Approval of the Minutes
President
The Minutes of yesterday have been distributed.
Are there any comments?

Ahern
Mr President, on the question of Sellafield and the contamination of the Irish Sea, I did not say that the article was edited, but completely excised, at the request, I believe of the nuclear industry, specifically British Nuclear Fuels Limited. I want to draw Members' attention to the fact that I will be distributing that article today for their information.

Pinel
Mr President, my point of order relates to the trunks that are provided by Parliament for Members' use. They enable Members to move their papers between Brussels and Strasbourg. In approximately two hours' time, I am due to present the opinion of the Committee on Regional Policy regarding the Cunha report. But the trunk containing all my papers has been left behind in Brussels, in the corridors of D3.
I do not wish to bore you with endless complaints about the incompetence of the removal services. I have however noticed that there are a number of other recurring problems at the Brussels offices, relating to the lifts and cloakrooms, etcetera. And this is the last straw.
What I should like to know, Mr President, is how Members are expected to fulfil their obligations, without files, papers, or the bare essentials they need in order to carry out their duties?

President
This is a consequence of having three separate places of work. I suggest you write to the President raising this matter.
(Parliament approved the Minutes)

Decision on urgency
Fantuzzi
Mr President, the overwhelming majority of the Socialist Group will vote for this request to apply the urgent procedure. It was on 17 February 1997 that the Commission's document of options to reform the olive oil sector was presented, and the compromise resolution named after Mr Jové Peres was adopted in December. The European Parliament has therefore certainly had ample opportunity to give its opinion on this matter!
Moreover, the Commission's current proposal, Mr President, does no more than take on board most of the points of the resolution by Mr Jové Peres, demonstrating that the Parliament's pressure has served to condition the Commission's basic guidelines. I should not be the one to say it, considering that I voted against this resolution. Rather, it should be the rapporteur, and it is absurd, in my view, that he did not do it in committee. The point is that, despite what has been written, there is a country, the leading producer, that does not want to hear about any reform, that has chosen the road of protest from which there is no way out and unconditional and unlimited postponement. The beginning of the next marketing year has been set at 1 November. Therefore decisions have to be made quickly, and I believe that there are a few absurdities that have to be quickly corrected. One of these absurdities is a guaranteed maximum quota for the Community as a whole, which results in the absurd situation of a substantial cut in aid for producers of those countries that have not increased production, only because another country has produced excess quantities. In no organization of the market is there a mechanism this unfair.
If we do not find a remedy for this, Mr President, I think that we will all be overwhelmed with protests from producers and that we will very quickly be asked to account for our short-sightedness. In committee, the rapporteur refused to commit himself to any deadline for his report, even when our group made very reasonable proposals. Urgency is also the only way to enable the President-in-Office, Mr Cunningham, to conclude the commendable inquiry that has been conducted in a difficult climate and to give producers a positive and definite answer.

Cunha
I think the President is mistaken. I asked to speak first because I wished to inform the House, on behalf of the Committee on Agriculture and Rural Development, that on 19 May the Committee approved the treatment of this issue as an urgency by 27 votes to 17. That is what I wanted to say at the outset, before other Members are invited to speak for or against the motion.

Colino Salamanca
Mr President, I have been a Member of this House for 13 years and this is the first time I have come across an urgency of this nature. A request was made in April for urgent procedure to take place in June on the reform of the olive oil sector due to come into force on 1 November 1998. In other words, from the procedural point of view, there is no need for us to debate the question of the olive oil sector reform now, in this urgent manner.
Secondly, the reform being proposed is not just a simple adjustment of a few problematic details, but an extremely farreaching reform of the olive oil sector. It is not just a question of the maximum guaranteed quantity and how it is shared out between countries - which is undoubtedly debatable - but very important elements are being introduced, without having been debated in Parliament. For example, the intervention is disappearing, and this is the first sector of the CAP to be affected by that change. That is not happening with cereals, milk or meat, but it is happening in the case of olive oil. Aid to consumption is also disappearing, without being debated in this Parliament. The ban on mixing olive oils is going to disappear, and also the lack of regulation for table olives.
So we do not think the matter can be dealt with quickly, without discussion in committee, without a rapporteur and without a report. I think the dignity of this House is at stake, quite apart from any problems a certain country might have with this sector. What is at stake is a serious, in-depth debate of something that must affect Agenda 2000 and which should therefore be discussed fully in the Committee on Agriculture and Rural Development.

(Parliament approved urgent procedure)

Robles Piquer
Mr President, I am speaking because it is my dubious privilege to be the oldest member of the Committee on Development and Cooperation, since the committee chairman, Mr Rocard, and the vice-chairmen cannot be with us at the moment, for various reasons. And I can inform you that the Committee on Development and Cooperation has studied this request for urgent procedure and has agreed almost unanimously in its favour, with the exception of just one political group.
So, if the request is approved, the Committee on Development and Cooperation will meet this evening at 5.30 p.m. to vote on Mr Liese's report and the amendments to the Commission text.
(Parliament approved urgent procedure)

Colino Salamanca
Mr President, the reason we requested agreement to approve urgent procedure in this matter, and the Committee adopted it, is that we have to debate agricultural prices in this part-session, and we have always demanded that that debate should include the set-aside requirement.
(Parliament approved urgent procedure)

