The Association for the Monetary Union of Europe (AMUE) was established in 1987 by a number of leading ERT companies (Fiat, Philips, Rhône-Poulenc, Solvay and Total). Now, the AMUE is busy with both the preparations for and the propaganda around the monetary union. While enjoying the same privileged access as the ERT to high-level decision-makers on the national and European levels, AMUE has played an important role in putting the economic and monetary union (EMU) on track.
The Association for the Monetary Union of Europe1 was created in 1987, well before the advent of the Maastricht Treaty. Officially the initiative of former French President Giscard d’Estaing and former German chancellor Helmut Schmidt, in reality AMUE was founded by a few multinational companies from the ERT Fiat, Philips, Rhône-Poulenc, Solvay and Total.2 The first chairman of this Roundtable offspring was Wisse Dekker, then also chairing both the ERT and Philips, and earlier a major player in the creation of the Single Market.
Current AMUE board members include eight chairmen of companies which are or have been represented in the ERT: Viscount Étienne Davignon of Société Générale de Belgique; Xavier Ortoli of Total; Rhône-Poulenc’s Jean René Fourtou; Theodore Papalexopoulos of Titan Cement; André Leysen of Gevaert; Philips’ Dudley Eustace; Fiat’s Cesare Romiti and Karl Hermann Baumann of Siemens.
Despite the obvious overlap, AMUE does not link itself with the ERT in its official publications. However, when asked about the relationship between the two lobby groups, AMUE Secretary-General Bertrand de Maigret explains: “We decided that the ERT would not work on monetary issues, and that we would. We have friendly links a kind of division of tasks”.3 Étienne Davignon, former Industry Commissioner and board member of both ERT and AMUE, confirms the division of tasks, but stresses that “there is no difference in the findings”.4
The competition-driven ERT has long been vocal about its preference for a European Monetary Union. “Japan has one currency. The US has one currency. How can the Community live with twelve?”5 it asked in its 1991 report Reshaping Europe. For industry, the single currency is a crucial element of the completion of the Single Market, and this is probably why Dekker and his ERT colleagues created the single-issue AMUE. The crew of industrial leaders that came together in AMUE felt it necessary to be proactive, and to push economic and monetary union in the EU’s political agenda.
In order to do this more comfortably, they decided not to include trade unions, consumer organizations or other partners. Just industry and banks, so that as board member Davignon put it: “We don’t speak for everybody, we speak for ourselves. It [the EMU] could only be effective if it was proposed by the people who were in favour, without the necessity to compromise between themselves”.6 Thus, industry accounts for 80 percent of AMUE’s membership, banks 15 percent, and the remaining 5 percent has been filled with national chambers of commerce and professional organizations. Among the latter is UNICE (the European employers’ confederation), and its President François Perigot is also an AMUE board member.
The AMUE organizes public meetings all over Europe, currently at the rate of four per week. Although initially it took a great deal of organizational effort, the situation has changed to the extent that AMUE events are solicited and even funded. The meetings address fundamental questions such as: Why is EMU good for the economic growth of Europe? And for employment? Meetings are often of a technical nature, with “officials from the Commission and officials from national states saying ‘these are the things that have to be done’”.7
In the grand tradition of the ERT, the AMUE enjoys easy access not only to Commission and government officials, but also to political leaders and elites. For example, the AMUE generally organizes its board meetings in the country holding the EU Presidency so that relevant officials can be involved. Thus, Philips hosted the March 1997 meeting in the Netherlands, and organized a dinner with Wim Duisenberg, (President of the Dutch Central Bank, from June 1997 on President of the European Monetary Institute (EMI)8 and probably the first President of the future European Central Bank). This kind of networking helps to maintain the AMUE’s close links with the EMI, and encourages joint meetings of the type organized in November 1996 in Korea about the relationship between the Euro and emerging currencies.
Cooperation between the AMUE and EU institutions goes further than joint meetings. For example, the AMUE released a report in May 1994 entitled Preparing the Changeover to the Single Currency which recommended the establishment of an independent committee to further analyze the changeover. Consequently, the European Commission established an expert committee which included three AMUE board members in the autumn of the same year. On the basis of this committee’s work, the Commission published a Green Paper (May 1995) on the procedures for single currency changeover. This was quickly followed by a November 1995 report from the European Monetary Institute, in general agreement with the Commission’s Green Paper. These two reports were used to support the European Council decisions at the EU Summit in Madrid the following month.9
AMUE followed up the sequence with its report Managing the Changeover to the Single Currency in the first half of 1996. Thanks to the financial support of the Commission, 200,000 copies of the report were distributed and an internet site was created.
