Is it time for the UK to join the euro?

After a short period of prominence, sterling has recently suffered one of its biggest falls in value and foreign investors are bailing out en masse. The United Kingdom's finances are in a parlous state, and little sign that, short of continued massive borrowing (requiring the gullible to buy ever more worthless government bonds) either HM Government or her Opposition know what to do about it.

As someone with business interests in the UK, it has of course always been in my interest that the country join the euro-zone, but equally, the currency would have been much more robustly managed with Britain on board. Despite this and the doom-mongering, the euro has become one of the world's key currencies. When times were good, sterling kept its head above water, but now we are seeing its true weakness.

Will Hutton offers a stark commentary here. Other than the usual national pride arguments, I'd be interested in opposing and supporting opinions of joining the euro from an economic point of view.

Importantly, at the moment, the five tests for entry set by Gordon Brown are all met 100 per cent. Britain and Europe's economies are in perfect synch as we enter recession simultaneously. The labour market is flexible. Entry would attract much-needed inward investment, and save the City. It would boost growth. In economic and political terms it would be a masterstroke. Britain would become a member of a reserve currency zone at a competitive level, offering us a key role in the emergent debate about the governance of globalisation and the international financial system. We would remain prosperous and we would matter.

Brown, I am told, when the idea was put to him not only ruled it out, he did not want it repeated again for fear even its mention would imply it was actively being considered. Euro membership is political poison, even as its logic becomes more compelling. The same crowd who cheerleaded Britain into becoming a de facto hedge fund in the name of free markets would now rather risk endemic inflation or endless recession and stagnation to avoid the dark hand of Europe.

Can someone explain to me why the UK didn't join in the first place? Was it a sort-of England trying to pretend they aren't really European thing?

The problem isn't the currency, it's the "leadership":

Boom years: keep debt at a constant percentage of GDP - i.e. it can creep up
Bust years: spend to stimulate economy - i.e. it can surge up

When are the years we try to run as a surplus?

Any currency with this outlook is in trouble - any country with this outlook is in trouble. The budget needs to be drastically altered. my preferences would be the two wars we are currently in - unless other countries want to pay us to fight, slim down the Civil service and cut social support in many areas.

The currency looses value helps to increase imports and make the country - temporarily - more attractive to investors and for exports. Sure, imports are more expensive - but we need to reduce these in any case as we as a country have lived beyond our means for years.

~:smoking:

Spot on Rory.

The 'Great Leader' is often touted as the bestest Chancellor of the Exchequer that we've ever had, despite the fact that anyone with more than one brain cell can see that he's not fit to run a whelk stall. There was an article in the Times yesterday written by John Major (another 'not up to the job' man) in which he makes several good points...

Spoiler Alert, click show to read: 

Sixteen years ago an economic gale blew away a vital part of my economic strategy; now, a more comprehensive storm has undone the entire economic strategy of the Labour Government.

In the days of the late-lamented Prudence, the Chancellor of the Exchequer at the time, promised an end to “boom and bust”. As Prime Minister that promise must haunt Gordon Brown, for he knows that - as Chancellor - he was culpable for the domestic circumstances that contribute to our dire economic plight.

Who ignored the debt spiral as it built up? Who weakened regulation and allowed Northern Rock to offer 125 per cent mortgages? Who diminished Bank of England control over our banking system? Who wrecked final-salary pensions with a £5 billion-a-year tax levy? Who ignored the risks of the house price and equity boom? A glance in the mirror shows him the culprit.

The Prime Minister admits to none of this but asserts that our present woes are due entirely to “an international crisis begun in America”. He repeats this mantra so often that he may have come to believe it. But no one else should. A large part of the crisis now engulfing us is home-grown in the Treasury and No10. The UK would be facing recession and a house price collapse without any international dimension. New Labour has as much financial blood on its hands as any erring banker on either side of the Atlantic.
Background
No theory can stop recurrent boom and bust
Cameron: Brown's had his boom, now he's bust
How far can Brown claim credit for quick fix?
Brown hits back: this is no time for a novice

Last year, at the Mansion House, the Prime Minister spoke of “an era that history will record as the beginning of a new golden age for the City of London”. Nemesis must have smirked. Within months there was the first run on a UK bank for 100 years, and the collapse of Northern Rock. Since then, the taxpayer has been called upon repeatedly to rescue our once-secure banking system.

Yet ministers foresaw nothing of what was building up and, to judge by their inaction, understood even less. Their failure to do so is one reason the future is bleak for so many who did not profit from the boom, but will surely suffer from the bust.

House prices are falling at the fastest rate since records began. Every home is losing value, but the plight of the elderly is especially heart-rending. Many who planned to boost their retirement income by trading down to release a cash nest egg have had their hopes dashed. The soon-to-retire face a double whammy: not only has the value of property fallen, but their pension funds - already weakened by tax levies - have also been cut in value by 30 per cent or more.

Hundreds of thousands of elderly people did everything possible - without state benefits - to secure their future. Now, the crisis cut in interest rates is likely to reduce their income even further.

At the heart of the troubles is debt. Debt has been this Government's biggest growth industry. Annual borrowing - even at the beginning of the recession - is at record levels: no comparable country is in a worse position.

When Mr Brown claims that national debt is lower than many such countries, he is being less than candid. He knows he is excluding long-term liabilities such as £100 billion of private finance debt, our unfunded public sector pensions and the debts of Network Rail and Bradford & Bingley. Once these are taken into account, our true debt is nearly three times higher - at a shocking £76,000 for every household. The figures the Government uses to reject the charge of financial incontinence are as bogus as a fourpenny bit.

Personal debt, too, has risen to levels never before seen - up by 70 per cent in a single decade. It is now the highest of any leading economy: higher as a proportion of income than any G7 country has seen. The Labour Government wallowed in the feel-good factor of this easy money: it made it popular, won elections, so Labour let it rip. The IMF tried - repeatedly - to warn Tony Blair and Mr Brown of the dangers ahead, only to be told it was “mistaken” and “wrong”. It was not.

Mr Brown glosses over these errors. The UK, he claims, is better placed than most to deal with the crisis. But, if the IMF is correct, that is yet another juicy piece of fiction: it believes the UK will suffer the deepest recession of any leading nation. The collapsing value of sterling suggests it is not alone in that view.

Faced with a blizzard of debt and a recession, the Government summons the ghost of J.M. Keynes and hints at further mega-borrowing, although whether this is for spending or tax cuts is not yet clear.

