The Danish government has put renewed focus on the countrys EU opt-outs in the past six months after high-lighting in its policy statement last November that the opt-outs would be put to a referendum some time dur-ing the term of this government. However, the govern-ment did not say when a referendum would be held, or whether all the opt-outs would be put to the vote at the same time.
Now, however, the government has announced that it will present a timetable in August for when the Danes will go to the polls on the three opt-outs. In our view, the government will pave the way for a two-track ap-proach, with the Danes voting first on the legal and de-fence opt-outs, and later deciding about EMU member-ship. Adopting the single currency is a thorny political issue, as the governments support party, the Danish Peoples Party, is clearly against the move, while the Socialist Peoples Party, which is an important player on this issue, will also recommend a no.
We therefore expect that the government will concen-trate on the easy issues and we would expect a vote on the first two opt-outs to be announced for late Sep-tember or early October, as the government would pre-fer a short campaign. The timing of a vote on EMU membership will then, of course, depend on the out-come of the first referendum but next spring looks like an appropriate time. The government is clearly keen to resolve these issues well ahead of the next general election.
Opinion polls on the EMU opt-out show a small lead to the yes camp. However, it is likely that the vote will be very close, and certainly not a foregone conclusion. Whatever the outcome, the Danish fixed exchange rate policy versus the euro will not be tampered with.
