Maria Borelius is a board member of the think tank Open Europe and a London based entrepreneur. She was formerly a Swedish MP and Minister for Trade. Follow Open Europe on Twitter.

Screen shot 2013-09-17 at 10.07.09Ten years ago, Sweden held a referendum on
joining the euro.  I voted Yes – and I was not alone. A whole host of business leaders, including the Swedish CBI, the main political parties – both
on left and right – and the major national newspapers, all were in favour of
joining. The Swedish CBI put a record £45 million into the campaign to ditch
the Swedish Krona, as the yes-side funding outspent the no-side by a factor of

I still remember the shock when we realised we
had lost, and I heard stories from close friends about how the campaign
managers on the Yes-side buried their faces in their hands as devastated
business leaders fumed with disappointment. Long-faced commentators and
politicians made sombre TV appearances. A clear majority of Swedes – 56 per cent versus
41 per cent – had defied the establishment and said No to the euro.

A week is a long time in politics, and ten years
a lifetime. Today, over 80 per cent of Swedes oppose the country joining the eurozone.
The issue is completely off the table, with the eurozone crisis in its third
year. Greece, Cyprus, Spain and Portugal have been saved by the bell, in some cases more
than once. Or rather by the little old ladies in Heidelberg and Helsinki, on
whose tacit approval the bailout of weaker eurozone countries and the survival
of the euro rests.

So how could I – and so many others – have be so
wrong? It’s not as if there were no warnings. Some came from dissenting voices
within the establishment, but most from ordinary citizens.  I vividly
remember a conversation I had with a car dealer in rural Northern Sweden. “You
know what”, he told me, “I won’t vote Yes because I don’t believe Greece will
manage the convergence criteria.” That very simple and profound analysis proved
bang on, but it eluded some of the country’s leading economists. Or another
friend, who asked whether it really was wise for the Portuguese and Swedish to
share a currency, given different histories and cultures, one being a former
superpower now basking in the sun with an economy based on fish, agriculture
and tourism, and the other a consensus-oriented, Lutheran, hardworking pulp,
paper and steel country heavily dependent on exports. These were not
superficial differences, but a fundamental divergence in welfare, economic
development and culture.

Our motives were noble. To us, the euro was a way of extending the common
market, which was essential for our small country with many larger
export-oriented companies, such as SAAB and Volvo. Ten per cent of all Swedish
exports went to Germany, which was also the single largest market for both IKEA
and H&M. The motives were also emotional. “Yes” was a way to end a sense of
shame or alienation that had pervaded Sweden after our decision to remain
neutral during World War II, a way to promote peace. Maybe my Yes was what
psychologists would call a projection. I made the euro into what I wanted it to
be. So part of the “Yes” was a dream, a Utopia in Brussels – but the devil is in
the details. And they did not work.

However, my Europhilia began to wane even before the eurozone crisis erupted,
around 2004. It was then that I started to work with the European Commission.
At the time, I ran a small specialist PR consultancy, and was hired to arrange
seminars to promote the so-called Lisbon Agenda – meant to make the EU’s the
most competitive “economy” in the world by 2010 (it didn’t quite work out that
way). As I arrived in Brussels I had high hopes. Here I would see Europe’s best
and brightest, working together. Instead, the experience had the opposite

Our discussions instead brought out the lowest
common denominator. Endless speeches with verbose legalities, people babbling,
talking to no one in particular, autocratic rants from various pompous
eurocrats – all translated by some 10-15 interpreters. It was sometimes pure Monty Python. I remember a meeting when we were trying to
settle which Commissioner would introduce a panel. It took us almost a whole
day as the battle amongst the minor popes dragged on. No, this was certainly
not what I had voted for.

In light of my own experience and journey – from a Europhile to a more realist
stance – I can understand that some Brits think the EU is “unreformable”, and
that the best thing to do would simply be to leave. However, we must be careful
not to throw the baby out with the bathwater. The basic ideas behind the EU –
the ideas of trade, peace and free movement of people, capital and goods – are
fundamentally decent. Most opinion polls show that a majority of both citizens
and business want to stay in a reformed, slimmed down EU, rather than to leave
it altogether with no guarantee of replicating the trading relationship the UK
currently has.

Yes, Brussels can be frustrating, but paradoxically, the EU is
also ripe for reform. The eurozone crisis has exposed the EU elite’s
unsustainable obsession with grand top-down projects, often pursued at the
expense of economic common sense or democracy. More and more EU leaders are
coming around to the view that the only way to make Europe work is to
decentralise – and for national democracy to make a comeback.

The pieces are already moving. The Dutch – EU
founding members – have outlined 54 areas in which the EU shouldn’t be involved,
Angela Merkel has said a repatriation of powers should be
possible, for the first time ever the EU budget has been cut, a big chunk of
the EU’s fisheries policy is being transferred from Brussels to groups of
member states – and a UK Prime Minister has actually offered an EU referendum,
to be preceded by a strong reform push.

However, there’s still a long way to go before
we get that fundamental new deal in Europe – and a lot of work still to be
done. This is why I’ve joined the board of leading think-tank Open Europe, to
continue to make the robust case for change. The euro has not aged well. I can humbly say
that I was wrong that autumn day ten years ago. Others were wiser, such as my
friend the car-dealer. Thanks to him and other citizens like him my native
country was saved from a sea of trouble, and I have learned my lesson.

4 comments for: Maria Borelius: Why I was wrong about the Euro, am no longer a Europhile – and why Europe needs reform

Leave a Reply

You must be logged in to post a comment.