Denmark to hold second vote on joining the euro

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Denmark will hold a new referendum on whether to adopt the euro and drop its opt-outs on closer co-operation with the EU on defence and law enforcement.

Danish voters rejected the European common currency in a referendum in 2000. It has also opted out of other key areas of EU co-operation.

The Prime Minister, Anders Fogh Rasmussen, said it was time to reassess those exemptions, which Denmark was granted in the early 1990s. "A lot has changed since," he said. "It is the right time to take a decision."

No date was set for a plebiscite but it would be held during the next four years, said the Prime Minister, whose centre-right government was re-elected last week. It was not clear whether there would be a separate vote for each of the exemptions.

Danes stunned EU members in 1992 by rejecting the Maastricht treaty on closer European co-operation. A year later, Danish voters approved a revised treaty with clauses letting it stay outside a single currency and banking system and refrain from joining a European defence structure or conform to EU citizenship laws and common law enforcement.

"We have always said that the Danish exemptions are a hindrance for Denmark," said Mr Fogh Rasmussen. He said the referendum would be held after Denmark had ratified the new EU reform treaty, which includes changes in decision-making rules designed to make the union function more effectively.

Mr Fogh-Rasmussen's Liberal-Conservative coalition won the snap election on 13 November with support from its nationalist ally, the Danish People's Party, and a smaller centrist group. Denmark has held five referendums on EU-related issues since it joined the bloc in 1973.

In the latest one, on 28 September 2000, Danes voted 53.1 per cent to 46.9 per cent against replacing the Danish krone with the euro. Recent opinion polls have shown a narrow majority of Danes now favour switching to the euro.