Brussels, 12/10/2004 (Agence Europe) - The European Commissioner for Industrial Policy, Olli Rehn, and his counterpart for Trade, Pascal Lamy, presented the battle plan proposed by the Commission to boost the competitiveness of the textiles industry to the press on Tuesday. The proposal is due to the fact that the last WTO textiles quotas are to be dismantled on 1 January 2005. The recommendation underlying this strategy will be adopted by the College on 13 October. It is based on the work of the high-level working group on textiles and clothing, whose conclusions were published on 30 June (see EUROPE of 30 June, p.13).
The Commission's strategy contains seven guidelines, some of them coming under internal EU policies and others from its trade policy. Olli Rehn, who is in charge of the EU's enterprise policy, presented the four-point action plan which constitutes the "internal" plank: 1) Stimulate research and innovation: in order to design and implement a strategic research agenda, the Commission is opting to set up a European technological platform. This will aim to foster the most advanced technology and high-added-value textiles products thanks to EU R&D programmes (40 million EUR planned under existing programmes), especially by offering possibilities of co-funding for these technologies and products. 2) Guarantee life-long education and vocational training by encouraging the use of the Leonardo da Vinci programme and of the European Social Fund to help adapt to industrial changes and innovation in the field of employment. 3) Reinforce the fight against counterfeiting and piracy by creating a European website on intellectual property law, which will be user-friendly and provide information via seminars and networking, especially to SMEs. 4) Use the structural funds to resolve unforeseen crises: in order to support the restructuring, modernisation and consequence management of trade opening and to mitigate the socio-economic impact on regions with high concentration of textile industry, the Commission has proposed a reserve fund within the structural funds (1% of the Structural Fund annual contribution for the "Convergence" objective and 3% of the "Regional competitiveness and employment" objective). Olli Rehn stressed that the community initiative should "be added to by actions by the Member States in their spheres of competency" and that "we must follow developments in the sector to see whether extra initiatives are necessary". He concluded by recommending the high-level group to take up its work once more, especially on points such as access to funding and non-technological innovations. (It is worth noting that at his hearing before the Parliament, the candidate to take over from him, Günter Verheugen, said that he set great store in the ability of this "sectorial" approach to help industries in crisis).
Presenting the "external" aspect of the community strategy, Pascal Lamy broke this down into two planks, one "offensive" and the other "defensive".
On the "offensive" plank, the Commission stressed the need to open markets up more, reiterating that EU customs duties were in the 10-13% bracket, whereas those of the United States were around 30%, and Indian ones virtually 100%. As a result, the Commission proposed to improve European industry's access to third countries and the remove non-tariff barriers during negotiations currently underway at the WTO under the Doha agenda. A working group comprising representatives of the Commission and industry has been set up to identify and priorities the obstacles to be resolved with third countries. The Commission would also like to boost access by developing countries to the EU marketplace, especially for the very poorest and most vulnerable countries. When asked about the possibility for countries such as China, India, Brazil and Indonesia to
benefit from the new Generalised System of Preferences (GSP), Pascal Lamy pointed out that the proposals on this would be adopted during the weekly meeting of the College of Commissioners on 20 October (see yesterday's EUROPE, p.11). He explained that, in the case of China, benefiting from GSP no longer seemed to him to be "very justified", that the case of India was "more difficult" and that Pakistan and Sri Lanka presented the "likelihood that their market share would allow them to continue benefiting from the GSP". The Commissioner nonetheless refused to say more, explaining that "we are discussing final thresholds (even now)". Pascal Lamy insisted, moreover, on the need to rapidly result in the creation of a Euro-Mediterranean zone. In this respect, he said in substance, it is appropriate to encourage the conclusion of agreements between all Euromed partners, including the same rules of origin so that the cumul of these rules may take place as soon as the agreements are established.
On the "defensive" chapter, Pascal Lamy recalled the regional policy measures evoked by Olli Rehn, but mainly insisted on strengthening cooperation with China. The Commission will resort to the recently established EU/China dialogue on textiles as well as to the setting in place of a mechanism to monitor Chinese imports to ensure smooth transition to a quota-free system from 1 January 2005. This statistical early warning mechanism will be composed of four phases, Mr Lamy explained: the green phase (normal surveillance of imports from China), the yellow stage (ex-post surveillance of imports), the orange phase (statistical surveillance of import-export movements in real time) and the red phase (activation of a safeguard clause). The last two phases require a Council legislative proposal, he noted.