$Unique_ID{COW04098} $Pretitle{373} $Title{Federal Republic of Germany (West Germany) The Federal Republic of Germany and the European Community} $Subtitle{} $Author{German Embassy, Washington DC} $Affiliation{German Embassy, Washington DC} $Subject{european community ec union economic co-operation council members common act} $Date{1988} $Log{} Country: Federal Republic of Germany (West Germany) Book: Pamphlets on Germany Author: German Embassy, Washington DC Affiliation: German Embassy, Washington DC Date: 1988 The Federal Republic of Germany and the European Community The European mission After experiencing the devastation and suffering of World War II, the nations of Europe sought to unite in order to prevent the recurrence of such disasters. This desire for change was coupled with the conviction that the West Europeans could master the challenges of the future only in unison. Hence the Western democracies formed the Council of Europe (1949) and Western European Union (1955). Other organizations that were founded were the European Coal and Steel Community (ECSC), the European Economic Community (EEC), and the European Atomic Energy Community (EURATOM), these three today having the common designation European Community (EC). With the accession of Great Britain, Denmark and Ireland (1973) and the southern enlargement (through the accession of Greece in 1981, Spain and Portugal in 1986), the Community became an economic area with 320 million inhabitants and the largest trading partner in the world. The establishment of European Political Co-operation (EPC) in 1970 also gave the Community more scope for action in the field of foreign policy. The introduction of direct elections for the European Parliament in 1979 was another important step on the path of political integration, that is, towards European Union. The Single European Act, which came into force on 1 July 1987, reaffirmed that goal and pledged the members to a time-table for economic; political and institutional progress. Nearly two thirds of the Community's total population hope that in the year 2000 they will be living in the "United States of Europe". Over half of them expect that by that time there will be a common European constitution and a common head of government. European Union is a dictate of national, European and global responsibility. Its purpose is to help build in Europe and worldwide the foundations of security and peace in freedom, stability and progress to defend democracy, the rule of law, fundamental freedoms and human rights in Western Europe, and hence to maintain our prosperity. The EC safeguards one in six jobs in the Federal Republic of Germany, where one in three depends on exports, by purchasing half of all its exports. Strengthening and expanding the Community with the ultimate goal of European Union is one of the Federal Republic's foremost objectives. In the autumn of 1986, three fifths of the population spoke favourably of the European Community. The Federal Government has constantly emphasized that there is no alternative. Speaking on the occasion of the 30th anniversary of the signing of the Treaty of Rome (see "Milestones on the road to union") on 27 March 1987, Chancellor Helmut Kohl said: "The path taken by the members of the EC after the war has been exemplary. The Federal Government will not relax its efforts to attain step by step the goal of European Union as laid down in the Single European Act." Much has been achieved in the past 30 years, but customs union, economic and monetary union, agricultural union and social union will remain incomplete without the protective roof of political union. The members of the EC therefore adhere to the goal of a European Union. Milestones on the road to union May 1950 Robert Schuman, the French Foreign Minister, proposes the establishment of a European Coal and Steel Community (ECSC). The signing of the treaty on 18 April 1951 marks the birth of the "Europe of the Six" (Belgium, Federal Republic of Germany, France, Italy, Luxembourg, Netherlands). September 1952 The Assembly of the ECSC meets in Strasbourg. March 1957 The European Economic Community (EEC) and the European Atomic Energy Community (Euratom) are founded in Rome. The treaties enter into force on 1 January 1958. March 1958 Twelve months after the enlargement of the Community to include the EEC and Euratom the joint assembly renames itself the "European Parliament". July 1968 Customs duties within the Community of the Six are abolished, thus creating a customs union. October 1970 The Luxembourg Report prepared by Foreign Ministers at the instance of the Hague summit lays the foundations for European Political Co-operation (EPC). October 1972 At the Paris summit the heads of state or government create the conditions for further expansion of the Community (joint environmental policy, common social and regional policies, economic and monetary union, scientific and technological co-operation). January 1973 The accession of Denmark, Britain and Ireland increases the number of EC members to nine. December 1974 At the Paris summit the heads of state or government decide to meet three times a year in future, together with their Foreign Ministers and the President of the Commission, as the European Council. A Regional Fund is set up to rectify structural and regional disparities within the Community. February 1975 The Lome Convention concluded between the EC and 46 African, Caribbean and Pacific (ACP) developing countries sets new standards for relations between industrial nations and the Third World. July 1975 The member countries sign a treaty widening the budgetary powers of the European Parliament and establishing a European Court of Auditors. November 1976 The Council of Ministers decides to extend on 1 January 1977 the fisheries zones in the North Sea and the North Atlantic to 200 miles and create an EC fisheries zone. The European University Institute is opened in