on the financial impact of completion of the single market on the developing countries

The European Parliament,

-having regard to its earlier resolutions on the single market,

-having regard to the resolution on the effects of the '1992' Single Market on the ACP States adopted by the ACP-EEC Joint Assembly on 29 September 1989OJ No. C 45, 26.2.1990, p. 30,

-having regard to its resolutions of 18 February 1987 on the problem of indebtedness in the developing countriesOJ No. C 76, 23.3.1987, p. 65 and of 26 October 1990 on the indebtedness of the ACP countriesOJ No. C 295, 26.11.1990, p. 658,

-having regard to the report of the Committee on Development and Cooperation (A3-0021/92),

A.having regard to the serious concern which has arisen in the developing countries with which the Community has concluded development agreements at the prospect of the completion of the single market,

1.Considers that it is in line with both the letter and the spirit of the agreements signed by the Community with the developing countries to look very closely at the individual problems raised and at the more general anxiety generated in the countries concerned by the prospect of the completion of the single market;

2.Notes that, as regards financial matters, the anxiety referred to above relates to the decline or inadequate growth of foreign investments in a certain number of developing countries, particularly in Africa;

3.Believes that the direct effects of the completion of the single market on EEC investments in the developing countries are relatively limited;

4.Notes that it is generally conceded, particularly by the Commission, that the ongoing restructuring within the EEC related to the progressive establishment of the single market is definitely leading to a polarization of investments in the Community, but that this is not generally to the detriment of investments in the developing countries;

5.Considers that, with regard to investment and financial flows, the completion of the single market will depend first and foremost on decisions taken by economic operators, and calls on the developing countries to create a more favourable environment for the development of foreign investment;

6.Recalls that the above-mentioned resolution of the ACP-EEC Joint Assembly underlines the need, for the development of foreign investment, for transparency and less cumbersome procedures, compliance with market mechanisms, and more generally the improvement of the industrial environment and all the conditions required for sound competition;

7.Notes that, on average, private investment has grown in the developing countries since the 1980s but points out that this growth has varied according to region, with greater increases in South-East Asia, smaller, more localised increases in Latin America, and a very worrying situation in Africa;

8.Points to the major growth in some countries that have benefited in recent times from flows of finance from outside such as Mexico and some of the South-East Asian nations; consequently believes that any improvement in the situation of the Community's partners calls for internal political measures and for greater financial commitment on the part of the international financial community and particularly of those in Europe with responsibility in this field;

9.Notes with concern that, for many of the Community's partner countries, flows of finance have been reversed since the 1980s to the benefit of the northern hemisphere as a result of the repayment of previously incurred debts;

10.Notes that this development is further reinforced by the deterioration in the terms of trade between the industrialized countries and the developing countries, depriving the latter of essential resources;

11.Believes that if this situation persists there will be very serious consequences and notes in this connection the very close link between the development of foreign investment and the overall flow of private and public money;

12.Considers it vital to reverse the flows of finance between the developing countries and the developed countries by reducing debt servicing and improving the terms of trade between them;

13.Recommends to this end the abolition of the debt of the LLDC and reassessment of the debt of the developing countries according to the real benefit they have gained from it and deducting the interest already paid; also recommends limitation of the interest rates on this debt to the level at the time the debt was contracted;

14.Considers that the new democratic authorities in the developing countries should have the means to recover the national wealth sent abroad by corrupt leaders and proposes that the International Court of Justice in The Hague be empowered to freeze their assets abroad and that the national banking laws of the industrialized countries be revised to allow this freeze and restitution to the democratic authorities of the developing countries;

15.Recalls its resolutions on the debt of the developing countries and in particular its request for cancellation of the debt of the ACP countries to the EEC, as a first step towards cancellation of the entire debt of the ACP countries to the EEC and its Member States;

16.Instructs its President to forward this resolution to the Commission, the Council and the governments of the Member States.