Which is why I think today's decision by the UK Chancellor Gordon Brown to hold fire on joining the euro has to be welcomed. Only one of the 'famous five' tests came in positive, the others seem to have turned in a 'more work to do' report. While I'm really not sure how much importance to attach to these tests in and of themselves, I feel that the biggest test of the euro itself now lies in front of us (resolving the 'German' problem). Of course if it can surmount that test the arguments against the currency union would at least need reconsidering, and if it can't, then the question of UK membership will I feel be settled definitively, and not by any of Mr Brown's tests. So I feel the arguments for taking a wait and see approach have to convince at this juncture.
Britain is not yet ready to adopt the euro, chancellor Gordon Brown said on Monday, as the Treasury’s assessment of the five economic tests for membership of the single currency was finally published.
In a speech to parliament, Mr Brown said that only one of the five tests, relating to the impact on the City, had definitely been met. “We still have to meet the two tests of sustainable convergence and flexibility,” Mr Brown said. “Subject to the achievement of sustainable convergence and sufficient flexibility, the tests for investment and employment would be met.” Mr Brown kept open the option of holding a national referendum on the issue before or soon after the next general election, something Tony Blair and pro-euro ministers wanted. He confirmed that draft legislation would be published that could enable Britain to hold a euro referendum before the next general election.
Source: Financial Times