The Week in Europe 04/03-10/03/02

13.03.2002 | Euroskop

EU news in brief

February 2002: the economic sentiment indicator continues on a positive path

The economic sentiment indicator went up again in February, although at a slower pace than in the previous month. The increase recorded was of 0.1 percentage points in both the EU and the euro area. As a result, the indicator is approaching the levels observed before September 2001. The change in the economic sentiment indicator between January and February was positive in Denmark (0.2), Spain (0.2), Ireland (0.1), Portugal (0.1) and, especially, in Italy (0.6), the Netherlands (0.5), Austria (0.5) and Sweden (0.5). The indicator remained stable in Finland, but fell in Germany (-0.3), Greece (-0.3), France (-0.2) and, to a much lesser extent, in Belgium and the UK (-0.1).

Full document on:

http://europa.eu.int/comm/economy_finance/indicators/businessandconsumersurveys_en.htm

February 2002: Business Climate Indicator

The Business Climate Indicator (BCI) for the euro area increased by almost 0.2 points in February compared with January, reaching the value of -0.86. Such favourable developments were mainly driven by increasing order books, especially export orders. Full document on :

http://europa.eu.int/comm/economy_finance/indicators/businessclimate_en.htm

EU honours commitment to early EU ratification of the Kyoto Protocol

The Council of EU environment ministers adopted the Commission's proposal for a decision to ratify the Kyoto Protocol. The European Commission strongly welcomes this decision. By taking this decision, the EU has reaffirmed its commitment to pursuing multilateral solutions to issues of global concern. With its decision to ratify the protocol at EU level, the European Union stays true to its ambition to enable the Kyoto Protocol to come into force by the World Summit on Sustainable Development in August/September 2002. The decision also makes the Member States' greenhouse gas reduction commitments (the so-called "Burden-Sharing Agreement") agreed in June 1998 legally binding. The EU continues to call for the United States to participate in the global framework for addressing climate change.

(See MEMO/02/46 for background information on the Kyoto Protocol and climate change)

[Background paper IP/02/355]

Financial services: Commission welcomes Council's Common Position on the Directive on collaterals

The European Commission has welcomed the Common Position on the Commission's proposal for a Directive on collaterals agreed unanimously, without discussion, by the 5th March Council of Finance Ministers. The Directive will create a clear and uniform EU legal framework to limit credit risk in financial transactions through the provision of securities and cash as collateral. The Commission's proposal was presented on 27 March 2001 (see IP/01/464 and MEMO/01/108). The Directive is a priority measure under the Financial Services Action Plan (see IP/00/1269), endorsed by the Lisbon and Stockholm European Councils as a key element in making Europe's economy the most competitive in the world by 2010. Collateral is already a huge market in the EU, with the total value of outstanding contracts on the market for repurchase agreements ('repos') alone estimated to be worth around 2 trillion euros.

[Background paper IP/02/361]

Commission launches secure pan-European platform for eGovernment services

The European Commission announced that it has set up a secure communications infrastructure for information exchange among European public administrations. In line with the eEurope initiative this facility, which is financed and managed under the Interchange of Data between Administrations (IDA) programme, will provide a platform for new pan-European eGovernment services to citizens and enterprises by improving co-operation between European public services at all levels of government. IDA is a Commission-driven strategic initiative using advances in information and communications technology to support rapid electronic exchange of information between Member State administrations. The objective is to improve EU decision-making, facilitate the operation of the Internal Market and accelerate policy implementation. Additional information can be found on http://europa.eu.int/ISPO/ida/.

[Background paper IP/02/358]

"Publishing in the Digital Age": Commission meets European publishing industry

High-level representatives of the European publishing industry met Enterprise and Information Society Commissioner Erkki Liikanen, European Commission officials and Members of the European Parliament at a one-day event in Brussels on 5 March 2002 to exchange views on policy issues affecting the publishing industry. These include the role of self-regulation and co-regulation, content and editorial liability, advertising in the digital economy, data protection and privacy, and applicable law in the sector. The European publishing and content industries are key growth catalysts for the Information Society in Europe and should help deliver on the March 2000 Lisbon European Council aim of making Europe the most competitive knowledge-based economy in the world by the next decade.

