Because weaker nations can no longer devalue their way out of trouble, there is a risk these imbalances will worsen - bringing pressures that could ultimately cause the break-up of the euro.

Britain, too, is going through an intensely difficult time. But it can profit from currency flexibility as the result of its decision to stay outside EMU in 1999.

The pound's sharp fall against the euro and the dollar since mid-2007 has made British exports more competitive on world markets.

And it has sparked extra foreign spending on 'invisibles' such as UK tourism - a valuable stimulus when times are tough.

Indeed, one of the reasons for the roughly 12 per cent recovery in the pound against the euro this year has been a growing feeling on the foreign exchanges that - whatever the depth of the 2009 recession - Britain will be quicker to escape than its Continental counterparts.

As a reflection of longer-term confidence in sterling, 10-year UK sterling government bonds are yielding slightly less than 10-year  French bonds in euros - showing that foreign investors see less risk in lending to the British government.

By contrast, yields on bonds from the weaker euro members - Greece, Italy, Ireland, Spain and Portugal - have ballooned compared with the most stable state Germany.

The weakest economies' external deficits have widened sharply because of these countries' poor competitiveness.

Although EMU countries cannot suffer a currency crisis - because their individual currencies have been abolished - they may have to endure a credit crisis if interest rates on their debt are forced up by worries about their underlying solidity.

This is what seems to be happening at the moment. The development may be worrying, but it is not surprising.

One of the striking points about the single currency is nearly all of EMU's current travails were predicted by the politicians and officials who laboured to establish it.

I discovered this as part of work in archives in half-a-dozen countries to uncover the secret history of 40 years of planning for EMU.

Jacques de Larosière, the allpowerful director of the French Treasury, recorded in 1975 that a single currency could cause 'permanent disequilibrium' in European balance of payments as a result of divergent evolutions in productivity and prices between states.

This development would lead to pressure for compensating credit flows to protect weaker countries.

EMU is now at a crossroads. Unemployment is likely to rise inexorably in the less-sound members as wage costs are reduced through the combined force of the recession and unfavourable borrowing conditions.

If such a situation persists for a lengthy period, the weaker members would have little choice but to consider leaving EMU - however unpalatable this might be.