The French Challenge to German Monetary Dominance: Demands for EMS Reform, March 1983 to May 1988

Abstract

French policymaking on monetary co-operation between March 1983 and May 1988 differed from that of the Socialist government ‘s first two years principally in that continued membership in the EMS was no longer seriously in question. Core French demands on EMS reform remained the same although they were now made more assiduously. Moreover, the defeat of the Fabius Socialist government in the March 1986 elections and the arrival to power of the RPR—UDF government led by Jacques Chirac did not modify the general thrust of French policy, even though the rhetoric in favour of reform became decidedly more vitriolic. In cohabitation with the Chirac government, President Mitterrand chose not to interfere in the formulation of French policy, even though some aspects of EMS reform — principally institutional matters — fell within the reserved domain of presidential powers guaranteed in the Constitution. The boundaries of this period are marked by the March 1983 decision to tie the franc definitively into the EMS and the May 1988 presidential elections which renewed President Mitterrand’s mandate and enabled him to pursue a policy in favour of a more rapid move to Economic and Monetary Union.