Florence. March 1979 The European Monetary System (EMS) comes into effect. June 1979 First direct elections to the European Parliament are held in the nine member countries. January 1981 The accession of Greece increases the number of EC members to ten. March 1982 An Act is signed establishing the European Foundation. January 1983 The Council of Ministers agrees on the basic elements of a common fisheries policy. June 1983 At the European Council meeting in Stuttgart, the heads of state or government sign the solemn Declaration on European Union reaffirming the aim of co-ordinating members' positions on the political and economic aspects of security. February 1984 The European Parliament (EP) adopts a draft treaty on European Union setting out its own ideas on the function and rights of the EP in a Community that has become a Union. June 1984 Second direct election for the EP. The European Council meeting in Fontainebleau takes decisions aimed at creating a "people's Europe". June 1985 The European Council, meeting in Milan, adopts the Single European Act to achieve progress towards European Union through modification of the EEC Treaty. October 1985 First informal meeting of EC and ASEAN economic ministers in Bangkok. They agree that relations should be further developed. EC ministers meet with representatives of the Gulf Co-operation Council (GCC) to discuss the possibilities of a co-operation agreement. November 1985 At the second meeting with the foreign ministers of Central America and the Contadora Group, the EC signs a co-operation agreement with Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. January 1986 Spain and Portugal accede to the EC. February 1986 Signing of the Single European Act. May 1986 The third Lome Convention enters into force (66 ACP countries). December 1986 Ratification of the Single European Act by the EC member countries (except Ireland). July 1987 Following its ratification by Ireland, the Single European Act enters into force, that is to say, the European Council and EPC become constituent parts of the EC. It contains binding goals for EC reform. From customs union to economic and monetary union After the inception of the European Economic Community in 1958 it took ten years to abolish the last customs duties within the Community, thus establishing a customs union. An economic area was established which is to lead, by 1992, to a common internal market in which people, goods, services and capital can move freely. In December 1969, the EC heads of state or government decided at the Hague summit to develop the Community in stages into a comprehensive economic and monetary union. For this purpose a European Monetary System with fixed exchange rates was created. Furthermore, new instruments and procedures were worked out to ensure greater harmonization of national economic policies and reduce structural and regional disparities. External influences such as the dollar crisis, the oil price explosion and the rise in commodity prices were a hindrance to unification and for a while the Community was more concerned about preserving the degree of integration already achieved, with the emphasis being placed on combating inflation, recession, trade deficits and unemployment. The Community made fresh efforts to meet this challenge. It drew up an energy policy, pursued a coherent policy aimed at economic stability, set up a Regional Fund designed both to promote employment and to eliminate structural imbalances, and provided support and loans to offset deficits caused by oil prices. The experience of those years bears out two points of view that have long been held by the Government of the Federal Republic of Germany. Firstly, a successful economic policy depends on the active participation and co-responsibility of all concerned; the Community therefore collaborates closely with employers' and employees' representatives at European level. Secondly, further economic and monetary integration can be achieved only through parallel progress in both fields. To attain greater stability among EC currencies and strengthen its international monetary relations, the Community established a European Monetary System (EMS), which came into force on 13 March 1979. Exchange rate fluctuations among member currencies are only permissible within certain bands. If they exceed these limits central banks intervene to support one another's currencies. This has created a zone of largely stable currencies and thus facilitated Europe's economic integration. The EC's common internal market is to be completed by 1992, thus eliminating trade and tax barriers throughout the Community. Only in unison can Europe achieve the goal of an outward-looking Community of economic stability and social progress, which is in turn the prerequisite for European political union. The common agricultural market The European Community has transformed the national agricultural markets into a single Common Market; in no other field has such a high level of integration been achieved. Without this Common Market, whose regulations cover about 95 per cent of agricultural products, there would have been no EC. Its main principles are free movement of goods within the Community, precedence of intra-Community trade over imports from third countries, and joint financing of the common agricultural policy (CAP). For the most important agricultural products there are market regulations and common price ranges, the latter being determined annually by the Council of Agriculture Ministers to guarantee farmers an adequate income, maintain a balance of supply and demand, and ensure the availability of inexpensive food. This calls for careful consideration, and of course compromises, on the part of the ministers. For some problems, e.g. the excess production of certain items, a satisfactory solution has not yet been found. The Community is still faced with the major task of eliminating farming subsidies. If the surplus