Since World War II, Europe has been moving toward integration. With the creation of the euro, they have made a giant step toward uniting Europe for good. The euro will have immediate benefits. People traveling or simply shopping among participating European nations will immediately benefit from being able to compare prices for similar goods without needing a calculator. Not only will the exchange rate become irrelevant, but the costs of converting between currencies will also be eliminated. Because of the savings related to currency conversions, one-third of firms expect short-term earnings gains from the introduction of the euro, and three-quarters expect long-term benefits to the bottom line. The euro will make life easier for the people of Europe.
The Maastricht Treaty mentions EMU and refers to it together with the Single Market as one of the means by which the Union will promote economic and social progress that is balanced and sustainable. The treaty refers to the irrevocable fixing of a single currency, the ECU, and a single monetary policy and exchange rate policy.
The first stage began on 1 July 1990 with the removal of exchange controls in 8 of the then 12 Member States, the inclusion in principle of all currencies in the narrow band of the Exchange-Rate Mechanism (ERM), and measures to encourage convergence. No new institutions were required. The second stage began on 1 January 1994, with the newly created European Monetary Institute (EMI), based in Frankfurt, gradually assuming a coordinating role.
Those countries that qualified undertook stage 3 of EMU in early 1999. At the beginning of Stage 3 the participating states adopted the 'irrevocably fixed' rates at which the Euro was to be substituted for national currencies. Stage 3 also entailed the creation of a European System of Central Banks (ESCB), composed of the European Central Bank (ECB) and representatives of the national central banks.