5 Negotiating the EMU Project, May 1988 to December 1991: the Victory of European Power Motives over National Policymaking Tradition

Abstract

The decision to embrace the EMU project was the logical expression of European power motives, given the German refusal to accept French demands on EMS reform and the expanded use of the ECU. However, French support for the project was neither inevitable nor acceptable to many key policymakers. During all periods of policymaking on European monetary co-operation there was a clear division within the government, normally based on the economic policy implications of European monetary co-operation. During this period leading to the Maastricht European Council of December 1991, the division both intensified and extended into the administration. The reluctance can be explained by both the stakes — the loss of national monetary policymaking power — and the conditions imposed by the Germans.¹³⁵