Denmark avoided massive euro bill

Economists calculate that Denmark would have had to dole out an additional 338 billion kroner if it had adopted the euro

Several police units were in attendance at Aalborg University Hospital following the threat (photo: iStock)
July 13th, 2012 1:06 pm| by admin
facebooktwittergoogle_pluspinterestmail

Economists are claiming that it was fortunate Danes voted against adopting the euro in the 2000 referendum.

“It was smart then but it has shown to be even smarter than we had thought,” Christian Bjørnskov, a lecturer in international economics at Aarhus University, said.

Christian Blaabjerg, chief economist at FIH Erhvervsbank, agreed.

“The bill that Denmark would have been handed is enormous compared with our GDP,” Blaabjerg said. “Very few people want to join a club whose membership fees rise at an unknown rate.”

The economists provided calculations to Jyllands-Posten newspaper showing how much Denmark would have had to stump up to bail out debt ridden EU countries if Denmark had adopted the euro.

The calculations show that had Denmark been in the monetary union it would have had to pay 338 billion kroner to bailout other Eurozone members.

This sum consists of 87 billion kroner and 95 billion kroner, respectively, for to the two financial stability funds, the ESM and the EFSF.

Denmark would also have had to contribute to the European Central Bank’s purchase of government bonds from the troubled countries. This would have amounted to 156 billion kroner.

“There is no-one else to pay the bills except the euro countries and we are exempt because we never adopted the euro,” Bjørnskov said, adding that the common currency had problems from the start.

“The euro is a construction that encourages countries to behave irresponsibly, since eurozone countries are liable for each other’s debt, regardless of the political promises they make.”

Marianne Jelved, former leader of the Radikale party, who were supporters of the euro at the time of the 2000 referendum, still supports adopting it even though she acknowledged that much had gone wrong.

“The problem is that many countries didn’t stick to the rules. If they had there wouldn’t have been the problems we are experiencing today. Germany and France moved off track in the early 2000s and as soon as that happened we lost our discipline.”

The building will use the same location as its predecessor (photo: Lundgaard & Tranberg)
Design chosen for new Resistance Museum
Two years after a fire burned down the building housing the Resistance Muse...
BankResearch annually produces risk report (photo: iStock)
Seven Danish banks at risk of bankruptcy, according to report
Seven Danish financial institutions are at risk of going under, according t...
Several police units were in attendance at Aalborg University Hospital following the threat (photo: iStock)
Aalborg hospital bomb threat dismissed as hoax
Aalborg University Hospital received a bomb threat by telephone just after ...
The emergency sirens will sound tomorrow at noon (photo: iStock)
Sirens to sound across Denmark tomorrow
When the emergency sirens go off nationwide tomorrow at noon, there's no ne...
Improved procedures are thought to be the reason behind shorter hospitalisations (photo: iStock)
Denmark holds the record for shortest hospitalisations
Patients in Denmark are returning home from hospital quicker than in the re...
Something worth sinking your teeth into (photo: iStock)
“Probably the best roast pork sandwich in Copenhagen, and the world!”
The Guardian has named a flæskesteg sandwich served by the Isted Grill in ...