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Thursday, 20 February, 2003, 12:08 GMT
UK business urges caution
Euro notes being counted
Some 13% of firms did not want to join the euro
About half the businesses in the UK want the government to wait and see how the euro develops before deciding to join the single currency, a new survey has found.

The British Chambers of Commerce (BCC) said that 49% of firms wanted Chancellor Gordon Brown to take his time over the issue even if his five economic tests were satisfied.

The organisation's survey found that 35% would support joining the euro if the tests were met.

But 13% did not want to be part of the single currency under any circumstances.

More evidence wanted

Larger companies - with 250 or more employees - tended to be more positive with nearly half supporting swift adoption of the euro.

The five tests
Has the UK's economy converged with the euro countries?
Is there enough flexibility to deal with problems?
Will joining the euro encourage investment?
Will it help the financial services industry?
Will it promote employment and growth?
But smaller firms were less likely to be in favour, with half of businesses employing between one and 19 people saying that the UK should wait.

"A positive outcome to the five tests will not be decisive in convincing the business community, particularly smaller businesses, that the time is right for Britain to join the euro," said BCC president Isabella Moore.

"If the government wishes the UK to adopt the euro within this parliament it is going to have to produce more evidence of the benefits of euro entry."

The BCC said its own stance on the euro would be to remain neutral because its members were divided on the issue.

Growing hostility

The anti-euro lobby leapt on the survey as more evidence of euro-scepticism.

George Eustice, campaign director of the no campaign, said: "The government desperately needs the support of British business in order to make the case for the euro.

"But this poll shows that businesses are becoming more hostile to the euro and increasingly sceptical about the government's five tests policy.

This is a blow to the pro-euro campaign."

'Damaging competitiveness'

But the pro-euro group, Britain in Europe, said support for membership of the single currency among BCC members had actually risen to 35% from 22% two years ago.

It said the poll reinforced the results of recent surveys by the Engineering Employers Federation and others which found strong business support for euro membership.

Philippe Legrain, chief economist of Britain in Europe, said: "Isolation from the euro is damaging British business.

"With over half of trade destined for euro countries, staying out is hurting exporters.

"Currency volatility outside the euro is also undermining foreign investment and damaging our competitiveness."

CBI position

He said more small and medium sized businesses were falling into line with big exporters in recognising isolation damages their business and the national interest.

The BCC's survey was conducted over the telephone by Mori and involved 1,005 firms of all sizes in all sectors.

The employers' organisation the CBI refuses to take a pro or anti euro stance and says it will poll its members once the government announces a referendum.

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02 Jan 03 | Politics
01 Jan 03 | Business
01 Jan 03 | Politics
30 Dec 02 | Business
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