Warning Against Weak Euro

A leading conservative German politician said on Sunday the euro must be delayed if the stability targets are not met and warned that politicians will lose public confidence if they trade the mark for a weaker currency.

Edmund Stoiber, premier of the southern state of Bavaria and a well-known euro-sceptic in Germany, nevertheless used unusually strong language in his warnings on the eve of a European Union summit in Amsterdam. He said in an interview with Bild am Sonntag newspaper that replacing the mark with a weaker single European currency could harm democracy in Germany The overriding question for politicians and especially for the public at large is not when the euro will be introduced but rather whether it is a stable euro, Stoiber said.

The mark with hard-earned savings attached to it represents the life-time efforts of the people who rebuilt our nation. The mark is inseparately linked to our 'economic miracle', Stoiber added. And anyone who would replace the strong mark with a weaker euro and thus turn the currency conversion into a currency reform would damage the democracy in Germany.

Stoiber, who has regularly insisted on a strict interpretation of the Maastricht Treaty's deficit criteria, said the Bavarian government would never accept anything less than a euro that is as strong as the mark.

If the European economic and monetary union turns out to be a club of inflation, there will be rising interest rates, higher prices, sinking investment and higher unemployment, he said. That is why the Bavarian government will never accept a rotten compromise.

EMU will begin on January 1 1999 as a stable union or it must be postponed -- and until such a time as the preconditions are in place, he said.

Stoiber's remarks came as a Forsa research institute survey found a slim majority of Germans against the euro with the strongest opposition coming from eastern Germany and left-leaning voters.

The survey of 1,011 Germans by the Forsa research institute for RTL television found that 51 per cent opposed the euro's introduction while 34 per cent were in favour.