Skip to content
Friday 14 August 2026London --:--Frankfurt --:--Zurich --:--
NewslettersSearchEN · DE
MorningWire

European business, markets and politics

FTSE 100
10,750.11
-0.21%
DAX
26,440.31
+0.53%
CAC 40
8,636.80
-0.16%
STOXX 50
6,539.59
-0.09%
  • Europe
  • Markets
  • Business
  • Economy
  • Technology
  • Politics
  • Opinion
More
GermanyFranceBankingAIEnergyFintechPropertyCapital Markets
  • Germany
  • France
  • Europe
  • Markets
  • Business
  • Economy
  • Technology
  • Politics
  • Opinion
  • DE
Wednesday 28 September 2011 7:30 pm  |  Updated:  Thursday 30 May 2019 10:08 pm

Saving the euro could prove costly to the UK

By: KCS-content

Add as a preferred source on Google

WITH a stop and a start, a rolling crisis and neverending summits, the Eurozone is edging towards fiscal union to shore up its struggling monetary union.

In the sweep of history, this is no surprise – eurosceptics and europhiles alike had forecast that merging currencies would lead to the merging of tax and spending. The UK is in the fortunate position of watching from the sidelines, rather detached from what is going on, as is our traditional way with Europe.

It is clearly massively in our interests to have stability in the European economies – and hopefully even a return to growth. The apocalyptic scenarios that economists are predicting if Greece does default, with knock-on consequences for Portugal, Italy and Spain, might give eurosceptics a moment of schadenfreude, but as the government keeps pointing out, it would not be good for Britain.

But the UK cannot watch the emergence of fiscal union in the Eurozone with a complete lack of concern. It will have big consequences for the way the EU operates, and in turn have big consequences for us.

It is possible the Eurozone’s fiscal union would splinter the EU into competing factions and differing layers of influence. It could easily lead to a central caucus of Eurozone countries, who reach policy agreements outside normal EU institutions.

This caucus will, inevitably, be dominated by France and Germany, who are far less enamoured of free markets than either the UK, the Eastern European countries, or the European Commission – who would all be out of the loop.

EU analysts believe this could lead to a protectionist sentiment dominating such a Eurozone caucus. The new grouping would use its unity and its suspicion of economic liberalism to push for more regulations and the raising of trade barriers.

And it would likely succeed. This caucus would be in a very strong position to get its protectionist policies adopted across the EU, through qualified majority voting.

As an example of what that could mean for Britain, Eurozone nations could decide to agree among themselves to adopt tougher regulation on financial services, and as a result force its adoption across the EU – including the UK. An example of what that might include was the announcement yesterday by Jose Manuel Barroso, the Commission president, of a Tobin tax on financial services, which would be totally antithetical to London’s interests as Europe’s financial capital.

Britain would then be in a position of being forced to accept legislation that it has had very little say over, even though it directly affects our main strategic industry, and has a far greater impact on us than any other country. This would certainly not be a satisfactory or even politically sustainable state of affairs. Those that say we should sit on the sidelines and let the Eurozone engage in fiscal union without interference assume that it will have no impact on us, but that is not the case. The UK should watch developments in Europe very closely, game play the different scenarios in any new treaty negotiations, and be prepared to defend our national interests if necessary. This is not petty nationalism, just doing what all European governments would themselves do.

Anthony Browne is former Europe correspondent for the Times, and author of The Case for European Localism, which was published last week by Open Europe.

Share this article

  • Facebook
  • X
  • LinkedIn
  • WhatsApp
  • Email

Similarly tagged content:

Sections

  • Opinion

Categories

  • Opinion

Related Topics

  • NULL

Trending Articles

  • Revolut takes flight with launch of new airport lounges

  • Grandparents fund university degrees to avoid inheritance tax net

  • Brompton Bicycle sues former adviser for ‘professional negligence’

  • It’s not just Jason Arday, most of sociology is a scam

  • Revolut chatbot goes rogue by charging users to cancel subscription

More from Morning Wire

  • Glencore targets secondary listing in Australia as London loses mining shine

    Mining
    Glencore corporate headquarters building exterior with the company logo sign, representing the commodities firm.
  • Brentford FC stadium to host rugby union franchise sevens finals

    Sport Business
    GettyImages 2244438763 depicts a significant business event highlighting key industry leaders in a networking session.
  • Ticket price hikes proof Wales Rugby Union is tone deaf to loyal fan concerns

    Sport Business
    Aerial view of Cardiff city, Principality Stadium, and surrounding buildings under a blue sky
  • Elite English firms face uphill battle in fierce New York market

    Legal
    Aerial view of New York City skyline featuring iconic skyscrapers and bustling streets
  • Doctors union tops up £1m reserve pot for strikes

    Healthcare
    GettyImages 2246649047: Business professionals discussing strategy at a conference table, highlighting teamwork and collab...
  • Exclusive: Rugby League monitoring Henry Pollock amid £1m Hearn wage demands

    Sport Business
    A young man with blonde hair and a dark shirt, clenching his fist and smiling, likely celebrating or cheering.
  • Elliptic Launches Next-Generation Continuous Monitoring, Giving Crypto Compliance Teams a Live View of Customer Risk Without the Flood of Alerts

    Business Wire
  • Politicians call for easing of private school stranglehold on elite rugby

    Sport Business
    Getty Images logo on a digital screen, representing the renowned stock photo agency in a business news context.
MorningWire

Independent European business, markets and political news for decision-makers.

Morning Briefing

Europe

  • Germany
  • France
  • Europe
  • UK & Ireland

Business

  • Markets
  • Banking
  • Technology
  • Energy
  • Property
  • Fintech

Editorial

  • Opinion
  • Editorial Policy
  • Corrections
  • Contact

Company

  • About Morning Wire
  • Privacy Policy
  • Terms of Use
  • Cookie Policy
© 2026 Morning Wire Ltd · Published by Morning Wire Media, Bahnhofstrasse 65, 8001 Zürich, Switzerland
Privacy · Terms · Cookies · Facebook