This would be folly. Some distress borrowing is inevitable - recession will cut tax revenue and increase social expenditure - but if the Government appropriates Keynes to justify further massive public spending, it will be making a fatal error.

What, then, to do? Most importantly, monetary policy has been eased. Beyond that, experience of the last recession makes me cautious. There is no pain-free way forward from the mess we are in. My heart says “yes” to tax cuts; yet my head tells me that, if we pile debt upon debt, there will be a painful day of reckoning. Today's unfunded tax cut is tomorrow's tax increase. We are not in a 1930s-style slump, nor do I believe we will be. It may be unpopular to say so, but we should be wary of mortgaging the future with even more debt.

For 11 years Mr Brown has claimed personal credit for the economy that Labour inherited but the Conservatives created: “We have had the longest period of growth in the history of this country,” he says, conveniently forgetting that the first five years of this growth came under the last Conservative Government.

As Mr Brown heads towards Washington, in his self-appointed role as economic czar to the wider world, there will no doubt be a spring in his step. But come the next general election the public will not be so easily fooled, or forgiving.

As with every Labour Government we have known, its legacy will be a wrecked economy that - yet again - will take years to mend.

The last point he made is significant. Every Labour administration has screwed up the economy...they just can't help themselves.

As to joining the Euro, it may happen but whichever government caved in and did so, would be out of office for a very long time. Especially if it was on their watch that allowed the collapse of Sterling.

It's fantastic to watch Brown and Darling these last few months. The men responsible for the credit bubble in the UK, responsible for saddling our grandchildren with enourmous debt, responsible for lax, even criminal neglect of the financial sector, responsible for selling our gold reserves at the lowest point in the cycle, responsible for 'off sheet accounting' ala PFI etc, etc. These men, Brown in particular, swan around, preening that they are the saviour of the worlds economy, when it is they and others like them, that are responsible for the mess that we're in.

It's like me having a glazing business. I go around chucking half charlies through peoples windows and then I go and put new glass in. At a price. Then I expect thanks for putting the glass back in.

Another thing. Brown can't stop grinning at the moment. Not that weird Frank Spencer grimace he used to do but a genuine smirk that rivals Shrubs 'Oh my god, I can't believe I'm prezzie' look. He hopes the recession will save his skin. Screw the country, as long as Brown can chisel his way into staying in power, then all's well.

Election now. Brown out!

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Originally Posted by InsaneApache

The last point he made is significant. Every Labour administration has screwed up the economy...they just can't help themselves.

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Hm.

who said yes, and were they british, because with respect; if they were not then opinion is invalid, and if they were european then their opinion is suspect.

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Originally Posted by Craterus

Hm.

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Winter of Discontent?

What state was the economy in when the Conservatives left Office.

To answer Banquo's question:

I fear a common currency shared by uncommon countries. The Eurozone may look good at the minute but we have seen that all those Chancellors and Finance ministers cannot work together. If we had joined the Euro and Brown had acted as he has would things have been worse?

I don't know if the euro is a good idea over all but it seems to me that half the eurozone can't talk to the other half sometimes and I don't want tot be any more linked to that nest of vipers than I already am.

I have to say don't know, currently buying PS3 games from the UK is often about 20EUR cheaper than buying them here, despite the shipping costs and conversion rate!
If it would stay that way, go ahead, about time, if not, please don't. ~;)

Im sorry, we aren't allowed to comment on other countries politics ?

As far as im concerned everyone is welcome to give thier opinions on british politics... whether i agree or not...

I said yes... im british...

Of course the UK ought to join the Euro. It is good for Britain. It is, even when bearing in mind the costs of bailing Britain out, good for the Eurozone.
It would be a complete no-brainer were it not for that wave of nationalist hysteria that is sweeping through Europe in the last few years. The whole of the City knows the Euro is exactly what Britain needs right now. Yet it would amount to political suicide, so I don't see it happening.

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Originally Posted by Will Hutton

For years Britain has indulged the City, allowing our financial system to grow four and half times the size of our GDP, a more modest version of Iceland, Ireland and Switzerland, but with the same risks.

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Spot on, this. The UK has been to Europe what Iceland has been to the UK. Deregulation of the financial market and ultraliberalism paid for a nice decade long party in both countries. The mess is for everybody else to clean up. France didn't have a recession, yet she is dragged down under. The Spanish banking system prevents a collapse like we're witnessing now, yet they share in the global recession. Depression maybe.

We all are into the same mess. If the past two months learned anything, it is that going it alone led to more disaster, and that cooperation seems the means to overcome the crisis. Not since it served as a vehicle for European peace has the EU showed its worth more clearly than in the current crisis.

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Originally Posted by IA

Brown can't stop grinning at the moment. Not that weird Frank Spencer grimace he used to do but a genuine smirk that rivals Shrubs 'Oh my god, I can't believe I'm prezzie' look. He hopes the recession will save his skin. Screw the country, as long as Brown can chisel his way into staying in power, then all's well.

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I think Brown has been handling the crisis very well.

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Originally Posted by CountArach

Can someone explain to me why the UK didn't join in the first place? Was it a sort-of England trying to pretend they aren't really European thing?

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I've been wondering this as well. I don't think they ever held a vote on it (forgot the proper term) as Sweden did.

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Originally Posted by Louis VI the Fat

Of course the UK ought to join the Euro. It is good for Britain.

It is, even when bearing in mind the costs of bailing Britain out, good for the Eurozone.

The whole of the City knows the Euro is exactly what Britain needs right now. Yet it would amount to political suicide, so I don't see it happening.

Deregulation of the financial market and ultraliberalism paid for a nice decade long party in both countries. The mess is for everybody else to clean up.

We all are into the same mess. If the past two months learned anything, it is that going it alone led to more disaster, and that cooperation seems the means to overcome the crisis.

Not since it served as a vehicle for European peace has the EU showed its worth more clearly than in the current crisis.

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Why is it good for Britian - or more precisely; better than what we do now?

Did 'someone' other than ourselves have to bail Britain out?

I think you'll find that the city of london shudders in horror at the idea of contintental style financial regulation, it removes their competitive advantage.

But we like a deregulated financial market, and in reality it was over-leveraged european banks and the US with its enforced social lending via Fannie and Freddie that have been responsible for much of the problem.

Co-operation is always good, does that necessarily mean a global currency; or even the UK in euro?

NATO has been the vehicle of europena peace, not the EU.

