The Week in Europe 28/01-03/02/02

11.02.2002 | Euroskop

EU news in brief

Taxation and customs: Commission proposes programmes to fight fraud and cut compliance costs

The European Commission has presented proposals for two programmes, "Fiscalis 2007" and "Customs 2007", to help Member States work more closely together against tax and customs fraud, through improved electronic systems for information exchange between national administrations, co-operation in investigations, training seminars for customs and tax officials and experts and the exchanges of officials between national administrations. Customs 2007 also aims to reduce customs compliance costs for economic operators by encouraging the development of a paperless electronic customs system. The two programmes would be open to candidate countries as well as Member States. The programmes would replace and strengthen existing programmes that expire at the end of 2002. The cost of the programmes would be shared between the European Union budget and the participating countries and, for the EU budget, spread over the five years, would be €56 million for Fiscalis 2007 and €133 million for Customs 2007. Both programmes would run from 1 January 2003 to 31 December 2007.

The full text of the proposed Decisions to see:

http://europa.eu.int/comm/taxation_customs/whatsnew.htm

[Background paper IP/02/144]

Structural funds: Commission announces applications for 58 programmes of innovative actions

Michel Barnier, European Commissioner responsible for Regional Policy, announced the application of three regional programmes of innovative actions in 12 member states. Community contribution will be: Austria €8,7 million; Ireland: €2,6 million; Germany: €20 million; Spain: €35 million; France: €12,5 million; Finland: €5 million; Greece: €5,5 million; Italy: €20 million; Netherlands €5,5 million; Portugal: €11,5 million; Sweden: €11,8 million; United Kingdom: €11 million. These programmes have different priorities according to the knowledge and the level of technological innovation, as well as the information society. The response from the regions surpassed expectations: 103 of the 153 eligible regions (more than 2/3) presented a programme proposal.

From Lisbon to Barcelona: Towards a more competitive Europe

A debate around the conclusions of the 2001 European Competitiveness Report (see IP/01/1630) will be held in Brussels on Wednesday 30 January from 14.30h to 17.30h at the Charlemagne Building. The report raises a number of fundamental questions that this conference will address. The conference is aimed at policy makers and stakeholders at the European and national levels as well as others with an interest in European competitiveness. The final programme is available at: http://europa.eu.int/comm/enterprise/events/events.htm

[Background paper IP/02/157]

Commission offers a fair and solid approach for financing EU enlargement

The European Commission proposed a fair and solid approach for financing the enlargement of the European Union until 2006, which fully respects the expenditure ceilings imposed by the budgetary rules while offering the benefits of EU solidarity to ten possible new Member States. For the Commission, this offer is not to be seen as a starting point leaving wide room for bargaining: it represents what can realistically be achieved given the current, well-known constraints and possibilities. The "information note" will allow the Council of Ministers to hold an overall discussion on the financial issues of enlargement and will serve as the basis for the Commission's detailed negotiation positions on agriculture, structural policies and budget.

[Background paper IP/02/170]

Enlargement and agriculture: An integration strategy for the EU's new member states

The European Commission set out its strategy for dealing with the EU's enlargement negotiations on agriculture: direct payments to farmers and the level of production quotas for the new member countries once they join the EU in 2004. To ease the problems of transition in rural areas, and to encourage the necessary restructuring of the new member states' agricultural sectors, the Commission proposes to beef up financial support through an enhanced rural development policy. Given that immediate introduction of 100% direct payments would serve to freeze existing structures and to hamper modernisation, the Commission favours a gradual introduction of direct payments over a transition period of ten years: for 2004, 2005, 2006 direct payments equivalent to 25, 30, and 35%, respectively, reaching 100% in 2013. According to the proposal, this aid could also be topped up with national funds. The new member states would however have full and immediate access to Common Agricultural Policy (CAP) market measures, such as cereal intervention.

[Background paper IP/02/176]

Commission adopts First Progress Report on economic and social cohesion

European Regional Policy Commissioner Michel Barnier has presented the First Progress Report on economic and social cohesion to the Commission. Drafted in fulfilment of the Commission's commitment to keep the Council informed regularly on progress in cohesion in Europe, the Report updates the data in the Second Cohesion Report adopted last year (January 2001) and sums up the debate on future cohesion policy after enlargement. For the first time the Commission is setting out an analysis of disparities in an EU of 25, encompassing the 10 candidate countries considered by the Laeken European Council as ready to join the Union in 2004 if negotiations continue to advance at the current pace.