Agricultural prices - common organization of the market in raw tobacco
President
The next item is the joint debate on two reports on behalf of the Committee on Agriculture and Rural Development:
A4-0216/98 by Mr des Places, on behalf of the Committee on Agriculture and Rural Development, on the proposals for 18 Council Regulations on the prices for agricultural products and on related measures (1998-1999) (COM(98)0051 - C4-0084 to C4-0101/98-98/0034(CNS) to 98/0049/CNS, 98/0805 (CNS) and 98/0806(CNS)-A4-0218/98 by Mr Rosado Fernandes, on behalf of the Committee on Agriculture and Rural Development, on the proposal for a Council Regulation amending Regulation (EEC) No 2075/92 on the common organization of the market in raw tobacco (COM(98)0019 - C4-0185/98-98/0027(CNS))
des Places
Mr President, Commissioner, first of all I should like to thank all the members of the Committee on Agriculture and Rural Development for their proposals and contributions during our various discussions, and for their amendments. They have in general supported me, and I should therefore like to thank them for this.
As far as the prices package for the 1998-1999 agricultural year is concerned, the roll-over of prices and compensatory aids will come as a surprise to no one. They are the same, with a few exceptions, as in preceding years, the same as presented by Mr Sturdy, not to mention the same as in 1993, ever since the reform of the common agricultural policy. The prices package clearly has no great claim to imagination, Commissioner. But this is perhaps due to the important dates which lie ahead: the reform of the common agricultural policy, with a view to the WTO negotiations in 2003; the reform of the Structural Funds in 1999 envisaged by Agenda 2000; enlargement to include certain Eastern European countries in the year 2000; the changeover by some countries to the euro, and even the exchange rate of the euro against the ECU, which also raises the problem of the "green' ECU; and finally, the euro/dollar parity because, as I would like to point out, world market prices for the large agricultural product areas are set in dollars, on the basis of the Chicago futures market. Unless of course, Commissioner, it would be possible to set up a European futures market for agricultural products, based near the European Central Bank, that is, in Frankfurt. All this, as you know, ladies and gentlemen, will take place within a rigorous budgetary framework set until 2006, in which the financial resources of the European Union will never exceed a ceiling of 1.27 % of its GNP. The financial resources available for the common agricultural policy are therefore limited.
Now I should like to say a few words about the budget situation in 1999. The provisional estimate for the 1999 agricultural guideline is about ECU 45.2 billion, that is an increase of approximately 1.9 billion, or 4.5 % in comparison with 1998. The budgetary authority adopted the principle of limiting expenditure, during the 1997 and 1998 budget procedures, by voting budgets significantly lower than the preliminary draft budgets drawn up by its departments. The Commission considers that this climate of budgetary restraint in the Member States should continue in 1999, the year of the introduction of the euro.
Within this specific budgetary context, the Commission is proposing a prices package which increases agricultural spending by ECU 9 million under the 1998 budget and ECU 29 million under the 1999 budget. It should be noted here that this increase at current rates amounts, in real terms and at constant prices, to a reduction of about 2 % in prices and compensatory aids. On this particular point, I have tabled a series of amendments, which aim to update agricultural prices and compensatory aids in order to redress the effect of monetary erosion.
With regard to the budget, I understand from the memorandum of 10 June 1998 on the early warning system, that there is a difference of almost ECU 1.1 billion between the implementation of the EAGGF Guarantee appropriations and the indicator of consumption. This reduction, caused by monetary erosion, will be accompanied by another reduction in prices and compensatory aids of about 2 %, according to estimates, which will be caused by the disappearance of the green ECU with the introduction of the euro.
The Committee on Agriculture has adopted my amendments regarding the creation of an adjustment coefficient with a view to maintaining equitable levels of income between farmers in all European Union Member States in order to compensate for the possible disappearance of the green rate on 1 January 1999 for the Member States participating in the single currency. I should like to point out here that some applications show that a 1 % difference in the values of the green ECU and the euro is equivalent to ECU 400 million.
The Commission's proposal on the prices package has a number of deficiencies. First of all, the set-aside rate. Earlier this morning, we voted on a request for urgent procedure with regard to the Commission's proposal on the set-aside requirement. I am delighted that the Commission has responded to our request to establish a set-aside rate by the end of June 1998, in compliance with an amendment adopted by the Committee on Agriculture. The proposal, which consists of implementing the principle of an extraordinary set-aside and raising the set-aside rate to 10 %, is totally unacceptable. Farmers should not have to bear the cost of errors made by the Commission in its management of the markets, which will lead to a 20-25 % increase in stocks carried over. Since July 1997 the Commission seems to have been adopting a rather risky approach to its management of cereals exports, with the tax on wheat exports when the European price was below the world market price, abandonment to the competitors of the Saudi market for barley and prolonged delays at the start of the agricultural year, all of which has now led to the risk of a very sharp increase in European stocks.
If the current delay in export commitments, 4.5 million tonnes less than in 1997 at the same period - 8 million tonnes less than the normal pattern -, is not reabsorbed, the European Union could find itself in the position, on 30 June 1998, of having about 30 million tonnes of cereals as opposed to 28 million tonnes on 30 June 1997. And yet, Commissioner, the volume of our exports is less than 25 million tonnes, although the WTO ceiling allows exports of 30 tonnes, plus the carry-over from previous years.
Furthermore, producers do not understand why it should be necessary to impose more set-asides, when they are being asked to accept further proposed price reductions for next year, to enable them to sell and produce more. I should like to reiterate that the set-aside rate affects the budget as well as farmers' incomes. And under these circumstances, I am delighted that we may be able to adopt both the prices package and the set-aside rate, during the same part-session.
Now I would like to say something on the subject of wine. Unlike other major agricultural product areas, the common organization of the market in wine has not been reformed for 15 years. The reform is in progress and should be presented to us this week. In any case, it will not be applicable to the marketing year 1998/99. In its price proposals the Commission provides for an extension of the quota for permanent grubbing up of vines, while failing to create a quota for new plantings. This provision on new plantings allows the most dynamic wine growing regions to adapt supply to demand and to improve the quality of the vineyards. I therefore tabled a number of amendments on this point, which were furthermore adopted by the Committee on Agriculture.
I will now turn to the subject of hemp. At the Council meeting in January 1997 the Commission undertook to propose stronger contractual arrangements with regard to hemp. In June 1997 the Council asked the Commission to study the possibility of establishing compulsory contracts between hemp producers and processors. Instead of putting forward such contractual arrangements as part of the prices package the Commission has merely lowered hemp prices by 25 %. The aim is to discourage producers, as the area given over to hemp production has increased from about 10 000 hectares in 1996 to 40 000 hectares in 1998. I would like to stress that hemp is an agricultural crop, which requires specific investments by both farmers and processors. The fibre produced from hemp is used in the industrial sector, for insulation and so on. It is therefore an agricultural product for non-food use.
The Commission's main proposals on beef and veal are as follows: extension of the reduction of national ceilings for premiums for male bovine animals. At Community level?
(The President cut off the speaker)

Rosado Fernandes
Mr President, I am going to speak on a hot topic, smoke, or kapnos , as the Greeks say. Tobacco, we call it. It is a hot topic, because it has provoked passionate reactions. It is a hot topic, because it has provoked near-irrational reactions. On the one hand false rationalism aimed at the expense it involves, and on the other pious words about the harm it does. Health considerations and budgetary considerations have whipped this subject up into a cocktail of passions which the Committee on Agriculture and Rural Development has tried to modulate, maintaining an attitude in which its first concern is for the people who make their living by growing tobacco.
Obviously all those of us who have children are concerned that young people should not smoke. We are all concerned that young people should not drink, but wine has to be produced... We are all concerned that young people should not eat too much fat, or too much sugar, because all these things can affect our health, but there are pigmeat producers and sugar producers... We all agree on that aspect of the matter.
With regard to the financial cost, the funds invested in tobacco growing, we know that around 600 000 people are involved in the industry, not to mention retailers, and we have of course seen the Committee on Budgets adopt a position which I jokingly referred to as 'Pope-like' , condemning the spending of money on tobacco growing as anathema.
Yet I know that same Committee voted against the purchase of scanners that could control the smuggling of tobacco products throughout the territory of Europe, in lorries and containers. And I have no doubt, from the information I receive, that if those budgetary measures and controls were put into practice the money we would recover from fraud and organized crime would comfortably outweigh the money we spend on maintaining tobacco producers.
Then again, there is the Committee on the Environment. That Committee is entitled to adopt whatever position it sees fit with regard to tobacco and other plants. Yet in my judgment it often exceeds its powers, inasmuch as it tries to issue diktats on the ways in which agriculture should be reformed, the money that should be spent, the way people ought to behave. The truth, let me say without wishing to offend anyone, is that at the beginning of the Iranian revolution - and you need only read an article published some time ago in the Economist , 'The Ayatollahs' - one of the first measures taken was to ban smoking throughout Iran. I do not have to think about anyone else's options, I support individual responsibility and people's ability to choose for themselves, provided they do not inconvenience anyone else and are not a burden on society. I think we all have that choice to do right or wrong. And I cannot prevent my neighbour from doing wrong.
In my report I have tried to prevent, and have proposed that we should prevent, the Committee from intervening by purchasing fixed quotas. I have tried to defend the argument that tobacco growing, which costs between a thousand and two thousand hours per hectare and is therefore one of the lowest-paid in Europe, should continue in the Greek mountains or the Mediterranean areas. I have also tried to support the provision of openings for young growers and to prevent modulation from being too heavy a penalty on growers under the pretext of quality control. These are the aspects I have defended and on this point I will finish, Mr President, so as not to overload this speech.

