Brussels, 03/05/2007 (Agence Europe) - Meeting up at the informal Competitiveness Council on 27-28 April in Würzburg, Union industry ministers, under the guidance of the acting president of the Council, the German minister for the economy, Michael Glos, tackled the question of the internal market and globalisation. They therefore touched on the need for a strategic and political reorientation of the internal market, in an effort to effectively meet the challenge of globalisation.
On the first day, industry ministers were able to hear the opinions from senior representatives from the private sector, such as the vice president of the Toyota Motor Corporation's board of directors, Katsuhiro Nakagawa, the vice president of AMD, Thomas M. McCoy, and the president of BP and former WTO director general Peter Sutherland. These speakers outlined the positions of industry and certain companies. The delegations shared the opinion of Nakagawa and McCoy, and stated that since its creation 15 years ago, the European single market (500 million consumers strong) had become an attractive destination for investments and already occupied a strong position in facing international competition. This was confirmed in a study of more than 800 companies carried out by Ernst & Young consultants and presented to the Competitiveness Council, which concluded that for 50% of those surveyed, the Union remained the most attractive region in the world for investors. There was a downside, however, with the European Attractiveness Survey pointing out that the attractiveness of the single market had fallen by 10 points between 2006-07.
Union ministers examined what measures the Union should take to keep its place in the face of global competition, and how it could prevent its loss of attractiveness. They agreed on the idea that certain emerging countries like China and India now possess a practically insurmountable advantage in the medium term on labour costs. In an agreement with representatives from industry and Ernst & Young's results, ministers concurred that maintaining and improving Europe's economic attractiveness required important measures urgently being taken at both national and Community level: an attractive tax regime; labour market flexibility; development of communication networks and infrastructure; a reliable and simplified regulatory environment; and aid to research and development. Industry ministers also pointed out that Europe's attractiveness also depended on other recurring factors involving Community economic policy being placed at the heart of the Lisbon strategy: development of the knowledge society and enhancing innovative capacity; life-long training for workers; and intellectual property rights protection. In relation to the inevitable theme of energy security, ministers also highlighted the need for the Union to preserve a top ranking role in clean energy technologies - an area that, in the eyes of industrial leaders, contained significant potential in terms of innovation and job creation in Europe. Industry ministers once again reaffirmed the essential role played by SMEs in the European economic fabric.
On the second day, after the introduction by Mr Sutherland, industry ministers discussed the challenges of globalisation. They agreed that it was an irreversible process that directly or indirectly influenced all aspects of daily life, from social protection and internal security to health, energy supply and the environment. Ministers agreed that globalisation could only be controlled by Europe through common and asserted action, as well as the opening up of the markets. The Competitiveness Council therefore reaffirmed its determination to advance in the implementation of the Lisbon agenda and the partnership for growth and jobs.
Industry ministers also discussed (together with the commissioner for competition, Neelie Kroes) the issue of state aid in globalisation. Although delegations thought that it was imperative to get rid of state aid in a global context (which is likely to create distortions in competition) in order to prevent international manoeuvring on subsidies, several delegations spoke out in favour of a more liberal regime in the Union in an effort to tackle competition from some third countries where there are no limits on granting subsidies to their companies (EUROPE 9417). These delegations stressed that the decision of companies to invest in a given site depended on other factors such as infrastructure, labour costs and personnel skills. They did say, however, that when there was a level playing field, higher aid could tip the balance in favour of one site over another. Some delegations highlighted the need to weigh up possibilities in international competition, to grant higher amounts of aid as part of the Community state aid system for R&D and innovation. Several ministers also called on the Commission to examine the possibility of an accelerated assessment procedure for taking decisions on site selection in a context of global competition. (eh)