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Author Topic: Swedish Polls Toll Death Knell for Euro Vote
El Indio
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posted September 10, 2003 10:45     Profile for El Indio   Email El Indio     Send New Private Message   Edit/Delete Post   Reply With Quote
STOCKHOLM (Reuters) - Sweden now looks sure to turn its back on the euro at Sunday's referendum as a raft of new polls showed a late upsurge in opposition to swapping the crown for the world's second most traded currency.

Five opinion polls on Wednesday all showed the grassroots campaign against the European Union single currency extending its already commanding lead over a "Yes" side dominated by the wealthy Nordic country's business and political elite.

"It looks sort of a done deal right now," said Thomas Kyhl, analyst at Danske Bank which presented one of the new polls. "We're very, very close to voting day and if this lead holds up it looks like a 'No' on Sunday."

The polls will dismay EU officials worried that a Swedish "No" will dim any chance of Britain or Denmark joining the euro soon and may foreshadow problems ratifying an EU constitution.

In a Reuters survey, 32 out of 38 strategists and political analysts thought Sweden would vote "no" but 32 out of 36 saw it eventually adopting the euro, with 2010 the most likely date.

The mid-range forecasts from the poll expect the 'No' camp to win 53 percent on Sunday, with around 46 percent voting 'Yes'.

A mixed bag of leftists, Greens and government dissidents opposed to becoming the 13th euro member mobilized deep-seated public unrest about trusting EU bureaucrats to safeguard its generous welfare state and economic advantages.

Prime Minister Goran Persson's Social Democrats, in power for six of the last seven decades, had hoped for a last-minute win thanks to vastly superior funding and establishment support.

"Of course I'm worried," Persson told reporters. "But the polling stations closes at 8 p.m. on Sunday and then we have the final outcome. I have a feeling this can still go our way."

WRITING ON THE WALL

Financial markets did not agree and Sweden's krona dropped to a two-week low against the euro. It would be expected to rise on "Yes" side gains anticipating a peg above its current price.

The euro, launched amid fanfare in 1999, is the second most traded currency after the U.S. dollar. But controversy has dogged budget deficit rules underpinning it and the one-size-fits-all monetary policy for 12 nations.

"People had believed that the 'Yes' side would catch up this week to make it a tight race," said Ulf Torell, an analyst at Swedbank, after the krona fell half a percent to a two-week low of 9.1953 against the euro in early trade.

"Unless there is something wrong with the opinion polls, and unless something unexpected happens, I think the 'Yes' side has lost," said Mikael Gilljam, a professor of political science at Gothenburg University in western Sweden.

The "No" side, in the lead in polls since April, struck a chord with a low-budget campaign.

"We have no money but we are meeting people and talking in the streets," said Left Party leader Ulla Hoffman, speaking to a crowd of 20 backed by two aging guitarists and three red flags.

Persson wheeled out big guns like Greece's foreign minister, Finland's central banker and a top executive from telecoms giant Ericsson who raised the specter of firms leaving and job losses.

But this does not wash in a land where growth outstripped Euroland in the second quarter by 1.3 percent, unemployment is lower and whose public finances are still in surplus.

Swedes may still remember a currency crisis in 1992, three years before they joined the EU, but a survey in April saw them as the most skeptical of all EU nations about the impact of EU membership on their prosperity. Half saw no benefits at all.

Persson has appeared to regret calling the vote, asking in an interview with Reuters last week whether it was "fair to have a referendum about such a technically difficult issue."

He fumes that Germany and France breaking EU deficit rules has undermined Swedes' faith in the euro, prompting him to moot a delay in euro entry, slated for 2006, if he wins on Sunday.

"He hasn't persuaded me yet," said trucker Henry Kiehn at a rally in the city of Karlstad. "Just look at France and Germany, they are having problems but Sweden is doing well."

With polls from Danske, Ruab, Demoskop, Gallup and Sifo showing the euroskeptics' vote rising to 47-57 percent and support lower at 35-39 percent, the swing vote would have to be massive, even with up to a quarter either undecided or unsure.

Gilljam said many of the undecided would not vote either way: "It's not like there's two million people who haven't decided yet. Maybe a million people won't vote at all."


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