The European Parliament,

- having regard to the motion for a resolution by Mr Balfe on the need to monitor exports from the Occupied Territories and possible connections with South Africa (B3-0621/89),

- having regard to Council Regulation (EEC) No. 3363/86 of 27 October 1986OJ No. L 306, 1.11.1986, p. 103,

- having regard to its resolution of 14 June 1990OJ No. C 175, 16.7.1990, p. 163 on Israel and the situation in the Occupied Territories;

- having regard to the declaration on the Middle East set out in the conclusions of the Dublin European Council of 25 and 26 June 1990In which the Council 'invites the Community institutions to take appropriate action for a rapid further improvement of the conditions of access to the Community market for Palestinian products and to examine further possibilities for increasing trade between the Community and the Occupied Territories' and invites the Commission to appoint a representative to facilitate 'the speedy and efficient implementation of the Community's expanding programme for the benefit of the population of the Occupied Territories'.,

- having regard to the Council Decision of 4 March 1991,

- having regard to the report of the Committee on External Economic Relations (A3-0207/91),

A. whereas the economic situation in the Occupied Territories has greatly worsened as a result of:

- the Intifada,

- the loss of donations from the oil-producing countries,

- the loss of salaries from employment in those countries,

- increasing unemployment caused by the loss of jobs in the oil-producing countries and the return of the Palestinians concerned to the Occupied Territories,

- the loss of more than half the jobs for Palestinians in Israel, which represent more than one-fifth of the overall job opportunities for Palestinians,

B. welcoming the extra financial aid promised by the Community,

C. whereas the uncertain employment situation caused by the steadily falling number of jobs given to Palestinians in Israel is exacerbating the vulnerability of the economy of the Occupied Territories,

D. whereas, in the Gaza Strip, 40% of the labour force was integrated into the Israeli labour marketIn Gaza, 446 000 out of the 633 000 inhabitants have official UNWRA refugee status,

E. whereas 33% of the total surface area of the Gaza Strip (373 km2) is not available for Palestinian use,

F. whereas, on the West Bank, 60% of the labour force was integrated into the Israeli labour marketOn the West Bank, 374 000 out of the 850 000 inhabitants have official UNWRA refugee status,

G. whereas 52% of the total land area of the West Bank (5678 km2) has been withdrawn from Palestinian use,

H. concerned at the worsening shortage of water caused by the salification of springs, the tapping of hill-streams by the authorities and the use of 20% of the available water by the Israeli settlements, even though they make up only 2 to 3% of the population,

I. whereas the Palestinian population has lost a great deal of agricultural land to Israel through expropriation, as a result of which the proportion of GNP and employment accounted for by agriculture (currently 35% and 33% respectively) is falling,

J. whereas industry has been severely neglected, generating only 9% of GNP; whereas this is the result of Israeli economic policies, which have always been aimed at preventing investment by refusing to grant businesses trading licences, particularly where this served to protect Israeli monopolies - before the boycotts, the Occupied Territories formed Israel's second largest export marketThe European Community is the largest market,

K. whereas the administrative and security measures imposed by the Israeli authorities have hampered economic growth in the Occupied Territories and prevented the free export of goods to Israel,

L. whereas, given the impossibility of importing directly, since almost all the import channels are controlled by the Israeli public or private sector, the economy of the Occupied Territories cannot produce or export competitively,

M. whereas, given the lack of a Palestinian authority, the Occupied Territories have practically no financial infrastructure and no possibility of reaching trade agreements with third countries,

N. welcoming the fact that the Council unilaterally adopted Regulation (EEC) No. 3363/86 of 27 October 1986 on the tariff arrangements applicable to imports into the Community of products originating in the Occupied Territories,

O.aware that this regulation was designed to put an end to the si tuation whereby all the neighbouring countries enjoyed tariff preferences, but the Occupied Territories did not; and whereas this regulation empowered Arab chambers of commerce in the Occupied Territories to certify products,

P. recalling that until 1988 this regulation could not be applied, because Israel prevented the transport of Palestinian products through its territory, even though this represented the only economically viable route to the Community,

Q. recalling that change was brought about partly through pressure exerted by the European Parliament, which initially refused, in March 1988, to approve the three additional protocols for Israel; it did then approve them after Israel's decision, taken in October 1988, to allow the transport of Palestinian products through its territory,

