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If the euro is such a bad thing why have so many countries joined?

26 October, 2018

• I AM no expert on the euro but if it is the disaster Stephen Southam says it is, could he explain some inconvenient facts, (EU can’t face fact that its reserve currency dream has failed, October 19)?

According to the Politico website, since the 2008 crash Slovakia (2009), Estonia (2011), Latvia (2014) and Lithuania (2015) have joined the euro.

Since 1992 a country applying to join the EU must commit to adopting the euro, but may only do so if its public finances comply with the debt and deficit criteria of the Stability and Growth Pact.

Therefore, to avoid adopting the euro all a country needs to do is fail to comply with the criteria. Sweden, Poland, Hungary, the Czech Republic, Romania, Bulgaria and Croatia have done just that.

It follows that the countries which have joined the euro chose to implement policies compliant with the criteria. If the euro is such a bad thing why did they? Was it Slav masochism or a Dostoevskyan belief in redemption through suffering?

Then we have Greece, which joined the euro in 2001 having, it is widely believed, cooked the books to appear to comply with the criteria when it did not.

In 2015, Greece’s creditors imposed harsh bailout terms. The left-wing, anti-austerity Syriza government held a referendum on whether they should be accepted in which 61 per cent voted No.

Syriza believed Greece could nonetheless have remained in the euro, but the creditors said, to quote the late Frankie Howerd, “nay, nay, and thrice nay, missis”.

On Mr Southam’s analysis, Syriza would surely have thought: “Oh frabjous day haroosh hooray” and left the euro but it chose rather to accept the bailout terms. My source is the BBC News website.

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