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   The  Governments of the Member States and the Commission of the  European
   Communities were represented as follows:

   Belgium:
   Mr Philippe MAYSTADT        Minister for Finance

   Denmark:
   Ms Marianne JELVED          Minister for Economic Affairs

   Germany:
   Mr Theo WAIGEL              Federal Minister for Finance
   Mr Johann EEKHOFF           State Secretary for Economic Affairs
   Mr Gert HELLER              State Secretary for Finance

   Greece:
   Mr Stefanos MANOS           Minister for Economic Affairs

   Spain:
   Mr Pedro PEREZ              State  Secretary  for  Economic  Affairs  and
                               Finance

   France:
   Mr Edmond ALPHANDERY        Minister for Economic Affairs

   Ireland:
   Mr Bertie AHERN             Minister for Finance

   Italy:
   Mr Enzo PERLOT              Ambassador, Permanent Representative

   Luxembourg:
   Mr Jean-Claude JUNCKER      Minister for Finance

   Netherlands
   Mr Wim KOK                  Minister for Finance

   Portugal:
   Mr Jorge BRAGA DE MACEDO    Minister for Finance
   Mr José BRAZ                State Secretary for the Treasury

   United Kingdom:
   Mr Kenneth CLARKE           Chancellor of the Exchequer

                                      -+-

   Commission:
   Mr Jacques DELORS           President
   Mr Henning CHRISTOPHERSEN   Vice-President
   Ms Christiane SCRIVENER     Member

                                      -+-

   The following also attended:
   Sir Brian UNWIN             President of the EIB
   Mr Wim DUISENBERG           Chairman of the Committee of Governors of the
                               Central Banks
   Mr Jean-Claude TRICHET      Chairman of the Monetary Committee

                                     - - -

   MULTILATERAL SURVEILLANCE

   1. The  Council  carried  out the biannual examination  of  the  economic
      situation  in the Community (multilateral surveillance).  It  received
      an  opinion of the Committee of Governors of the Central Banks and  of
      the Monetary Committee. The exercise showed that the Community economy
      was going through a difficult period.  GDP was expected to contract by
      about  half a percentage point this year with some signs  of  recovery
      in 1993  and  a modest recovery expected to take  place  in 1994.  The
      forecast  decline in employment might lead to sharply rising rates  of
      unemployment,  which might well reach a rate of about 12%  next  year.
      Progress in the nominal convergence situation was uneven: the  adverse
      economic  environment  wiped out efforts to  reduce  budget  deficits,
      which were now reaching record levels, while inflation was coming down
      more slowly than would be warranted by the weakness of activity.

   2. The  Council  noted with satisfaction the measures to  support  growth
      which  the  Member  States and the Community had taken  in  close  co-
      operation since the Edinburgh meeting of the European Council and  the
      decisions  taken at the recent Copenhagen meeting.  It  also  welcomed
      the recent progress towards a conclusion of the GATT negotiations.

   3. Given  the state of the public finances in most Member  States,  there
      was now widespread agreement that the best contribution that budgetary
      policy  could now make to recovery was to announce  credible,  medium-
      term measures to reduce fiscal imbalances.

   4. The  Council  underlined  that  an  additional  encouragement  to  the
      Community's short-term economic outlook would also undoubtedly emanate
      from  the  creation of the conditions necessary to  ensure  a  further
      reduction  in interest rates.  In this regard, evidence  of  budgetary
      consolidation and of wage moderation would both have an important role
      to play.

   5. The  Council stressed that structural adjustment policies  represented
      an  essential  instrument in returning the Community's  economy  to  a
      higher  and  more employment-intensive growth path.  Efforts  in  this
      direction  were indispensable since the current downturn  had  exposed
      two  major  underlying  weaknesses in the  economic  capacity  of  the
      Community:  its  decline in overall competitiveness and its  inability
      to  create  a  sufficient number of new jobs.  These  issues  will  be
      addressed  in  the White Paper on a medium-term  strategy  on  growth,
      competitiveness  and employment which the Commission will transmit  to
      the  December  Brussels  European  Council.  The  Council  will   give
      particular  attention to these issues, including the reduction of  the
      labour  costs, in the framework of the broad guidelines  for  economic
      policy it prepares for deliberation by the European Council.

   6. The Council reaffirmed the importance of the convergence programmes as
      valuable instruments of economic policy co-ordination in the Community
      as  well as useful tools for re-establishing sound public finances  in
      the  medium  term.  Ministers  called  on  all  Member  States  facing
      structural  imbalances  in  their economies to  submit  a  convergence
      programme if they had not already done so.

