Sweden's No deals serious blow to the euro

Euro vote: Yes 42%, No 56% (with 97% of votes counted)
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The Independent Online

Sweden delivered a crushing "no" verdict to the euro last night, defying expectations of a pro-single currency sympathy vote after the murder last week of Anna Lindh, the Foreign Minister, who was a prominent "yes" campaigner.

The result represents an extraordinary grassroots rebellion against Sweden's political and economic establishment, which largely backed membership of the euro. It also sends a powerful message to Brussels, underlining the fact that the EU is seen by many of its citizens as remote and elitist.

With almost all the votes counted and the "no" camp clinching victory by 56 per cent to 42 per cent, the Prime Minister, Goran Persson, of the Social Democrats, conceded defeat. The outcome was "very clear" and therefore "easy to respect", he said, adding: "This reflects the profound scepticism of the economic and monetary union project. With the wisdom of hindsight, you could have said that we could have held the referendum at a more auspicious time. We are in the midst of a recession and two or three [eurozone] countries have significant deficit problems."

Ulla Hoffmann, leader of the anti-euro Left Party said the vote was "a signal to Europe that it must democratise".

Young, first-time voters and women were prominently represented among those who rejected the euro. The turnout in the referendum was more than 80 per cent.

The result is bad news for Britain's beleaguered supporters of membership and illustrates to Tony Blair how difficult it is to win a referendum. Chris Bryant, chairman of the Labour Movement for Europe, said that people should not assume that a British referendum would produce a similar result. "Many of Sweden's trading partners are not in the euro or even the EU, like Norway, whereas with Britain, more than half of our trade is with euro countries," he said.

But Michael Ancram, the shadow Foreign Secretary, said that the vote "strengthens our view that for us to oppose the euro for the UK is right". He added: "This demonstrates the extent of doubt that exists in Sweden and is increasingly reflected in other parts of Europe."

Romano Prodi, president of the European Commission, described the result as "worse than expected". When asked if Sweden would lose influence within the EU as a result of the vote, he said: "Certainly, yes."

More than seven million Swedes were eligible to register their views in yesterday's vote, which was overshadowed by the assassination of Ms Lindh.

Eurosceptic celebrations were muted. At the headquarters of the "no" campaign run by members of the Social Democrat Party, which is divided on the euro, the evening began with a minute's silence. The five cabinet ministers who defied party line by backing the "no" side were not at the meeting.

Both camps had called on voters to turn out in large numbers to show that democracy cannot be thrown off course by violence. But the "no" supporters seemed to benefit more as the expected "Lindh effect" failed to materialise. One theory is that the trauma of the murder encouraged voters to opt for the status quo. Another is that the "no" camp benefited from the high turnout with more of its supporters voting than had been expected. More than one million Swedes are thought to have cast their votes by postal ballot before Ms Lindh's death.

"Yes" campaigners blamed their failure on lack of preparation and divisions within the Social Democratic government.

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