STRESA, Italy, 14 September 2003 — EU finance ministers yesterday urged Sweden to adopt the euro in a closely watched referendum, but bickering in the 12-nation currency zone presented a poor advertisement for Swedish voters.
A Swedish “yes” in today’s referendum would be a huge shot in the arm for the euro area, which is battling an economic slowdown and discord over its Stability and Growth Pact, the rules that underpin the common currency. A “no” would further cloud confidence in the currency and set back the pro-euro camp in the two other European Union countries that are outside the zone, Britain and Denmark.
Two opinion polls published yesterday gave conflicting indications on voter intentions.
One confirmed the lead long held by Sweden’s “no” camp, and another showed the “yes” lobby edging slightly ahead, possibly in reaction to the murder of Foreign Minister Anna Lindh, who had been a high-profile euro supporter. “From a European perspective... it would be marvellous if Sweden could join the euro solidarity,” Luxembourg Prime Minister Jean-Claude Juncker, who is also finance minister, told reporters at a meeting in northern Italy.
Swedish Finance Minister Bosse Ringholm said at the EU meeting in the lakeside town of Stresa that France had not helped his government’s pro-euro case by flouting the stability pact. “Unfortunately, the French attitude has played a role in this vote,” Ringholm was quoted as saying by the Dagens Nyheter daily.
The French government’s approach “has complicated things for us in the euro campaign”, he said.
Dutch Finance Minister Gerrit Zalm, in a barb at France, said Sweden has “sound ideas about economic policies and about budgetary policies, and we’d like to have an extra friend in the group”.
For its part, France gained no respite from a barrage of criticism over its approach to the stability pact, after a stormy session of talks on Friday evening among the euro group countries.
At the euro meeting, French Finance Minister Francis Mer committed himself only to getting his government’s budget deficit back in line with the pact in 2005.
That would mean France breaching the pact’s deficit ceiling - 3.0 percent of gross domestic product - for the third year running in 2004, raising the prospect of multi-million-euro fines.
Economic and Monetary Affairs Commissioner Pedro Solbes said the assurance given by Mer to his euro group colleagues “was a good step in the right direction”.
“But in my view it wasn’t sufficient to satisfy the conditions of the recommendations” of the EU for France to get under the 3.0 percent limit as soon as possible, Solbes told AFP.
The Dutch finance minister reiterated his threat of legal action if the European Commission, the pact’s guardian, fails to bring France to heel.
“I cannot imagine how the commission could argue that 2005 is early enough,” Zalm said.
Meanwhile, the size of a planned European Union growth initiative could double to around 100 billion euros ($112 billion) by adding loans for research and development to an infrastructure program, a senior official said yesterday.
European Investment Bank President Philippe Maystadt, the official in charge of evaluating the growth plan, said the EIB believed investment in R&D should get the same weight as loans for new roads and railways proposed by EU experts in June.
“We agree with the French and German governments that we should devote as much to research as to infrastructure,” Maystadt said on the margins of a meeting of EU finance ministers in Italy. The EIB is the EU’s long-term lending arm.
France and Germany have led the charge for R&D to be given equal treatment in the growth plan floated by Italy, which holds the rotating EU presidency. German Chancellor Gerhard Schroeder and French President Jacques Chirac are expected to unveil proposals for changes to the plan at talks on Sept. 18.
