Uk Adopting Euro
The Euro notes and coins were officially launched on January the 1st 2002. (Financial Times,2002, http://specials.ft.com/euro/FT3O9H0O2PC.html). We in the UK for now and the foreseeable future have retained the use of sterling. During the course of this assignment I am going to look into the case for and against the Uk adopting the Euro and replacing sterling, and also the case for the Uk retaining the use of sterling and not joining the countries who have already adopted the Euro as their national currency. During the course of this assignment we will need to look at areas such as the current suitability of the Uk economy to adopt the Euro. It is a very politically controversial issue as shown with the launch of a party headed by the late Sir James Goldsmith whose sole manifesto was for there to be a referendum on this issue.(BBC,1997, http://www.bbc.co.uk/election97/background/parties/parefer.htm). Although in my opinion even if there was a referendum on this issue a well informed decision may not be made on joining the Euro as you would be assuming that people would be well informed on all the issues surrounding this which may not be the case. The predecessor to the single currency was the Exchange Rate Mechanism. Britain joined this in 1990 but by 1992 had left this. However the major difference with the Euro is that once Britain joins it could possibly be an irreversible step. The Chancellor of the exchequer drew up five economic tests to govern whether the Uk would be in a position to join the Euro as laid down by the Commons Select Committee. (Parliament publications,2003,http://www.publications.parliament.uk/pa/cm200203/cmselect/cmtreasy/187/18708.htm)
In this assignment I will be attempting to look at the main issues surrounding the case for and against joining the single currency which should address these five economic test areas:
Can Britain’s economy run in synch with the Euro zone long term?
Will joining the Euro affect our...
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