For further information:

http://europa.eu.int/comm/enterprise/ict/publ-forum/index.htm

[Background paper IP/02/362]

Changeover to the euro: a success story

In a communication to the coming Barcelona European Council on 15 and 16 March, the Commission reviews in detail the operations for the changeover to the euro, the state of preparation in firms and the public's reactions. Detailed information for each country traces progress from frontloading to the recovery of the national currencies. Throughout the euro area the changeover to the single currency has been a success. According to the latest surveys conducted in mid-February 2002, fears that small businesses were not properly prepared have proved to be unfounded. At 1 January 2002 95% of small firms were keeping their accounts in euros, 96% were setting prices in euros and 97% were invoicing in euros. The differences between participating countries were not marked. As far as the general public is concerned, the surveys confirm the widespread positive feeling: over 80% of people in the euro area think that the changeover went smoothly and nearly 70% are happy that the euro is now their new currency. The surveys also show that there has been enthusiasm for the euro in the pre-in countries: 57% of people in Sweden say that they would be very happy or fairly happy if their country were to adopt the euro. The figure for Denmark is 49% and for the United Kingdom 34%. Results of the Flash Eurobarometer 122 "SMEs and the euro" see at: http://europa.eu.int/comm/public_opinion

Results of the Flash Eurobarometer 121 "Euro zone" and 121 "pre-in countries" at: http://europa.eu.int/comm/press_room/presspacks/euro/pp_euro_en.html

[Background paper IP/02/368]

EU tables proposals to complete jigsaw on access to essential medicines for developing countries with no drug production of their own

The EU tabled proposals in Geneva on ensuring access to medicines, in developing countries with no domestic drug production. At a meeting of the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) Council, the EU put forward options to address a key issue that remained unresolved with the landmark Declaration on TRIPS and Public Health at the World Trade Organisation (WTO) Ministerial last November in Doha. Now negotiators under the auspices of the WTO need to work out how to make sure that countries, which cannot themselves produce essential drugs, may still fully benefit from the TRIPS Agreement.

Declaration on the TRIPS agreement and Public Health, Doha, November 2001:

http://www.wto.org/english/thewto_e/minist_e/min01_e/mindecl_trips_e.htm

WTO Ministerial Declaration on the TRIPs agreement and Public Health, the issues at stake: Explanatory note, Brussels, December 2001

http://europa.eu.int/comm/trade/csc/wtotrips.htm

World Aids Day: Lamy calls for more action on access to medicines after progress in Doha

http://europa.eu.int/comm/trade/speeches_articles/spla87_en.htm

[Background paper IP/02/363]

International Women's Day: Diamantopoulou speaks out against double burden of gender and racism on Muslim women

At a conference on "Muslim Women in Europe: Voices to Be Heard in the Intercultural Dialogue", Equal Opportunities Commissioner Anna Diamantopoulou urged for the end to the stereotyping and ignorance that surrounds Islamic women. Diamantopoulou also used the event, organised by Administrative Reform Vice-President Neil Kinnock, to stress that Muslim women living in Europe must be allowed to exert free choice and independence in their personal and family lives. "Fear and suspicion must give way to dialogue and trust; discrimination and hostility to equality and respect, " she said. She went on to highlight the place of religion in upholding the founding values of the European Union: human rights, fundamental freedoms and the rule of law.

[Background paper IP/02/377]

EUROBAROMETER 56 - Initial Findings

The latest Eurobarometer survey shows a marked growth in confidence in the European Union and support for its initiatives, against a background of increased anxiety. Highlights and Annex can be downloaded from http://europa.eu.int/comm/dg10/epo/polls.html

Eurostat news releases

January 2002 - Euro-zone unemployment stable at 8.4% ; EU15 steady at 7.7%

Euro-zone seasonally-adjusted unemployment stood at 8.4% in January 2002, the same as December 2001, Eurostat reports. It was also 8.4% in January 2001. The EU15 unemployment rate was 7.7% in January, the same as December 2001. It was also 7.7% in January 2001. In January 2002, lowest rates were registered in the Netherlands (2.4% in December), Luxembourg (2.6%), Austria (3.9%), Denmark (4.2% in December), Ireland (4.2%), and Portugal (4.3%). Spain's 12.8% remained the EU's highest rate.

[Background paper STAT/02/27]

A statistical panorama on distributive trades in Europe - significant structural differences between Member States

According to a comprehensive study on the European distribution sector, published by Eurostat, with around 5 million enterprises in the EU and more than 22 million people employed in 1999, the distributive trades sector plays an important role in the economy. In the EU, the distributive trades accounted for about 13% of total value added in 1997 and employed nearly 16% of total employment. In 1999, retail trade accounted for almost 60% of all businesses in the distributive trades, half of all jobs, and around 30% of total turnover. Wholesale trade represented 27% of all businesses, one third of total employment but was the most important activity with regard to turnover (around 55% of the total). The third sub-sector, motor trade, occupied a smaller share: 13% for the number of businesses, 15% for employment and 16% for turnover.

[Background paper STAT/02/28]

Enlargement news

Candidates take part in the EUs Future of Europe Convention

The European Union's strategic debate on its future took another step forward on February 28, with the inauguration of the Convention that is to examine options for how an enlarged EU should function - and EU candidate countries were fully represented at the event. The purpose of the Convention is to consider the future development of the European Union. Key questions include citizens' expectations of the EU, the roles of the EU and its member states, the competencies of the EU institutions, how to ensure coherence of EU external actions, and how to assure democratic legitimacy. The underlying concern is to make sure that the EU remains both workable and relevant when it has 25 or more member states.