food were exported at subsidized prices this would distort global competition, especially in the Third World. Common regional and social policies Prosperity in Europe is still unevenly distributed. Owing to historical and geographical factors there are not only thriving economic areas but also disadvantaged regions, usually on the fringes of the Community, e.g. in Greece, Portugal, Ireland, southern Italy, Scotland and Ireland. EC regional policy is designed to reduce these disparities gradually. The Regional Fund, which came into operation in 1975, is not adequate for this purpose. As a demonstration of solidarity with its poorer members, the Community must provide them with reasonable financial scope to conduct their own regional policies. The United Europe must also help the individual, the worker. It should become a "social community". Hence social policy is a key element of integration. A Programme for Social Action was drawn up in 1974 in response to a German initiative and is being implemented step by step. It covers the harmonization of labour law, equal trading opportunities for all, the approximation of social legislation, the equal treatment of men and women, and health protection at work. Equal rights for workers from other countries and wider involvement of employees in company affairs are other aims set out in the programme. At its meeting on 26 May 1975 the Council of Ministers established a European Foundation for the Improvement of Living and Working Conditions with its seat in Dublin. A Social Fund is available for combating unemployment, and in 1975 an EC Institute was created to promote vocational training. It is located in Berlin. On 19 December 1984, the Council of the European Community adopted the second programme of measures to combat poverty within the Community. It runs from 1985 to 1988. Assistance will be provided for those who have been unemployed for long periods, unemployed young people, older people, single parent families, refugees and returning migrant workers, as well as fringe groups. The common environmental policy The European Community will also have to develop into an environmental community. The Single European Act, which entered into force in July 1987, is a step in this direction. It is the first supplement to the 1957 Treaty of Rome establishing the EEC - which made no provision for the "environment" or "environmental protection" - and now makes this one of the Community's tasks. The European Community proclaimed 1987 European Year of Environmental Protection to mark the 30th anniversary of the EEC Treaty. The European Community and the world economy As a result of their economic integration, trade among the Community's members and between them and other nations has increased considerably. Today the EC accounts for the largest proportion of world trade, even surpassing the United States. At the same time, its political weight in the world has grown from year to year. The European Community participates in the annual economic summits of Western industrial nations. Furthermore, it adopted a common trade policy in 1973 and thus speaks with one voice on these matters. In this context, the Government of the Federal Republic of Germany has always advocated that the EC take a liberal, outward-looking approach, especially in negotiations under the General Agreement on Tariffs and Trade (GATT) and at the Uruguay Round, and that it resist all protectionist tendencies. The centrepiece of the EC's development policy is the Lome Convention. The current version, Lome III, promotes the exports, industrial development and economic co-operation of 66 African, Caribbean and Pacific countries (the ACP States) and states the principles of co-operation. The Community's main trading partner is the United States. Relations have not always been unproblematical, however, especially in such sensitive areas as steel and agriculture. But it has been possible by means of various agreements (on citrus fruits and pasta, for instance) to avoid the trade war that has occasionally been predicted. The Community has a growing deficit in trade with Japan which it feels will have to be balanced by means of increased access to the Japanese market. The EC has agreements with the EFTA countries - Sweden, Switzerland, Austria and Norway - which permit almost completely free trade in industrial products in Europe. The enlargement of the EC (to include former EFTA members the United Kingdom, Denmark and Portugal), the growing significance of European Political Co-operation (EPC), and especially the completion of the common internal market by 1992 as envisaged in the Single European Act, have prompted the EFTA countries to seek closer relations with the EC. EC and Comecon are discussing the possibility of establishing official relations. In addition, the EC Commission is negotiating with Comecon members Hungary and Romania on trade and co-operation agreements, and with Czechoslovakia on a trade agreement for industrial products. The EC's relations with Asia are dominated by co-operation with the ASEAN countries, with whom the Community signed a co-operation agreement in 1980. Trade agreements between Pakistan and China were replaced in 1985 by co-operation agreements. At a meeting between EC ministers and representatives of the Gulf Co-operation Council (GCC) in October 1985, the possibilities of a co-operation agreement were discussed. The members of the Arab League and of the European Community have been engaged in a dialogue since 1974 seeking closer, long-term co-operation between the two neighbouring regions. The Community's global economic relations and aims are complemented by the dialogue on foreign policy within the framework of European Political Co-operation (EPC). European Political Co-operation The purpose of European Political Co-operation (EPC) is to establish a Community foreign policy. Since the first initiative for such co-operation was made at