Cunningham
Mr President, I wish to begin by saying that it is both an honour and a privilege for me, on behalf of the presidency and the Agriculture Council, which I represent here today, to have the opportunity of addressing you all in Parliament.
Just over a year ago a new Labour Government in Britain embarked upon a sea change in relations between the United Kingdom and the European Parliament and, for that matter, the other institutions of the European Union too. We were determined to work constructively and cooperatively with our European partners and with the European Parliament, and we have done so. Speaking about my own contribution to that development, this is my fourth appearance in Parliament as President of the Agriculture Council and my sixth visit in 12 months in my role as United Kingdom Minister of Agriculture.
The UK presidency has been an active one and, as for the brief remaining part, June also looks very busy. Apart from the topics we are here to address today at the June Council, we aim to reach conclusions on other items of business, for example on quotas for the production of potato starch, updating the rules on controlling tuberculosis, brucellosis and EBL in cattle and determining the 1990 set-aside rate for arable crops. We hope, too, that it will be possible for the June Council to agree a measure which will effectively set general standards on farm-animal welfare, right across the Union. Moreover, we were grateful for Parliament's rapid consideration of the ornamental plants dossier, where there is now a wide measure of agreement in the Council, and we expect adoption of that dossier shortly.
Let me deal first with the question of price-fixing. In view of the proposals for reform of the CAP and many of the major common market organization regimes - about which I will be saying more later - the Commission's proposals for the 1998 price-fixing round are centred on those price decisions which are required for legal or technical reasons. In most cases the Commission has simply recommended a roll-over of existing provision. There is broad agreement in the Council in support of this approach. However, not unexpectedly in the course of the Council discussion of this dossier, Member States have suggested a number of additional elements to the 1998 prices package.
The presidency and the Commission are working closely together to accommodate as many of these as can be realistically adopted. I intend to negotiate a compromise on this package at next week's Agriculture Council, having first taken careful note of the views of Parliament.
Tobacco is an example of a sector where the Union's agriculture needs to be more competitive and open to the market as we prepare for enlargement and the forthcoming WTO negotiations. With this in mind, the Commission has come forward with some constructive workable ideas which I hope will provide a sound basis for a much improved regime.
All Member States accept the need for reform and the aim of improving tobacco quality but there is a divergence of views between producer states and non-producer states over the ways and means of proceeding. Most producer states accept the need for premium modulation as an important tool in improving quality and helping their growers to get closer to the market. They do, however, favour less modulation, phased in over a longer period. The main producer states also oppose quota buyback as over time it would result in a progressive reduction in the amount of subsidized production. They argue it would cause rural depopulation and unemployment unless surrendered quotas are redistributed to existing producers or new entrants. The Commission takes the line that surrendered quotas must be withdrawn permanently.
Non-producer Member States continue to draw attention to the high cost of the regime and the disparity between the budget for the Commission's anti-smoking programme and the annual spend on subsidies for tobacco producers. Indeed, some argue for gradual withdrawal of support from this sector altogether.
In discussions so far, general agreement has been reached on many issues but some outstanding differences remain to be resolved. The presidency has been trying to make headway with this dossier, as with all dossiers we have been responsible for dealing with during our presidency, in a fair, open, constructive and impartial manner. We are making every effort to reach a final agreement later this month and, to that end, will place particular value on the opinion that will be forthcoming from Parliament.
I wish to pay a warm personal tribute to Commissioner Franz Fischler, on behalf of the United Kingdom presidency, for his excellent help and cooperation and constructive working with us throughout the months of that presidency, and, once again, Mr President, thank you for inviting me to open your first debate. I now look forward with interest to hearing the views of your colleagues on these important questions.

Fischler
Mr President, Mr President-in-Office, ladies and gentlemen, first I would like to look at the context of the price proposals for the marketing year 1998/99. The proposals continue the policy of stability of the previous prices packages, providing for existing institutional prices to be maintained in almost all sectors. That does not, however, in any way imply that there is no need for a fundamental revision of the common agricultural policy. On the contrary! Using Agenda 2000, the Commission wants to introduce a reform that will go far beyond the fragmentary annual adjustments made in the context of the prices package, in order to prepare European agriculture for the future and to provide security for the European agricultural model. Therefore, for the 1998/99 prices, we should restrict ourselves to those measures which are absolutely necessary and not deal prematurely with imminent fundamental reforms.
I would like to thank the rapporteur and the Members of the Committee on Agriculture and Rural Development for their excellent work of examining the proposals and formulating the amendments. My thanks also go to the Members of the other Committees that were actively involved in this work: the Committee on Budgets, the Committee on External Economic Relations, the Committee on the Environment, Public Health and Consumer Protection, and the Committee on Development and Cooperation.
I would like to begin by discussing those amendments which deal with the introduction of the euro. These propose an adjustment coefficient for prices and subsidies in order to offset the abolition of conversion rates on 1 January 1999 in those countries participating in the single currency. In the past week the Commission has adopted a proposal addressing this very matter of the effect of the introduction of the euro on the common agricultural policy. The Commission is of the opinion that possible loss of income due to the introduction of the euro can best be offset by payment of compensatory allowances. A system of adjustment coefficients would serve only to introduce yet another new type of agricultural conversion rate. Thus, the amendments based on this cannot be accepted but, like Parliament, the Commission is aware of the underlying economic problem.
A whole series of amendments are aimed at increasing prices and direct payments by a blanket 1.7 %. I cannot accept this for three reasons. Firstly, this is diametrically opposed to the need to improve the competitiveness of Community produce, indeed both in the internal market and in the global market. Secondly, it would result in considerable budget costs - approximately ECU 260 million, which is unacceptable in times of strict budgetary discipline. Thirdly, it could jeopardize the international obligations of the Union, affecting in particular the level of internal support. In addition, I would like to note that the minor effects of inflation are more than offset by technological progress and improvements in agricultural structuring.
In Amendment No 11 the Commission is called upon to submit, as soon as possible, a proposal concerning the rate of setaside for the marketing year 1999/2000. As you know, this proposal is already in existence and was even accorded urgency. In two sectors, those of hemp and beef, the majority of amendments are intended to change fundamentally the Commission proposal.
Firstly, Amendments Nos 18 to 22 concern the hemp sector, and their primary aim is to delete the proposal concerning reduction of subsidies. The Commission is really concerned about the considerable and constant expansion of arable land, and also about the problem of control in this sector. On 6 May, the Commission proposed to the Council a clear increase in control, to be linked notably to the introduction of obligatory contracts between producers and processors. This point is incidentally also contained in Amendment No 77, the content of which I will split in two.
In the beef sector, Amendments Nos 48 to 53 aim to reverse the Commission's proposal. These provide for a return to the high levels of 1996 for the maximum premiums for bulls - that is, 20 % more than in the last two years. In view of the remaining difficulties concerning market situation and in order not to rush the revision of the organization of the single market within the context of Agenda 2000, the status quo must, in the Commission's opinion, be maintained. However, in the case of Spain and Portugal, an increase in maximum rates can be directly attributed to an obligation of the Council of November 1996, and we therefore made a corresponding proposal.
Several amendments also provide for considerable changes to market organization which the Commission cannot, however, accept in the context of these price proposals, which are to be kept as simple as possible. Thus, Amendment No 7 provides for a higher compensatory payment for areas set aside to be used for purposes other than food production. On this subject, I would like to say that of course we all want to promote the cultivation of renewable primary products with the various instruments available, but to my mind, a specific new subsidy would seem to be far from desirable. A set-aside rate of 10 % would also comply in principle with this request.
Now on to Amendment No 25. Breeders of silkworms have already recently profited from currency devaluations in the relevant Member States. I therefore consider a subsidy increase to be inappropriate. Approval of renewed planting, premature replanting, the period of validity of planting rights for wine and a subsidy for grape must, as provided for by Amendments Nos 29 to 35 and by Amendment No 37, cannot be dealt with in the context of this prices package. The Commission recognizes that these are important issues; it will therefore deal with these in its proposal concerning the reform. This proposal will be submitted to the Commission for a decision tomorrow.
Amendments Nos 41, 85 and 87 aim to increase the premiums for certain higher quality types of tobacco. There is no economic reason to favour one kind over another. On the other hand, one of the main aims of the tobacco reform, which is also being discussed, is to improve the overall quality of tobacco.
Amendments Nos 55 and 94 aim to neutralize the stabilizing effect in sheepmeat by increasing the basic premium by 7 %. This would mean having to abandon the premium for rural areas and would reopen the debate on the budget made available for this sector. Potential supplementary costs would be ECU 85 million.
I will now look at the amendments which aim to extend or introduce derogations. These cannot be approved in their current form. Some of them, however, merit thorough examination. These are Amendments Nos 2 and 3. They refer to the moisture content of cereals. This decision falls within the jurisdiction of the Commission. The exemption was granted traditionally but this year the higher intervention stocks are also to be considered in global terms.
Amendments Nos 5 and 9 refer to the suspension of special set-aside. They should be judged in the context of the proposal concerning the set-aside rate. Amendments Nos 6, 10, 49 and 54 refer to the new German Länder. The derogations in question were granted for a limited period in the new Länder because of specific structural problems. As far as the base area for arable crops is concerned, I would point out that the proposals of the current prices package provide for a certain flexibility in that the deadline for the choice of partial base area regulation is postponed to 15 September.
According to Amendment No 8, in certain cases it should still be permissible for the area set aside to be greater than its arable acreage. The Commission is aware of this problem but prefers to deal with it within the framework of Agenda 2000.
Amendment No 36 provides for the derogation on the minimum acid content of wine to be extended. Whatever solution is chosen, it must not under any circumstances anticipate the pending reform. Amendments Nos 38 to 40 allow suspension of wine growing on small plots of land. We could, in effect, consider taking this problem into account. In any case, I am pleased to see in the result that the proposals of the Commission largely did justice to its suggestions, as appropriate suggestions have already been submitted for too many amendments - I am thinking here of the euro, the set-aside rate, the tobacco reform, the hemp agreements and others.
Many of these are considered in Agenda 2000 and we agree that some of these amendments must be examined urgently. I would ask for your indulgence if I speak a bit longer today because I have another important topic to discuss: the organization of the tobacco market. I will come to this now.
Firstly, I would like to thank the Committee on Agriculture and Rural Development and the rapporteur for having dealt so swiftly with the proposal on the reform of the common market organization for raw tobacco, so that we could discuss it today. After the vote on the report which the Commission submitted to Parliament last year, the Council and the Commission agreed to continue to support tobacco growers. As you know, the Commission basically proposes to create effective incentives to improve product quality and at the same time to support those who wish to give up tobacco production.
By shifting the emphasis from quantity to quality, the reform takes into account the business of the Committee on the Environment, Public Health and Consumer Protection and the Committee on Budgets without taking away the possibility of other sources of income from farmers particularly in disadvantaged areas. For this reason, the Commission rejects Amendments Nos 29, 30, 33, 37, 42, 53 and 59, and Nos 66, 67 and 76 which aim for a compulsory withdrawal of the Community from tobacco production.
Community production represents only about one-third of Community consumption and could easily be replaced by imports. I am very much in favour of encouraging voluntary withdrawal from production, however. I welcome in principle the definition of quality criteria in the marketing of tobacco, as contained in Amendments Nos 4, 7, 15 and 16. These criteria should nonetheless be incorporated into cultivation contracts and the individual provisions relating to this should be laid down in the Commission's implementing regulation.
Please rest assured that the Commission will take the European Parliament's amendments into account in this procedure. The Commission would like to offer farmers the most effective incentives possible to improve quality. As regards the variable part amounts of the premium in accordance with Amendments Nos 14, 17, 18, 39, 69, 75 and 77, the Commission is of the opinion that at least 35 % of the premium should be graduated accordingly in order to fulfil the aims of quality differentiation and avoidance of social problems to a satisfactory extent.
By means of the possibility of quota buy-back - the basis for Amendments Nos 8, 9, 27 and 28 - the Commission wishes to provide a safety net for economically weak producers who are not in a position to participate in the campaign for improved quality. I am prepared to examine additional safety measures which should prevent this system from leading to a complete cessation of production. But I cannot accept any amendments that would render this system ineffective.
I would also like to note that within the framework of the Structural Funds, Member States already have the opportunity to submit projects which would facilitate the transition to other economic activities for tobacco growers. For this reason, I cannot approve Amendments Nos 6, 26, 58 or 63. With regard to Amendment No 44, I share these aims but it is neither necessary nor obvious for bought-back quotas to be withdrawn from the guarantee fund. With reference to Amendment No 51 I would like to remind you that quota buy-back should be on a voluntary basis, so minimum targets cannot be accepted.
The Commission welcomes Amendments Nos 24 and 81 and that part of Amendment No 36 which deals with the expansion of the area of application of the tobacco fund. However, in my opinion conversion schemes and research into new uses for tobacco should be financed by this fund. Therefore, it is my view that we should persist in our proposal to increase the amount to be made available to this fund in order to be able to finance these new initiatives as well. Thus, I cannot accept Amendments Nos 11, 23, 25, 48, 49, 50 or that part of Amendment No 36 which refers to this. I share the concerns expressed in Amendment No 10. The Commission cannot, however, allow research and investigation to take priority over such measures aimed at improving quality.
With regard to Amendments Nos 52 and 86, I can readily agree to make the report available to the European Parliament. However, I cannot accept Amendments Nos 13, 34 or 38, as the additional amount offered to the northern producer states is in accordance with the situation of their producers and thus should also be maintained.
Amendment No 20 proposes quota compensation at a national level. However, quotas belong to individual producers, which is why the existing carry-over possibilities are the correct solution to this problem. I cannot, therefore, accept this amendment any more than I can Amendment No 22, as we must respect the stability of annual expenditure.
Amendments Nos 41, 45, 47, 51, 78, 79, 82 and 85 are directed towards a change in the commitology procedure. I, however, am of the opinion that the common market organization regime for tobacco should be subject to the same rules as all other market organization regimes. I cannot accept Amendments Nos 35, 60, 61 or 68, as it is important to retain structural improvements and freedom of quota transfer. The evaluation of the new regulation in the year 2000 or 2001, proposed in Amendments Nos 52 and 65, seems somewhat premature but, of course, an evaluation is necessary.
With regard to Amendments Nos 70, 73 and 74, it is my opinion that the agreements on sale by auction would give the producer better opportunities in terms of market prices. I would therefore like to keep this option open.
Amendments Nos 1, 5, 12, 19, 32, 40, 43, 62 and 64 would entail enormous changes to the underlying equilibrium in the respective areas that is intrinsic to our proposal, and this is why I am not in a position to accept them. Nevertheless, I can accept Amendments Nos 71 and 72, which allow the Member States a transitional period for the transition to direct premium payments to producers. With regard to Amendments Nos 31 and 86, to accept these would not be to increase the quality of tobacco but to reduce it. The Commission is prepared, however, to use the national supply of quotas for allocation to young farmers, as provided for by Amendment No 21. However, this should take place in conjunction with the usual administrative authorities.
I would like to thank you for dealing with the reform of this sector so swiftly, and I hope this will also be the case with upcoming Agenda 2000 proposals.

