Tuesday was an important day for Ireland, for it saw the first really significant move by Britain towards the adoption of the euro as its currency.
That this is now the strategic objective of the Blair government is evident from the tone, as well as the content, of the announcement of "Britain's Changeover Plan", designed to prepare the way for a referendum on the adoption of the euro.
Ireland has, of course, a strong interest in British participation in Economic and Monetary Union and in its adoption of the euro as its currency. In addition to the inconvenience and costs involved in the use of different currencies here and in our biggest single trading partner, Britain, it is particularly unsatisfactory that we should have different currencies here and in Northern Ireland when our two economies are in the process of being more closely linked than at any time since 1920.
There has been concern here also about the potentially destabilising impact on our economy of fluctuations between the values of sterling and the euro. We saw in autumn 1992 how the instability of this sterling/Irish pound relationship could in extreme circumstances have a seriously disruptive impact on our economy.
Those events seem, indeed, to have traumatised some of our academic economists as well as, more understandably, those engaged in the financial services sector.
But I have always thought that these economists opposed to Irish entry to EMU in advance of Britain exaggerated the risk of a recurrence of the 1992 crisis, which was the product of a unique combination of circumstances.
The UK had entered the Exchange Rate Mechanism in 1990 at a rate (DM2.95 to the £stg) that was unsustainable. For between 1987 and 1990 Britain's inflation rate of over 6.5 per cent had been higher even than in Spain and Italy and, despite the overvaluation of its currency at the point of entry, its inflation rate remained close to 6 per cent in 1991.
By contrast, in the remainder of the Community prices had risen during this period by only 2.5 per cent, (3.25 per cent in Ireland), so it was scarcely surprising that after 5 1/2 years of such disparate inflation experience Britain, as well as Spain and Italy, was unable to avoid devaluation.
Since 1993 inflation in Britain has run only marginally higher than in the rest of the Community.
While sterling is clearly overvalued at the moment and will certainly decline at some stage from its present level, it is difficult to see what circumstances could force it down by more than about 10 to 12 per cent. And a fall of that magnitude would still leave its value somewhat above that of our pound, and would offer no threat to our trade with Britain.
Moreover, because of the potential competitive threat to our EMU partners as well as to us, they would not tolerate UK entry to EMU at a sterling rate below 1.30-1.35 to the euro. So British policy in its pre-EMU phase will not be directed towards a lower rate than that.
THUS, to my mind, the idea that by joining the EMU ahead of Britain we might have faced a repetition of 1992 was never realistic. Moreover, despite scepticism as to whether Britain would in fact wish to join EMU, it always seemed most unlikely that any British government could indefinitely defy the industrial and financial pressures favouring membership.
It is clear that a majority in Britain has not favoured the single currency. But that is only half the story.
First of all, hardline opposition does not appear to exceed 24 per cent, and a massive 80 per cent of the population believe that Britain will eventually join.
That sense of the inevitability of membership is a crucially important factor. It will be significantly intensified by Wednesday's publication of the National Changeover Plan.
The other point that is sometimes missed is that the current state of British opinion on this issue is the product of a period of many years during which the public has effectively heard only one side of the case; the arguments against, deployed skilfully and unremittingly by a section of the press (including some xenophobic tabloids) owned by press lords from outside Europe.
In the political arena, Labour has been constrained by its cautious strategy of making entry to EMU conditional on five economic criteria being met. And while pro-European Toriesremain publicly committed to the cause, they too prefer to delay going into battle with their own party on the matter until the issue is squarely posed in the impending referendum debate.
So for the moment public opinion is effectively hearing only one side of the debate, the case against. But when the referendum campaign finally gets under way the 40 per cent of the population who are opposed to the single currency but are not fanatical about it (and that percentage may by then be somewhat reduced), will be faced with a formidable array of persuaders.
These will include: a recently reelected Labour government with a renewed mandate; the leading Tory pro-Europeans; the Liberal Democrats; and an array of business leaders who will then come out of their closets to promote the interests of the British industrial and financial economy.
POLITICALLY this formidable combination of forces is likely to be opposed only by a Tory Party just defeated at the polls and either in the throes of, or just licking its wounds after, a bruising leadership struggle. Thus, as the final drama is being played out, the present imbalance of forces on this issue will be dramatically reversed.
In presenting the Changeover Plan in the Commons on Tuesday Tony Blair was, of course, careful to preserve the concept of conditional commitment to EMU entry, the need to meet five economic criteria. It emerged from a range of contacts in London last Monday and Tuesday that some regard these criteria as vague enough to be "fudgeable" if necessary.
However that may be, Blair went to some trouble to draw attention to progress already made towards sustainable convergence between Britain and EMU states both in short-term and long-term interest rates and inflation.
Overall, despite his presentation remaining formally conditional, its tone was extremely positive.
His announcement was vigorously attacked by the Tory leader, William Hague, but that may not have been unwelcome to the Prime Minister for it added to the impression that this was a major shift in policy.
That is precisely the impression Blair wished to give for he clearly hoped that, despite the fact that his approach remains conditional, industry and finance would be sufficiently impressed to invest now in preparations for the single currency.
If they fail to do so, then his plan of moving rapidly towards participation after an early autumn 2001 referendum might not be capable of implementation.
What was not at all clear from his statement, although it emerged from contacts with British government sources, is that if this referendum timetable is adhered to, the pound could be irrevocably linked to the euro as early as January 1st, 2002, and almost certainly by January 1st, 2003, at the latest. His speech left this vital stage deliberately vague.
For the view in London is that, so long as economic convergence has taken place, the Maastricht requirement of two years' prior participation in the Exchange Rate Mechanism will probably not be insisted upon. It was truncated in the case of one existing member.
It must, of course, be added that the fact that the Prime Minister is clearly committed to the single currency does not mean that UK membership on this timetable is now certain.
Even leaving on one side any uncertainty that may attach to the referendum outcome, we cannot be sure that in 2002 Britain's exchange rate will be close enough to an acceptable level to facilitate entry, or that its interest rates will be within striking distance of those of the EMU at that point.
Moreover, between now and then the potential instability inherent in the present inflated level of US stock market prices could produce a global crisis with implications for Europe as well as the US, and that could postpone British entry.
But despite these caveats the odds are now clearly in favour of the locking of sterling to the EU within three to four years, with the same notes and coins being in use in Britain, Northern Ireland and our State within five years from now.