The candidate countries are represented on the same terms as the existing member states (one representative of the government (and an alternate) and two members of the national parliament - also with alternates); they will not, however, be entitled to vote. There are also observers from the EU's Economic and Social Committee and Committee of the Regions, European social partners, and the European Ombudsman.

The governemnt of the Czech Republic is represented by Jan Kavan (delegate) and Jan Kohout (alternate), the Czech Parliament delegation consits of two delegates - Jan Zahradil and Josef Zieleniec, and two alternates - Petr Necas and Frantisek Kroupa. For more details see http://european-convention.eu.int/. The civic society organizations from the candidate countries are welcomed to take part in the discussion forum accessible from that page.

Ireland debates enlargement and future of Europe

Ireland, which looked as if it had jolted the EU's enlargement plans when it rejected the Nice Treaty in a referendum last year, has been debating the future of Europe in its own national forum for more than four months - and enlargement has been one of the focal points of the discussions. Unlike similar debates organised in other member states, the Irish forum was assigned the additional task of promoting a discussion of the merits and demerits of the Nice Treaty. According to the interim report of the forum, the discussions suggest that Ireland is not anti-enlargement, but that there are some fears about competitive threats from candidate countries. The predominant concerns are more related to questions such as the rights of smaller member states, issues of legitimacy and accountability, sovereignty (including Ireland's neutrality) and governance.

The debates in the forum confirmed the findings of various Eurobarometer surveys that the Irish are enthusiastic supporters of enlargement. However, several speakers at the forum's numerous sessions since October last year have questioned whether the candidates are truly ready to assume the obligations of membership - while others noted that similar concerns were expressed about Ireland prior to its accession in 1973. Some speakers, echoing the "no" camp in the referendum campaign, argued against any "legal imperative" to ratify Nice, claiming that institutional arrangements could be contained in the individual accession treaties, although others contended that it was essential to have a legal framework for enlargement. There were also complaints about the government's intention to re-run the referendum before the end of 2002.

The forum has so far heard presentations from three candidate countries - the Czech Republic, Malta and Slovenia. Some of the speakers from these countries expressed shock and disappointment at the rejection of the Nice Treaty, while ultimately accepting that this should not be interpreted as a "no" to enlargement. Only one of the speakers, former Maltese prime minister Bonnici, expressed opposition to his country's accession. Some of the candidate speakers cited Ireland as a "role model" EU success story for them. According to the report, the forum's overall message to the candidates was one of partnership and support, in recognition of the fact that "most candidates are of similar size to Ireland, emerged in the 20th century from somewhat difficult, though different, historical experiences, and now wish to participate in a new and rapidly evolving Europe."

While some participants welcomed the opportunities which would be presented by 100 million potential new customers for Irish exports, others cited downsides like lower labour costs in the candidate countries and the fear of diversion of foreign direct investment. The candidates were also perceived by some as posing a competitive threat because of their high levels of educational attainment and R&D capacity. However, it was also argued that the FDI pool would increase so it was not a zero sum game; that the candidates had enjoyed free access to the EU market for some time without a very significant shift to them of FDI; and that, at present only 3-4% of Ireland's total output is exported to the candidates, leaving room for considerable expansion as long as the country can remain competitive. It was generally accepted that continuing structural and other problems would prevent the candidates from an early realisation of their potential and that significant market opportunities would be available for Irish agri-business.

Slower growth for candidate countries

In some countries of central and Eastern Europe, gross domestic product grew even more in 2001 than in 2000; however, in the second half of 2001 growth decelerated everywhere. The latest trade and industrial output data clearly point to a worsening of the global business climate and its knock-on effects, according to a new report from the Vienna Institute for International Economic Studies (WIIW). The economic policy response has varied, says the report. The currencies of the leading candidates started appreciating even nominally, possibly more than is healthy for the corporate sector. The WIIW's forecast is for low GDP growth rates for 2002, reverting to resumed growth in 2003.

70% of Estonians ready to vote in EU referendum

Approximately 70 percent of Estonians would take part in a referendum to decide Estonia's entry into the European Union if it were held now, whereas 10 percent are firmly against voting, according to a recent study commissioned by the government. According to the study 78 percent are undecided how to vote in the referendum, but have a positive rather than negative attitude towards the EU. Some 18 percent of the respondents are neutral, less than four percent negative rather than positive, and none totally negative. Some 42 percent of those polled believe Estonians would vote for accession, whereas 21 percent think the referendum outcome would be against entry. Only 13 percent of the respondents feared their lives would change for the worse after the country's joining the EU. At the same time, only one respondent in three expected a change for the better. 57 percent of the polled said that accession would be of benefit in the final analysis, even if it caused some problems for Estonia. Pessimism about the results of accession is most widespread among the jobless, 40 percent of whom thought entry into the EU would have negative consequences for them. Expectations are highest among farmers, but officials, students and business people are also looking forward to joining the EU.