UK must join Euro, says NatWest

28 April 1999

UK must join Euro, says NatWest

By Vicky Houchin

FARMERS in the UK will become increasingly isolated from the rest of Europe unless the country joins the single currency, said an official from the NatWest Bank today (Wednesday).

“The weakening of the Euro against Sterling has put pressure on farm incomes,” said Brian Montgomery, senior executive at the banks agricultural office.

“There is no doubt that Britain is one the highest cost countries in Europe that could benefit greatly from joining the Euro.”

Mr Montgomery was speaking at a conference organised by the National Farmers Union and the National Association of British and Irish Millers.

He said that joining the single currency would mean increased market transparency and a more stable European trading environment.

If the UK decided not to join, it would run the risk of losing inward investment and the opportunity to influence European Union politics, he added.

The Euro is showing no sign of being sensitive to the high value of Sterling at present, said Mr Montgomery.

Sterling is currently trading at 66p to the Euro, instead of the 75p rate which many analysts say would be more economically acceptable.

“The Euro continues to sink in value to the amazement of the 11 in countries,” he said.

At 66p to the Euro, UK agricultural exports are uncompetitive and the livelihood of many farmers is under threat from cheaply priced food imports.

That makes it even more important for the UK to join the single currency, said Mr Montgomery.

Joining the Euro would also reduce business costs, make it easier to source inputs from abroad and give farmers the chance to trade on a more level playing field.