ABSTRACT
This chapter explains, together with the gradual evolution in the division of powers between the Commission and the Council, the role which the Commission played both in the preliminary negotiations and in later discussions. In the minds of many people, EMU was an attempt to apply the neo-functionalist strategy in European integration. The neo-functionalist strategy relied basically on the role of experts in bringing about an agreement on politically non-controversial issues. It relies on the dynamic effects of functional spill-over which would force governments to extend their co-operation to new fields of economic activity. The study of the history of EMU has shown that the Community has gradually evolved towards a more intergovernmental type of organisation. Growing economic interdependence, coupled with a continuing divergence in national inflation rates, increases the need for using the exchange rate as an instrument for balance of payments adjustment.
