European Payments Union

The European Payments Union (EPU) was an organization in existence from July 1950 to December 1958, when it was replaced by the European Monetary Agreement. With the end of World War II, economic depression struck Europe. Of all the non-neutral powers, only the GDP of the United Kingdom had not decreased because of the war, West Germany's GDP was at its 1908 level and France's at its 1891 level. Trade was based on US dollar reserves (the only acceptable reserve currency), which Europe lacked. Therefore, the transfer of money (immediately after each transaction) increased the opportunity cost of trading. Some trade was reduced to barter. The situation led the Organisation for European Economic Co-operation (OEEC) to create the EPU, all members signing the agreement on 1 July 1950. The EPU a

European Payments Union

The European Payments Union (EPU) was an organization in existence from July 1950 to December 1958, when it was replaced by the European Monetary Agreement. With the end of World War II, economic depression struck Europe. Of all the non-neutral powers, only the GDP of the United Kingdom had not decreased because of the war, West Germany's GDP was at its 1908 level and France's at its 1891 level. Trade was based on US dollar reserves (the only acceptable reserve currency), which Europe lacked. Therefore, the transfer of money (immediately after each transaction) increased the opportunity cost of trading. Some trade was reduced to barter. The situation led the Organisation for European Economic Co-operation (OEEC) to create the EPU, all members signing the agreement on 1 July 1950. The EPU a