The system of exchange rates, border taxes, and subsidies- the agrimonetary system- is incompatible with the goals of EC-1992. This system has led to a breakdown in the concept of common pricing and to distrotions in trade patterns and has created large administrative costs to the EC. Elimination of the agrimonetary system would reduce EC prices, productionm next exports, and budget expenditures and increase consumption. Major changes to the system will probably be reserved for a date beyond 1992.