Originally Posted by CountArach -
Can someone explain to me why the UK didn't join in the first place? Was it a sort-of England trying to pretend they aren't really European thing?

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Originally Posted by SwedishFish

I've been wondering this as well. I don't think they ever held a vote on it (forgot the proper term) as Sweden did.

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It was that whole inconvenient democracy thing, the people didn't want it regardless of what the politicians in power thought was best for us.

As an american i would say no. England has long proven that it can be quite independent of europe, economically.

While i can consider it part of europe, at the same time it isnt part of europe, however wierd that may sound.

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Originally Posted by Furunculu5

It was that whole inconvenient democracy thing, the people didn't want it regardless of what the politicians in power thought was best for us.

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Okay I understand that, but why didn't they want it?

there can be no definitive catalogue, as not all apply or are agreed with by britons, but here are some:

1. the EU was invented by france to ensure that germany never invaded again, germany was a bit embarrassed and so complied, their neighbours thought that was a jolly good idea too. not a problem Britain has.

2. socialism took a firmer grip on the continent than ever did here, and the consequence is a much greater enthusiasm for regulation in matters socio-economic. we freebooting Britons pillaging the high financial seas see this as a threat to our competitive advantage.

3. the continent as a result of the 100 years war, the franco-prussian war, the first world war as well as the second and many more, has suffered centuries of political instability repression and revolution. how many continental countries have not been facist, communist, revolutionary, and invaded in the last 350 years? the EU therefore represents stability to many nations, not a problem Britain has.

4. for an economic union to work, in the bad times as well as the good, there needs to be a large element of political union; who is the lender of last resort, why should germany bail out italy's fantastic attempt to make the euro worthless, etc. we don't necessarily want a political union, we have an exceptionally successful political model already, and no-one has demonstrated why an extra layer of EU federalism is an improvement.

5. we are rich in absolute and comparative terms, will joining the EU make us richer or poorer? certainly no-one has persuaded me that joining the EU will do anything but reduce britain's competitive advantage.

6. we have a history with, and a duty to, the commonwealth nations to assist them in their socio-economic development, and we like the freedom to recommend our political structures and structure economic packages to their benefit as we see fit. specifically, we dislike EU trade protectionism and the damage we feel it does to developing nations, especially given the skepticism with which we view aid programs. there is no question that greater involvement in the EU further reduces our options with the developing world generally, and the commonwealth in particular.

7. similar to #6, there further we integrate the less free our hand to act as we please, which is fine if we acted in concordance with the rest of the continent because we amplify our message, but bad if we have divergent views because our own will be watered down among 300 million continetal voices. if Britain decides it wants to join america in invading somewhere then i don't want to euro apparatchik telling us we can't because we signed up to a common foriegn policy!

i have yet to hear these many mysterious benefits i hear touted encouraging britain to join the euro, and i rather suspect that silence will persist.....................

I would say No. If the UK joined the Euro, they would also joint the European Central Bank and lose control of their own monetary policy. This isn't a good thing for them. For example, say most of Europe is running strong, but Britain is having sluggish economic growth. The European Central Bank would most likely raise rates to cool the rest of the European economy, while strangling the life out of a weak British economy. Vice versa works in this situation too.

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Originally Posted by AlexanderSextus

As an american i would say no. England has long proven that it can be quite independent of europe, economically.

While i can consider it part of europe, at the same time it isnt part of europe, however wierd that may sound.

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Spot on

Having sole control over your currency is a very GOOD thing.

a little more background reading:
http://blogs.telegraph.co.uk/daniel_...terling_crisis

It's up to the Brits, it doesn't affect me in the slightest. On the whole I quite like having the Euro; the "own monetary policy" argument doesn't really fly for the Dutch because our currency was always fixed to the German mark to begin with.

if another country has a different opinion then more power to them. :)

The EU may be just considered an economic/monetary policy pact, but he who controls the purse strings effectively controls all political policy. Personally, I'd be hesitant to endorse this too.

Denmark is seriously considering joining the Euro at last. Norway, not an EU member, is seeking closer co-operation too. Scotland's nationalist first minister Alex Salmond would love to take his country into the euro if it ever wins independence.

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Now, in research published this week by Chatham House, a commission of the great and the good readdresses the issue of Britain and the euro and the prospect that, by the middle of the next decade, the UK could be in a minority of one, two or maybe three outside a eurozone of up to 25 member countries. Unsurprisingly, the conclusions are balanced, nuanced and ambivalent.

On the one hand, the authors reject the notion that Britain should give up the pound simply to avoid "losing influence" among EU economic policymakers, especially the eurogroup which increasingly dominates debates and coordinates policy responses. They are unconvinced that the eurozone will in future see a greater convergence in terms of business cycles, growth rates, inflation and unemployment than in its first 10 years.

On the other hand, they say, the eurozone has acted as a "safe haven" in the credit crunch and as a bulwark against the turmoil that would have arisen were the lira and peseta, say, still traded. "The stability offered by the euro would be especially welcome if, over the next ten to 20 years, the British economic performance deteriorated relative to that of the eurozone for a sustained period."

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link

~+~+<((*))>+~+~

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63% of UK’s top firms believe in euro benefits

THE majority of Britain’s biggest companies believe they would benefit from joining the euro - though not at the bottom line, according to a new survey.

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The top of British' business, the people who know how Britain makes its money, seem rather convinced of the Euro's benefits.
This was before the current financial meltdown. I rather suspect the number of pro-Euro firms will be much higher now.

~+~+<((*))>+~+~

Another interesting question is, should Europe allow the UK to join the Euro? The Euro is not a 'get out of jail free' card, to be used as a measure of last resort whenever Britain has its traditional financial meltdown. The EU is about solidarity as well.

small economies will indeed benefit from being part of a larger whole, particularly if they wish to participate in capital intensive parts of the service industry like the financial sector, though i would argue that less regulated economies will see their competitiveness stifled by regulatory harmonisation.
britain is neither a small economy and nor too is it regulated to the degree of that seen on the continent.

"though more than 80 per cent did not think it would make any difference to their sales or profits.
Nearly 90 per cent said they expected their sales would remain the same, and just 13 per cent believed the euro would improve their profitability. But more than 40 per cent considered it would improve their market valuations."
two points:
> the british people will not end up richer.
> captains of british industry looking for a greater market capitalisation are not the british people.

and regarding the last point; do we want a get out of jail free card? i think we do not regardless the ammount of media speculation on the ramifications of the credit crunch for britain, indeed i doubt any great number of people see the euro as a liferaft.

