A3-0403/93

Resolution on the Commission Communication: 'Towards greater competitiveness in the steel industry: the need for further restructuring' (SEC(92)2160)

The European Parliament,

-having regard to its resolutions of 29 October 1992, 12 March 1993 and 16 September 1993 on the situation in the steel industry,

-having regard to Rule 148 of its Rules of Procedure,

-having regard to the Commission Communication: 'Towards greater competitiveness in the steel industry: the need for further restructuring' (SEC(92)2160) and the information note concerning the implementation of the social measures for the reconstructing of the steel industry (1993-1995) (COM(93)0178),

-having regard to the report of the Committee on Economic and Monetary Affairs and Industrial Policy and the opinions of the Committee on External Economic Relations and the Committee on Social Affairs, Employment and the Working Environment (A3-0403/93),

A.whereas for over a year the European steel industry has been facing a serious structural crisis caused by excess production capacity of 30 million tonnes, which makes it impossible to balance supply and demand,

B.aware that the restructuring of the sector involves further drastic cuts in employment, some 70 000 jobs being at risk over 1993-1995 in addition to those lost in the 1980s,

C.concerned about the unfavourable economic situation, which is exacerbating the structural difficulties in the European steel industry and the social implications these difficulties have,

D.concerned also at the delays and postponements which have so far beset the establishment of a restructuring plan, since this allows the situation to deteriorate and prevents individual undertakings from implementing initial measures,

E.convinced that the European Parliament must be enabled to express its opinion on the important instruments concerning the steel industry, in addition to the formal powers conferred upon it by the ECSC Treaty,

1.Supports the Commission's restructuring plan for the steel industry and urges the Commission and the Member States concerned to take the various outstanding decisions on state aids quickly so as not to delay restructuring any longer;

2.Calls on the Commission to use all the means at its disposal to settle those cases of 'State aid' still pending and remove the obstacles raised by some Member States, which are blocking the entire restructuring process in the Community's steel industry;

3.Appeals to the Member States' sense of responsibility and calls on them to

-undertake to reach an agreement with the Commission on the basis of the capacity reduction criteria established by the Commission,

-adopt at the meeting of the Council of Ministers for Industry on 17 December 1993 the agreements concluded on the above basis, since it would consider it unacceptable if, yet again, nothing were to come out of this Council meeting;

4.Reaffirms its conviction that the undertakings concerned must take responsibility for the necessary restructuring and for overcoming the crisis; notes the view of the Commission that application of Article 58 of the ECSC Treaty (manifest crisis) has been found to be ineffective in practice and expresses its conviction that if significant progress is not made in a short time, Article 4(c) of the ECSC Treaty (prohibition of state aids) should be fully applied;

5.Therefore calls on the Commission to speed up the preparations for implementing a restructuring plan by submitting the BRAUN report as soon as possible setting out all the agreements for possible closures and bringing into operation the advance financing under Article 53(a) of the ECSC Treaty for the agreements already reached with some undertakings;

6.Calls on the Commission in particular to seize the opportunities provided by the Treaty to stop illegal subsidization practices, for example by taking action pursuant to Article 88 of the ECSC Treaty, that is, by instituting proceedings for contravention of the Treaty and discontinuing payments from ECSC resources to the recipients of subsidies;

7.Emphasizes, moreover, that the Commission should not permit any further exemptions from the prohibition of subsidies stipulated in Article 4(c) of the ECSC Treaty unless they are linked to reductions in production;

8.Calls for Community action to give absolute priority to social measures and conversion, by making the maximum resources available without delay and adjusting the additional budget allocation for social measures (ECU 240 million earmarked in November 1992 for 50 000 possible redundancies) to the new figures for possible job losses;

9.Calls on the Member States to submit their accompanying social plans as soon as possible, without which neither the additional social measures nor the ordinary measures can be operational;

