Siemens offers UK wages in euros

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The Independent Online
SIEMENS, the German electronics giant, intends to offer its UK workforce the option of being paid in euros after the launch of the single European currency next year.

Siemens, which yesterday became the first company in Britain to open a bank account in euros, employs 13,600 people in the UK, manufacturing semi-conductors, electrical equipment and power generation plant.

Bernd Euler, finance director of Siemens PLC, said: "Paying employees in euros is something we will offer as an option in the coming years." He indicated that the facility would almost certainly be available before the UK enters the single currency.

The company is also examining the possibility of paying its taxes in the UK in euros although it has not yet had any discussions with the Inland Revenue.

The decision to allow employees to opt for payment in euros is likely to be followed by other large foreign investors in the UK and is an indication of how Britain may end up with de facto adoption of the single currency.

"It will come in by the back door," said Mr Euler. "More and more companies will adopt the euro, particular those who are exporters. They will have no choice but otherwise they will be at a competitive disadvantage."

Siemens has already invited its suppliers to bill in euros although its stresses that they will not be forced to use the new currency. Its UK arm spends pounds 1.5bn a year on supplies, of which about pounds 500m worth comes from 13,000 UK suppliers. Exports from the UK generate about 15 per cent of Siemens' pounds 2bn turnover.

The new euro account, opened with NatWest, will enable Siemens to deal with customers and suppliers in euros. NatWest said a further 2,000 big UK companies were interested in opening an account in euros.