Denmark
All you want to know about Denmark
Denmark uses the krone as its currency and does not currently intend to adopt the euro, having negotiated an opt-out from participation under the Edinburgh Agreement in 1992.
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Current Status
The Maastricht Treaty originally required that all members of the European Union except Denmark and the United Kingdom join the euro once certain economic criteria are met. Denmark meets all of these criteria and can join the euro if it chooses. [1].
Since 1 January 1999, the krone has been part of the ERM II mechanism, under which it is required to trade within a 2.25% either side of a specified rate of €1 = DKK 7.46038 making the lower rate 7.29252 and the upper rate 7.62824 kroner for 1 euro [2]. This band, ±2.25%, is narrower than for most ERM II members ±15%. However, the exchange rate changed within 1% of the defined rate, what is even less this limits.[3][not in citation given]
History
Early monetary unions in Denmark (1873-1914)
On 5 May 1873 Denmark with Sweden fixed their currencies against gold and formed Scandinavian Monetary Union. Prior to this date Denmark used Danish rigsdaler divided into 96 rigsbank skilling. In 1875 Norway joined this union. A rate of 2.48 kronor per gram of gold, or roughly 0.403 grams per krone was established. An equal valued krone of the monetary union replaced the three legacy currencies at the rate of 1 krone = ½ Danish rigsdaler = ¼ Norwegian speciedaler = 1 Swedish riksdaler. The new currency (krone) became a legal tender and was accepted in all three countries - Denmark, Sweden and Norway. This monetary union lasted until 1914 when the World War I brought an end to it. But the name of the currencies in each country remained unchanged.
Pre-eurozone documents (1992-1995)
The Maastricht Treaty originally required that all EU member states except the UK join the euro, however, following a referendum on 2 June 1992 in which Danes rejected this treaty, Denmark negotiated the Edinburgh Agreement, under which Denmark was also allowed to opt-out from eurozone membership. As such, like the UK, Denmark is not required to join the euro. Euro membership was specifically rejected by referendum in 2000, though a new referendum is currently planned by the Danish government.
First euro referendum (2000)
A referendum held on 28 September 2000 rejected membership of the eurozone. 87.6% of eligible voters turned out, with 46.8% voting yes and 53.2% voting no.[4]
Second euro referendum (planned in 2008)
- Further information: Danish European Union opt-outs referendum
On 22 November 2007, the newly re-elected Danish government declared its intention to hold a new referendum about abolishing the four exceptions, including the euro, by 2011.[5] It remains unclear if people will vote on each exception separately, or if people will vote on all of them together.[6] Fogh Rasmussen also said he would seek a "noticeable reduction of income taxes" and improved conditions for asylum-seekers in Denmark as he presented the government's platform for the next four years.
Denmark was expected to vote on whether to join the euro in 2008 according to Anders Fogh Rasmussen's statement.[7] It was thought this would occur in the autumn, but due to the result of the Irish Lisbon referendum, the debate may be postponed.[8]
There has been some speculation that the result of the Danish referendum will affect the Swedish debate on the euro.[9]
Polls
Question: Do you think Denmark should remove krone and adopt the euro as its currency?
| Date | YES |
NO |
Unsure | Number of participants | Held by | References |
|---|---|---|---|---|---|---|
| 29 March-30 April 2002 | 47% | 33% | 20% | unknown | Eurobarometer | [1] |
| March 2007 | 56% | 39% | 5% | 910 persons | Greens Analyseinstitut published in Børsen | [2] (Danish) |
| April 2007 | 53% | 40% | 7% | 910 persons | Greens Analyseinstitut published in Børsen | [3] (Danish) |
| November 2007 | 54% | 42% | 4% | unknown | Greens Analyseinstitut published in Børsen | [4] |
| 26 November 2007 | 52% | 39% | 9% | Interviews with 1,016 Dane adults | Vilstrup Synovate published in Politiken | [5] |
| April 2008 | 55% | 38% | 7% | Telephone interviews with 1 009 Dane adults | Greens Analyseinstitut published in Børsen | [6] |
| 5-7 May 2008 | 54% | 42% | 4% | Telephone interviews with 1 009 Dane adults | Greens Analyseinstitut published in Børsen | [7] [8] |
| middle of June 2008 | 40% | 48% | 12% | 1036 Danes | Capacent Epinions | [9] (Danish) |
Danish provinces
It remains unclear if Greenland and the Faroe Islands will adopt the euro should Denmark choose to do so. Both are parts of the Kingdom of Denmark, but are remain outside of the EU. The Faroe Islands currently use Danish banknotes printed with Faroese motifs - the Faroese króna. Greenland currently uses the krone, but plans to introduce a similar system.[citation needed] Under the current system, both continue to use Danish coins.
If Denmark adopts euro Danmarks Nationalbank will have to switch from kroner to the euro printing. In that case it would be harder to support printing kroner notes and coins for Greenland and the Faroe Islands.[citation needed]
Danish euro coins
At present no official designs exist regarding any future Danish euro coins. Before Denmark's 2000 referendum on the issue, the Danmarks Nationalbank was requested by the Ministry of Economics to propose designs for the future Danish euro coins.[10] The suggested design was based on the designs of the Danish 10 and 20 kroner and 25 and 50 øre coins. Since the referendum rejected the introduction of the euro in Denmark, this design was never implemented and it is not clear if Denmark will use it or not should the euro be adopted.
See also
References
- ^ Travel Document Systems - Denmark Economy: Denmark meets, and even exceeds, the economic convergence criteria for participating in the third phase (a common European currency--the euro) of the European Monetary Union (EMU)
- ^ Upper and lower limits of the exchange rate of the DKK
- ^ EUR-DKK exchange rate of the last 5 years
- ^ Results and background for referendum (Danish)
- ^ "Danes to hold referendum on relationship with EU" (in English). Guardian Unlimited (2007-11-22). Retrieved on 2007-11-22.
- ^ Dagens Nyheter, Danmark går före, AB Dagens Nyheter, 2007-11-24.
- ^ Pittelkow, Ralf, Pittelkow: Tvivl om euro-afstemning (Danish)
- ^ EUobserver
- ^ Utspelet kan höja temperaturen i den iskalla svenska EU-debatten (Swedish)
- ^ Folketingets EU-oplysning - Illustration af danske euromønter (Danish)
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