EMU (Economic And Monetary Union)

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Early experiments
The goal of Economic and Monetary Union was first proclaimed by the French president, Georges Pompidou, and the German chancellor, Willy Brandt, in 1969, immediately after President Charles de Gaulle's departure from the scene. The blueprint set out in the resultant Werner Report did not, however, succeed. France was unwilling to surrender more than a modicum of financial autonomy. Moreover, the collapse of the dollar-based Bretton Woods international monetary system in 1971, followed by an unprecedented rise in oil prices and global inflation, led to unstable foreign exchange markets in which no artificial attempt to link European currencies could have expected to survive without the sturdiest of political and institutional underpinnings.
In 1977, four years after the demise of the Snake, EMU was relaunched by the Commission president, Roy Jenkins, supported by the next generation of French and German political leaders, Valéry Giscard d'Estaing and Helmut Schmidt. The revised scheme, known as the European Monetary System, was designed to bring about a zone of currency stability in Europe through the Exchange Rate Mechanism (ERM) and a new quasi-currency (not legal tender but usable in wholesale transactions) called the ECU, or European Currency Unit. The ERM came into effect in 1979. More sophisticated and more firmly backed by central banks than the earlier arrangements, it lasted more or less unscathed for some 12 years, although the ECU, whose value was based on a basket of currencies, did not match the strength of the D-Mark.
The Maastricht era
The ERM had initially been a flexible framework, with room for rate adjustments. But in 1989 a committee of central bankers and economists headed by Jacques Delors made recommendations for a concrete three-stage process of harmonising national economic policies, fixing exchange rates and finally adopting a single currency. From the Delors Report would spring the Maastr...