The benefits of joining the European single currency should be staring us in the face. Our exports to Europe and our imports from Europe are about four to five times our exports and imports from the American Free Trade area. Europe is a local close-by market with 2000-year-old cultural and civilisation background similar to us.
As an economic concept in action, the European single currency, will have about five times as much impact as as the internet, as it will bind 300 million Europeans to genuinely work together in a price-transparent environment, free from exchange rate conversion costs, in a spirit of mutuality and co-operation.
In this century, it will be the European single currency that will be the most significant event surpassing the internet as the second most significant. Our pound already has two exchange rates: one for domestic sales and one for export sales.
Export sales are effectively achieved by discounting the exchange rate by 10 to 20% or quoting in US dollars. Going in at about three DM to the pound is quite reasonable even if the euro has now depreciated by about 30% in terms of US dollars.
Conversion costs at Pounds 36bn are exaggerated. With advances in computer software technology, it would be much less. There would be an instant market for British goods overnight when we change to the euro. The benefits would be in hundreds of billions of pounds.
Our economy is fundamentally stronger than many European countries and we would end up as one of the leaders in the pack.
- Nagindas Khajuria FCCA, London
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