Brussels, 05/12/2000 (Agence Europe) - The Industry/Energy Council adopted "conclusions" confirming the end of operating aid for shipbuilding on 1 January 2001, in conformity with the 1998 Council decision. Along lines defined on 29 November this year by the European Commission, the conclusions specify, however, that, in the event of failure of talks with Korea for putting an end to unfair practices in its shipbuilding sector, the Commission will propose, in May 2001, a temporary aid mechanism to support European yards. It will also study the possibility of aid to research and development. The Member States opposed to State aid made it clear that temporary aid should not bring in competition distortion within the EU.
These conclusions were adopted after several hours of discussion in camera, discussions that were "lengthy, laborious and difficult", according to the Council president, French Secretary of State Christian Perret. Most Member States (Britain, Netherlands, Scandinavian states) confirmed their opposition to extending State aid after January 2001, against the position held by States "representing 70% of European shipbuilding" - Germany, Spain, Italy and, above all, Greece.
"The conclusions are a satisfactory compromise between these positions", noted Spanish Minister Anna Birules, who stressed that the Council has admitted aid would possibly be resumed from May. The conclusions strike a balance between the "contrasted positions of Member States", insisted Christian Perret, who gave his assurance there would be consistency between the Council 1998 decision to do away with aid to shipbuilding contracts, and the need to step up pressure on Korea. Nonetheless, these measures must not prevent European shipbuilding from continuing with its restructuring effort, the only way to ensure it remains competitive on the global market, stressed the Council president.
Among other things, stressed Christian Perret, the conclusions specify that the Council: 1) invites the Commission and the Member States to continue their close cooperation with industry for questions affecting competitiveness, and invites the Commission to study the possibility of facilitating recourse to aid to research and development; 2) welcomes the Commission's determination to support and engage in commercial measures against unfair competition by Korea and calls on it to make every effort to report as early as possible in April, and at any event before 1 May 2001. In view of proposing taking this affair before the WTO, if it has not reached a satisfactory agreement with the country", 3) "for lack of a satisfactory agreement, the Council takes note of the Commission's initiative for a temporary and appropriate initiative, aimed at countering unfair Korean practices, while waiting for the conclusion of the WTO procedure, as described in the Commission decision of 29 November 2000. Implementation of this mechanism under the Commission's control must not introduce distortions to competition within the European Union". This last paragraph was the central issue behind closed doors that occupied most of the Council debates in the morning.
The Commissioner for competition, Mario Monti, spelt out the process before the press: "if negotiations with Korea lead nowhere, the Commission will propose temporary measures in May. It is clear that the current aid scheme will come to an end in January and that the temporary mechanism will not have to introduce distortions to competition". Aid to research and development could take the form of "incentives", and the possibility of converting current aid into aid to research and development will be explored". The Commissioner for industry, Erkki Liikanen also placed emphasis on the balance of this solution, despite the "period of uncertainty that will prevail between January and April".
Political agreement on renewable energies
After lunch devoted to an exchange of views on supply in oil, the Council continued its work on questions of energy. It was, in the evening, to adopt conclusions on the Community action plan regarding energy efficiency and reached a political agreement on the promotion of renewable energies. The Council was moving along the lines of rendering non-binding the goals concerning the proportion of renewable energy in electricity consumption. Ministers were also briefed by Commissioner Loyola de Palacio on the liberalisation of the gas and electricity market and on the Green Paper on energy supply.