In an effort to stabilize the unpredictable euro, 23 European countries, including France and Germany, signed a new treaty in Brussels in December to centralize economic policy and control over national budgets. But conspicuously absent from the new agreement is Great Britain, which had already formally opted out of the euro.
Sweden, the Czech Republic, and Hungary decided to consult their parliaments, but reports suggest they may ultimately ratify participation in the treaty, which would leave only Britain on the outside looking in.
The move to centralize economic policy in the euro-zone had its strongest support from French president Nicholas Sarcozy and German chancellor Angela Merkell, who have long advocated a smaller core euro-zone with a single, centralized European economy.
British Prime Minister David Cameron wanted Britain to retain a veto over financial services regulation, but when he was unable to secure that concession, he used his veto to opt out of the agreement.
Analysts say Britain’s withdrawal from the treaty signals a fundamental split in the European Union, and it is unclear the effect this will have on British, European, and global economies.