Britain and the Euro

Recent articles have suggested variously that the euro would not be a good thing for Britain and that the Blair government needs to be prodded into becoming more European in outlook. The British government sees no choice to be made between the transatlantic relationship and working as a key member of the European Union (not least to advocate a more open, flexible, less-regulated Europe). Each relationship strengthens and underpins the other.

Our position on the euro is clear and cogent. The United Kingdom has met the criteria for membership but made a conscious decision not to join in the first wave. We are at a different point in the economic cycle from continental Europe. It would not be in the British economic interest to join without real convergence. But we see no constitutional bar to our joining when economic conditions are right and if the euro proves to be successful.

For Los Angeles businesses, the point is that Britain still wins 40% of all U.S. manufacturing investment in the European Union. U.S. manufacturers and service providers invest there because they find the conditions for business are attractive. And London continues to be Europe’s leading financial center, with daily foreign exchange trading (including the euro) of $640 million--32% of the world’s total.

PAUL DIMOND

British Consul General

Los Angeles