In addition to providing financial support to the AMUE, the European Commission frequently consults the group on monetary questions. Secretary-General Maigret explains that this cooperation takes place both formally and informally. “It’s a very confident way of working. They call us, we call them, they see us, we discuss matters. They are quite flexible. I’m not one of those who criticize the Commission administration they are very open for discussion, at least in the monetary field”.10
The AMUE also influences national governments through its members. Multinationals can be quite persuasive when it comes to their ability to relocate their investments, as was illustrated by the threats of Unilever (an ERT member) and Toyota to liberate themselves from the United Kingdom if the country does not join the EMU. In addition, the AMUE offers major Central and Eastern European companies and banks a complimentary service by providing information about EMU, “so these companies can in turn persuade their national authorities to take the necessary measures for future entry of their countries into EMU”.11
Étienne Davignon explains that governments have always been interested in listening to AMUE and that “they gladly come to our general assemblies in various countries. Prime Ministers usually come to address these, and also governors of central banks attend”. Such meetings occur without protest from other interests in the EU. Davignon explains: “in these issues, industry is much less suspected than in other issues. This is not the lobby for the car industry, or for electronics, or multimedia, or the deregulation of banks or whatever, but the discussion over the improved use of the internal market”.12
How important has the AMUE been in setting the agenda for EMU? There is no doubt that European politicians have been dreaming about a more integrated economy for many years and that significant political will existed. However, when political doubts arose about the alternatives of setting precise dates for the implementation of EMU in the Maastricht Treaty or leaving the timetables more open, the AMUE successfully pressed for the former option. As Maigret explains, governments “were very glad to find the support of industry and the bank community in preparations for the writing of the treaty, where we had discussions on various high levels”.13
A further measure of its influence is that the AMUE is often chosen by both the Commission and the Parliament for public tenders requiring expertise in monetary matters. For example, the AMUE was awarded a major contract with the Parliament after the 1992 monetary crisis; its advice was to change the European monetary system.
Board member Davignon expands further on the role of the Association: “You cannot be vain about this. At the end of the day, a lot of drops make the sea. What is significant is that we were always considered as very useful by the Commission. And also by the various member states, all of which have now set up technical groups dealing with this type of problems, they always ask representatives of the AMUE to be there”.14 The AMUE can also claim success for increasing the acceptance of the monetary union by a large part of the business sector.
Now that nearly every government has demonstrated its commitment to EMU, the role of the AMUE will change. The debate is no longer if, but how, and the Association is now more focused on details, rules, facilitating a cost-effective conversion to the Euro and ensuring its proper functioning, organizing training sessions for industry and bank employees, and, of course, monitoring the strict application of the timetables and criteria.
Among the services that AMUE offers to its members in this new role is “protecting major companies from any suspicion about special advantages that they could gain from EMU at the expense of the public or of small businesses”.15 And how does AMUE dispel this suspicion? With plenty of meetings and publications in which they try to convince the man in the street to love the EMU. They use appealing arguments such as reduced prices, costs for changing money and charges for international payments in order to avoid “a popular reaction, politically sensitive” and to “transform it into dynamic support”.16
Economic and monetary union is presented as an important step towards the completion of the Single Market, which is still not as efficient as industry would like. AMUE’s basic message is that EMU will bring “monetary stability and long term certainty, which will increase productive investment, generate economies of scale and eliminate production costs, which in turn will increase competitiveness, sales, economic growth and employment”.17 This neo-liberal message is accompanied by the usual demands for deregulation and a more flexible labour market.
A single currency is considered as desirable by industry in the current globalised context. It is envisaged that the new euro will give Europe a global currency advantage which will in turn increase European exports.
The final paragraph of AMUE’s manifesto reads as follows: “We believe that Monetary Union will bring a positive contribution to economic growth and make Europe a better place to invest and to live in the 21st century. The single currency will also help the European Union to better meet new challenges such as enlarging its membership. The Euro is within our reach. A timely start of the final stage of Monetary Union on January 1, 1999 will allow Europeans to fully reap its benefits”.
