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Sweden ‘defacto’ accepts to work for the Euro finance pact

Tuesday, 31 January 2012
Sweden is accepting to fully join the euro countries' fiscal pact according to the Prime Minister, Fredrik Reinfeldt, whose request for Swedish influence in the whole process was being considered at the Euro summit.

Reinfeldt was pleased when he was one of the first to leave for the EU summit in Brussels on Monday evening. He claimed that all the requirements approved by the Swedish Parliament for the Swedish participation has been met. Of the 27 EU countries, only Britain and the Czech Republic have not announced intention to participate.

The Pact on national budgetary rules is only binding for the euro currency countries. But all other members are called to participate, something seen by political strategist as a better way of influencing individual country’s issues in the wider EU.


“What the euro countries should do is what Sweden did some 15 years ago,” said Reinfeldt.
He was also pleased that Sweden's right to decide whether the euro should be introduced as their currency was clearly written into the pact and that Sweden is guaranteed to be involved at least in one euro summit each year.

The Euro argument was a strong reason for the Social Democrats to reject the pact participation because they saw it was a backdoor room to getting Sweden into a euro currency country.

“The attitude to shut use from the world out there does not create prosperity and growth in Sweden, quite the opposite,” said Reinfeldt, who emphasized that a stable public finance in the euro zone is good for Swedish exports.

Besides the fact that Sweden is guaranteed to be on a Euro summit each year, non euro area countries cannot also participate with the euro countries when they discuss competitiveness, changes in the euro zone's global structure and the fundamental rules for monetary union.

Thus Reinfeldt considers that all the requirements that the Social Democrats stood for at the parliamentary EU committee as condition for participation in the pact are now been fulfilled.
This is great victory – diplomatic victory for Sweden and it shows that Sweden is taken seriously in many aspects and that Europe is open to learn more from a successful smaller economy like Sweden. 

Though a small country, Sweden has show that efficient management of its resources and responsible politics can improve competitiveness and if Europe could learn these types of ideals, then Europe will likely solve most of its problems within a very short time.

EU Summit was held in an exceptionally quiet Brussels. The first general strike in the country for many years had buses, trains and subways coming to a stand still and many other stayed at home. The strike was a protest against the cuts and austerity measures carried out in Belgium, which many other heavily indebted euro area countries, are forced to implement.

The idea is that the financial pact will create confidence in the euro area countries' public finances. For instance, it will require that each country in its national law impose a rule that the structural budget deficit must not exceed 0.5 percent of GDP. If such a law is not introduced, those countries can be brought before the EU courts.
By Team

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