Steppingstones to a Common Currency

A <I>TSC</I> chronology on how Europe got this far.
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The euro didn't spring out of nothing. The practice of setting up pan-European economic and political structures is as old as Imperial Rome.

More recently,

William Penn

, the founder of Pennsylvania, published an essay arguing for a European parliament. The year was 1693 -- more than 80 years before the U.S. was born.

But the pan-European urges behind the euro have their origin in the period immediately after World War II, which devastated the Continent and called into question the very notion of a European nation-state. Driving the push to overarching supranational European government was an elementary logic: If countries didn't exist, they would not be able to fight one other.

The post-World War II architects of an integrated Europe moved decisively. In 1950, French Foreign Minister

Robert Schuman

said that, in order to help cement the peace between France and Germany, Franco-German production of coal and steel should be "placed under a common High Authority."

That led to the

European Coal and Steel Community

, established in 1951 with four other members in addition to France and Germany. Just six years later, the

European Economic Community

was formed.

In the following 30 years, economic crises and sharp divisions between the U.K. and other European countries held back integration. But the drive for economic and political integration intensified in the past 10 years with the reunification of Germany and the fall of the Soviet Union.

Now, nearly 50 years after the founding fathers of Europe laid down the foundations, 11 European countries are set to adopt one currency. The bureaucrats of Brussels couldn't have timed it any better.

Steppingstones to Unity

  • May 1945: World War II ends in Europe.
  • April 1951: As a result of Franco-German discussions on more closely integrating postwar Europe's economy, the European Coal and Steel Community is established. Members are France, Germany, Italy, Belgium, the Netherlands and Luxembourg.
  • March 1957: European Economic Community is established by France, Germany, Italy, Belgium, the Netherlands and Luxembourg.
  • July 1961: The U.K. applies to become a full member of the EEC.
  • January 1963: President de Gaulle vetoes the U.K.'s application to join the EEC.
  • April 1969: De Gaulle resigns as president of France.
  • October 1970: EEC Werner Report lays out intention of forming economic and monetary union by 1980. But economic problems during the 1970s create delays.
  • August 1971: President Nixon pulls the dollar out of the fixed exchange-rate system set up at Bretton Woods in 1944.
  • January 1973: U.K., Ireland and Denmark join the EEC.
  • January 1981: Greece joins the EEC.
  • January 1986: Spain and Portugal join the EEC.
  • February 1986: Single European Act is signed. As a result of British and German pressure, the Act stopped well short of calling for an early introduction of a full-blooded EMU.
  • January-June 1988: France and Germany start pushing for a much more ambitious EMU. European Commission President Jacques Delors heads committee to produce a report on EMU. It makes reference to the possible establishment of a single currency.
  • September 1988: Margaret Thatcher makes "Bruges Speech," attacking the more integrationist direction Europe is taking.
  • November 1989: Berlin Wall falls as Soviet rule over Eastern Europe collapses. German reunification seems inevitable.
  • December 1989: French President Francois Mitterand appeals to Soviet leader Mikhail Gorbachev to prevent German reunification. He is unsuccessful, so Mitterand moves to contain Germany by making the country agree to a speedy implementation of EMU.
  • July 1990: First stages of EMU begin.
  • November 1990: Thatcher resigns as prime minister of the U.K., to be succeeded by John Major.
  • December 1991: Treaty on European Union, or "Maastricht Treaty," is agreed upon. Key features of this treaty include economic criteria that must be fulfilled by countries aiming to be part of EMU, as well as statements on the independence of the European Central Bank.
  • September 1992: French electorate votes to ratify the Maastricht Treaty.
  • September 1992: Severe market pressures force the British and Italian currencies out of the Exchange Rate Mechanism, which fixes European exchange rates within trading bands.
  • August 1993: Another crisis rocks European currencies, forcing a widening of ERM trading bands.
  • January 1994: European Monetary Institute, forerunner to the European Central Bank, is established.
  • January 1995: Austria, Finland and Sweden join EU.
  • March 1995: Spanish and Portuguese currencies are devalued.
  • December 1995: EU Madrid Summit commits to introducing the single currency on Jan. 1, 1999.
  • January 1996: Mitterand dies.
  • November 1996: Italy's lira rejoins the ERM.
  • May 1997: British Labour Party achieves a landslide victory in general election. Newly elected Prime Minister Tony Blair takes a more enthusiastic approach to EMU.
  • October 1997: Blair rules out joining the single currency until after the next general election, which has to be held by 2002. He also promises to hold a referendum on joining.
  • March 1998: EU forges accession agreements with 10 Central European countries: Poland, Hungary, the Czech Republic, Slovakia, Estonia, Latvia, Lithuania, Slovenia, Romania and Bulgaria.
  • May 1998: At a Brussels conference to ratify the launch of the euro, France causes a last-minute clash with other EU members over the presidency of the European Central Bank. France forces other countries to agree to a plan whereby the first head of the European Central Bank, Wim Duisenberg, will step down halfway through his originally agreed-to eight-year term and give way to a Frenchman.
  • June 1998: European Central Bank starts operations, with Duisenberg at the helm.
  • Summer/fall 1998: European economies start to show signs of a sharp slowdown.
  • September 1998: Germany's Chancellor Helmut Kohl is voted out of office. His Social Democrat successor, Gerhard Schroder, and new Finance Minister Oskar Lafontaine, favor easier fiscal policies in the EU and tell the Bundesbank and ECB that they want lower rates.
  • November 1998: Lafontaine causes uproar in the U.K. as he calls for more tax harmonization within the EU and the end to the practice of requiring a unanimous vote on EU tax matters.
  • Dec. 3, 1998: In a surprise move, central banks across the EU cut rates just 29 days before the scheduled launch of the euro on Jan. 1, 1999.
  • Jan. 1, 1999: Eleven European nations scheduled to adopt the euro alongside national currencies, though euro notes and coins won't circulate until 2002.
  • 2001: Greece aims to adopt the euro.
  • January 2002: Euro bank notes and coins are scheduled to go into circulation.
  • 2002-2005: Hungary, Poland and Czech Republic -- and maybe other Central European countries -- are expected to join the EU.

This story was originally published on Dec. 9.