Dutch Freedom Party pushes euro exit as €1.8 trillion rescue bill looms
The Dutch Freedom Party has called for a return to the Guilder, becoming the first political movement in the eurozone with a large popular base to opt for withdrawal from the single currency.
"The euro is not in the interests of the Dutch people," said Geert Wilders, the leader of the right-wing populist party with a sixth of the seats in the Dutch parliament. "We want to be the master of our own house and our own country, so we say yes to the guilder. Bring it on."
Wilders, whose lawmakers support the minority coalition of Liberal Prime Minister Mark Rutte on most subjects, said a referendum is needed on whether the Netherlands should stay in the euro area. The ruling Liberals and Christian Democrats rely on the opposition Labor Party to back their European policy as Wilders opposes further financial aid to debt-ridden euro countries.
“In the worst case, if the guilder appreciates 10 percent, we’ll suffer a loss of 51 billion euros ($67 billion)” in 2012, Wilders said, citing the report. “That will be compensated starting in the second year, because it’s smaller than the 37 billion and 38 billion euros we will save in 2013 and 2014 by not contributing to maintaining the euro zone.”
He acknowledged Monday it would cost money to depart the euro and calculated the new guilder might rise by 10 percent against the euro in the short term, hurting exports. But he argued consumers' purchasing power would improve in compensation.
“The Netherlands can exit the euro, but you have to be honest, it’ll cost money,” Wilders told reporters
Mr Wilders made his decision after receiving a report by London-based Lombard Street Research concluding that the Netherlands is badly handicapped by euro membership, and that it could cost EMU’s creditor core more than €1.8 trillion to hold monetary union together over the next four years. "If the politicians in The Hague disagree with our report, let them show the guts to hold a referendum. Let the Dutch people decide," he said.
The idea is not likely to succeed in the short term, but it marks a significant change in the discussion over the euro in one of the "core" euro-zone countries - one of the few, along with Germany, that retains a top-notch credit rating.
That analysis doesn't address the possible costs if a Dutch departure leads to a new acute financial crisis in Europe.
A majority of Dutch voters say they want to remain in the single currency, though most regret joining it. Enthusiasm has waned as the country's economy has weakened in recent months. The government's statistics agency announced last week that the country is now in recession.
His call came hours after he met with the country's prime minister to discuss new spending cuts needed to comply with European budget rules that, ironically, the Netherlands itself demanded in exchange for participating in a new bailout package for Greece.
Wilders heads the Freedom Party, the country's third-largest, and is an indispensable partner for Prime Minister Mark Rutte's minority Cabinet. Rutte relies on outside help from Freedom to achieve a majority in parliament.
Wilders is mostly known for his anti-immigrant stances, but he also is a longtime skeptic of European projects. He has opposed any aid for struggling countries during the sovereign debt crisis, saying the Greeks should return to the drachma. He also was a prominent figure in the Netherlands' rejection of the European constitution in 2005.
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