The European Community
In 1992 the future development of the European Community was in more doubt than at any time since the stagflation period of the 1970s. Three broad outcomes were possible. One was that the Maastricht treaty would be ratified, and progress towards greater integration and economic and monetary union would resume. That seemed increasingly unlikely as the crisis of September 1992 developed and resistance to ratification grew within the Conservative Party. A second scenario was that what remained of the ERM would collapse, other major programmes such as the single market would be placed in jeopardy, the Franco-German alliance would dissolve, and Europe would once again become a patchwork quilt of nation states divided by economic barriers. This doomsday scenario also seemed unlikely, although certainly not impossible. A third scenario, perhaps the most likely, was that there would be some kind of ‘two-speed’ Europe. Such an arrangement could take many different forms, but at its heart would be a core group of countries which would move quickly to a single currency (France, Germany, Benelux, the Netherlands, with Austria and Switzerland pegging their currencies to the ECU). What remained very uncertain was what would happen if Britain failed to ratify the Maastricht treaty. The treaty itself would fall, but would a successor treaty be negotiated, and by how many countries?
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