Denmark need to join the euro zone to weather the financial crisis, Denmark’s Prime Minister Anders Fogh Rasmussen said recently. Polls show that 50 percent of Danes are now in favour of scrapping the Danish Krone (DKK).
“The euro ensures political and economical stability in Europe and the current financial turmoil makes it evident that Denmark has to join the Euro,” said Mr Rasmussen.
The Danish National Bank had to repeatedly intervene in the foreign-exchange market to support the krone, which is closely pegged to the euro, and to drive up interests rates to 5.5 percent, a historical high that translates into considerably higher mortgages and credits for Danish citizens.
Mr Rasmussen said that a referendum to switch to the euro could be held in 2011. Danish voters already rejected several times the switch to euro. In 1992, they voted no to the Maastricht treaty which was only passed with an opt-out for euro-adoption. A referendum in 2000 on adopting the single currency was also lost by 53.2 percent to 46.8 percent. A recent poll though showed that a slim majority of 50.1 percent of the Danes were now in favour of the euro.