A chara, - Paul McGrath TD (December 31st) misunderstood my recent comments on RTE's "Questions and Answers" on why it would be disastrous for Ireland to join a single EU currency should Britain opt out of it.
Contrary to Mr McGrath's claim, I am fully aware that the Republic does not send the bulk of its exports to Britain and that our trade dependency on Britain has been declining over the years. That trade remains highly important, however, particularly for indigenous firms and because of the high level of employment it generates.
The point I was seeking to make on the programme was that about 30 per cent of our trade (exports and imports) was with the likely founding members of the EMU single currency bloc - Germany, France, the Benelux countries and Austria. The remaining 70 per cent is with Britain and the rest of the world.
In these circumstances I believe it would be the height of folly to propose abolishing our national currency to join the currency of the countries with whom we do less than one third of our trade. Such a move would have the effect of exposing ourselves to the risk of the proposed new European Central Bank and the EU authorities imposing on Ireland an unsuitable exchange rate with Britain and the rest of the world, on whose trade we are most dependent. This view is shared by most Irish economists and economic commentators.
The 1993 devaluation crisis vividly underlined the value for Ireland of having an independent - exchange rate, especially when Britain followed an independent exchange rate policy. EMU now carries a serious danger of the democratically unaccountable European Central Bank imposing interest rates and a monetary policy on Ireland that are quite unsuitable for our economic circumstances, even though, the EU authorities may regard it as appropriate for the continental economies.
In a recent newspaper interview the Minister for Finance Mr Quinn, with whom I debated the single currency experiment on "Questions and Answers", stated that "EMU is undoubtedly and fundamentally a political project".
Yet neither he nor Mr McGrath have told us what political benefits are likely to emerge from a single currency that can outweigh the economic peril posed to our money and jobs, not to mention the way it will increase divisions between the North and South of Ireland should Britain remain outside (as now looks likely, even if Labour win the forthcoming general election).
As a Fine Gael TD Mr McGrath belongs to a party which has signed an agreement with other Christian Democrats in Europe committing itself to work for a European federal superstate, with its own currency, foreign policy and army. Unfortunately my impress ion is that most grassroot Fine Gael members are unaware of this commitment.
The Taoiseach's New Year message, which I presume Mr McGrath has seen, urged Fine Gael's elected representatives to work for a federal Europe. If that objective is reached, the State, which Mr Bruton is committed under his oath of office to uphold, would be transformed into a province or region of a federal superstate. The consequences for our independence and democracy would be far reaching.
May I suggest to Mr McGrath that his party leader's New Year message is more deserving of the "astonishment and disappointment" he professes than my performance on a TV programme? - Le gach dea ghui,
Offices of the European
Parliament,
43 Molesworth Street,
Dublin 2.