With less than two weeks to go in Sweden's referendum campaign on euro membership, the latest opinion polls show a narrowing of the lead those opposed to the single currency have enjoyed since April.
Many Swedes have not yet made up their minds and intend to do so only just before voting on September 14th. Campaigning in the final period will focus above all on the likely economic consequences. But there are also significant political implications for Sweden - and for other states, not least how it might affect British attitudes to joining in the coming year.
The ruling Social Democrats are divided on the issue, with five cabinet ministers opposed and many of its members and voters against joining the euro. Other left-wing parties and the Greens are also against, while the major conservative and liberal parties, together with employer bodies and trade union leaders, are in favour. Women are much more opposed than men. Many women are employed in local authority welfare and caring services and have been convinced by opposition arguments that one effect of joining the euro would be to encourage pressure for tax harmonisation in the euro zone, in order to stimulate economic growth in its largest states.
The effect of that would be to lower Sweden's high tax rates and therefore jeopardise its welfare state and employment, it is argued. The country already enjoys higher growth and employment rates than the euro zone and healthier budgets. This has made the prime minister, Mr Goran Persson's arguments that joining would encourage lower interest rates, stronger growth and more employment less credible. He has therefore criticised Germany, France and Italy for their economic mismanagement before the euro was introduced, rather than running up deficits now during the downturn. He focused too on weaknesses in the Stability and Growth Pact, which is too inflexible to cope with such difficulties.
Sweden's highly developed industrial and economic structures would certainly be affected by a vote against joining the euro, while its political influence within the EU would also suffer - all the more so if, as Mr Persson argues, the issue would not be revisited for two more parliamentary terms, making a wait-and-see policy costly in the medium term. From the Irish point of view a Swedish vote against would be regrettable. One of its effects would be to strengthen the growing impression that Mr Tony Blair has neither the political willingness nor the capacity to insist on a euro British referendum before the next election. Any such political setbacks should hasten reform of the euro's governing system.