The Werner Group Submits its Final Report on the Creation of the Economic and Monetary Union

At the Hague summit in December 1969, the Heads of State and Government define a new goal for European construction: the Economic and Monetary Union (EMU). A high-level group, chaired by Pierre Werner, Prime Minister of Luxembourg, is thus tasked with drafting a report on the means to be used to achieve this objective before 1980.
The Werner Group submits its final report in October 1970. The report envisages the establishment of an Economic and Monetary Union within ten years, according to a multi-stage plan. The ultimate goal is the full liberalization of capital movements, the absolute convertibility of Member States’ currencies, and the irrevocable fixing of exchange rates. The report then considers the adoption of a single European currency as the final objective of the process but does not yet consider it a separate goal. Moreover, the report recommends strengthening the coordination of economic policies and defining guidelines for national fiscal policies.
In March 1971, despite their disagreements on some key recommendations of the report, the Six agreed in principle to establish EMU in several stages. The start of the first stage, which corresponded to the reduction of currency fluctuation margins, was to be carried out on an experimental basis, without implying a commitment to the continuation of the process.
The collapse of the Bretton Woods system and the American decision to float the dollar freely in August 1971 caused a wave of instability in foreign exchange markets, which strongly brought back the issue of exchange rates between European currencies. This development posed a serious obstacle to the further progress of EMU.