the Hague summit conference of December 1969, EPC has become an important instrument of European unification. By adopting common positions and taking joint action, the Twelve stress the Community's political reality, which has long since been recognized by the family of nations. It is expected to state its opinion on major world issues and its voice is heard. EPC is an outstanding example of close co-operation. A system of comprehensive mutual consultations, co-ordination and concerted diplomacy links the Twelve at all levels: foreign ministers (at least 6 EPC meetings a year, discussions during monthly meetings of the EC Council), political directors and correspondents for European affairs (at least monthly meetings of the Political Committee), working groups in the foreign ministries (regular meetings of the 20 or so EPC working groups), as well as the embassies and missions in third countries and at international organizations and conferences. The heads of state or government meet as the European Council at least every six months. The EC Commission and its delegations around the world play a full part in the EPC process. The members of the Community hold the presidency for six months at a time in rotation. In this capacity they act as the co-ordinator and spokesman for EPC. Since the beginning of 1987, the presidency has had the support of a permanent secretariat located in Brussels. The foreign ministries, the Commission and the EPC secretariat are linked up by a telex network (COREU). The entry into force of the Single European Act on 1 July 1987 gave EPC a basis in international law and made it binding on all members. The European Parliament The European Parliament (EP) embraces the three European Communities EEC, ECSC and EURATOM. 434 members were elected directly in June 1984 by all voters in the then ten member States. Following the accession of Portugal and Spain, 60 Spanish and 24 Portuguese members were added, and in the summer of 1987, they too were elected directly. The EP now has 518 members. In the EC's early years the European Parliament had only 198 members who were delegated by the national parliaments. The EP's members belong to 8 multinational groups. There are now 9 working languages. Plenary sessions are held in Strasbourg. Outside the weeks when plenary sessions are held, committee meetings are usually held in Brussels. The Parliament's administration is in Luxembourg. No decision has yet been taken as to the Parliament's final seat or that of the Community's other institutions. The fact that the European Parliament is elected directly has considerably increased parliament's political authority within the Community and given the members a democratic mandate. This has also affected Parliament's advisory and controlling functions as provided for in the treaties. It now has to be consulted in all fields of Community policy. Parliament exercises its controlling function through oral and written questions to the Council and the Commission. It is also entitled to submit questions on matters relating to EPC and can force the Commission to resign by means of a vote of no confidence. Since 1975 Parliament has had a large say in EC budget matters. In fact, in the case of expenditure not prescribed by law it has to some extent the last word. It can also reject the entire budget. Since the entry into force of the Single European Act the EP has also been involved in the actual law-making process. The previous arrangement for consultations between the EP and the other Community institutions has been transformed into a co-operative procedure in matters relating to the establishment of the internal market through the introduction of two readings of the bills in question. Amendments to Council or Commission proposals usually require an absolute majority in Parliament. Conversely, the Council may only diverge from decisions taken by Parliament unanimously. Also since July 1987, the EP has been entitled to participate in decisions on further accessions to the EC and on agreements with third countries. With the draft treaty for the establishment of a European Union which it adopted on 14 February 1984, the European Parliament presented its own ideas about its role and rights in the prospective Union and thus showed itself to be a forerunner on the way to this goal. The Single European Act and European Union In 1981 the Government of the Federal Republic of Germany, together with Italy, took the initiative for further progress towards European Union (Genscher-Colombo Plan). This led to the signing on 19 June 1983 of the Solemn Declaration on European Union at the meeting of the European Council in Stuttgart, which was presided over by the Federal Republic. An intergovernmental conference, again strongly advocated by the Federal Government, drafted the Single European Act which was adopted by the European Council in Luxembourg on 3 December 1985 and became effective on 1 July 1987. The Single Act is the basis for the EC's further development into the 90s. The Federal Government regards the Single Act as an important step on the road to European Union and as a result of its own European policy. When it assumes the presidency again in the first half of 1988 it will be aiming to achieve further progress in this direction. The Single Act provides real opportunities for completing the Community's internal market. It widens the EC's responsibilities to include research, technological development and environmental protection. It establishes the basis for streamlining the Council's decision-making procedures and for the European Parliament's participation in the Community's legislative process. Moreover, it places European political co-operation within the framework of international law, thus making it binding on all members. It has thus enhanced the principle of a common European foreign policy, improving EPC's procedures and giving it a firmer institutional framework.