Pune, July 11: The euro, which is slated for a January 1, 1999, launch, will provide a balance to the power of the US and Japanese currencies. It will also avoid de-stabilising attacks on a European currency, as witnessed in the south-east Asian crisis last year and the Far Eastern crisis of this year, said Claude Blanchemaison, French ambassador.Blanchemaison said it would be more meaningful if the British were to join the euro, even as banks in London have readied themselves anticipating a quick changeover. Eleven of the 15 members of the European Union (EU) will join the currency when it comes into being on January 1, 1999, with Britain, Denmark and Sweden staying out of the Monetary Union due to "political reasons." The French ambassador, who was in Pune for the silver jubilee celebrations of the Alliance Francaise de Poona, also addressed a meeting of the Top Management Club (TMC) on the subject of the `euro'. Since the economies of the countries of western Europe have already reached the stage ofintegration, 60 per cent of their foreign trade is with member states (nations), justifying unification of currencies. The Monetary Union would also prevent competitive devaluation of a national currency to gain business advantages.
The ambassador expressed concern over the happenings in the Far East and warned that a Chinese devaluation would trigger off an international crisis. Earlier, speaking to newspersons, the ambassador said the strong European economies of France, Germany, Italy and Spain, which have a higher GDP than the US, could result in other countries using the euro as a reserve currency.
France opposed to sanctions
The French ambassador, Claude Blanchemaison, said France was opposed in principle to sanctions against India, adding that these were "unjustified."
Moreover, sanctions were not the way to get India to sign the Comprehensive Test Ban Treaty (CTBT), Blanchemaison said. He went on to say it could be in India's own interests to sign the Comprehensive Test Ban Treaty(CTBT) on its own terms.
India is emerging as a favoured destination for French business and industry, especially after the relative stability of its currency in the wake of the south-east Asian currency meltdown last year, Alain Couanon, French consul general in Mumbai, said.
India, which was vying with the other Asian giant, China, for foreign direct investment, is increasingly being seen as a more stable destination by French business and industry.
Although it gives lower and slower returns than the south-east Asian countries and China, its systems are being preferred, Couanon said.
Among the areas of interest for French business are the export of processed food and services, including banking.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