Among others, trade unions fear the harmful effects of the convergence criteria. Spectacular budget cuts by governments throughout the EU have targeted national social, health and educational programmes, and have encouraged the privatisation of public services. In the short term, this will no doubt worsen unemployment, as even EMU defendors admit.18 The long-terms effects are no more promising, with many economists indicating that a pan-European monetary policy may prove too austere for depressed countries and will increase unemployment.19 All over Europe, citizens are protesting against heavy government cutbacks and high unemployment. Viscount Davignon is unperturbed by these reactions: “It is as if you have been saving for a long time to buy a bicycle, and then decide to wait because you are not sure you like the colour. That is quite absurd what you want is a bicycle”.20
EMU also poses a threat to democracy. National governments will no longer have control over their monetary policies, which will be run from the European Central Bank (ECB), an unelected and unaccountable body which intends to follow the inflation-fighting policies of the German Bundesbank. When quizzed on these concerns Viscount Davignon’s response proved unequivocable: “I find it total rubbish”.21 AMUE’s response, though more diplomatic, is no more comforting. The organization argues that this lack of accountability has been approved by elected heads of state, and that the ECB will need full freedom in order to fulfil its task of guaranteeing price stability.22
Economists warn that competition on rules between regions will increase within the economic and monetary union.23 It will sharpen the impacts already suffered with the Single Market: centralization of production will result in larger regional disparities, destruction of local communities and increased long-distance transport of goods. Davignon remains confident: “Again, that is rubbish. I’m not an ayatollah of EMU, but this argument is rubbish”.24
1. The AMUE, based in Paris, has a 10-staff secretariat. |back to text|
2. Phone interview with Bertrand de Maigret, 11 March 1997. |back to text|
3. Ibid. |back to text|
4. Personal interview with Étienne Davignon, Brussels, 20 February 1997. |back to text|
5. ERT, Reshaping Europe, Brussels, 1991, p.2. |back to text|
6. Personal interview with Étienne Davignon, Brussels, 20 February 1997. |back to text|
7. Ibid. |back to text|
8. The European Monetary Institute is the forerunner of the European Central Bank (ECB). Its tasks include technical preparations needed in order to introduce the single currency and establish a European system of central banks. The EMI is also preparing the future monetary policy of the ECB. Another joint meeting of the AMUE and the EMI focused on the future monetary policy of the ECB. |back to text|
9. In Madrid, in December of 1995, the European Council agreed on the EMU’s scenario and calendar. January 1999 will be the date for the irrevocability of exchange rates and the birth of the Euro. The year 2002 will see the total replacement of EMU countries’ currencies by the Euro. |back to text|
10. Phone interview with Bertrand de Maigret, 11 March 1997. |back to text|
11. AMUE, Annual Report, 1995. |back to text|
12. Personal interview with Étienne Davignon, Brussels, 20 February 1997. |back to text|
13. Phone interview with Bertrand de Maigret, 11 March 1997. |back to text|
14. Personal interview with Étienne Davignon, Brussels, 20 February 1997. |back to text|
15. AMUE, Annual Report, 1995. |back to text|
16. Ibid. |back to text|
17. Phone interview with Bertrand de Maigret, 11 March 1997. |back to text|
18. When AMUE Secretary-General de Maigret was asked about the trade union’s critique that EMU will worsen unemployment, he answered: “In the short term they are partially right, because indeed some countries have increased the tax pressure for the convergence criteria and they have reduced the number of civil servants to reduce expenses”. Phone interview with Bertrand de Maigret, 11 March 1997. |back to text|
19. EMU’s Working Hypothesis, The Economist, 9 November 1996, p.110. |back to text|
20. Personal interview with Étienne Davignon, Brussels, 20 February 1997. |back to text|
21. Ibid. |back to text|
22. AMUE, EURO Europe United Through A Single Currency, preface. |back to text|
23. Statement signed by 70 Dutch economists, published in de Volkskrant, 13 February 1997. |back to text|
24. Personal interview with Étienne Davignon, Brussels, 20 February 1997. |back to text|