   7. To   ensure  effective  monitoring  and  follow-up  of  the   existing
      programmes,  the Council invited Member States to update them as  soon
      as  their budgets had been approved, notably to take into account  the
      deterioration  in the economic situation.  Without prejudice  to  each
      Member  State's own responsibility with respect to their  content,  it
      was  desirable  that  all programmes extend to  the 1996  horizon,  be
      revised  once a year and be based on realistic assumptions  compatible
      with  the Community's general economic outlook, specify clearly  their
      objectives  and  give  the necessary indications  about  the  measures
      contemplated to achieve those objectives.

   WESTERN ECONOMIC SUMMIT

   The  Council was informed by those of its Members who had taken  part  in
   the Tokyo Summit about the discussions that had been held on economic and
   financial matters.

   UNITED KINGDOM CONVERGENCE PROGRAMME

   At  its meeting on 12 July 1993 the Council examined  the  United Kingdom
   Convergence  Programme covering the period up to the 1997-1998  financial
   year.  The  Council  welcomed the presentation of  the  programme  which,
   although ambitious, was based on realistic assumptions.

   The  Council  noted the Government's firm commitment to a  low  inflation
   target  and  encouraged  the Government  vigorously  to  pursue  whatever
   measures  were necessary to ensure that the target was  maintained.  With
   respect  to exchange rate policy, the Council looked forward to  the  re-
   entry of sterling into the ERM as soon as conditions permitted.

   Sound and stable growth would also require that the imbalances in  the UK
   economy  be tackled.  The adoption of a budgetary consolidation  strategy
   and  the  measures  taken  and announced in  the  Budget  were  welcomed.
   The United Kingdom Government was encouraged to fulfil, within the period
   of  the convergence programme, its commitment to meeting  the  Maastricht
   deficit  criterion.  In  this  context, the Council  noted  that  a  more
   vigorous budgetary adjustment might be necessary, especially in the first
   years, if the pace of economic recovery was slower than expected.

   Finally,  the Council noted the substantial progress already achieved  in
   the  area of structural reform and welcomed the programme  of  continuing
   efforts to strengthen the supply side. Such efforts would be an important
   aid over the medium term to the achievement of sound and stable growth.

   FOLLOW-UP TO THE COPENHAGEN EUROPEAN COUNCIL

   The Council considered the organization of discussions during the  second
   half of 1993 concerning, in particular,

   -  the second stage of EMU;
   -  the broad guidelines of the economic policies;
   -  the Commission's White Paper on economic renewal in Europe.

   It noted that no decision could be taken on the second stage of EMU until
   the Maastricht Treaty had come into force, but that the guidelines  which
   the  Commission intended to submit shortly on the various  aspects  could
   begin   to  be  studied  informally  without  delay  by   the   Permanent
   Representatives  Committee, the Monetary Committee and the  Committee  of
   Governors of the Central Banks.

   Regarding  the  broad guidelines of the economic policies of  the  Member
   States and the Community, under Article 103 of the Maastricht Treaty, the
   Commission  intended  to  prepare its draft  for  the  Brussels  European
   Council  at its next meeting on 22 November. It asked the  Commission  to
   submit its White Paper on economic renewal in Europe by the beginning  of
   November.  This  would  enable it to take the White  Paper  into  account
   during  its  preparatory  work on the broad guidelines  of  the  economic
   policies, as requested by the European Council.

   The Council took note of information from the President of the EIB on the
   implementation of the "Edinburgh facility" (ECU 5 million + ECU 3 million
   as decided at Copenhagen) and called on the Bank to press ahead with this
   exercise.

   With regard to the implementation of the short-term measures envisaged by
   the  European  Council,  the  Council  heard  a  presentation  by   Vice-
   President CHRISTOPHERSEN of two Commission proposals, one concerning  the
   subsidizing  of interest rates on loans granted by the EIB  to SMUs,  the
   other  concerning  the possibility of raising loans - in  favour  of  the
   Member States - in connection with the bridging facility mentioned by the
   European Council.

   The Council asked the Permanent Representatives Committee to examine  the
   questions to which these proposals gave rise.