Ambrose Evans-Pritchard is the best financial analyst i know of:
http://www.telegraph.co.uk/finance/c...n-devices.html

Spoiler Alert, click show to read: 

Best to leave the euro to its own (de)vices
Joining the single currency would make our situation worse, says Ambrose Evans-Pritchard.


By Ambrose Evans-Pritchard
Last Updated: 10:19PM GMT 01 Dec 2008

Comments 30 | Comment on this article

The euro is on a roll. Icelanders are clamouring to join, as soon as they can get into the EU. The Danes seem ready to abandon their long rebellion and sign meekly on the line. A Danish referendum is pencilled in for March.

Eastern Europe's states are trying to engineer entry as fast they can to escape the hell of semi-fixed currencies. It was not such a good idea after all to take out euro mortgages in Budapest, Warsaw and Sofia – or Swiss franc mortgages, heaven forbid.

Everybody wants a safe port in this Force 10 storm. No matter if it is full of undetonated mines. No matter, too, that Denmark's travails stem from membership of the ERM, a half-way house that has forced them to raise rates twice – into the Copenhagen property crash.

José Manuel Barroso, the Commission's chief, was a little too honest telling French TV that the people who count in Britain hanker for monetary union. What a slip of language. Is this a reversion to his Maoist youth in Portugal, or has he been drinking the EU waters for too long?

The people who count in British democracy are the voters. But let us not quibble. Mr Barroso is right to sense a shift in the undercurrents of British politics. This is a tricky moment for those who fear that total loss of control over our monetary policy would lead to even more destructive cycles of booms and busts than those we have already.

"I don't want to break the confidentiality of certain conversations," said Mr Barroso. "But British political leaders have told me that: if we'd had the euro, we'd be better off."

How, exactly, would we have been better off? Our current mess is caused by over-reliance on bankers (7·8 per cent of GDP), six years of incontinent spending by Gordon Brown and a housing/credit bubble that has pushed personal debt to 103 per cent of GDP.

Joining the euro would not have prevented any of this. It would have made matters worse. The European Central Bank held rates at 2 per cent for part of this decade to help Germany out of the doldrums. Imagine what such rates – or anything near – would have done to Britain's property boom. You might as well have poured petrol on the fire, as Ireland and Spain can attest.

Events since the crunch began last year – and reached volcanic fury in September – entirely vindicate our refusal to give up control over our economy. Sterling has come down from silly levels, falling 30 per cent against the dollar and 21 per cent against the euro. Perfect. The economy has suffered an asymmetric shock: the currency has acted as the shock absorber. Our sympathies to well-heeled Britons in Aquitaine or Umbria living off sterling rents, but policy is not set for their needs.

The Bank of England botched the crisis at first, but it is now responding to emergency with stunning boldness. The 1·5 point cut in November – and what follows this week and beyond as rates fall to the lowest level since the Bank's creation in 1694 – may make the difference between recession and depression. Others that gave up their currency may not be so lucky.

Would you really want Frankfurt to decide your fate? The "people who count" in global finance – investors, economists and hedge funds – are increasingly in despair about the conduct of the ECB. It has misread events at every turn over the past year. It panicked in July when it raised rates to offset an oil and food price spike. By then, Germany and Italy were already in deep recession, and Spain faced a housing crash.

The "Shadow ECB", a panel of private economists from across Europe, last week called for immediate and drastic rate cuts, demanding to know what the ECB's strategy now is – if it has any at all. It would be going too far to describe the ECB's policy utterings as primitive gibberish – as two Nobel Laureates put it – but the bank is bent on a course of action that is at best very different from the reflation strategies of the Anglo-sphere, China and Switzerland, and risks repeating the errors of 1931 to 1933.

These are early days in this long, winding crisis. We cannot yet judge whether the euro is a force for stability, or whether it is workable at all – given the lack of an EU treasury and debt union to back it up. Monetary unions can create an illusion of calm for a while. They shield sinners from market discipline, but in doing so they let problems fester.

Locking the currencies together was the easy part of EMU. Once the euro was off the ground, it was unlikely to face an existential test for at least a full credit cycle. But then it gets harder. The Latin bloc has allowed costs to creep up, while Germany has squeezed wages with relentless discipline. The gap has grown wider every year.

This is starting to matter. Investors are no longer willing to treat Greek, Italian, Irish or Spanish debt as interchangeable with German debt.

Nothing is pre-ordained in the euro drama. The chief reason for launching the single currency – before economies had properly converged – was to force the pace of political union. It may have to deliver on this agenda. Either the EU creates the machinery to needed cushion the bust on Europe's fringes, or EMU will drift into crisis. The ball is in the court of very reluctant paymasters in Germany.

Whichever of these two paths its chooses, there is no earthly reason for us to follow.

I also think experts who share my views are the best, but his illusion becomes obvious when he claims the people who actually count are the voters. :laugh4:

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Originally Posted by Furunculu5

Ambrose Evans-Pritchard is the best financial analyst i know of

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Ah, Evans-Pritchard. The same man who, when he was correspondend in the United States, wrote many an angry colum about how the Oklahoma bombings were an inside FBI job? The same man who fed his readership endless columns about how the Clinton adminisatration was a sign of "incipient fascism" in the United States? :idea2:

Really, the Telegraph is Britain's worst newspaper. An agenda driven, ultra-nationalist, rightwing rag. It's the Daily Mail without colour pictures and page three girls, to convince its conservative petty bourgeois readership that they really! honestly! are reading a proper newspaper instead of a foaming tabloid.


The one thing Evans-Pritchard gets right is his portrayal of the enormous gap between the populace and the British financial, business, and political elites. The latter overwhelmingly hanker for monetary union, the former think that British independence is under assault again and that Britain needs to sail out under Horatio Nelson to defeat Napoleon.

It's the Daily Mail without colour pictures and page three girls,

Your thinking of The Sun, Daily Mail is somewhere in the middle, no boobs but plenty of tits... or no tits but plenty of boobs... works either way...

I think the major reason against it is...
europeans are different
brits are different
the pound! save it!
damn french/germans!
Freedom!
Bearaucrats from brussels
Immigrants!
More rules and regulations
Soveriegnty!

and its generally something along those lines when i read a right wing newspaper commenting on the euro.... deep stuff...

A quarter of British nearing retirement age dream of living abroad. Spain, France, and recently Croatia and Cyprus are hot spots. Half a million live in France alone.

