EMU delay ‘risks stalling euro for 20 years’

Date: 13/03/1997

By Tim Jones

ANY attempt to delay the advent of the single European currency risks putting it off for a generation.

With this stark warning, French Budget Minister Alain Lamassoure hopes to counter the growing belief in the financial markets that the euro will have to be delayed beyond 1 January 1999.

“It is impossible even to imagine a delay,” he told European Voice this week.

“In the history of Europe, ever since the Treaty of Rome there has never been an example of a deadline not being respected. If we say, 'why not have six months more, a year more, two years more?', then we might as well make it 20 years because there will always be an obstacle.”

For the last month, the markets have been rocked by constant rumours that France and Germany will announce a delay.

Money traders believe rising German unemployment will make it impossible for Bonn to reduce its budget deficit to 3&percent; by the end of this year, as it must in order to qualify.

But stronger tax revenues have increased Lamassoure's optimism that the French deficit will hit 3&percent; this year and he is confident that if Germany starts to overshoot, Bonn will push through new budgetary measures.