[Background paper IP/02/175]

The euro, one month later

In one month from €-day the euro has firmly taken its place as daily currency in the life of more than 300 million Europeans. Indeed it took only a few days for people to replace much of their national currencies with the new euro banknotes and coins. Currently more than 95% of cash transactions are in euro, in all of the euro area countries. In the Netherlands, euro banknotes and coins are now the only ones to hold legal tender status. It is also the case in Germany, though the retail sector is committed to accepting DEM at least until 28 February.

[Background paper IP/02/183]

Busquin on embryonic cells research

European Commissioner for Research Philippe Busquin has welcomed the outcome of Wednesday's vote in the German Bundestag to allow the import - under strict conditions - of existing embryonic stem cells for research purposes. "German researchers will now be able to fully participate in EU-funded research projects that investigate the use of embryonic stem cells for curing diseases such as Parkinson's, Alzheimer's or heart insufficiencies. The decision of the German Bundestag will strengthen the possibilities for researchers to work together on leading-edge science in a European Research Area." In the Commission's proposal for the 6th Framework Research Programme (2002-2006), any intervention on the germ line is excluded from funding as well as the creation of embryos for research purposes or for the procurement of embryonic stem cells. EU funded research projects that raise sensitive ethical questions are always subject to a specific ethical review at the European level and have to respect the ethical rules in place in the country where the research is conducted.

Eurostat news releases

Regional GDP per capita in the EU and the candidate countries in 1999 - Inner London, Brussels, the Grand Duchy of Luxembourg and Hamburg ranked first among EU regions - Praha, Bratislava and Cyprus ranked first among candidate countries regions. According to Eurostat, in 1999 GDP per capita, expressed in terms of purchasing power standard, in the EU's 211 NUTS-2 regions ranged from 51% of the EU average in the French regions of Réunion and Guyane, as well as Ipeiros in Greece, to 242% of the average in the Inner London region of the United Kingdom. Just over 10% of the regions were above 125% of the EU average, and more than 20% were below 75% of this average. Per capita GDP in the 56 level-2 regions of the candidate countries varied between 18% of the EU average in the Nord-Est region of Romania and 124% in the Praha region of the Czech Republic. The figures thus showed a difference between the two last mentioned regions, expressed as a ratio of 1:7.

[Background paper STAT/02/13]

Flash estimate - January 2002 - Euro-zone inflation estimated at 2.5%

Euro-zone annual inflation is expected to be 2.5 % in January 2002, up from 2.1% in December 2001, according to a flash estimate issued by Eurostat.

[Background paper STAT/02/17]

Enlargement news

Support to SMEs in EU border regions - Commission Co-financing of EUR 10 million

On 31 January 2002, the European Commission will participate in the presentation in Landshut, Germany, of a pilot project to support small and medium-sized businesses in EU border regions wishing to meet the challenges and exploit the opportunities of enlargement. The project has been developed by the Working Community of Chambers of Economy in the EU Regions Bordering the Central and East European Candidate Countries. The European Commission has made available co-financing of €10 million.

Monti spells out state aid challenges

European Competition Commissioner Mario Monti spelled out his thinking on the place of fiscal state aid in the enlargement process when he spoke at a seminar in the Netherlands on 22 January. "For the accession negotiations, fiscal aid is certainly a very important issue that remains to be fully resolved in several candidate countries", he said. "Some of these countries continue to operate fiscal aid regimes that are incompatible with the Treaty" - instancing "certain tax breaks, tax holidays and tax credits that are used to attract foreign investments or to keep non-viable businesses alive".

Sapard report under critical review

The European Parliament's committee on agriculture and rural development is currently reviewing the EU's Sapard programme of aid for agriculture in the candidate countries. The focus of the Parliament's work is the Commission's own Sapard annual report for 2000. A draft prepared by Euro-MP Willi Görlach starts from the premise that the agricultural sector in the candidate countries plays a crucial role for the economy and employment, and that the success of enlargement is dependent to a considerable extent on the successful integration of the candidate countries' agricultural sector into the EU's agricultural market.

