BUSINESS people, farmers and trade unions in Northern Ireland should seriously consider joining the European Monetary Union ahead of Britain, according to the Fianna Fail leader, Mr Bertie Ahern.
In a speech to be delivered at the European Finance Convention in Dublin today, Mr Ahern will suggest that the island of Ireland could become a single zone. This would have benefits for tourism and would make it easier to attract foreign investment, he feels.
Mr Ahern will request that his suggestion be evaluated on economic grounds and will argue that it need not have any political or constitutional implications. It would not involve Northern Ireland accepting the Irish pound as its currency, because the euro would be the currency involved, according to Mr Ahern.
"We would then have a common currency on this island, the euro, which would be neither British nor Irish . . . From the British government's point of view it would give them a foot in the door. I cannot imagine that if the proposal were supported by both governments and by all major economic interests in Northern Ireland our European partners would have any real difficulty with the idea, even if there might be some initial surprise.
Farmers and political representatives in Northern Ireland and the Irish Government want to have Northern Ireland exempted from the BSE restrictions imposed on Britain on the grounds that the island of Ireland is the natural unit for any veterinary regime, according to Mr Ahern. The same logic should apply in the currency sphere, he will argue.
Mr Ahern believes "there is a strong possibility" that Britain" will decide to take part in EMU from the outset. But if Britain opts to stay out of EMU, he will suggest that sterling will become "a secondary currency" in a world dominated by the dollar, the euro and the yen. Mr Ahern believes that "the long term risks for the position of the City of London as Europe's leading financial centre and for British business will be weighed up ever more carefully as the time for decision approaches".
A "pro European" government at Westminster would remove "one of the real irritants in Anglo Irish relations", according to Mr Ahern. "A shared approach to European issues would also have a beneficial spin off impact in dealing with the problem of Northern Ireland," he will argue.
The economic thrust of EMU is to enable Europe to compete more effectively with the US and the tiger economies of the Pacific region led by Japan, according to Mr Ahern. "Three dozen or so currencies in the continent of Europe, or indeed 15 within the Union as it stands at present, are obviously an impediment to trade, investment and tourism. And small countries suffer worse from these impediments than larger ones.
Within EMU, Ireland would no longer control its relationship with sterling. If the euro fell against sterling, steps would have to be taken to protect against inflation, while if the euro rose there would be a need to take steps to protect domestic competitiveness. But these problems would not be unique to Ireland, according to Mr Ahern.
"Maintenance of the single market will depend on managing sensibly currency relationships between those countries that join the euro currency and those who stay outside."
