Delors recipe for single currency

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The Independent Online
(First Edition)

ROME - The European Commission President, Jacques Delors, yesterday suggested that an inner core of seven countries could launch a single European Community currency without waiting for the other members.

'It is a question that can be raised whether it might not be in the interest of countries that are not totally ready, for the others to go ahead with a single currency so as to drag the rest along,' Mr Delors said. 'This would mean that if a group of seven countries went ahead with a single currency, there would be a transition period of two or three or four years for the others to join in.' He denied that this would amount to 'creating a two-speed or a two-track Europe'.

Mr Delors, who was addressing a joint news conference with the Italian Prime Minister, Giuliano Amato, said it was in any case wrong to think of a two-speed Europe in pejorative terms.

Under the December 1991 Maastricht treaty, the earliest target for the final stage of Economic and Monetary Union (EMU) - including the introduction of a single currency - is 1 January 1997, if all the partners are ready for it. If a majority of countries miss the 1997 target, a minority can go ahead with a single currency from mid-1999.

Because of its disastrous public finances, Italy is one of the EC members that would find it hardest to meet the economic convergence targets set for the next stage of EMU. Italy, which dropped out of the European Community's Exchange Rate Mechanism (ERM) currency grid with sterling last September, has advocated speeding up progress towards monetary union as the best way of overcoming currency market turmoil.

The deputy director-general of the Bank of Italy, Tommaso Padoa-Schioppa, said in a recent article that 'a speedier passage to the third (and final) phase of EMU, perhaps only by a restricted group, is the only really structural solution'. He said the decision to opt for a long transition period was a purely political one, not justified on economic grounds.

'From the economic viewpoint, speeding up (phase three) would benefit even those countries that would be forced to delay their participation,' he wrote in the latest issue of Il Mulino current-affairs review.

OSLO - Denmark, the current president of the European Community, said yesterday that the EC must respect the politics, history and culture of applicant states in talks on enlarging the 12-nation bloc, Reuter reports.

The Danish Foreign Minister, Niels Helveg Petersen, visiting Norway, said this principle would have to be applied in the talks on enlargement with Norway, Sweden, Finland and Austria. The thorniest issues with Norway included fisheries, energy policy, Arctic farming and regional policies, he said.