Giansily
Mr President, I am surprised that Commissioner Fischler did not wait to hear the opinions of the committees to which the proposal was referred before giving his response, but I shall nevertheless deliver the opinion of the Committee on Budgets.
The 1998-1999 agricultural year is unusual because it will be the last year to fall within the scope of the present agricultural policy. I am therefore tempted to ask you, ladies and gentlemen, to endorse these price proposals because they will be the last. In fact, the raison d'être of the real debate on the forthcoming reform of the CAP can be found in Agenda 2000. That is why the Committee on Budgets has emphasized, by adopting the opinion I proposed, that the budgetary consequences of the present price proposals with regard to the forthcoming agricultural year are limited.
The Committee on Agriculture and Rural Development has paid special attention to the introduction of the euro, as the Committee on Budgets asked, and rightly so. It is important for the budgetary effect of the introduction of the euro on the agricultural sector to be evaluated as accurately as possible, and appropriate measures proposed as soon as possible. From 1 January 1999 the euro will replace the ECU and therefore also the green ECU, whose value is up to 1.5 % higher than the normal - financial - ECU. The Commission has not yet made proposals for the transition of the present agri-monetary system to the euro, but intends to forward proposals to Council and Parliament before September this year. It has not been able to do so yet as there has to be certainty about which countries will definitively participate in European monetary union. The Committee on Budgets will naturally prepare another opinion on the financial consequences of the proposals.
With regard to the sectoral amendments, I am delighted that the Committee on Agriculture has taken up my proposal with regard to the authorization of "new plantations' for high-quality wines produced in specific regions.
The Committee on Budgets also protested against the European Commission's proposed approach to the question of aid for hemp producers. The Commission now wants to discourage the production of hemp as it is of the opinion that hemp is sometimes produced for 'illegal' reasons. But Indian hemp is not the only type of hemp, and not all types can be smoked. The Commission has chosen the easiest solution: reduction of the premium to discourage a further rise in production. The agricultural sector has invested in this, and is now being unfairly punished by a savage 25 % reduction in the subsidy. It is very encouraging to see that the Committee on Agriculture is aware of this problem and has even proposed an increase in the aid per hectare.
I should like to add a last remark about olive oil and draw to the Commission's attention the tensions and distortions that exist between the amounts of olive oil produced, the amount of financial aid provided, and the uncertainty of current methods of inspection.

