The Month in Europe - August 2002

EU news in brief

EU response to floods in Central Europe

The floods that have devastated parts of central Europe during the summer break have led to a new level of co-operation between the European Union and the candidate countries that have been most severely affected. The EU response has moved quickly from personal expressions of sympathy to on-the-ground assistance and the creation of outline plans for tangible aid in a concrete gesture of European solidarity.

European Commission President Romano Prodi flew over the floods in the Czech Republic with President Vaclav Havel on 16 August, and said he was "simply shocked" by the extent of the damage. European Council President Anders Fogh Rasmussen sent a message of support and promised to promote urgent EU action to lend assistance. Enlargement Commissioner Günter Verheugen, Regional Affairs Commissioner Michel Barnier and Budget Commissioner Michaele Schreyer represented the Commission at the special summit hosted in Berlin by German federal chancellor Gerhard Schröder, which was also attended by heads of government and foreign affairs ministers from Austria, the Czech Republic, and Slovakia.

As soon as the extent of the catastrophe became apparent, the Commission started discussions with the national and regional authorities in the member states and the candidate countries affected. The Monitoring and Information Centre for Civil Protection of the European Commission, under the authority of Environment Commissioner Margot Wallström, received a request for support from the Czech republic for portable dryers for drying damp houses, floating pumps with an internal combustion engine, and electric submersible pumps. This was immediately transmitted to the member states, several of which immediately deployed teams with adequate equipment to the Czech Republic. France made available two teams specialised in water purification and water pumping. Belgium sent vehicles, personnel, generators and motor pumps, Italy flew in pumps, and Greece offered immediate help. Denmark sent a ten-man civil unit with pumping devices.

For the candidate countries and in particular the Czech Republic, Commissioners Verheugen and Barnier identified possible financial support through the pre-accession programmes. An additional amount of 9.75 million under Phare could be spent for reconstruction projects to be presented by the Czech Republic in line with the usual rules of the programme, they said. And up to 48 million of as yet unallocated ISPA funds for the Czech Republic could be immediately redirected at environmental and transport initiatives linked to flood damages, on the basis of projects presented by the Czech authorities.

On 28 August the Commission approved an initial plan to provide immediate assistance of up to 500 million for Germany, Austria, the Czech Republic and Slovakia. Both the Czech Republic and Slovakia will receive technical assistance and substantial amounts of unallocated money towards flood relief, under more favourable and flexible conditions.

And the Commission has proposed a longer-term plan for a disaster relief fund to furnish up to 1 billion a year from 2003, which could be mobilised in the event of natural, technological or environmental disasters. The Commission is proposing to Parliament and the Council that the special aid fund will have its own budget line and will be available for both the Member States and the applicant countries with which accession negotiations are under way. Action from the fund should primarily focus on short-term reconstruction of destroyed infrastructure in the fields of electricity, water and waste water, telecommunications, transport and social infrastructures as well as preventive securing of damaged infrastructure such as dams and dikes.

The Commission also confirmed that a raft of measures covering different fields, including the Structural Funds, would be implemented. Funds designed to support the "Trans-European Networks", but not assigned will be reallocated, EIB: loans will be made available, and in the Czech Republic and Slovakia pre-accession funds not already assigned under ISPA, Phare and Sapard will be reallocated.

For 2002, money would come from the parts of the EU budget that are under-utilised - money that has already been paid to the budget but for one reason or another has not yet been spent. For 2003 and onwards, the necessary financial resources would only be called from the Member States in case of such catastrophe.

President Prodi said: "The European Commission has reaffirmed that it will stand by the people so cruelly devastated in the wake of the floods and by the leaders of the States affected. Today, when some of our citizens are enduring such difficult conditions, it is more important than ever that the European message of solidarity is clearly heard, not only within the European Union but also in the countries that are soon to join us. More than ever, we need to find swift, practical and effective remedies." EU foreign affairs ministers discussed the floods at their informal meeting in Elsinore on August 30-31, and the Council and Commission will make statements on the floods at the European Parliament plenary session on September 3, before Parliament itself adopts a resolution on the subject on September 5.

