. If they say 'no,' this influence will be much weakened. Danes will be unable to continue encouraging the EU enlargement process. Another thing is that in our own country we do not need additional support for Euro-skepticism. We understand that we have no other choice, no other way, for a better life, democracy, and prosperity than joining the EU."

The official results of the Danish referendum are expected at 2300 (Prague time) tomorrow (Thursday.)

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