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Blair hoped britain would be center of europe

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http://www.telegraph.co.uk/news/main.jhtml;sessionid=0COXJNZA4GEQ5QFIQMGCM5WAVCBQUJVC?xml=/news/2005/06/05/neu05.xml&sSheet=/portal/2005/06/05/ixportaltop.html&secureRefresh=true&_requestid=22123

Blair gives up on his EU dream
By Melissa Kite, Toby Harnden and Tony Paterson
(Filed: 05/06/2005)

Tony Blair has given up on Europe as an issue worth fighting for, senior allies of the Prime Minister have told The Sunday Telegraph.

A leading Blairite cabinet minister made the admission last night as the European Union descended into deeper turmoil, with doubts surfacing over the future of the single currency.

Mr Blair, who will seek to shift the focus of his administration on to poverty in the Third World this week during talks with President Bush, has told his closest allies: "Africa is worth fighting for. Europe, in its present form, is not."

The signal is an astonishing U-turn for a leader who said three years ago that the euro was "our destiny" and who announced a British referendum by proclaiming: "Let the battle be joined." But one of his closest allies said that Mr Blair no longer believed that putting Britain at the heart of Europe could be his legacy: "Europe is back to the drawing board. Africa will become more important."

Mr Blair flies to Washington tomorrow to try to secure support for proposals to tackle poverty ahead of next month's G8 summit in Gleneagles. But the Prime Minister is unlikely to be able to divert attention completely from the chaos over Europe's future.

President Chirac of France and Germany's Chancellor Schröder held a summit in Berlin last night after the No votes in France and Holland on the constitution.

Yet the crisis widened beyond the document alone, with a media offensive being mounted to bolster the euro after German officials and an Italian minister openly discussed its possible demise. In the first rumblings of a call for the franc to be reinstated, Nicolas Dupont-Aignant, a member of Mr Chirac's ruling UMP party, said: "France, Italy and Germany would be in a better state without the euro. However, I don't believe we should ditch it now.

"But either it is reformed, and the central European Bank kick-starts growth by lowering interest rates and pursuing a more American-style monetary policy, or the euro will explode in mid-air."

The governor of France's central bank, however, rushed to the euro's defence. Christian Noyer said that the currency was "in no way under threat" following its fall in value since the No votes of the past seven days. He dismissed as "absurd" the idea of a temporary withdrawal from the euro by individual states.

"The euro is a solid currency which brings us a lasting guarantee of stable prices and thus the maintenance of purchasing power for our wages and savings," he told Le Parisien newspaper.

The markets have been slowly adjusting to the possibility of the break-up of the euro, with the spread between government bonds in different countries widening.

Last night, John Redwood, the leading eurosceptic Tory MP, said: "You can't have a single currency without a single government. They are in a mess because they have only done half of it and they are now discovering in a painful way what that means."

The No campaign in Britain will launch a campaign tomorrow demanding a referendum on any aspects of the constitution that leaders might attempt to salvage. It will also unveil 46 new business backers, including Stuart Rose, chief executive of Marks & Spencer.

An ICM poll for the No group found that 81 per cent of voters say that it would be unacceptable to bring in any of the proposals without a referendum in Britain first.




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