The Fran-Ger's Aix Influence On The Esteblishment Of European Monetary System

European Monetary System(EMS) is an important stage of European Monetary Integration. It has a profound impact on the European Economic Community(EEC).At the same time,we can not ignore its strong influence on the political process of European Community(EC).The estemblishment of EMS is to satisfy EEC's need,because ECC demands stable financial enviroment. They are both indispensable, working together, creating European monetary system.In this paper, the main purpose of the study is to analyse the role which France and Germany played in the estemblishment of EMS. involving in the reason why they positively want to estemblish EMS,why they can play a role and how to play .The first part is to analyse the deepening of the problem which was caused by the achievements of the EC. EEC had made great achievements, not only because it conformed to the historical trend, but also was a result of the economic circle of Western Europe which had been already existed for several centries. The common market which was esteblished in Post-war is not a miracle ,but the history can be traced back as early as the 12,13 century which had been formed pan-European trade, and the kind of trade which was without the intervention of the secular government was natural and spontaneous. The trade should have been expanded,in fact because of factors such as the disruption of war, which affected the scale of the trade,but not entirely cut off economic and trade exchanges.The existence of economic circle of Western Europe is the basis of the Common Market . Since the establishment of the Common Market, the European Economic Community makes tremendous achievements, the most prominent is the completion of the customs union which is ahead of deadline and the esteblishment of the Common Agricultural Policy which was important but hard to draw up. The menbers of CE all benefit from Common Market ,their countries' economic recovery soon, at the same time becoming increasingly dependent on the common market, which is bound to increase the political will to deepen the community. Dollar Crisis seriously harmed the European Economic Community, to solve this problem was generally faced with the task of Member States, especially France and Germany which suffered a lot , so they were dissatisfied with the U.S. dollar which caused the dollar crisis.The second chapter is to introduce the esteblishment and maturation of the Fran-Ger's aix which is the premis of the cooperation between France and Germany in the esteblishment of EMS. To establish shch a monetary system is bound to be involved in nation-state's economic sovereignty, members state tended to consider the economic interests of their own country, which made the establishment of such a monetary system filling many political obstacles to overcome, therefore, a country which can take the leader role in critical moment , and provide sufficient political support is particularly important. The esteblishment and maturation of the Fran-Ger's aix which is the premis of the cooperation between France and Germany in the estemblishment of EMS. Cooperation of France and Germany was not able to achieve from the very beginning, instead of a decade-long run.Franco-German reconciliation was the cornerstone of European integration. France and Germany a decade old grudges finally slightly reconciled in the form of the "Schuman Plan" . France and Germany co-operation model was made by De Gaulle which was the first President of the French Fifth Republic and the first Prime Minister of the Federal Republic of Germany Conrad Adenauer in 1958.France and Germany realized the necessity of esteblishing the legal form to ensure the reconciliation.Jan 22nd ,1963,the Franco-Germany treaty was contracted in Elysee Palace.The treaty reflected the spirits of the reconciliation and the cooperation,and marked the relationship between France and Germany as the cooperation stage. However, the treaty was not play a role in the first ten years. the maturation of the Fran-Ger's aix which was the premis of the cooperation between France and Germany provide sufficient political support in the estemblishment of EMS.Chaper three narrates that the co-operation of France and Germany builts a European Monetary System.The EMS was build in 1979. European countries had a currency co-operation after the Second World War ,they set up European Payments Union,(EPU) in 1950,though it existed 8 years,yet it worked well. Since the dollar crisis, especially the collapse of the Bretton Woods system in the early 70's, the international currency market was into chaos.In order to reduce the damage caused by U.S. dollar crisis to the Community trade, Members State tried to esteblish a monetary system which called snake mechanism in the early 70s, but because of turmoil of the U.S. dollar crisis,it failed. The most fundamental reason why it failed was that France and Germany failed to reach consensus in the esteblishment of monetary system. The EMS was build in 1979,and France and Germany provide sufficient political support in the estemblishment of EMS. With the joint efforts of D's Estaing and Schmidt, the Monetary Union Plan that would be abolished in the early 70s finally put into practice. It is an inevitable trend to establish a monetary system in the process of making European countries unified into a union. With the efforts of D's Estaing and Schmidt the plan turns into reality in their own tenure in office, which did not only make the contribution to the development of European Union but also raises their political prestige. In brief, the establishment of European Monetary System is the product of the impelling of the economic situations and the political wishes, and the latter has a more decisive function.