Other candidate countries too showed solidarity, with material aid following quickly upon political statements. And the Presidents of the European farmers' organisations, COPA and COGECA, also expressed their solidarity to the farmers and families of the European Union and candidate countries. COPA and COGECA are now trying to gain an overview of the damages caused by the disasters by aggregating information from agricultural organisations in the EU and the candidate countries.

Fischler calls for political leadership to make headway in WTO farm talks

Speaking at the QUINT meeting of farm ministers from Japan, the US, Canada, Australia and the European Union (EU), EU Farm Commissioner Franz Fischler called upon his colleagues to show political leadership to make headway in the WTO negotiations on agriculture. "Without an acceptable compromise in the agricultural negotiations, there is little hope for the Doha round," he said. "A spirit of compromise and a process that provides leadership are essential ingredients to achieving successful results. Europe stands ready to do its part. The direction should be clear: reduce trade-distorting domestic support and all forms of export subsidisation, improve market access, provide more favourable treatment to developing countries, and take into account non-trade concerns such as the environment, food safety, which are key to maintain public support to further trade liberalisation."

[Background paper IP/02/1173]

Internet: Commission seeks views on cybersquatting

Some European citizens and businesses have registered an Internet domain name in good faith only to receive a threatening letter accusing them of being "cybersquatters" Others have tried to register a domain name related to their name or business only to be told that it has already been registered by someone who refuses to transfer it except for an extortionate sum of money. In an on-line consultation just launched, the European Commission's Internal Market Directorate-General is seeking views from those who have faced these and similar problems in using the Internet. The survey is part of the Interactive Policy Making initiative (see IP/01/519). The results will feed into the Commission's consideration of public policy rules for the European Union Internet top level domain, which will carry the suffix ".eu" that will be introduced under the ".eu" Regulation adopted by the European Parliament and the Council in April 2002 (see IP/02/468). To collect a wide range of views and to make it as easy as possible for everybody to contribute, the Commission has put the questionnaire on its website at http://europa.eu.int/yourvoice. Responses can be sent to the Commission from that site. To find out more about the future .eu domain, you can visit the Commission's Europa website at:

http://europa.eu.int/information_society/topics/telecoms/internet/eu_domain/index_en.htm

[Background paper IP/02/1178]

Indicator-based forecast for euro area GDP for 2nd and 3rd quarters of 2002

The indicator-based model for quarterly GDP growth for the euro area, developed by the Directorate General for Economic and Financial Affairs of the European Commission, forecasts for the second quarter of 2002 a range of 0.3% to 0.6% for the percentage change of GDP vis-ŕ-vis the previous quarter. For the third quarter of 2002, a significant acceleration is expected and quarter on quarter growth is forecast to be in the range of 0.6% to 0.9%. The latter forecast range has been revised downwards by 0.1 point compared to the release of 9 July 2002. The ISM index (previously NAPM) really lost momentum in the second quarter of this year. The situation in the retail and construction sectors in the euro area also remained weak. Full document available on:

http://europa.eu.int/comm/economy_finance/indicators_en.htm

Commission expresses solidarity with victims of floods

In the name of the European Commission, President Romano Prodi expressed his sympathy for the populations affected by the bad weather in Europe, in particular Germany, Austria and the Czech Republic, and especially for the victims and their families. During telephone conversations with the Austrian Chancellor Wolfgang Schüssel and the President of the Czech Republic Vaclav Havel, President Prodi assured that the Commission was exploring all the possibilities of financial solidarity of the EU with the populations affected, notably through the EU Structural Funds and pre-accession funds for the candidate countries. A similar telephone conversation took place with the German Chancellor Gerhard Schröder. A range of financial possibilities have been already identified.

[Background paper IP/02/1220]

Commission officially recognises Russia as a market economy country

The European Commission has approved an amendment to its anti-dumping law in order to recognise Russia as a market economy. This follows Commission President Prodi's Declaration during last May's EU-Russia summit. This proposal is expected to be approved by the Council in the autumn. Once confirmed, the package will become EU law and the EU will be the first trading power to bestow the recognition of market economy status on Russia. The EU has also taken this opportunity to encode in its trade law a number of long-standing practices and to bring EU law in line with certain WTO developments. These changes apply to all future investigations and to all countries. For more details see also http://europa.eu.int/comm/external_relations/russia/intro/index.htm

