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EU: Danes' No to Euro May Affect EU Integration, Expansion

  • Anthony Georgieff

In an unprecedented turnout of almost 90 percent of the electorate, Danish voters have decisively rejected joining the EU's new common currency, the euro. In so doing, they may have changed the course of future EU integration and expansion. Our correspondent in Copenhagen reports on yesterday's vote and its implications for the EU and the 10 east European states seeking membership.

Copenhagen, 29 September 2000 (RFE/RL) -- The final tally showed 53.1 percent against and 46.9 percent for Denmark participating in the EU's Economic and Monetary Union, or EMU. Thus, in the first EU member-state to ask its citizens about the euro, the response was a clear "no."

Prime Minister Poul Nyrup Rasmussen led the pro-euro campaign that was supported by most major parties, the media, business and industry, and the major trade unions. He admitted his government's defeat last night, but sought to play down its significance. The referendum's result, he said, was not a sign that Danes have turned their backs on Europe. Nor, Rassmussen added, have they said that EU enlargement to the east must be stopped now.

But at the same time Rasmussen did indirectly acknowledge the Danish vote would create concerns elsewhere in the EU. He told reporters: "Many, many people here and in other European countries are a little bit uncertain about where do we have the lines between what is Europe and what is our nation's [views]. And perhaps, our contribution could be, in a constructive way, to give an input to that discussion."

Rasmussen and others supporting the euro had maintained the Danish economy would fare better if the country joined the euro-zone, which -- with Greece's entry in three months -- will soon comprise 12 of the EU's 15 members. They said, too, that Denmark would be marginalized politically if it opted out of the EMU.

Their arguments were rejected in favor of the nay-sayers, an assorted alliance of far right and far left parties and civic movements, which said that Denmark would lose its national sovereignty if it gave up the krone, its national currrency. The right stressed that Danes should decide for themselves what to do in their own country. The left played on fears that the country's generous social services might deteriorate if Denmark was forced to lower its high tax rates as a result of EMU membership.

Many Denmark analysts view the referendum's result as a victory for the far-right Danish People's Party led by Pia Kjaersgaard, whom some see as her country's equivalent of Austria's Joerg Haider. Kjaersgaard said last night that the government should now begin the kind of public debate she proposed during the run-up to the refeerendum. The debate's questions should include, she said, "What is Denmark's place in Europe? How far can we go? The only thing sure," she added, "is the sort of integration process to which we have so far been exposed must be stopped."

Some analysts read very little into the referendum beyond the rejection of the common currency. Lykke Friis, a senior research fellow at the Danish Foreign Policy Institute, told RFE/RL that yesterday's vote was strictly on the issue at stake, the euro.

"[Danes rarely vote along party lines] in EU referenda. We can have a split system, where people vote differently in EU referenda and elections for the European Parliament elections than they do in [national] parliamentary elections -- because EU politics is not seen as being a part of ordinary Danish politics."

According to Friis, the most immediate political consequence of the vote for Denmark will be increased difficulties at the December EU summit in Nice, France, which is due to adopt a new Union treaty on internal reforms and enlargement. She said that it remains very much in in Denmark's interest to achieve eastward expansion, and therefore to push for the adoption of the Nice treaty. But she added: "Obviously, Denmark will now be unable to do that."

Friis foresees additional difficulties for the central and east European EU candidate states as a direct result of the Danish referendum. In Nice, she says, there will be more pressure to adopt what she calls the "the so-called flexibility paragraph" that will make integration requirements more adaptable and thereby allow EU front-runners to run even faster. That, she says, is "not necessarily" in the interest of central and eastern Europe.

Friess' concerns that Denmark's rejection of the euro may have a negative impact on EU expansion to the East are shared by Krum Slavov, Bulgaria' ambassador to Denmark. Slavov told our correspondent:

"My opinion is that, from a political standpoint, the impact on the former socialist countries in central and eastern Europe will be primarily moral [and negative]. In addition to the personal disappointment of people like myself, who tend to think in an European integrationist pattern, I think that negative outcome will not bring anything positive."

There has been immdiate, and strong, international reaction to the Danish vote. In Brussels, European Commission resident Romano Prodi said that Denmark "chose not to have an impact on Europe." In Frankfurt, European Central Bank President Wim Duisenberg said the EU bank would intervene on behalf of the Danish krone in case pressure on it now increased.

Swedish Prime Minister Goran Persson acknowledged that Denmark's "no" was likely to encourage anti-euro voters in Sweden. Persson refused to say when his country might hold its referendum on the issue.

British Prime Minister Tony Blair said the Danish "no" was unlikely to influence the his government's course, which, he said, "in principle" favors the euro. But many analysts predict that the Danish outcome will be used extensively by Britiain's anti-euro media and could play a role in an eventual British referendum on the issue.

In Stockholm, economics proessor Lars Calmfors summed it up this way: "The Danish 'no' will make things much easier for both Sweden and Britain to stay outside euro-land."

Other analysts had a kinder judgment about the Danes. They said, essentially, that what matters most is Denmark has again asked its citizens uncomfortable questions about the EU -- questions that other EU governments have not yet dared to put to a popular vote.