   TRAVELLERS' ALLOWANCES

   The Council turned to the issue of increases in travellers' allowances to
   see  whether  unanimous agreement was now possible on the  formula  which
   11 delegations had accepted in December 1992, i.e.:

   -  to  increase  allowances for travellers coming  from  third  countries
      from ECU 45  to ECU 175 and limits on tax-free purchases  made  during
      intra-Community travel from ECU 45 to ECU 90;

   -  to  authorize Spain, until 31 December 1996, to grant travellers  from
      the Canary Islands, Ceuta and Melilla entering the fiscal territory of
      Spain an allowance of ECU 600 in respect of goods imported.

   Noting  that Germany was unable to accept this formula as it  stood,  the
   Council  instructed the Permanent Representatives Committee  to  continue
   seeking a solution to the problem.

   MISCELLANEOUS DECISIONS

   UNRWA

   The Council authorized the Commission to negotiate, in consultation  with
   a committee comprising representatives of the Member States, the  renewal
   of  the Convention between the EEC and UNRWA (United Nations  Relief  and
   Works  Agency  for  Palestine  Refugees)  for  a  period  of  three years
   between 1993 and 1995.

   The proposed Community contributions to the three programmes  (education,
   health  and  supplementary  feeding)  will  be  ECU 30 million   in 1993,
   ECU 31 million in 1994 and ECU 32 million in 1995.

   Textiles

   The Council authorized the Commission to open negotiations with  Slovenia
   for the conclusion of a textiles agreement.

   Fisheries

   The    Council   adopted   a   Decision   concerning   the    provisional
   application - pending  its definitive entry into force - of the  Protocol
   establishing for the period from 1 June 1993 to 31 May 1996, the  fishing
   rights  and financial compensation provided for in the Agreement  between
   the  European  Economic Community and the Government  of  the  Democratic
   Republic of Sao Tome and Principe.

   Under the Protocol it will be possible for 40 freezer tuna purse  seiners
   from  the  Community  and eight pole-and-line  tuna  vessels  or  surface
   longliners  from  the Community to continue to operate off  Sao Tome  and
   Principe.

   The  Community's financial compensation for the duration of the  Protocol
   is  ECU 1 650 000, covering a catch weight of 9 000 tonnes  of  thunnidae
   per  year.  The Community will contribute ECU 250 000 to the  funding  of
   scientific  and  technical programmes concerning the  exclusive  economic
   zone  of Sao Tome and Principe.  The conditions for the new Protocol  are
   exactly the same as for the previous one.

   The Council adopted Regulations:

   -  giving  a  separate  tariff  identification  to  surimi,  and   surimi
      preparations, as products subject to the rules of the common fisheries
      policy  laid down in Regulation No 3759/92 of 17 December 1992 on  the
      common organization of the markets in this sector.

      The  Community will now be able to monitor trade and any  developments
      in  the market prices for surimi (a washed and stabilized protein  gel
      made from minced fish) and its preparations, the demand for which  has
      increased steadily in recent years, as have imports;

   -  laying  down common marketing standards, including  sizing  standards,
      for new species eligible for intervention, following the reforms  made
      by Regulation No 3759 to certain mechanisms of the common organization
      of the markets in fishery products;

   -  fixing  the  guide prices for the 1993 fishing year  for  the  species
      mentioned  below following their inclusion in the common  organization
      of the market by Regulation No 3759/92:

   ecu/tonne

   =    fresh products

   Dab (gutted fish with head)                                  760
   Flounder (gutted fish with head)                             450
   Albacore or longfinned tuna (whole fish)                   1 800
   Albacore or longfinned tuna (gutted fish with head)        2 100
   Cuttlefish (whole fish)                                    1 300
   Sole (gutted fish with head)                               5 000

   =    frozen products

   Lesser or Greenland halibut                                1 300
   Whole hake of the genus Merluccius spp.                    1 115
   Fillets of hake of the genus Merluccius spp.               1 450
   Prawns of the species Parapenaeus longirostris             5 000
   - other species of the family Penaeidae                    6 500

   Agriculture

   The   Council   adopted  Regulations  opening  and  providing   for   the
   administration of a Community tariff quota for the period 1 July 1993  to
   30 June 1994, with a duty of 4%, in respect of:

   -  42 600  cows  and  heifers, not intended  for  slaughter,  of  certain
      mountain  breeds falling under subheadings ex 0102 90 05,  0102 90 29,
      0102 90 49, 0102 90 50 and 0102 90 69 of the Combined Nomenclature;

   -  5 000 bulls, cows and heifers, not intended for slaughter, of  certain
      Alpine  breeds falling within subheadings  ex 0102 90 05,  0102 90 29,
      0102 90 49,  0102 90 59,  0102 90 69 and 0102 90 79  of  the  Combined
      Nomenclature.

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