Britain has decided the time is not right to give up the pound and adopt the euro as the national currency. The announcement came from Chancellor of the Exchequer Gordon Brown.
Mr. Brown says Britain is not ready yet to adopt the single European currency because not all of the five economic tests he laid out in 1997 have been met.
Mr. Brown told parliament that conversion to the euro now could hurt British jobs and restrict economic flexibility. He said there are too many structural differences at this time between the British and European economies to make the currency switchover successful. But he said investments in Britain would grow, and the financial services industry would prosper with the euro.
Despite Monday's announcement, Mr. Brown made it clear the government of Prime Minister Tony Blair will work to convince the public that Britain's future lies with Europe.
"I believe a modern, long-term and deep-seated pro-European consensus in Britain, about Britain's role in Europe, and Europe's role in the world, can and will be built in our country," he said.
Public opinion polls show that three out of five Britons oppose giving up the pound, and the Blair government would have to win voter approval in a referendum before switching over to the euro.
A leader of the anti-euro campaign in Britain, Janet Bush, told British television that Mr. Brown made the right decision, in light of Europe's current economic problems.
"What's really important today is that the chancellor is saying, 'No, we are not going to hold a referendum yet, the economics are not right. And we are very cautious about this,'" she said. "So for our campaign, we are very pleased, because it means that we are not rushing into the euro, and we believe that's the right decision, because the euro zone is in difficulties."
But Mr. Brown said he will re-examine euro membership next year. He said eventual adoption of the euro would benefit the British people, and he called it one of the most momentous economic decisions facing the country.
Twelve of the 15 European Union countries now use the euro, with only Britain, Denmark and Sweden remaining outside the euro zone.