ABSTRACT
When, at the Hague summit of 1969, the member states fIrst seemed willing to take practical steps towards creating such European-level institutional competencies, they were constrained by a clear difference of economic outlook as to the priority to be given to the convergence of inflation prior to monetary union. Nevertheless, in 1971 the ECOFIN accepted the Werner Report's stated objective of achieving monetary union by 1980. Whilst aspects of that plan were in certain respects more far-reaching than even the Maastricht Treaty, 1 its principal achievement was the establishment of the 'Snake in the tunnel'. In the turbulent period following the collapse of Bretton Woods, the divergent policies pursued by the major European countries soon reduced the Snake, stripped of its dollar 'tunnel', to a D-mark zone for West Germany and the smaller countries: Britain, France and Italy all withdrew as it became impossible to defend their parities. The incentives for policy coordination, exchange rate stability and European integration did not prove strong enough, at least amongst the larger countries, for the system to be maintained, and the Werner plan therefore came to nothing.
