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Monday, 31 January, 2000, 06:59 GMT
CBI halts euro campaign

Tony Blair at the CBI conference Tony Blair and the CBI have developed close ties

The UK's leading business organisation is to stop promoting early membership of European Monetary Union.

The Confederation of British Industry's (CBI) new chief executive, Digby Jones, will tell members that the issue of scrapping the pound and adopting the euro had been "distracting" members from the issue of making the single market work.

Mr Jones is due to say to members on Monday, that the arguments surrounding the single European currency had become "sterile" and should be put aside until the government called a referendum on membership.

The CBI's members are generally large companies, including many which have subisidiaries on, or trade links with, continental Europe.

Two decades away

The organisation's decision to withdraw from the debate on is seen as a blow to Prime Minister Tony Blair's hopes of persuading the British public of the merits of membership.

The CBI's decision comes the day after Wim Duisenberg, president of the European Central Bank (ECB) - which sets monetary policy for the 11 countries in EMU - told the BBC it could be years before the UK was ready to join.

He said, in an interview for the BBC's Money Programme, that joining the European single currency was not just a decision for London and that the UK economy would need to more closely resemble those of other European Union states.

"We're talking about a moment in time which is years from today," he said.

That view was shared by Michael Hughes of Barings Asset Management, who said it would take about 20 years for the UK economy to truly come into line with its European partners.

Byers reacts

The debate also comes as the euro stands at, or near to the record lows it fell to last week, down about 15% on its launch value a year ago.

UK Trade Secretary Stephen Byers, who last week attempted to lay out a timetable for the UK's membership of the euro, said Mr Duisenberg's comments showed economic criteria were what mattered.

"He has raised some important questions about the economic fit between our economy in the UK and the economies in continental Europe," Mr Byers said.

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See also:
31 Jan 00 |  UK Politics
Cook downplays euro setbacks
30 Jan 00 |  Business
UK given euro warning
27 Jan 00 |  Business
Euro hits new lows
27 Jan 00 |  Business
Byers lays out euro timetable

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