[Background paper IP/02/1223]

The world cannot afford to let Johannesburg fail: Statement by Mr Poul Nielson, EU Commissioner for Development and Humanitarian Aid

On the eve of the opening of the World Summit on Sustainable Development and his departure for Johannesburg, Mr Poul Nielson made the following statement: "The world cannot afford Johannesburg to fail. The challenges faced by this planet and its people are just too big. The floods in Europe and Asia this summer are yet another striking reminder of the possible consequences we face if we fail to achieve sustainability. Poverty and environmental degradation are global problems that require urgent, global solutions and this Summit provides an important opportunity to secure tangible results to ensure a decent life for future generations. Johannesburg has to move from words to deeds. The European Union is determined to face its responsibilities and play a leading role in achieving a successful outcome. We are striving to get concrete, quantifiable targets and timetables towards the implementation of the Millennium Development Goals, as well as a strong political declaration. In our view, the world needs more economic and environmental governance. As the leading trade and aid partner for developing countries, the EU is aiming to build bridges and achieve a consensus with all partners. We must remember that as we enter in to the final round of negotiations on texts, the aim is to bring the world together to agree on how to shape our common future."

For more information on the European Commission and WSSD:

http://europa.eu.int/comm/environment/wssd/index_en.html

Commission launches website on applications to register EU quality products

Applications for the registration of a product as a 'Protected Designation of Origin' (PDO), a 'Protected Geographical Indication' (PGI) or a 'Traditional Speciality Guaranteed' (TSG) can now be consulted on the website of the Directorate-General for Agriculture. This new service should contribute to more transparency, simplification and effectiveness in the consultation procedure before registration of a PDO/PGI/TSG. The rules on the protection of geographical indications and designations of origin of agricultural products and foodstuffs and the rules on certificates of specific character for agricultural products and foodstuffs foresee that at least six months before finally registering a product, the European Commission has to publish the main characteristics of the application request in the Official Journal of the European Communities. The publication of the application for registration confers the right to object to this request. Consequently, a transparent registration procedure is the pre-requisite for other parties concerned to exercise their right of objection. In order to facilitate the consultation of the requests published in the various issues of the Official Journal all pending registrations can now be consulted at:

http://europa.eu.int/comm/agriculture/foodqual/protec/firstpub/index_en.htm

[Background paper IP/02/1240]

Eurostat news releases

July 2002 - Euro-zone inflation estimated at 1.9%

Euro-zone annual inflation is expected to be 1.9% in July 2002, up from 1.8% in June 2002, according to a flash estimate issued by Eurostat - the Statistical Office of the European Communities in Luxembourg.

[Background paper STAT/02/90]

Regional unemployment rates ranged from 1.2% to 33.3% in the EU in 2001

Within the EU and the Central European Candidate Countries (CECC), regional unemployment rates varied widely in 2001. Rates in the EU ranged from 1.2% in the region of Utrecht, in the Netherlands, to 33.3% in that of Réunion, in France. The disparities were of the same order of magnitude in the regions of the CECC: from 2.0% in the region of Közép-Magyarország, in Hungary, to 32.8% in that of Severozapaden, in Bulgaria. Regional unemployment rates fell between April 2000 and April 2001 in more than 80% of the 209 NUTS 2 regions of the EU, as well as in half the 53 NUTS 2 regions of the CECC between the second quarter of 2000 and the second quarter of 2001. The data on regional unemployment, compiled on the basis of the Community Labour Force Survey, are comparable between the regions of the EU and the CECC. They are taken from two reports published by Eurostat, the Statistical Office of the European Communities in Luxembourg.

[Background paper STAT/02/93]

June 2002: Euro-zone unemployment up to 8.4%

Euro-zone seasonally-adjusted unemployment rose to 8.4% in June 2002 compared to 8.3% in May. It was 8.0% in June 2001. The EU15 unemployment rate was 7.7% in June compared to 7.6% in May. It was 7.4% in June 2001. In June 2002, lowest rates were registered in Luxembourg (2.3%), the Netherlands (2.8% in May), Austria (4.1%), Denmark (4.2% in May), Ireland and Portugal (4.4% each). Spain's 11.5% remained the EU's highest rate.

