The European Payments Union and the Western European Recovery, 1945–59
Our purpose in this chapter is to present the context in which the European Payments Union was established and in which it functioned. In Section 8.1, we survey the economic problems facing Western Europe immediately following the Second World War, particularly the balance-of-payments crisis that emerged in 1947. In Section 8.2, we consider the programme of intra-European trade and payments liberalization under the auspices of the Organization for European Economic Cooperation, of which the EPU was an integral part. We proceed to examine in Section 8.3 the remarkable recovery from the postwar crisis between 1947 and 1959. Finally, in Section 8.4 we analyze the role of the EPU in helping to reestablish the international convertibility of OEEC European currencies.
KeywordsCentral Bank Current Account Real Exchange Rate Trade Liberalization Reserve Loss
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