Dutch Had Back-Up Plan for Guilder Return, Dijsselbloem Says

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The Netherlands had a plan ready to reintroduce the Dutch guilder if the euro crisis became uncontrollable, Dutch Finance Minister Jeroen Dijsselbloem told RTLZ.

At the height of the fiscal crisis the Dutch government was “prepared for the worst scenario,” Dijsselbloem, who has been in office since November 2012, said in a RTLZ television interview broadcast today.

In the middle of 2012, bets were multiplying that the euro area would break apart as a debt crunch that started in Greece spread to engulf Spain and Italy, sending borrowing costs soaring. ECB President Mario Draghi stemmed the crisis by saying in July that year that he would do “whatever it takes” to save the single currency and in September announced a plan to buy the government bonds of stressed nations.

“Heads of government, including the Dutch cabinet, always said: ‘We want to keep the euro together and to keep the euro as a single currency.’ That said, we also looked at what would happen if that didn’t succeed,” he said, adding that no guilder notes were actually printed.

When asked about Germany, Dijsselbloem said he couldn’t say whether that country’s government had made similar preparations.

“It was very right and wise of the government at that time to not openly speculate about it, because it has a lot to do with trust,” he said. “When it would have become known that various governments would be preparing for -- this is going to fail, this is going to collapse -- at the height of the crisis, you absolutely create panic on the financial markets and investors run away en masse. That’s the last thing you want, then you contribute to your own defeat.”

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