B2 The Daily of Geopolitical Europe. News. Files. Reflections. Reports

News BlogEconomy Euro zoneEuropean history

When the Euro was saved by … a Briton

Ken Clarke, the man who saved the EMS, according to JC Juncker (Here with Commissioner Viviane Reding and the Pole Igor Dzialuk during a Justice Council, November 2011, credit: CUE / Archives B2)
Ken Clarke, the man who saved the EMS, according to JC Juncker (Here with Commissioner Viviane Reding and the Pole Igor Dzialuk during a Justice Council, November 2011, credit: CUE / Archives B2)

(B2) It was Jean-Claude Juncker himself who recounted it during his visit to Paris, for the 20th anniversary of the Delors Institute. It was in the summer of 1993, at the time of the European monetary system when Europe was (already) in crisis. A piece of forgotten European history... The current President of the European Commission was then Minister of Finance of the Grand Duchy.

The atmosphere is then not festive. Speculation rages. Germany, in the midst of reunification, refuses to intervene further. France - it was then Prime Minister Edouard Balladur, who was in charge - proposed the exclusion of Germany. The Italian lira already left the EMS in September 1992. The explosion of the EMS seems close...

When the EMS almost exploded

“I lived through this period when we were locked into the European monetary system, when every third Sunday the finance ministers had to travel to Brussels to carry out realignments, to review from top to bottom the economic realities which made evening in the morning the productions in one country became too expensive and the other productions taking advantage of competitive devaluations, that is to say devaluations against the others, went better.

The Euro Revolution

"All of this was put to an end thanks to the creation of the single currency, which in fact owes its creation to Jacques Delors, since he chaired the Delors group in '88, who chaired a committee made up of governors in particular and he convinced this difficult troop of the necessity and justification of the single currency. »

When Berlin and The Hague wanted to leave the EMS

“Germany and the Netherlands wanted to leave the European monetary system. [As] a Luxembourgish, small finance minister, I was in a bit of a bind because the Luxembourgish fundamentals were much better than those of Germany and the Netherlands. We [however] could not really leave the European monetary system because we had no money, since we had the Belgian franc. If Luxembourg had left the European monetary system with the Germans and the Dutch, the Belgian franc would have fallen to minus 30-40% the next day. »

When London saves the Euro

It was actually a British finance minister who saved the euro. The Twelve were then gathered in Brussels, to realign the different currencies... It was the day after the death of King Baudouin. Juncker was then Minister of Finance of the Grand Duchy.

“[We] met in Brussels the day after the death of King Baudouin, to realign the different currencies. (...) Kenneth Clarke [then] Chancellor of the Exchequer, took the floor and said: "The UK has an opt-out and we won't adopt the single currency, but we will one day, and I would like my grandchildren to be able to pay in euros", which was not yet called like that, "but if you let the Germans and the Dutch leave the European monetary system to put you under French command, you will never have the single currency and as I want my grandchildren to have the single currency, you do not have the right to do what you're concocting"."

(NGV)

Nicolas Gros Verheyde

Chief editor of the B2 site. Graduated in European law from the University of Paris I Pantheon Sorbonne and listener to the 65th session of the IHEDN (Institut des Hautes Etudes de la Défense Nationale. Journalist since 1989, founded B2 - Bruxelles2 in 2008. EU/NATO correspondent in Brussels for Sud-Ouest (previously West-France and France-Soir).

s2Member®