The Confederation of British Industry finally gave its backing for sterling membership of European Monetary Union - but only when "conditions are right." As such, the CBI does not expect the UK to be among the first wave of European countries signing up to the single currency and EMU in 1999.

"It is unlikely that the UK position in the economic cycle will make entry on January 1st, 1999 appropriate - even if the others go ahead," said Mr Niall FitzGerald, chairman of Unilever and chairman of the CBI's Europe Committee yesterday. Clarification of the CBI's position on the single currency has been a long time coming due to major differences of opinion between the pro-EMU views of the CBI's leadership drawn from major companies and the more sceptical views of many smaller numbers.

Mr FitzGerald, speaking at a meeting of the CBI National Council in London, said the CBI believed that "a successful EMU would be a logical extension of the single market and therefore a good thing for British business and that we should be actively involve d as a nation in bringing it about."

"The UK government should declare strong support for UK membership of a successful EMU, work constructively with our EU partners to bring about the conditions for a sustainable single currency and join when they are in place," he said.

"A successful EMU would bring many benefits but success depends upon fiscal convergence and on labour markets becoming more, not less, flexible. "At present, there are doubts about whether the economic conditions for all the potential entrants will be in place for 1999."