Wynn
Mr President, I will just be referring to the tobacco report. Firstly, I will be ignoring the comments of Mr Rosado Fernandes on the Committee on Budgets. Like his report they are flawed. I am a realist in these matters and I can assume that the Wynn amendments, the Hardstaff amendments and the Environment Committee amendments will not be carried later in the day and therefore I can imagine that the report will be adopted.
As you may well imagine, I will not be voting for it except probably for the first amendment from Mr Rosado Fernandes which says 'whereas the Commission has taken no account whatsoever of the European Parliament's opinion of 17 July 1997' . I would change that to say 'welcomes the fact the Commission has taken no notice of our opinion last year because once again it was a flawed opinion' . There is this ostrich attitude, with its head in the sand: look at the second amendment from the committee, which talks about the raw tobacco market being very competitive. Where do they get this fiction from? It beggars understanding.
The truth is, that without European Union subsidies there would be no tobacco industry in Europe. Not one gramme can sell on a competitive market without EU subsidies. There is no reason to give money to farmers in France, Belgium, Germany and Austria. It is a black hole that we pour money into.
Having said that, the Commission has come forward with a report that is a good deal better than the system that we have at present. However, the Budgets Committee opinion is that it is flawed. Why not go back, Commissioner, and start again? The consequences are far from perfect. As you have said yourself, we are not even saving money. It will actually cost more money than the present system when we take into consideration the monies from the Structural Funds. This is not a situation that we in the Budgets Committee want to see continuing and quite frankly the best result for everyone would be to take the report back and come forward with something far more bold and dramatic.

Sonneveld
Mr President, the agricultural proposals are not very radical this year. In fact, most prices will be left unchanged. One very significant element, however, is missing from these proposals, namely the compulsory set-aside rate for cereals.
The Commission proposals on this issue had not been completed when the price proposals were drawn up. For some years the cereal growers had been used to the market price being higher than the EU intervention price. The situation within the EU and on the world market gave rise to this. But this year the intervention in the EU internal market is fully in the picture again.
Furthermore, for EU price development it is important that the EU be able to slow down the buildup of stocks and overproduction. Fortunately, the set-aside instrument is still fully intact. A new set-aside rate of 10 % could result in essential support for the internal price level, but it could also stop the EU from hitting the ceilings of the cereal exports with the export refunds allowed under WTO regulations. It is useful that these kinds of mechanisms are being put into effect in other sectors as well. This applies in particular to the beef sector, in which the EU stocks are still giving cause for some concern. The sums needed for export refunds over the past few years have, until now, turned out to be lower than assumed in the 1998 budget. But things might turn out differently for 1999.
It is good that we are maintaining sufficient flexibility in the EU agricultural system so as to able to continue our trade relations. We should also be on the alert as to what others are doing if the world market deteriorates. In any case, the Commission's agricultural price proposals cannot be seen as a provocation to our WTO partners. The EU is behaving in a disciplined fashion in this regard as well. The real discussion about the working of the future EU agricultural market and price policy is taking place in the context of Agenda 2000.
The Committee on External Economic Relations would very much like to analyse the external trade aspect on that occasion.

Kestelijn-Sierens
Mr President, Commissioner, ladies and gentlemen, we do not wish to play Ayatollah, as Mr Rosado Fernandes is insinuating. When we drafted our opinion on the common organization of the market in raw tobacco, we, in the Committee on the Environment, Public Health and Consumer Protection, made two basic assumptions.
Firstly, the massive production aid for tobacco, and we are talking about no less than ECU 1 billion, is completely at odds with the EU's policy on the prevention of cancer. We are supporting a product which is responsible for the deaths of half a million EU citizens a year.
Secondly, the subsidies are, in principle, temporary. We have been supporting tobacco farmers for more than a generation without any prospect of improvement. That is why we do not agree with the Commission proposal. We are therefore calling for a complete abolition of subsidized production by the year 2006. In countries where there are adequate alternative forms of cultivation, such as Belgium and Austria, the subsidies must be abolished sooner.
The Committee on the Environment, Public Health and Consumer Protection realizes that the abolition should happen gradually, and has therefore developed a transition scenario with the following main features. Firstly, half of the premium must depend on the quality of the production. Those who produce better quality will therefore be able to manage without subsidies at a later date. Secondly, quotas must be gradually reduced. Thirdly, the transfer of quotas between producers will no longer be permitted. Fourthly, 5 % of the premium must go the Tobacco Research and Information Fund. The Fund must look into possibilities for the cultivation of other crops and into other profitable economic activities. Finally, we are asking the Commission to again conduct a thorough study into the option which was handed to us by the Court of Auditors in 1994, namely direct income support.
Ladies and gentlemen, my proposals are incorporated in Amendments Nos 29 to 53. The Committee on the Environment, Public Health and Consumer Protection adopted these unanimously. It was co-signed by thirty Members from all groups. I therefore hope that a majority in this House will opt for a responsible and healthy use of public funds.

Fantuzzi
Mr President, Commissioner, what more can be said about the prices package? That it would perhaps be reasonable to no longer present it in these terms and to switch to a different system that involves our House in deciding basic directions, to offer multiannual guidelines to our farmers who have to make production choices. Our group believes that now is the time to do this, because the contrast has become so great between this procedure, which before involved long marathons, and the Agenda 2000 reforms which are the real package of farm prices on the table. The only thing to be said is to agree with the rapporteur, Mr des Places, on the urgency of giving a little more impetus to the wine sector. We cannot just sit around twiddling our thumbs when there is a policy of new large-scale plantings of vines in countries competing with the European Union: since there are no longer surpluses, the market for quality wines is witnessing renewed vigour and the money in the Community budget for this sector is being reduced to virtually nothing. We must avoid the gradual paralysis of a sector that can continue to be an object of pride for Europeans, anticipating with the prices package certain aspects of the reform of the COM that the Commission should adopt tomorrow.
As for tobacco, I would like to say to my fellow Members: let us try to have a progressive vision of the sector and not always remain confined to a Manichean and ideological debate - tobacco yes, tobacco no -, let us stop criminalizing a sector of production that can continue to play an economic, social and occupational role, worthy of the utmost importance. Were people to no longer die from smoking if all aid was cut off, I would be the first to observe this moral command. But we know that it does not work that way, that it is an illusion: we would just import more products from outside the Community, the amount being already greatly insufficient, as Commissioner Fischler recalled. What is more, we already discussed the matter at length a few months ago. We also know that with the billion ECUs of the COM, it is quite difficult to guarantee for other sectors an opening for jobs like the one created by tobacco production, which is the most labour-intensive agricultural product grown in what are usually disadvantaged regions.
We therefore agree with the strategy proposed by the Commission - significant innovation, emphasis on quality - to make the sector more and more market-oriented and to grant aid also to anyone wanting to leave the sector because of lack of prospects. We believe that the rapporteur, although he honourably wants to defend producers, in some passages introduces too much resistance to these innovations. But it is only right that tobacco producers also begin to see clearly what the future of the entire common agricultural policy is: less situation rents, more targeted aid, policies of quality and more international competition; on the other hand, new developments in policies for rural development and agricultural structures. This is the picture, and it is in the interest of all that it be very clear.

Funk
Mr President, Commissioner, ladies and gentlemen, the rapporteur, Mr des Places, established in his report that average income from agricultural activities, measured in terms of real net product, has fallen by 3.1 %. I fully concur with him in this. In fact, prices for products from livestock farming have fallen; in particular, pig prices have reached their lowest in years. The profits from cereals have also been very much affected by downward pressure on prices. This is why monthly surcharges must be retained.
In this agricultural debate, which differs from previous agricultural debates, I would ask you, Commissioner, to intervene in these two areas of cereals and pigmeat and, as you did in the case of beef, to use all possible means to relieve the market. In the context of the reports on Agenda 2000, the decisions on agricultural prices are, as you said, of a temporary nature and consist mainly of an assessment. I have a positive suggestion for you in terms of the Agenda. Should you accept our proposals, the Agenda will be able to proceed far faster than hitherto envisaged; otherwise, we must prepare to go through a long rigmarole. However, we have drawn up excellent proposals which we will be submitting to you in due course.
I would urge you not to take the path of least resistance in the area of hemp, but to support this environmentally friendly plant so that its introduction to the market can be successful. With plants, there is no point in beginning with subsidies, then investing in the market, then immediately starting to reduce subsidies before the plants have been fully introduced to the market. The existence of national hemp processing plants is thus jeopardized as well.
I welcome the extension of the derogation for the five new German Länder. In principle, a lasting solution to this problem must be found in agricultural reform, in the beef and veal market organization regime. I thank you expressly, Commissioner, for having responded so promptly in the area of set-aside. I would like to commend you very highly on this. I would like to encourage you to see this 10 % set-aside through to the end. Otherwise we will never put an end to this desperate state of affairs and the Agenda 2000 negotiations will once again be crippled before the event by heavy investment; this is not good because once again we would be unable to determine how things really ought to be.
This path is not practicable as it would lead to a new set of problems. New beef and milk surpluses are being produced and for this reason I think set-aside should be implemented in the same way in which it has already proved its merit.
I would also point to the early marketing premium for calves. Mr President, please allow me to make one last comment. I would like to praise the Commissioner for making a sensible proposal regarding how to introduce the euro - not through some complicated mechanism; instead, he wants to even out any losses which individual countries may incur by means of transparent measures.