The programme is not going very fast, remarks Görlach: the first paying agency of an applicant country was not operational until December 2000, and by the end of 2001, "only insignificant sums (approximately € 30 million)" had been channelled via Sapard. To his regret, he says, the management of Sapard funds was transferred to only five candidates: Bulgaria, Estonia, Slovenia, Latvia and Lithuania. And the difficulties which were already apparent in 2000 with regard to the content of the programme and subsequently to the setting-up of paying agencies have still not been completely overcome. This "is having an adverse impact on the structural changes which must be made prior to accession", he says.

The delay, he points out, is due to the need to create the requisite administrative conditions for appropriate financial management of Sapard's decentralised administration in the candidate countries. But he says he is deeply concerned that preparations for accession are being "considerably hindered in the agricultural sector by the delay in implementing the programme". "The fact that there was no take-up of funds at all in the financial year 2000 and only insignificant amounts in 2001 (is) a sign that Sapard has been poorly organised".

Council to debate progress on enlargement

At the General Affairs Council on 28 January, the EU Presidency held a debate on its work programme for enlargement. The Presidency says it intends to make a decisive contribution to ensuring that negotiations with all those candidate countries which are prepared can be concluded by the end of the second half of 2002. The Presidency's programme emphasises in particular that the principle of differentiation will continue to be applied in the negotiations and all candidate countries will be judged according to their own merits.

The Presidency says it will do its utmost to meet the targets of the "road map" and reach a common position of the Union on all the chapters assigned by the "road map" for the first half of 2002 - including agriculture, regional policy, financial and budgetary provisions, and the chapter on institutions. It stresses that negotiations will be conducted on the basis of the principles laid down at the Laeken European Council: the existing acquis and the financial framework established at Berlin. A first general assessment of the effective implementation of the acquis by the candidate countries will be carried out by the European Council at Seville on the basis of an Action Plan to be drawn up by the Commission.

The Presidency also intends to address all the pending chapters with Bulgaria during this first six months, and will try to do the same for of Romania "as long as and when the necessary information and data are made available". Support will also be given to the efforts being made as part of the on-going United Nations-sponsored drive to work out a political settlement for the Cyprus issue. Encouragement will also be given to Turkey's pre-accession strategy.

Two Accession Conferences at Deputy level are planned, on 21 and 22 March and on 19 and 22 of April. But should the need arise, other Conferences at Deputy level could also be held, it says. The Accession Conference at Ministerial level will take place on 10 and 11 June. The Presidency also plans to invite the Heads of State, Prime Ministers, Ministers of Foreign Affairs as well as Ministers of Economy of candidate countries to take part in the first day meeting of the Barcelona European Council on Friday 15 March. The drafting committee for the Act of Accession should also be established during the Spanish Presidency and will probably start work in March.

Commission optimistic after Austrian petition

The Commission does not consider that the results of a recent public petition in Austria on the Temelin issue, addressed to the Austrian Parliament as a direct democratic instrument of domestic policy definition, has any direct repercussions on the accession negotiations with the Czech Republic, confirmed Enlargement Commissioner Günter Verheugen in a 22 January statement. "I take note of the result of this petition. It confirms that there is a strong opposition in Austria to nuclear energy", said the Commissioner. But he pointed out that the petition "also confirms that an overwhelming majority of the Austrian population does not want to endanger good neighbourly relations with the Czech Republic". He said the Commission assumes that in the course of Parliamentary discussions, the results of the Melk process - the agreement reached late last year between Austria and the Czech Republic on the contentious issues relating to Temelin - "will be acknowledged and that the commitments made will be respected". Meanwhile, he insisted, negotiations "will proceed according to plan".

15% of the Austrian electorate signed the petition calling for the closure of Temelin to be a condition for Czech EU accession. The issue now has to be debated and voted upon in the national Parliament within the next five months. To achieve legally binding effect, the Parliament would need to pass a so-called constitutional law, the necessary majority for which (67%) is considered most unlikely.

Europe of the regions - the Czech Republic

The first meeting of the EU-Czech Republic Joint Consultative Committee between the Committee of the regions (CoR) and the Czech Liaison Committee for co-operation with the CoR took place in Prague on 24 January. Like the EU-Poland committee already set up last year by the Committee of the Regions, this Joint Consultative Committee is designed to create a forum for dialogue and co-operation between local and regional authorities, to help European integration. It is planning to draft two recommendations during 2002: one will cover informing citizens about enlargement, and the other will look at strengthening regional and local administrative capacity in the Czech Republic.