R. whereas, in the first marketing year, the exporters' inexperience proved to be a severe handicap, communication between importers and exporters was poor and marketing was inadequate,

S. whereas, in addition, the weather conditions were so bad that part of the harvest was lost, with the result that prices on the domestic market rose and exports became less attractive,

T. regretting that, during the first marketing year, the negative attitude adopted by the Israeli authorities further hampered exports: products were damaged by the widespread safety checks, for which, in addition, high charges had to be paid; although the Community had urged the Israeli authorities not to create administrative obstacles to exports, they still insisted that firms obtain export licences,

U. aware that exporters had to gain a foothold on the European market in the face of strong competition from, amongst others, the well-established Israeli AGREXCO concern,

V. whereas, when the exporters complained to the Commission about the various difficulties facing them, they were informed that the Commission was responsible only for the political and legal framework, and not for dealing with trade problems,

W. noting the fact that the second marketing year has proved more successful, that exports have grown substantially in volume and that the transport problems with the Israeli authorities have been partially solved,

X. regretting the fact that there remain, however, a large number of problems requiring the attention of Parliament and the Israeli authorities, such as:

- cash starvation as a result of the non-repayment of VAT by the Israeli authorities,

- exclusion of Palestinian exporters from export subsidies scheme and facilities under the 'Export Currency Exchange Insurance',

- the fact that the Palestinian residents of the Occupied Territories have to pay significantly higher income tax than people living in Israel, although the disposable per capita income is about one third of the figure in Israel,

Y. whereas the Community and its Member States are seeking to bring Israel's conduct in the Occupied Palestinian Territories into line with international law and to ensure that the population is adequately protected from arbitrary and unlawful practices in Israel's administration of the Palestinian economy,

1. Takes the view, therefore, that the annual parliamentary monitoring of the situation regarding export trends remains important, and calls upon the Commission to report to the European Parliament:

(a) by 31 January 1992, on the existing discriminatory practices of the Israeli authorities in relation to the Palestinian producers and exporters, and

(b) by 31 December 1992, on the progress made towards the removal of such practices;

2. Advocates closer cooperation between the Community and organizations such as UNDP, whose development projects are seeking to strengthen the economy of the Occupied Territories, in disbursing the ECU 60 m granted under the Council Decision of 4 March 1991 and the extra money promised;

3. Calls for the scope for expanding Community trade with the Occupied Territories to be investigated;

4. Regards it as essential that the Commission should study means of ensuring that (Community) products have free access to the Palestinian market without (administrative and/or military) interference by the Israeli authorities, i.e. that they should be available to local consumers under normal competitive conditionsThe most important products for the Palestinian population are: building materials, such as cement and iron; foodstuffs, particularly cereals, dairy products, sugar and rice; agricultural machinery, especially tractors; heavy goods vehicles; insecticides; seeds, plant protection products; refrigerators, washing machines and cars.;

5. Calls for a Community representative in the Occupied Territories to be appointed, as urged by Parliament in its resolution of 14 June 1990 referred to above and by the Council in the conclusions to the Dublin Summit of 25 and 26 June 1990, to supervise the expansion in aid following the Gulf crisis and the increase in the volume of trade; expresses its deeply-felt conviction that this representative's office should be definitively located in the Occupied Territories;

6. Advocates that the export revenue be channelled into a guarantee/stabilization fund and that a transitional fund be set up to deal with (temporary) cash-flow problems;

7. Calls on the Commission to make every effort to remove all the (administrative) trade and transport obstacles set up by Israel in the sphere of economic relations with the Occupied Territories;

8. Calls on the Commission to foster the development of sound financial structures in the Occupied Territories, these being vital to lasting trade relations;

9. Urges the Commission to use its influence with the Israeli authorities to secure a permanent water supply for the region, based on a fair distribution of this scarce resource; fears that, without a responsible solution to the water supply problem, there is no future for the Palestinian people;

10. Draws attention, as a matter of urgency, to the problem of the salification of springs in the Gaza Strip, and calls on the Commission to assist the Palestinians in halting this disastrous development;

11. Hopes for the speedy success of the US peace mission, so that the Palestinian people can at last enjoy the dignity, identity, homeland and lasting peace to which they are entitled;

12. Points out that progress in the Community's relations with Israel is bound to be affected by Israel's conduct in respect of its obligations under international law;

13. Instructs its President to forward this resolution to the Commission, the Council, the Israeli Government and the PLO.