THERE is now not the slightest possibility that a referendum on the European single currency will be called before the next general election.

It is off the political agenda, but this is a mistake nonetheless.

Britain used to be the gateway to the European economy. Five years ago when the euro was launched we attracted 27 per cent of all the inward investment coming into Europe. We were flexible. Britain gave access to the huge EU market. It was easy to start up a company here, and easy to close it down again.

Every year since then the proportion of inward investment coming into the country has fallen. The most recent figures show that it is now down to just seven per cent of the EU total. Britain has fallen behind France, Germany and the Netherlands.

Of course, eurosceptics will argue that the economy is doing relatively well at present. But given the continuing damage to our manufacturing industry, massive balance of payment deficits and Britain's poor record on both investment and productivity, will they laugh last? Only time will tell.

Chris Davies, Liberal Democrat MEP for the North West.