[A-List] Sweden: eurozone membership

["Michael Keaney" <michael.keaney@xxxxxx>]

Sweden's ruling party paves way for euro vote
By Nicholas George in Stockholm
Financial Times: November 18 2002

Sweden took another important step towards membership of the eurozone on
Saturday when the ruling Social Democratic party gave the go-ahead for a
referendum on the single currency.

At a meeting of the Party Council in Stockholm, delegates agreed
overwhelmingly that the economic conditions set by the party for entry had
now been fulfilled.

Göran Persson, prime minister and party leader, was instructed to find a
date for the referendum and will begin negotiations with the leaders of
Sweden's other six parliamentary parties on November 29.

"It is time to move to a decision. The discussion won't take us any
further," Mr Persson said. "It will not be a unanimous decision, but it is
time to deal with this issue."

The conditions set by the party congress in 2000 established that Swedish
wage formation should be in line with that in the eurozone and that the
country's economic cycle not be significantly different from its European
partners. Public finances should also be strong enough to allow the
government room to use fiscal measures as a way of countering an
economic downturn.

Mr Persson said the date of the referendum would be sometime between March
and November next year. The largest opposition party, the conservative
Moderates, wants to the hold the referendum in spring of next year while the
government's support party, the Left Party, would prefer late autumn. A
compromise date sometime in September or early October is the most likely.

At present, opinion polls show a small majority in favour of membership
although there is a strong movement against, even within the SDP itself.
Opponents claim Sweden's welfare state, with high employment and generous
benefits, would have to be sacrified inside the eurozone.

Supporters of membership will instead focus on the prospect of lower
interest rates and prices in the monetary union.