This is one of the great benefits of the EU. We have the space, the sunshine, underdeveloped rural areas that few of working age want to live in. Americans move to Florida or Arizona after retirement. Thanks to the EU, Europeans can do this too. Work in bleak Manchester, retire in 'Dordogneshire'. Travel times, telecommunication and administrative hassle of travelling have been greatly reduced by the EU as well. British grandchildren live only a few hours away by cheap train and can hop over as if they were travelling from Scotland to England.

This fabulous system is now under threat.

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[British] Expat pensioners in Europe have seen their norm monthly pension income plumb bob by about €200 a month, thanks to falls in the value of sterling, a collective loss of more than €4 one million million of their income in the last two years.

The shocking reduction, calculated by currency specialists HiFX, could get even worse if the pound continues to fall.

If it hit €1.15, then their pension income could fall by a further €750 over the next year, and with involvement rates cut a full 1.5 per cent by the MPC last week, there is probably to be even greater pressure on sterling.

Nick Fullerton, managing manager of currency broker FC Exchange, said: "This involvement rate cut will bring more doom and gloom to an already weak pound - but the thirster people put off their currency transactions, the more expensive it will become.

More than a 1000000 Brits abroad claim the state pension, and are accordingly subjected to the vagaries of currency fluctuations.

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Obviously, currency fluctuations mean the pound could also rise against the euro. But a pensioner or retiree doesn't need a rise in value. He needs one thing only: stability and security in his financial plans. The recent currency fluctuations are nothing short of a million small dramas to British retirees. :shame:

My dads pulling out whats left of his hair. Since he moved to Greece in 02 he's lost upwards of £600 a month due to devaluation, of course he's all for joining the euro. I, on the other hand, am not convinced.

Serves the old bugger right for spending my inheritence.:laugh4:

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Originally Posted by Louis VI the Fat

A quarter of British nearing retirement age dream of living abroad. Spain, France, and recently Croatia and Cyprus are hot spots. Half a million live in France alone.

This is one of the great benefits of the EU. We have the space, the sunshine, underdeveloped rural areas that few of working age want to live in. Americans move to Florida or Arizona after retirement. Thanks to the EU, Europeans can do this too. Work in bleak Manchester, retire in 'Dordogneshire'. Travel times, telecommunication and administrative hassle of travelling have been greatly reduced by the EU as well. British grandchildren live only a few hours away by cheap train and can hop over as if they were travelling from Scotland to England.

This fabulous system is now under threat.

Obviously, currency fluctuations mean the pound could also rise against the euro. But a pensioner or retiree doesn't need a rise in value. He needs one thing only: stability and security in his financial plans. The recent currency fluctuations are nothing short of a million small dramas to British retirees. :shame:

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that is lovely, but in no way is it a significant reason for the UK to join the euro.

i am really fond of Polish Gingers beer, does that we mean both Nation States should join just so i can have a stable price on one of my favourite beers?

Quote:

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Originally Posted by Furunculu

that is lovely, but in no way is it a significant reason for the UK to join the euro.

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Really? I think it is:

Quote:

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Originally Posted by InsaneApache

My dads pulling out whats left of his hair.

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See? This is all about real people, with real commitments, real lives. Let me repeat my point: the financial stability, the very livelihood of a million British pensioners - most of them not rich! - is undermined.
It is not about abstract ruminations about Empire, British insular identities, EU 'superstatism', national pride or lord knows what.

Louis' first rule of politics: never let an abstract political goal override what brings a concrete benefit to concrete people.

Quote:

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Originally Posted by InsaneApache

he's lost upwards of £600 a month due to devaluation

Serves the old bugger right for spending my inheritence

---

If Britain had joined the Euro in 2002, then your father would by now squander 600 quid a month less from your inheritence. :beam:

Quote:

---

Originally Posted by Louis VI the Fat

See? This is all about real people, with real commitments, real lives. Let me repeat my point: the financial stability, the very livelihood of a million British pensioners - most of them not rich! - is undermined.
It is not about abstract ruminations about Empire, British insular identities, EU 'superstatism', national pride or lord knows what.

Louis' first rule of politics: never let an abstract political goal override what brings a concrete benefit to concrete people.


If Britain had joined the Euro in 2002, then your father would by now squander 600 quid a month less from your inheritence. :beam:

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it is a significant reason for IA's dad, not the UK as a whole.

financial stability is something we take individual responsibility for, IA's dad took a risk when he moved outside the UK while leaving his pension inside.
No-one ever said it was about ruminations of empire.

Maybe so, and.............

So to have financial freedom, one would have to stay in Britain?
I thought many people shared the ideals of freedom, being financially or otherwise locked in a country isn't freedom in my book. :thumbsdown:

It's about time we abandon countries and bring forth the world government.

Quote:

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It's about time we abandon countries and bring forth the world government.

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Good God no.

It's about time we abandon countries and bring forth the world government.

Yes!

Its about time companys where no longer able to hold goverments hostage with the threat of moving elsewhere, with one world goverment corporations and the rich will not be able to run away and hide from fair taxes...

Quote:

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Originally Posted by Husar

So to have financial freedom, one would have to stay in Britain?

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i never said that.

To answer a question that was asked in this topic, Britain isn't part of the EU because Britishs, for some unknown reason, think they're different from other Europeans, and that they built their prosperity outside of Europe (which is actually a complete fairy tale).

As for myself, I'm all for them staying out of the Euro zone, and for withdrawing from the EU as well. We've had enough of these buggers and their constant whining. I don't even know why they wanted to join the European project so much in the first time, only to slow everything down and complain all the time.

Oh yeah, right, because UK was back then the poorest country in western Europe (bar Portugal and Spain), and thought - quite rightfully - that joining the rest of Europe could help.

A couple of other thoughts :

1 - Evan-Pritchards is indeed not the best financial analyst, but one of these people that really give a bad name to journalism. I can't even understand how some papers still publish his articles.

2 - Stop your constant nonsense about Democracy. It's not as if London was the city in the world with the most video spying crap, and it's obviously not as if your last prime ministers did not support anti-personal freedom laws in the name of the holy Fight Against Terror, laws that are still unmatched in the rest of Western Europe.
So much for democracy and freedom heh.

