The forgotten currency: the European Currency Unit private market and European Integration
Résumé
Created as a part of the European Monetary System in 1979, the European Currency Unit (ECU) basket currency aimed to provide shelter against the fluctuating exchanges and stimulate trade between the members of the European Economic Community. In the minds of supporters of the European monetary integration, the wide use of the ECU could lead to the European Economic and Monetary Union (EMU). Since the early 1980s, the new currency dynamically entered the secondary bond market, became a popular leading currency, and a new form of a denomination in internal companies’ transactions. By 1991 the ECU was already the world fifth largest traded currency. This paper explores this 1980s forgotten ECU private market in the context of European integration. Applying the perspective of European banks and businesses, it sheds light on the motivations behind using a European basket currency. The study integrates the traditional business history approach with the research on non-state actors and European Integration. On the one hand, ECU was one of many new financial innovations of the 1980s which was used in the name of economic profit. On the other hand, enlarging ECU private market sent a clear signal of support for the European monetary integration and motivated European policymakers to back the new currency with institutional and political arrangements. As previous studies on the European business actors in the 1980s revealed, in this period, the progress of European integration was high on their agenda. By looking at cases of use of ECU in private transactions, the paper assesses the relationship between the emergence of the ECU market and the businesses and banks’ support for the looming project of EMU. The study relies on the research of the archives of European business associations (European League for Economic Cooperation, Association for the Monetary Union of Europe, British Bankers’ Association, European Banking Federation) as well as specific banks (Barclays, Midland, Lloyds, Crédit Lyonnais, Société Générale, BNP) and companies (Fiat, Saint Gobain). Bringing in banks and businesses in one paper provides additional insight into similarities, differences, and interdependence between them when facing EMU.