Mulder
Mr President, I would like to start by thanking the President-in-Office for the warm interest he has shown in the activities of this Parliament over the last six months, and we hope that future Presidents-in-Office will use this as a model.
First of all, the des Places report is not taking place under the most favourable circumstances, as far as prices for farmers are concerned. I believe it would be a delusion to think that, both in the light of the budget difficulties and in the light of Agenda 2000 proposals, we might promise farmers higher prices. My group will therefore support the general terms of the Commission proposals. A few aspects need to be emphasized, however, and the Commission has already been forthcoming with us about this prior to our vote on the amendments in the Committee on Agriculture and Rural Development. The transition from the green ECU to the euro must happen gradually. At the moment it appears likely that we will be continuing this discussion.
Secondly, the Commission must do as much as it can to develop new markets. We will therefore support the amendments proposed by the Committee on Agriculture and Rural Development on agrification, the use of agricultural products for nonfood purposes, especially those amendments which refer to the production of hemp for industrial purposes.
As far as the Rosado Fernandes report is concerned, I must say that my group is very divided on this issue. We will vote in two ways. The general line is that we support the position of the Commission that the tobacco which is being produced must meet market requirements and therefore must be of high quality. In areas with low-quality tobacco we will have to try to find alternatives so that the farmers living in these areas can also earn their income from products other than tobacco.
In conclusion, we would like to point to the need to continue the informational campaigns about the dangers of smoking and the like.

Kaklamanis
Mr President, ladies and gentlemen, listening to my colleague from the Socialist Group, Mr Wynn, I have to tell you that I too am a member of the Committee on Budgetary Control of the European Parliament and, naturally, not all the members of the Committee on Budgetary Control share the views that were expressed by Mr Wynn. Mr Wynn belongs to a group of colleagues within the Committee on Budgetary Control and, whenever the debate turns to matters of European agriculture in general and the products of the south of the European Union in particular, something happens to them and they start to say "no' to everything, as, for example, our very dear Commissioner today.
In your twenty-five minute speech, Commissioner, although you started off by saying that you would give very serious consideration to the recommendations of the European Parliament, when you referred to the amendments, I counted that you rejected 90 % of the European Parliament amendments. I ask you this: is that what you meant when you said that you would give very serious consideration to the recommendations of the European Parliament? I wonder whether, if you had rejected them all, that would have been a mark of respect or derision for the European Parliament.
You also said that you yourself are not against the complete abolition of tobacco production. You do not wish to throw thousands of European farmers on the dole. You say you are for improvement in tobacco quality, but with all these "nos' you are not moving towards improvement in quality.
Secondly, could you tell us whether the tobacco that is imported into Europe is of better quality than the tobacco that is produced in Europe? Have you, the Commission, checked this? And to what extent is it better quality?
Thirdly and most importantly, I am a doctor and I know very well whether tobacco is harmful or not. But what I have not heard from the Commission today is how much money you will give to teach our children in school that they must not smoke. I have not heard you say that, Commissioner.

Ephremidis
Mr President, firstly with regard to tobacco: the campaign against tobacco is a sham, a fraud. If the Community really wanted to reduce or to put an end to smoking, it should not implement an anti-smoking policy but should, within the context of an anti-smoking policy, reduce and even ban tobacco imports. It should take measures against the tobacco industry, which produces the final product, cigarettes. It does not do this and that is why it is a sham.
Secondly, with regard to the prices package: it is the same as it was before and is getting worse and it will have worse consequences. The previous regime brought about a significant reduction in real average prices for the producer and a corresponding reduction in his income. Are those measures for the benefit of producers? And where is your concern about quality, Commissioner? You rejected an amendment which said "special subsidies for special varieties of tobacco of special quality' . Why are you rejecting it? Are you concerned about quality or are you not?
As a result, your model, in essence, Commissioner, is the large agricultural enterprise. You are hitting small and medium-sized producers, you are hitting especially those in the south and the products of the Mediterranean region to which my country belongs. Tobacco growing has been reduced by 30 % and along with it the number of those employed has fallen by 33 %. Where will these people go? What will they do? Neither you nor national governments tell them.

Graefe zu Baringdorf
Mr President, I will limit myself to only a few basic comments. Commissioner, in the case of prices - whether we fix them now in this prices package or reduce them drastically in Agenda 2000 - the problem remains that an intervention system still exists. Already, prices are insufficient for 80 % of small and medium-sized farms. However, it is also a fact that the fixing of intervention prices and the intervention system itself create surpluses in these areas and that the prices - in any case long-term - never rise above the intervention system. This leads to a situation where most farms cannot live with these prices. As a result, it is a matter of readjusting the market so that farms can obtain higher prices on the market. I hope that this is given greater emphasis in Agenda 2000.
I would like to make a point regarding hemp: Commissioner, please give your support to European money being spent on hemp! Then you will not need to reduce the 25 % because we will then have a huge market. In addition, the money rustles so nicely and we would have reasonable ongoing support for a very interesting product. With regard to tobacco, it is my view that the true scandal lies not in the fact that we are promoting a product which endangers our health, but in the fact that, although only a low level of our production is destined for the world market - premiums are also a form of indirect support - billions are spent here to put pressure on the price in the world market overall. Thus, we are in fact supporting the tobacco industry. We should see that our tobacco is also being sold here in Europe and that the industry is accepting it. Here, too, we need a positive strategy - not so much a strategy of prevention.

Nicholson
Mr President, I should like to begin by congratulating the rapporteur on his very good report.
Since the reform of agriculture a number of years ago, to a large extent the price review process we go through has become an unreal exercise and does not recognize the problems that face farmers on the ground. This exercise is largely irrelevant and will not solve the many difficult problems that face the industry. The agriculture industry, certainly in my own part of the United Kingdom in particular, has never faced as many difficulties as it does at this moment in time.
In the past one sector could perhaps have faced difficulty. Now we have been racked by BSE in the beef sector and are trying to recover from that. If you look at agriculture in the United Kingdom at the moment - the pig industry, the poultry industry, the dairy industry, those producing cereals - all these sectors are facing financial difficulties, with farmers wondering which way to go. Young farmers are just not coming into the industry. Yes, I know that there has always got to be change; yes, I know that agriculture has to evolve with the times. Farmers will evolve, but they have to be given the chance to do so. As things stand at the moment they do not have that chance. And I have to say to the Minister responsible, who is here in his capacity as President-in-Office, that he cannot stand back and idly watch the agriculture industry disappear and take the hammering it has been taking because of the strong pound and issues over which the farmer has no control. That is a great difficulty.

Hardstaff
Mr President, I want to concentrate on the Commission proposals for raw tobacco and welcome those sections concerning diversification and withdrawal of quotas as growers move out of this sector.
My reservation is that the Commission, whilst encouraging growing for the market rather than for subsidies, does not propose the final logical step, namely the complete phasing-out of tobacco subsidies. I have tabled amendments accordingly. Interestingly, yesterday's Süddeutsche Zeitung carried an article about proposals for the abolition of tobacco subsidies in the United States. The EU should be doing the same.
Subsidizing production of food and useful non-food agricultural products is justifiable. Subsidizing - to the tune of ECU 1 billion a year of taxpayers' money - the growing of tobacco, which kills 500, 000 of its consumers every year, usually after years of ill-health, is completely indefensible. The Commission has partly conceded this case with its proposals to buy back quota, give support to producers to change to other crops and other activities and its encouragement of production of tobacco types which can command a reasonable market price.
Currently much of Community production is either destroyed or offloaded on poor countries at below production cost, to add to their health problems. The Commission should take the logical next step, moving toward a situation where tobacco competes in the market with no subsidy, if it is grown at all. Rich countries like Germany, France, Belgium and Austria cannot possibly claim they are financially dependent on such subsidies. Those Mediterranean countries where real hardship would be caused must be given ongoing support to enable growers to diversify and assist local and national government to establish alternative job opportunities in the regions currently heavily dependent on tobacco.
With political will this could be achieved over the next ten years - I offer two years more than the Committee on the Environment, Public Health and Consumer Protection. By the year 2008 we could do away with the scandal of spending ECU 1 billion of EU taxpayers' money annually supporting a crop which kills our citizens.
I urge support for the amendment setting out this programme.