Oh, and the voters don't have any power once they've elected their leader. They never did and never will.

i am all for electing a gov't, granting them my authority to govern in my name and with my acquiescence, but if they want to divest that authority to a third party then i do expect them to come back to me and ask my persmission.

but talk of democracy is better kept to the; "is Britain an island" thread, except where we recognise that the euro is a tool that will of necessity result in greater political union.

as to Evans-Pritchard, people are happy to rubbish him but i have seen little sign of people rubbishing the arguments against Britain joing the euro.

and i am sorry the continent has to keep on putting up with british moaning about "ever deeper political union", and can fully accept that you would be happy to see us out so that brussels can continue with its grand federal project. all the (majority of) British people want is free-trade, and our politicans know it so they keep flogging the dead horse of halting this or that diktat to avoid the sensible solution; EFTA.

Some of you equating us states with European countries are kind of reaching.

I don't understand joining the EU.

Free Trade: have a trade agreement
Fixed exchange: have a fixed exchange rate (that didn't really work in the past, yet having no opt-out would somehow be better).

The EU accounts have not been signed off for the last decade. If this happens to a company they're in trouble. If it's a massive bloc of countries you merely ignore it.

The EU is a disorganised mess which tries to paper over internal struggles by not asking the general public what it wants. Votes to the contrary are overlooked, ignored or repeated until the "right" result is gained.

Companies can always move elsewhere. The UAE is open for trade - unless that too is going to be forced into the EU.

~:smoking:

Quote:

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Originally Posted by InsaneApache

Good God no.

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Why do you hate your dad so much? ~;)
I mean in the end we're all supposed to be derived from the same monkeys, aren't we? so why would it be impossible to have the same rules, same money and same rights for everyone without imagining a line somewhere in a forest or desert beyond which you pay 20 EUR more for a PS3 game or get stoned for being raped or something like that?
Just because it allows you(in general) to think you're better than "the others", the beyond-border-people, is not a valid reason. ~;)

Quote:

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Originally Posted by Furunculu5

i never said that.

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That's why it was a conclusion on my part.

Quote:

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Originally Posted by Husar

I mean in the end we're all supposed to be derived from the same monkeys, aren't we? so why would it be impossible to have the same rules, same money and same rights for everyone without imagining a line somewhere in a forest or desert beyond which you pay 20 EUR more for a PS3 game or get stoned for being raped or something like that?
Just because it allows you(in general) to think you're better than "the others", the beyond-border-people, is not a valid reason. ~;)

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Because we don't necessarily want the same rules, and our economies don't have the same needs which could be accomodated by the same currency.

Show me how it will benefit the UK before you start putting up strawmen about needless nationalist willy-waving.

Quote:

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Originally Posted by Furunculu5

Show me how it will benefit the UK before you start putting up strawmen about needless nationalist willy-waving.

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Show me how benefitting the UK will benefit me before you want me to agree with you.

what?

Quote:

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Originally Posted by Husar

It's about time we abandon countries and bring forth the world government.

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I don't want to share a government with countries I've got nothing in common with, like Swaziland, Bhutan, Greece or Bulgaria. Trade agreements, fine, but not further than that. They have a different history, different customs, different economic interests.

:creep:

Quote:

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Originally Posted by Louis VI the Fat

I don't want to share a government with countries I've got nothing in common with, like Swaziland, Bhutan, Greece or Bulgaria. Trade agreements, fine, but not further than that. They have a different history, different customs, different economic interests.

:creep:

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???

All countries have different history and different customs. Even some parts of France have different history and different customs compared to some other parts of France. And what do you mean different economic interests? Don't we generally have the same economic interests? We may disagree on actual policies and actions, but the goal is generally the same

Quote:

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Originally Posted by Louis VI the Fat

I don't want to share a government with countries I've got nothing in common with, like Swaziland, Bhutan, Greece or Bulgaria. Trade agreements, fine, but not further than that. They have a different history, different customs, different economic interests.

:creep:

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I do not want to share a government with my neighbors either, they have a different history, different religion, different customs, different hairstyle, different culture (I'm rap, they're hiphop) and different shoes as well as a completely different job, it's completely lunatic to think the same government could please both my neighbors and me. :dizzy2:

Quote:

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Originally Posted by Sarmatian

???
All countries have different history and different customs. Even some parts of France have different history and different customs compared to some other parts of France. And what do you mean different economic interests? Don't we generally have the same economic interests? We may disagree on actual policies and actions, but the goal is generally the same

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Oh, I am taking the piss, Sarmatian. ~;)

Come on, I base a dramatic and emotional pro-integration plea on poor IA's father who's starving to death because mean tabloid-wielding xenophobes don't want to be in a monetary union with Greece, only to be followed not two posts later by me revealing myself to be a dastardly xenophobe moaning that I don't want to be in a union with strange and foreign countries like Greece. It was funny, no?


And apart from taking the piss, I am posing a mental challenge. It may not sound like it, trying as I am to further debate by stubbornly, singlesidedly arguing for more EU integration, but I do take the arguments of the others seriously. For all my talk of a xenophobe, nationalist tabloid version of European integration, I myself of course think exactly the same. We all do. Save for Husar, who really does accept the consequence of his arguments and calls for a world government. Unless one does, one will have to define an 'us and them', and put a geographical and political limit to the extent of the EU.

Whom do I want to be in bed with? For me it is simple: the countries that surround me. Italy, Iberia, the British Isles, the Benelux, Germany, the Alpine countires. Those, plus the fat beef of Scandinavia - all their Kroner are belong to me.

A Serbian wants a union with his fellow orthodox countries Bulgaria and Greece, plus western Europe. The Poles dream of Ukraine and Belorus. But from where I'm sitting, Bulgaria is Mars. Ukraine the Kuiper belt. From where a Briton is sitting, Marseille and Naples are already North Africa. Erm...for me as well but let's for the sake of argument pretend they aren't.

This all means that all criticism about invoking different histories, different customs, different interests, is a matter of quantitive preference, not a qualitive one. Or, to put it differently, I can argue Furunculu's argument that Britain does or doesn't belong in the EU because of different history and customs etcetera. I can not argue the principle itself that different history, customs, etcetera are a criterium.

I myself have a limit. Turkey? No, too big and too different. Russia, the same. North Africa? Nope. Some Britons have limit as well, often conveniently summarised as: beyond the cliffs of Dover, the abyss.
You too, Sarmatian. Do you want a union with Syria? With Libya? They are as close to you as Ireland is. Yet I presume you don't. Which means that you, as well as I, have a mental and political line beyond which we think that there is just too much different history and different customs.

