The British Government's diplomatic skills will be tested during the UK's six-month tenure of the European Union presidency.

The government will set the agenda for the union's business over the next half year and British ministers will chair inter-governmental conferences.

The Prime Minister, Tony Blair, and his ministers plan to work to a "neither a surrender, nor isolation" blueprint with the aim of making Europe a "people's Europe".

Last time the UK held the presidency, in 1992, former Prime Minister, John Major, was beset by ministerial rows over the Maastricht Treaty and the Exchange Rate Mechanism.

Preparation for the single currency, likely to be launched in early 1999 will probably dominate the EU for much of the next six months.

Britain will not be in the first wave of countries with a single currency and will not sign up to the euro during the course of this parliament.

The question of which economic issues are to be treated as ones for ministers of all 15 member states to discuss and which should be left to those countries about to adopt the euro has still to be resolved.

Another possible area of contention is the issue of enlargement of the EU. The UK is eager that the countries of eastern Europe be brought into the EU as quickly as possible.

The government will also continue to battle with its EU partners to secure a partial lifting of the export ban on British beef.
 

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