Redondo Jiménez
Mr President, Commissioner, ladies and gentlemen, one of the advantages of speaking when most people have already done so is that practically everything has already been said, which means you can add the odd finishing touch to aspects you want to emphasize.
I want to congratulate the rapporteurs, Mr des Places and Mr Rosado Fernandes, on the effort they have put in, and on their clear and positive approach to their subjects. I also want to congratulate the Commissioner on his rational proposals regarding prices, tobacco, adapting to the euro and efforts in the area of controls. I think this is important, and I would be grateful if the Commissioner would take note of what I am saying at the moment, because it seems he is busy with other things.
Compulsory contracts have been proposed for hemp, and I agree with the Commissioner. I also agree with premiums to cattle, with the increase of 7.7 % and 7.5 % for Spain and Portugal respectively, which is quite right, since it was approved back in 1996. It is a bit late, but at least it has arrived.
On the tobacco question, having listened to the honourable Members, this is opening up the debate again between the people who are wrongly labelled as environmentalists or agri-environmentalists. But what really worries me, and what I would like to stress to the Commissioner, is that Commissioner Flynn said in this House not long ago, during the last part-session, that he would spare no effort until subsidies to tobacco producers had been suspended.
It really worries me, Commissioner, that a Commissioner said that on behalf of the European Commission. I do not know if it was said in a personal capacity, but he cannot say that, or at least it is not acceptable for him to say that in this House on behalf of the European Commission, when the subsidies to European tobacco producers are legal and provided for by the rules of the European Union, as part of the aid given to EU farmers. So, Commissioner Flynn should be reminded of his obligation to put things right on that score.
If we want to create jobs at the moment, here we have 400 000 jobs and 130 000 direct producers. So notwithstanding any comments we may be able to make about improving quality, agri-environmental measures and so on, if we want to improve this crop we cannot be directly opposed to it, when it represents only 5 % of EU tobacco consumption.

Anttila
Mr President, Chairman of the Council of Ministers, Commissioner, I congratulate Mr des Places on a clear report that depicts excellently the effects of the EU's agricultural pricing and aid policy on farmers' income. The Commission's pricing package proposal will cut farmers' compensatory prices and aid by 2 %. The introduction of the euro at the beginning of next year will bring with it a further 2 % cut for agriculture. Last year income from agriculture fell by 3.1 %.
I agree with the rapporteur's insistence on maintaining a pricing package to be made yearly under the terms of Agenda 2000. It must not be taken away under any pretext. By means of this package we can moderate the losses to farmers in aid and compensatory payments stemming from changes in currency values or other factors. As we do not yet know how strong the euro will be, there must be systems for reducing the damage it may do. The rapporteur proposes keeping pricing and compensatory payments in line with inflation. I support this proposal.
EU agricultural policy presents a sad picture form the point of view of the farmer. Income from agriculture has declined continuously, and it is still falling with the reforms in the Agenda programme. How much longer will the farming community tolerate the immense inequalities among population groups which the CAP is increasingly leading to? While other people are getting income increases, the farmers are losing money. There are elements of a serious crisis in this policy, and I cannot therefore support it.

des Places
Mr President, ladies and gentlemen, I shall be brief. We must support the report by Mr Rosado Fernandes, and in particular, the 28 amendments adopted by the Committee on Agriculture and Rural Development.
As I have said many times before in this Chamber, the European Union is a net importer of nearly 70 % of the tobacco it consumes. That is why we support the principle of production subsidies. May I remind you that tobacco-producing areas are mainly situated in less-favoured regions, and tobacco growing is extremely labour-intensive.
However, our group has tabled five amendments, as we are opposed to the principles of the cultivation contract auction scheme tying the producer to the first processor and the creation of a quota buy-back system.
Mr President, the COM in tobacco must continue and must enable the European Union gradually to become self-sufficient. Tobacco consumption must regularly decrease and production must continue to be limited to a constant tonnage of 351 000 gross tonnes of European tobacco, between the proposed new COM and the present COM.

Izquierdo Rojo
Mr President, the COM in tobacco should be treated using the same general criteria as govern the rest of CAP production. There is no basis for extremism, or different or unfair treatment compared with the other CAP products.
Also, at a time when the EU's main priority is employment, it would be very inconsistent to fail to take account of a crop like this, which is very labour intensive and provides jobs for women. We cannot on the one hand state that we are giving priority to jobs and then, when it comes to making concrete policies, ignore that principle. So I think it would be a very good thing if all the proposals relating to this COM had to take account of the impact on jobs. This reform has to favour young farmers in the most depressed areas of the EU.
I agree that we have to be able to reconcile protection of public health and the environment, but we also have to reconcile the social burden and the social consequences of this product.
Commissioner, we must also improve the management of the research fund, because it has been doing very badly so far. Reduced tobacco production in Europe does not result in less consumption, by any means. The result is simply that the European Union will have to buy this product abroad.
I also think it is right to make the reform more flexible and progressive, to the benefit of the producers. And I think it is good to be bold when it comes to investigating new uses and varieties of tobacco. Guarantees of work and income have to take account of the producers. We must prevent their income from falling, otherwise we would be forcing them - not giving them the choice, Commissioner - to abandon the sector.
I also think it is right that quality should not just be interpreted on the basis of commercial prices.

McCartin
Mr President, I agree with the persons who have said that this procedure is now a bit meaningless. In the MacSharry reform we were offered maintenance of incomes from agriculture and, at the same time, stabilization of the rural population. As we can see today this has not materialized. In this decade we have already lost 25 % of people engaged in agriculture and incomes have dropped by around 20 %. Therefore any improvement in the position of individual farmers has come at the expense of employment in the sector.
The situation in Ireland is even worse because of our high dependence on beef and sheep meat. As Jim Nicholson stated, the situation is exaggerated in Northern Ireland and the UK because of the strength of sterling and there is a new and very obvious reluctance by young people to embark on agriculture as a career.
This procedure is fairly meaningless because, taking into consideration the budget constraints together with the GATT decisions, we have very little capacity to influence the price that farmers can obtain for their produce. This annual procedure should be looking at the state of the agriculture industry, its long-term viability, recognizing that our share in world production is becoming ever reduced. While the market is becoming bigger, Agenda 2000 does not give us any more of a strategy than we had in the MacSharry reform to exploit these expanding markets and maintain the long-term viability of European agriculture.

Lambraki
Mr President, the Commission proposal concerning the tobacco market is governed by the idea of quota buy-back and, naturally, there are no proposals for improving quality, as Mr Fischler has said. Moreover, that is why he has rejected all our amendments which make provision for and promote improvement in the quality of European tobacco. The logic of wiping out tobacco growing in less favoured regions will have enormously negative economic, social and political consequences in those regions.
Mr Fischler, you know as well as I do and as well as all of us here, that in those regions it is not possible to grow alternative crops. That is why, traditionally, inhabitants have been cultivating tobacco there for hundreds of years.
There is the argument that tobacco is associated with damage to health. Indeed, but we still do not know just to what extent smoking plays a part in health issues and, secondly, there are other products that can cause health problems, such as dairy products. I have not heard you put an end to the buying of dairy products because they raise cholesterol levels. Do you know how many heart attacks are due to dairy products? Above all we must understand that even if we put a stop to European tobacco production, smoking will continue in Europe. And I believe that behind this anti-smoking campaign is hidden the attempt of large companies to import cheap tobacco which is of lower quality than European tobacco.
I would like to say to you that the latest statistics from the United States show that the way in which the campaign is being conducted - this American hysteria which has now inundated Europe -, instead of reducing smoking, is increasing smoking among young people. Let us not create conditions like the prohibition in America. Let us remain Europeans, in other words let us act in moderation.
I also wish to congratulate the rapporteur, Mr Fernandes, because I believe that his report is along the right lines.