Quote:

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Originally Posted by Louis VI the Fat

Whom do I want to be in bed with?

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The nice turkish ladies I see almost every day of course, don't try to trick yourself into believing they shouldn't be here. :belly:

Quote:

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Originally Posted by Louis VI the Fat

A Serbian wants a union with his fellow orthodox countries Bulgaria and Greece, plus western Europe. The Poles dream of Ukraine and Belorus. But from where I'm sitting, Bulgaria is Mars. Ukraine the Kuiper belt. From where a Briton is sitting, Marseille and Naples are already North Africa. Erm...for me as well but let's for the sake of argument pretend they aren't.

---

All day long I'm hanging out with internet friends from all over the world with whom I have more in common than a lot of people here in Germany whose interests could well be from Mars, but when I want to see those best friends of mine I have to pay a fortune, have my fingerprints taken, undertake a nekkid scan etc and when they gift me a flatscreen TV while I visit I will have to pay my country for taking it back home when I return. And people talk about freedom? :inquisitive:

The EU offers that freedom, I can buy things from the UK, support their precious nationalistic economy and let ours rot because they are ripping me off anyway (to make a stupid example again I ordered LBP from the UK for 30EUR including shipping etc, in german stores it costs 65 to 70, that's more than twice as much...), I can also travel to Bulgaria and visit that beautiful country with nothing but my personal ID(or passport or whatever you call it). I know about the dangers of terrorism etc but if we could get the world to unite under one political entity and get rid of all artificial borders dividing friends and enemies alike, then we could achieve real freedom, different religions and customs merge at the borders all the time anyway and even faster since we got planes and the internets, a modern building in Bangkok looks very similar to a modern building in New York, at least in architecture the cultural differences are vanishing anyway.

350 years ago catholics and protestants were still bashing eachother's heads in, now they peacefully coexist so what says that muslims and christians cannot coexist peacefully or that a briton and a frenchman cannot be neighbors? The only thing that does is their perception of the other guy, their prejudices, their monkeyspheres, their stupidity. :thumbsdown:

And when that world state becomes so unbearable, where to go?
For it is the Utopian dream land, no?

Any idea that it is not, must desist.

If I were you Hussar, I would think harder about a World State than simply that it will allow you to buy cheaper goods.

Quote:

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Originally Posted by Bopa the Magyar

And when that world state becomes so unbearable, where to go?

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Mars.

I mean currently the options do not look much better either, if the west turns undemocratic(and some say it is), where to go? China? Iran? Pakistan? Africa?

Quote:

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Originally Posted by Husar

Mars.

I mean currently the options do not look much better either, if the west turns undemocratic(and some say it is), where to go? China? Iran? Pakistan? Africa?

---

Mexico

Quote:

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Originally Posted by Louis VI the Fat

I myself have a limit. Turkey? No, too big and too different. Russia, the same. North Africa? Nope. Some Britons have limit as well, often conveniently summarised as: beyond the cliffs of Dover, the abyss.
You too, Sarmatian. Do you want a union with Syria? With Libya? They are as close to you as Ireland is. Yet I presume you don't. Which means that you, as well as I, have a mental and political line beyond which we think that there is just too much different history and different customs.

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i would love to see turkey in the EU.

in my view they have earned it for their party in NATO during the cold war, the west would also benefit from what can be best described as the obama effect, and most importantly it would help make the EU broad and shallow, which is the way i like my supra-national governance.

Quote:

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Originally Posted by Furunculu5

i would love to see turkey in the EU.

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Wot!? Rubbish Furunculu! The EU must not expand! We are too different, have too many diverging interests. I don't need the UK and their schemes to get me into a union with Turkey! I want a referendum NOW!!


Hehe. ~;)


Bah, I enjoy myself much more as an evil rightwinger. Forget about my recent sharpleft turn. From now on, Louis is a rightwing fanatical maniac. :knight:

i want turkey precisely because it is so different it would force the EU project in a shallower direction, as a necessity to survive it being so broad.

Oh, I am taking the piss, Furunculu. ~;)

Come on, I splatter dramatic and emotional pleas for more EU expansion over five hundred threads, only to now argue that expansion must be halted and that I want a referendum NOW. It was funny, no?

whatever, i'm just telling you my thoughts that spring from your comments.

Quote:

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Originally Posted by Louis VI the Fat

Come on, I splatter dramatic and emotional pleas for more EU expansion over five hundred threads, only to now argue that expansion must be halted and that I want a referendum NOW. It was funny, no?

---

No. Done it before.

Anyway, when Turkey finally enters the EU we may finally get some new laws for the equal treatment of muslims that are sorely needed in countries like the UK, France and the Netherlands.

Spoiler Alert, click show to read: 

:hide:

Quote:

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Originally Posted by Husar

No. Done it before.

Anyway, when Turkey finally enters the EU we may finally get some new laws for the equal treatment of muslims that are sorely needed in countries like the UK, France and the Netherlands.

Spoiler Alert, click show to read: 

:hide:

---

Taking the piss or what?

Quote:

---

Originally Posted by Husar

No. Done it before.

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Hah! I am unshakable in my pompous arrogance! No amount of weird looks and painful silence will ever convince me I am not hysterical. :beam:

Quote:

---

Originally Posted by Husar

Anyway, when Turkey finally enters the EU we may finally get some new laws for the equal treatment of muslims that are sorely needed in countries like the UK, France and the Netherlands.

---

Indeed. And more secularism! And doner kebabs! :jumping:

However, I, for one, do not intent to share the wealth with Turkey. Sorry Husar, but I think sharing is for naive internationalists. It is not what Europe is about, how our capitalist union works. We are not going to share with Turkey.
Instead, we will continue to shamelessly milk Germany and the UK for our own financial gain, thank you very much. ~;p

Spoiler Alert, click show to read: 

Whatcha gonna do about it? ~;p

Louis, this is descending into spamming.

Overall Germany is making some nice trade profits, at least it was last time I looked at wikipedia.
If we make poor Louis a bit richer in the process I have nothing against it.
I already said I buy from the UK so basically I'm sharing our wealth with them as well.
I'm sure you've stopped watching youtube videos because that means sharing your wealth with the US, I wonder where the .org host is located since you're probably financing them as well with your visits.

Quote:

---

Originally Posted by Furunculu5

Louis, this is descending into spamming.