[Background paper STAT/02/94]

European population trends in 2001: EU population up by 0.4% in 2001 due mainly to net migration - Population down in most of the Central and Eastern European candidate countries

On 1 January 2002 the populations of the European Union and of the euro zone were 379.6 million and 305.2 million, respectively. The EU population increased by 1 560 000 in 2001, an annual rate of 0.4%, exactly the same as the figure in 2000. Net migration accounted for about three-quarters of the population increase in 2001, with natural growth accounting for the other quarter. Natural growth has been below net migration since 1989. The rise in the EU population was 2% of the total increase of the world's population in 2001. The main contributors to world population growth were India (with an increase of more than 16 million, or 20% of the total world increase), China (14%) and other developing countries (nearly 60%). The United States, with 279.3 million inhabitants at the start of 2002, recorded a population increase of 0.9% in 2001, with natural growth accounting for nearly two-thirds of the increase. Japan, with 126.9 million people, recorded an increase of 0.2%, due solely to natural growth.

[Background paper STAT/02/95]

Employment rate in the EU up from 63.2% in 2000 to 63.9% in 2001 - Employment characteristics differ between EU and candidate countries

In spring 2001, 161.3 million people had a job in the EU, 2.3 million more than in spring 2000. The corresponding employment rate rose from 63.2% in 2000 to 63.9% in 2001. The employment rate of women increased from 53.9% to 54.8%. Among the candidate countries (Malta and Turkey not included), the employment rate varied in 2001 from 50.7% in Bulgaria and 53.8% in Poland to 67.9% in Cyprus and 65.0% in the Czech Republic. The corresponding rates for women varied between 47.9% in Bulgaria and 58.6% in Slovenia. This information comes from two reports published today by Eurostat, the Statistical Office of the European Communities in Luxembourg, one on the EU and EFTA countries and the second on the candidate countries. Both are based on the latest results of the spring 2001 Labour Force Survey.

[Background paper STAT/02/101]

Euro-zone inflation estimated at 2.1%

Euro-zone annual inflation is expected to be 2.1% in August 2002, up from 1.9% in July 2002, according to a flash estimate issued by Eurostat - the Statistical Office of the European Communities in Luxembourg. The euro-zone inflation is measured by the Monetary Union Index of Consumer Prices (MUICP). To compute the MUICP flash estimates, Eurostat uses early price information relating to the reference month from Member States for which data are available as well as early information about energy prices. The estimation procedure for the MUICP flash estimate issued today combines historical information with partial information on price developments in the most recent months to give a total index for the euro-zone. No detailed breakdown is available. Simulations have shown the procedure to be reliable (14 times correctly anticipating the full estimate, 8 times differing by 0.1 and 2 times differing by 0.2 - last time in April 2002 - over the last two years). Nevertheless a major structural change such as the introduction of the euro is likely to affect the performance of the estimation procedure. Thus the August 2002 flash estimate carries a greater uncertainty than past performance would indicate. Further information can be found in Eurostat news release N° 113/2001, 5 November 2001.

[Background paper STAT/02/102]

Enlargement news

Second Sapard annual report highlights importance of scheme in CEECs

Accreditation of Sapard Agencies in five of the ten candidate countries during 2001 signified an important step towards enlargement, according to the second Sapard annual report prepared by DG Agriculture and published by the European Commission. While the first report, published in July 2001, gave an overview of the Sapard instrument and its rules, this second report is able to comment on the programme at work following the conferral of management of the instrument to some of the candidate countries. Other achievements in the last year include the setting up of monitoring committees in all ten countries, the approval of the Annual Financing Agreements 2001, and seminars organised by the Commission to deal with the main issues of Sapard implementation. "Such administrative capacity building work is imperative in the enlargement context," says the report, and represents a "major task" for the candidate countries. "The Commission has been considerably encouraged by comments from various candidate countries recognising the contribution Sapard makes in the context of enlargement preparations." The report also includes contributions from several candidate countries commenting on their early experiences and expectations for subsequent developments. By the time of the report's adoption, a further three countries had also secured conferral of management decisions for their national agencies responsible for Sapard. For the full report, please see:

http://europa.eu.int/comm/agriculture/publi/reports/sapard2001/full_en.pdf

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