Podium: Now for the good news about the euro

Robin Cook From a speech by the Foreign Secretary to an audience of businessmen at the British embassy in Tokyo, Japan
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The Independent Culture
BRITAIN HAS never been a more attractive place in which to invest. But I know that when you look at Britain, you are also looking at Britain's place in the continent of Europe.

Britain is attractive as a place for investment because it guarantees access to the huge European market of 370 million people. It is the largest single market in the world, a market that is likely to expand even further with the accession of new member states.

Today I give you a guarantee that, under Tony Blair, Britain's place in Europe is secure and the access of business to that market is ensured.

There will be no return to isolationism under this British Government. We are determined to play a positive role in Europe and we have made Britain a key player in Europe.

In all the major debates, Britain is now listened to with respect as a country that is committed to making a success of the European project.

We send the great majority of our exports to other members of the European Union. Seven out of our top eight export markets are other members of the EU. We will be prosperous if their economies are a success. That is why it is in the interests of Britain as much as any other member state that the euro currency is a success story.

And if the euro proves itself to be a success, then it will be in Britain's interests to be part of that success. After only eight months it is too early to reach a firm view, but already there are signs that the euro is bringing a new strength to the economies that are part of it.

In the first six months of this year, the value of the international debt issued in euros was 100bn euros. Over the same period, the amount of international debt issued in dollars was 87.1bn euros. That is a complete reversal of the figures of only the previous year. This not only represents the confidence of the markets in the euro, but is a source of investment for the long term on which European companies are able to draw.

There is also evidence that the birth of the euro is providing a major stimulus to economic restructuring within the euro-zone. Governments are undertaking serious reforms to liberalise their economies and remove structural rigidities, as even some anti-Europeans are starting to recognise.

France is now creating jobs faster than anywhere in the world outside the United States. Across all the member states, borrowers and mortgage- payers benefit from interest rates that are half the level of Britain's. If these trends continue, the single currency will bring significant benefits to those countries that are members of it.

British-based companies and the British workforce are now among the most competitive in Europe. But complacency is the enemy of competitiveness. We must watch with care to see whether the euro brings relative advantages to the industries of the countries within it.

Today I assure you that if the euro proves to be a stable, successful currency, Tony Blair's Government will make sure that Britain is ready to take part, subject to the support of the British people in a referendum. If the euro brings benefits to its members, we will not let Britain lose out by staying out.

Your investment in Britain as the best bridge into continental Europe is a sound investment. We will guarantee that it remains a safe investment by making sure that Britain always makes the most of its membership of the EU.

But we will join the euro only if Britain is ready to reap the benefits of membership. That is why we have set out the five economic tests Britain needs to meet before we can join. Is there sustainable convergence with the euro-zone? Is there sufficient flexibility in the British economy? Will the euro promote investment (including inward investment from Japan and other countries)? Will it boost our financial service industry?And will it be good for employment?

As our Prime Minister has said, "We have resolved the political issues in favour of joining should the economic tests be met. But they must be met." We have given the British people an undertaking that they will take the final decision in a referendum and we will convince them only when the economic case is convincing.

Britain and Japan have a strategic partnership. Our anti-Europeans delude themselves when they imagine that Britain could strengthen its ties around the world by weakening its ties with continental Europe. The opposite is the case. The greater our influence in the capitals of Europe, and the greater our access to the markets of continental Europe, the greater will be our value to our friends outside Europe.

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