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EU officials defend euro amid turmoil
Associated Press
Published June 7, 2005
LUXEMBOURG - European Union finance ministers opened a two-day meeting Monday, determined to stand by their euro currency at a time of political turmoil over the French and Dutch rejections of the EU constitution and Britain's decision to not even put it to a vote.
The value of the common currency took a dive after "no" votes in referendums over the constitution in the Netherlands and France, and ministers in some euro-zone governments questioned whether the euro should be dropped.
The European Central Bank has been at pains to defend the currency, and EU diplomats said the finance ministers planned to echo the view of central bank president Jean-Claude Trichet, who has called it "absurd" to speculate about the euro's demise.
Austrian Central Bank Governor Klaus Liebscher, who is a member of the European Central Bank's governing council, went to bat for the euro Monday in an unusual advertisement in the Austrian newsweekly Profil .
"A common market without a common currency would have remained just a torso. The euro itself has been effective," the ad said.
Some Italian government ministers have publicly called for a return of Italy's former currency, the lira, criticizing the central bank's one-size-fits-all interest rate policy and blaming the euro currency for higher prices.
Luxembourg Premier Jean-Claude Juncker, whose country holds the EU presidency, and German Finance Minister Hans Eichel dismissed the idea of reviving currencies that were withdrawn from circulation in 2002, making room for the euro.
"What I read in the newspapers in the last 10 to 14 days (about the euro being in danger) was such nonsense," Eichel said.
On Monday, the euro rose slightly against the dollar to $1.2287 in European trading but remained well below the $1.26 level it last reached on May 25.
The ministers' agenda is packed with other issues, ranging from a proposed redesign of euro coins - to show a larger map of Europe after the bloc's expansion last year - to a new European commitment to boost development spending for the world's poorest nations.
[Last modified June 7, 2005, 02:15:48]
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