Denmark, Sweden and Britain: Joining the Common Currency

In this essay, I am going to assess the prospect of Denmark Sweden and Britain joining the common currency in Europe. This has been an issue of some debate over the last twenty years or so, after the ratification of the Maastricht treaty of 1993. The setting up the Economic Monetary Union (EMU) with the view of a common currency,   this hereby meaning the Euro. This paper sets out to achieve three things with regards to these countries.   Firstly, to highlight the reasons why the three countries initially 'opted-out' of the EMU single currency, and seeing if their original claims are still valid in 2013 in judging the prospect of joining the single currency. Secondly, I shall look at the actors and institutions of each of the three countries and comment on the likelihood of any of them adopting the single currency. Finally, I will look at the major recent development in Europe, namely the financial crisis to suggest it has weakened the prospect for these countries joining the Euro. In all, this essay will conclude that there is very little prospect of any of these countries joining the single currency in the near future, as there is little evidence pointing to wards it being beneficiary to any of the countries on a political or economic level.

To start this essay, I will give a brief account of the creation of the EMU and the single currency, and the difference between the British/Swedish opt-out and Danish opt-out.

The Euro and the EMU was established by the Maastricht Treaty of 1992 (Crawford, 1996:146). In the Treaty, the United Kingdom, Sweden and Denmark were granted opt-outs from this regarding the EMU replacing national currencies with the Euro. Britain secured an opt-out during the negotiations of the Maastricht treaty, making them on of the two countries (Denmark being the other) to secure such an opt-out.

Denmark, having held a referendum on the content of Maastricht, as per the Danish constitution,   which rejected the initial treaty. It was...