---

Nah, spamming is single smiley posts. This is turning this place into a riot. The thread is three weeks old, I don't think we'll see any hefty posts discussing the financial merits of euro membership anymore. Consider my gibbering nonsense the equivalent of debators having a few drinks after a debate to laugh it all off and to mock the heavyhanded seriousness of earlier that night.


Let me buy you a pint! We'll drink to Britain! To this precious stone set in the silver sea! This other eden, this demi-paradise!

To your sceptred Isle! http://matousmileys.free.fr/drink1.gif

all brits can say no quite easily, and its our decision so shove off people that dont live on the sacred island of chocolate and stuff

It seems we have a statistical tie!

never fear! grizzly has a plan, we ship out a few anti eu residents... temporarily of course... so boot out Apache (visit the dad in greece) and frunculu (i hear spain's nice this time of year) and ship in a few of the euros... not the evil manaic's though... and then... EURO FTW!!

Louis you are hysterical, and ill drink to that!

Quote:

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Originally Posted by Louis VI the Fat

Oh, I am taking the piss, Sarmatian. ~;)

Come on, I base a dramatic and emotional pro-integration plea on poor IA's father who's starving to death because mean tabloid-wielding xenophobes don't want to be in a monetary union with Greece, only to be followed not two posts later by me revealing myself to be a dastardly xenophobe moaning that I don't want to be in a union with strange and foreign countries like Greece. It was funny, no?

---

Well, when you put it like that, yes. Not really funny, but interesting. You need to hone your witticism. I guess you've spent too much time watching German films or reading German literature, switch to British for a couple of months :laugh4:

Quote:

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Originally Posted by Louis VI the Fat

A Serbian wants a union with his fellow orthodox countries Bulgaria and Greece, plus western Europe. The Poles dream of Ukraine and Belorus. But from where I'm sitting, Bulgaria is Mars. Ukraine the Kuiper belt. From where a Briton is sitting, Marseille and Naples are already North Africa. Erm...for me as well but let's for the sake of argument pretend they aren't.

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Yeah, because they all live in a dream that we'll get rich the moment we become EU members and others will stop looking down on us. Poor beggars, they don't know what they're getting into.

I see what you mean. So, you must have protested when a certain guy of Berber/Algerian roots born in Marseille played for Bordeaux and France? :beam:

Quote:

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Originally Posted by Louis VI the Fat

You too, Sarmatian. Do you want a union with Syria? With Libya? They are as close to you as Ireland is. Yet I presume you don't. Which means that you, as well as I, have a mental and political line beyond which we think that there is just too much different history and different customs.

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Are you kidding? Of course! Serbs are held in very high regard in Syria because of our involvement in non-aligned movement :laugh4:

Reject union with Ireland? To pass on an opportunity to be in an union with the country where Tribesy is from??? Not a chance! :laugh4::laugh4::laugh4::laugh4::laugh4:

Quote:

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Originally Posted by Sarmatian

Not really funny

You need to hone your witticism. I guess you've spent too much time watching German films or reading German literature, switch to British for a couple of months

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Ouch! Scathing! :applause:

I might have to study Serbian instead to hone my skills of razorsharp insult. :beam:

Quote:

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I see what you mean. So, you must have protested when a certain guy of Berber/Algerian roots born in Marseille played for Bordeaux and France?

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When they win, they're French. When they lose, they're Algerian. :smash:

Quote:

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Originally Posted by Louis VI the Fat

When they win, they're French. When they lose, they're Algerian. :smash:

---

I know what you mean. In WC 2006, (then) Serbia and Montenegro lost 6:0 to Argentina, and would you believe it - those Montenegrins managed to concede 6 goals!!! Luckily, Serbia managed to grab a 0:0 draw.... :laugh4:

Now is quite possibly the worst time for the Uk to join the Euro if ever there was one...

With Sterling in free-fall at the moment, joining now at the current exchange would likely mean that our exports would be uncompetitive in the short term since sterling has a lot more devaluing to yet, forcing an even deeper recession... However, in long term, when things pick up, it would mean imports would become far too expensive, causing an inflation problem.

Also, surrendering monetary policy independence in current climate would be quite possibly the most stupid thing we could do in the present economic climate given that monetary policy (interest rates etc.) is the only policy tool that works in a world of floating exchange rates. Essentially, the UK would be forced to take an interest rate set for the economic conditions of countries doing far better than it and risk a huge deflationary trap.

That said, pegging our currency would mean that all this 'fiscal expansion' nonsense would actually work... (I love how Gordon Brown professes to give David Cameron 'a lesson in economics' every PMQs, yet it's first year Cambridge economics undergraduate stuff that fiscal policy doesn't work with a system of floating exchange rates... Mind he's probably too busy saving the world to brush up on the Mundell-Fleming model...)

But then, what do I know?

As with all things with Europe it seems the argument is we should charge into the EU where we have no ability to leave if things are causing our country to be ruined... but nothing about reversible measures such as currency pegging which can be unpegged in worst case scenarios.

Dear old Gordon does seem to think rather too much of himself with the Economy- everything that goes right is him, everything wrong is external forces. Sorting out problems by throwing money at them is easy. Dealing with the debt later isn't - but of course that probably won't be his problem.

~:smoking:

As a matter of clarification, I got the answer from the ONS on the total value of UK trade in goods and services for the year of 2007 with the EU, which now stands comparison with the worldwide figures.

Quote:

---

Dear Me,

Your e-mail enquiry of 11 December has been passed to me for reply.

The EU total trade in goods and services figures you request for 2007 are
as follows:

Imports: £223,977m (= Goods £169,143 + Services £54,834)
Exports: £187,114m (= Goods £127,678 + Services £59,436)
Balance: £36,863 (my addition)

Kind regards

Him

---

Versus World Figures -

Imports: £415 817m (= Goods £309 955 + Services £105,862)
Exports: £368 337m (= Goods £220 703 + Services £147,634)
Balance: £47 480

So the EU represents:
54% of our imports
51% of our exports

Regarding the importance of service trade:
Our services exports to the EU represent 1/3 of the total exports, versus only one quarter of service imports from the EU, making the competitive advantage of service industries of comparatively greater importance to the UK than it is to the EU.
Likewise our service exports to the world represent 2/5 of the total exports, versus only one quarter of service imports from the world, making any EU derived harmonization of service industry regulation particularly damaging to UK trade.

On balance of payments:
77% of the UK's balance of trade defecit is with the EU
The UK actually maintains a surplus with the EU when the balance of service trade is considered.

In short; the EU represents half of the total value of external trade conducted by Britain.