Is Denmark set to reconsider Euro opt-out amid plans for closer Eurozone cooperation? - La Treizième Étoile: A blog on EU politics
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Is Denmark set to reconsider Euro opt-out amid plans for closer Eurozone cooperation?

Saturday, 12 February 2011
Lars Lokke Rasmussen, 7th December 2009 (Photo: Miguel Villagran/Getty Images)There was a very interesting quote that leapt out from a Reuters dispatch this week. It reads reads: "Closer and deeper cooperation in the Eurozone could very well make it timely for us to re-evaluate [our] Euro opt-out". The country in question: Denmark. The speaker: Prime Minister Lars Løkke Rasmussen.

Speaking during the Parliament’s question hour, Reuters reports that Mr Rasmussen, pictured left, said his country could soon need to re-evaluate its outsider position vis-à-vis the Eurozone in light of efforts to “intensify economic cooperation” - a reference to the current French-German proposal to establish a 'Pact for Competitiveness' amongst Eurozone countries.

As is the case with the United Kingdom, Denmark has an opt-out when it comes to membership of the Eurozone, and 53.2% of Danes voted against joining in a referendum held in September 2000.

The country’s current centre-right government (which incidentally does favour adopting the single currency), has since rowed-back and said it would not call another referendum on the Euro, but this contradicts a statement made by the PM Rasmussen in May 2009 when he confirmed that a referendum would be held before the next general elections, which must take place by mid-November this year.

Mr Rasmussen said, in the same announcement, that Denmark was already using the Euro because of the currency peg (ERM II mechanism since 1st January 1999), and they had only decided to remain calling their currency the "danske kroner".

So what chance is there of a referendum soon? With an opinion poll in December showing opposition to the Euro at record strength, it is unlikely the government will want to risk losing a referendum on the Euro at the moment. That said, support for adopting the single currency jumped briefly during the economic crisis, with the pro-Euro side gaining a majority in some polls, but that backing for the common currency has since receded.

Reportedly, and revealingly, the issue has so far not figured at all in early campaigning for the forthcoming Danish elections – although after the Prime Minister’s comments this week, you feel it is only a matter of time before it does once again.

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