The Delors Committee 'agreed that there should be no discrimination against the private use of the ECU and that existing administrative obstacles should be removed'. (Delors, i989, para. 49) Work is being done to follow up that recommendation.' A recent report by Ernst and Young2 notes that the administrative obstacles are not considered to be a major problem by most businesses. As anyone familiar with the continuing debate over the use of the ECU will know the obstacles are not purely administrative. The future of the private use of the ECU cannot be considered in isolation from the future of the ECU as the single currency of the Community once the process of economic and monetary union is completed. The purpose of this paper is to provide the necessary macroeconomic background to an assessment of the microeconomic arguments for a wider use of the ECU and to consider what the implications might be at a macroeconomic level of a spontaneous movement to adopt the ECU as a common European currency even in advance of the political process of economic and monetary union (EMU). We begin by describing briefly the advantages of a common currency, and more particularly of a single currency, within Europe. We then ask whether these advantages might come about spontaneously. This leads us into a short discussion of the possible results of' currency competition' in advance of further progress towards EMU. With that scenario we contrast one in which the steps towards EMU are announced well in advance, making clear what the future role of the ECU is intended to be. We give our reasons for preferring this second scenario to the first. The next section considers how the wider use of the ECU might be encouraged over the next year or two. We discuss, but only briefly, the possibility of converting the ECU from a 'currency basket' into an independent currency in its own right; and in more detail, the scope for using the ECU more extensively in foreign exchange market intervention, with particular reference to its role in the development of a common monetary policy within the Community. Our final section is concerned with longer-term issues, corresponding to stages 2 and 3 of the Delors Report. It is important to have in mind at least