As the only country in the EU that does not use Euro currency, the UK has for a long time cut a lone figure perched between European and American sympathies. For those people who do business with the Eurozone or who travel there a lot, the discrepancies between currencies have created some annoyances with exchange rates, money changes and bank settlements times to take into account. For example, to accept card payments from a European customer as a UK resident can be problematic; a much longer clearance rate, high exchange charges and commission rates mean that continental business has been avoided in the past. Card payment companies such as Payleven work to lower these transaction rates, but many business owners still feel the sting. This is a shame, as the UK is a member of the EU that holds the largest number of seats after France, Germany and Spain and has a lot to offer the European economy. Why then, has the UK struggled with the idea of adopting the Euro for so long? And as the struggle continues, is it likely the UK ever will?
Britain, Northern Ireland and Wales have so far expressed no wish to adopt the Euro
The answer to this question is more often than not a resounding no. Britain, Northern Ireland and Wales have so far expressed no wish to adopt the Euro currency (Scotland, at the moment, is a different matter) for mostly economic reasons.
The main financial drawback the UK sees with adopting the Euro is being unable to set own interest rates- many politicians and public alike believed this would have a detrimental effect on the economy. Other reasons for reluctance is that many European countries have large unfunded pension liabilities and there was fear that these liabilities would be a strain on the British tax payer. Further to this, when adopting the Euro it is impossible to devaluate your currency if it becomes uncompetitive (see problems with Greece and Spain)and the fact that there is no central bank to act as a Lender of Last Resort if bonds become unsellable served to further put politicians off the idea. These fears that were first set out at the proposal of instating the Euro are still very much in the mind of politicians and the UK public today, making it unlikely that the UK will join.
Opposition from the UK to the Euro has been gradually increasing since 2005; 57% voted no to the Euro that year. Again in 2009 64% voted no, and in 2011 public opinion reached a huge 85% opposition to the Euro. Moreover, with the UKIP taking a stronger hold in politics and Scotland planning its independence, it’s looking likely that the UK will pull out of the Union altogether. With an overwhelming amount of both public and political opposition to Euro adoption, it is extremely unlikely that such a move will happen. There is a possibility that a dip in the Pounds value, as in 2008, would prompt UK politicians to rethink this decision; however at the moment the Pound is relatively strong compared to previous years, meaning that this move is probably unlikely. The UK has always been fearful, opposed and skeptical about the Euro and this opinion will not change overnight and the fact remains that this opinion will probably never change.