10.Regrets a lack of transparency on the part of the Commission

-concerning the financial cover for the additional resources, ECU 240 million for the period 1993-1995, made available for social action, and the actual availability of this amount;

-concerning the Commission's renouncement of claims in the arrangement with KLOECKNER, which is linked to a reduction in capacity, and as regards the inclusion of a loss reserve in the ECSC budget pursuant to Article 54 for credits to KLOECKNER and SAARSTAHL;

11.Is alarmed at the ECSC budget for 1994 which does not seem sufficient to support both the advance financing of closures and the doubling of social contributions and reminds the Commission that a year ago it was announced that the ECSC budget would have to be adapted to the new crisis;

12.Notes the Commission's undertaking to enter appropriations totalling ECU 120 m in the 1994 ECSC budget but points out that for the time being only ECU 86 m are available;

13.Considers that the additional aid, on top of the traditional ECSC aids, granted under the package of social measures for the steel sector, is indispensable, in conjunction with the reductions in capacity imposed by restructuring of the Community's iron and steel industry;

14.Proposes that the gap between the necessary resources and the resources available be covered by:

-use of part of the reserves for financing social measures by transferring loan guarantee activities, including advance financing under Article 54, to the EIB or to the EC general budget,

-a firm commitment to the social measures, possibly by reducing the other items in the ECSC budget,

-use of the Structural Funds for vocational training and retraining;

15.Insists, therefore, that the necessary funds are released for the maintenance of the aid provided by the steel industry social measures for each worker during the entire period of restructuring envisaged;

16.Stresses the importance of the conversion of production, jobs and production areas and the creation of new activities, especially in areas heavily dependent on large steel works, and calls for the use of ECSC resources and the Structural Funds in accordance with the new reform or under a Community initiative such as RESIDER;

17.Calls on trade unions and producers, where undertakings are affected by the restructuring of production, to devise new solidarity arrangements to reduce the number of redundancies, convinced that this could be the opportunity to promote new industrial relations and a different form of participation in company decisions;

18.Is convinced that the steel industry needs a Community industrial strategy more than ever, to promote a sound and balanced market through the use of the powers conferred on the Commission under the ECSC Treaty as part of a preventive policy: formulation of forward programmes, observation of price movements, consultation of the parties involved, measures to assist research and the environment, vocational training, protection of reciprocity in world trade, closer observation of the scrap market on the grounds of the increased number of mini-mills;

19.Considers that the European Community should assist the modernization of the steel industry in the countries of eastern Europe and the former USSR by transferring capital and technology to lessen the economic and social impact of this process, which nevertheless is and will be dramatic; however, since modernization must lead to closer alignment of production capacity with current and expected demand, calls on the Commission to monitor the use of ECSC loans for central and eastern European countries and the level of prices, where necessary also in other countries; calls on the Commission also to ensure that, while restructuring is underway on both sides, the flow of sales from such countries to the EC develops harmoniously without any excessive variations which would disrupt market stability and price levels;

20.Agrees that the Commission should work to reach a new Multilateral Steel Agreement within the GATT, as it is unacceptable that the European steel industry should be dependent, to its great cost, on unilateral decisions such as those taken by the US, which are unjustified and go against the rules of international trade;

21.Calls for the rapid and successful conclusion of the negotiations on the Multilateral Steel Agreement, and stresses the importance of rapid conclusion of the negotiations on the overall Uruguay Round package for Community steel exports;

22.Considers it vital that the Commission's work be officially coordinated, thus avoiding the fragmentation of powers and ensuring extensive synergy;

23.Proposes periodic meetings in the form of a forum or conference comprising the Commission, the European Parliament, undertakings and trade unions to:

-keep the production and social aspects of the sector under constant observation,

-pinpoint proposals to ensure the long-term development and competitiveness of the sector,

-devise a horizontal policy that involves not only steel producers but also those operating in the raw materials sector, the scrap trade and steel users;

24.Instructs its President to forward this resolution to the Commission, the Council and the ECSC Consultative Committee.