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17 Feb, 2012 07:45

Sweden: Knocking on Euro’s door?

As the eurozone crisis appears not to be sparing any member-country, Sweden insists it is not bound to the single currency bloc. Stockholm has agreed to adopt the terms of the EU fiscal pact, which some fear is a "back door" into the eurozone.

The pact on EU budgetary discipline and economic governance between the 17 eurozone nations is to be formally accepted at an EU summit in March. It has been agreed in principle by 25 out of 27 EU states, with Britain and the Czech Republic staying out. While Sweden is not a eurozone member, the country has backed the pact."The European economic crisis has showed that our neighbors’ problem is also our problem. It's about how to take part in it and make an impact on it," says Swedish Prime Minister Fredrik Reinfeldt.But the government‘s favour of the euro fiscal discipline has sparked heated debate over a future eurozone vote.The Scandinavian country shocked its European neighbors by voting against joining the euro in a 2003 referendum.It was just one factor which now sees the country with one of the world’s lowest government debts, and one of the healthiest looking economies in Europe – an influential player in European efforts to improve financial discipline. “We have most specifically changed our problems with the fiscal side, so we don’t have all those debt problems and budgetary problems that many other countries have”, Former Senior Economist at Swedish Central Bank Martin Adahl told RT.But as the EU is by far Sweden’s largest trading partner, both politicians and people assume there will be another referendum on joining the Euro sooner or later. Meanwhile, the people are watching the embattled euro as a guide to how they would possibly vote in the future.Some put it simply, like economist Rolf Englund who campaigned against the euro back in 2003.“I think the euro will collapse before Sweden joins,” he told RT.Whereas around 80% of Swedes say they are glad they are not in the euro, the figure is reversed for their politicians.The government and the Social Democrats argue this crisis isn’t the euro's fault, it’s about debt.“If you compare Sweden which has been outside the Euro for just over ten years and Finland which has been a member of the euro for the same period – we have almost identical economic development,” argues Carl B Hamilton from the Swedish Liberal People’s Party. But regardless of the politicians’ point of view, the Prime Minister pointed out, if it comes to it, it will be the Swedish people who will take the final decision through a referendum.