Swedish 'No' Vote on Euro Could Slow European Centralization

After Swedes voted against adopting the euro by a wide margin, supporters of the currency said they would respect the results and examine why they failed to sway a skeptical electorate.

Prime Minister Goeran Persson, who said he wouldn't resign because of the results, has ruled out any new vote on joining the European Monetary Union (search) before 2010.

After preliminary results were counted Sunday, he said the country's government accepted the vote, but added that "in the long term this means worse possibilities for Sweden."

Swedes voted Sunday in a national referendum, clouded with emotion over the slaying of Foreign Minister Anna Lindh (search), a leading euro supporter. She was stabbed at an upscale department store Wednesday.

Despite a rich war chest and a blitz of campaigning across the country of 9 million, the pro-euro side lost with nearly 42 percent to about 56 percent for the opponents. Two percent of the 5.4 million ballots cast were undecided. The result was seen as a setback to a more unified Europe.

"I think it's a fantastic result that we've managed to resist the enormous campaign from the 'yes' side," said Peter Eriksson, a spokesman for the Green Party which worked with the left to mount its grass roots opposition. "I was very worried we would lose. But even after the murder, people were able to separate their emotions from the facts."

Police are still searching for suspects in Lindh's murder, and haven't made any arrests.

Analysts said Monday that the recession in Europe and unemployment in major euro-zone countries like France and Germany likely scared off voters already skeptical of the currency.

But Finance Minister Bosse Ringholm said problems in Germany and France have nothing to do with the euro.

"Germany's problems are a result of the unification and France's problems they have brought on themselves with large tax cuts, among other things, which have been idiotic because there was no money," he said.

Swedish economist Jan Theorell said economic concerns were a driving factor in the result.

"Those who voted have, to a great extent, referred both to their personal financial situation and the finances of the country," Theorell said.

The president of the European Union Commission, Roman Prodi, said Sweden's international stature would be diminished by the decision, while Graham Watson, leader of the British Liberal Democrats in the European parliament, said it would bring "a crushing loss of investment and political influence and increased vulnerability to money market turmoil."

In neighboring Denmark, which rejected the euro in a 2000 referendum, EU opponents celebrated the Swedish vote. To them, it was a sign that they are not alone against "the undemocratic EU development," left-wing lawmaker Soeren Soendergaard said.

The Danish government and euro supporters, however, said Sweden's referendum would have little effect on their efforts.

When the euro was launched in 1999, Denmark locked its currency to the euro, meaning Denmark's central bank closely follows the moves of the European Central Bank (search) and raises or lowers its rates accordingly. Sweden and Britain have not done so and their currencies fluctuate freely against the euro.

In Norway, the decision could douse a growing sentiment for the country of 4.5 million to consider joining the EU.

"I would think that the result in Sweden would make the 'yes' side in Norway calm down for a while," said Aaslaug Haga, leader of the anti-EU Center party.

Norwegian Finance Minister Per-Kristian Foss of the pro-EU Conservative party said Sweden's vote would likely have no impact on the country's debate.

"The Norwegian EU debate stems from Norwegian issues, and we are the ones who decide when the topic should be raised again," he told radio broadcaster NRK.

But in Finland, which adopted the euro with the 11 other countries in 2002, Foreign Trade Minister Paula Lehtomaki lamented the loss.

"If Sweden had joined, the euro zone would have been stronger and increased the possibilities of Nordic cooperation within it," she said.

The vote may also raise concern among the new members of the European Union, including Baltic neighbor Estonia which approved joining the EU in a referendum Sunday.

The new members are obligated to eventually adopt the euro, although there is no date set.

Next year, the 15-member EU will add 10 new members: the Czech Republic, Poland, Hungary, Lithuania, Malta, Slovenia, Slovakia, Latvia, Estonia and Cyprus.