Filippi
Mr President, overall I agree with the direction given by the two rapporteurs, whom I thank for the job that they did, and would like to make two brief comments on the two reports - one on wine and the other on tobacco. As far as wine is concerned, and specifically regarding the amendments that have been presented - which Commissioner Fischler says will be difficult to accept because tomorrow there will be the organic reform of the wine sector - I would just like to stress the importance of the problem. In the prices package these past two years, I myself presented a proposal aimed to renew the regulation on replanting and grubbing up. Generally speaking, a certain balance has been found on the market; now it is time to fine-tune the mechanism. In my view, management has to be regionalized in such a way that this market balance is found in all the major producing areas.
On tobacco I only want to say one thing: since I have seen that there are amendments - probably based on good intentions - aimed to cope even with any restructuring and reconversion of production, let us try not to be demagogic in our statements. There are areas that earn a living by growing tobacco. Myself, for example, I live in an area, lower Veneto, where people earn their living growing tobacco, and this is the case also of the region of Venezia and the province of Verona. So, before we start talking about restructuring, let us see what the alternatives are, otherwise we will be acting like demagogues.

Iversen
Mr President, I must say I find the results of Mr Rosado Fernandes' work on this report rather disappointing. Instead of a progressive report innovatively probing how to improve the reform of the tobacco sector, what we have is a report reflecting old-fashioned thinking, proposing massive support for tobacco cultivation and sustaining farmers in utterly untenable production. As if that were not bad enough, the rapporteur also strongly emphasizes the need to support young farmers to enable them to take over production. That is simply laying the groundwork for bringing a whole new generation into the trade so that for many years to come, the EU can continue producing poor-quality tobacco that can only be peddled with the backing of hefty EU subsidies. I searched the report in vain for any support of the Commission's excellent initiative of buying up quotas from farmers wishing to leave the sector. I searched in vain for new thinking on how to support and educate farmers in these vulnerable areas in how to switch production to non-hazardous products.
Further, I find it most regrettable that the rapporteur did not wish to give more financial support to the research fund. How else is the research fund supposed to function effectively? Or is it being muzzled intentionally? Mr President, I must say I am most disappointed with this report.

Fernández Martín
Mr President, this is the third proposed modification to the COM in raw tobacco in a very short time. Three reforms in five years are enough to define this situation as an unresolved crisis.
The measures implemented, especially the subsidies regime, have allowed the maintenance of crops and the survival of the sector, but have not resolved any of the structural problems. Europe's tobacco-producing regions are among the least developed in the EU, and no new job opportunities have been found as an alternative to the work provided by tobacco growing. The only alternative to growing raw tobacco is unemployment, in regions which are already suffering the highest unemployment levels in the EU.
In this context, Commissioner, I think your proposal is the best one possible, although it may not tackle some of the basic problems affecting the sector, as is clear from Mr Rosado Fernandes' report.
Because of all this, Commissioner, we are going to vote in favour of your proposal.

Virgin
Mr President, the report on tobacco is an opinion on the Council's proposal for certain changes to the market for raw tobacco. These changes are aimed, among other things, at certain quality issues. However, the overriding question of the justification of subsidies is not taken up. This is quite remarkable considering the debate about the harmful effects of tobacco and the ban on tobacco advertising which Parliament decided on a month ago. In fact a majority of Parliament's Members considered the problem to be so great that it justified disregarding the requirements of the EU's system of rules.
The opinion from the Committee on the Environment, Public Health and Consumer Protection proposes, among other things, that subsidies from the EU budget for tobacco production within the European Union should end no later than the 2006 harvest. This objective has also been expressed in Amendments Nos 37, 55, 65, 66 and 67. These proposals deserve full support. There is no doubt that it is irresponsible to spend public money, European taxpayers' money, in order to subsidize the growing of a product which does so much harm. After all, tobacco is responsible for the deaths of half a million people in the EU every year. The amount of subsidy has been around ECU 1 billion per year, or ECU 7 500 per grower. This casts a dark shadow over all other support systems in the EU, a shadow which could be lifted by a decision on abolition - an abolition which must of course take place in a socially acceptable way.

Baldarelli
Mr President, Commissioner, first of all I agree with the proposal for greater integration between production and processing in farm prices in the case of the hemp sector. In the case of tobacco, I would like to point out the difference in style between Commissioner Fischler and Commissioner Flynn. Commissioner Flynn definitely had less style in this House when he became very agitated, even gesticulating - it was not very clear what he wanted to emphasize -, and was extremely wrong in his opposition to the reform of tobacco. I do not believe it befitting for a Commissioner to behave in this way when the decision has been made by all the Members of the Commission.
As for tobacco, a lot has already been said on quality and employment. I would like to raise a few points. I believe that it is important, Commissioner, that the Commission prepare a specific communication for the Parliament regarding the annual 5 % quota set for research. We consider it important that the Parliament be informed how the research fund is being used: that means having not only the figures but also an analytical presentation of the results of this fund.
I agree with the idea of modulating the premium and consider it a useful proposal. It seems to me that the modulation of the premium should be linked to employment, quality, but I would like more information about environmental constraints. I consider it a good idea, for example, to increase aid to associations from 2 % to 5 %. They could use it especially to improve quality and particularly to develop environmental themes which are very, very important in this production. I believe that modulation should also take into account new production techniques, but not to the detriment of the important obligation of keeping people employed, given that if the European Union spends so much on tobacco, it does so especially because it has a major obligation to maintain jobs in the many regions that have very serious problems of employment. I am referring to the Mediterranean regions and also to some of the regions in Italy.

Garriga Polledo
Mr President, ladies and gentlemen, I rise to justify the position of the Committee on Budgetary Control on the reform of the raw tobacco sector described in the Rosado Fernandes report.
Our committee thinks the proposed reform presented by the Commission is acceptable, although we want to introduce a series of amendments, mainly aimed at strengthening Parliament's role in the reform procedure for this sector.
We think the right way to achieve that stronger role is through a procedural change, from Article 23 to Article 43(2) of the Treaty. This question of comitology, which the Commissioner has said he will not support, would guarantee that the Commission had to listen to and take account of the political positions defended by this Parliament in all aspects of this reform, particularly regarding the maintenance of a quality Community tobacco production.
We also regret that the Commissioner does not want to accept this procedural change in other reforms either.
In any case, we think the position adopted by ourselves and the rapporteur, Mr Rosado Fernandes, is rather more realistic and appropriate to the general problem of Community production than the position expressed, for example, by the draftsman of opinion of the Committee on Budgets.
In any case, the road to reform is open. I think we should involve the European Parliament in the defence of farmers and tobacco producers.

Wibe
Mr President, Parliament has made a decision to ban tobacco advertising. We have also made a decision to ban indirect tobacco advertising. We give support to campaigns to encourage people to give up smoking. We also give support to research to combat the harmful effects of tobacco on health. However, the biggest support we give is to the growing of tobacco, a crop which claims hundreds of thousands of lives every year in the Union.
Throughout the world, many more people die from tobacco than from Aids. That does not make sense. I know I speak on behalf of all Swedish Members and with the agreement of all the Swedish people when I say that this policy must come to an end. The subsidies cannot be justified on the grounds of employment or on the grounds that someone else would have produced the tobacco. By the same logic we could just as easily subsidize the production of nuclear weapons, or of biological and chemical weapons. The fundamental issue is not an economic, but a moral one. The Union's citizens do not want to finance the growing of this harmful crop.

President
The debate is closed.
The vote will take place today at 12.00 noon.

Agenda 2000: Economic and social cohesion
President
The next item is the report (A4-0219/98) by Mr Cunha, on behalf of the Committee on Agriculture and Rural Development, on the reform of the common agricultural policy (Agenda 2000 - Part One, Chapter III) (COM(97)2000 - C4-0522/97).

Cunha
Mr President, Commissioner, ladies and gentlemen, the object of this report is to provide the European Parliament with a set of general principles which can be used as a reference framework for the sectorial reports to be approved later on.
In that respect, as rapporteur I should like to underline a few fundamental points:
Firstly, the real world of European agriculture is not limited to the small number of farmers who can export without receiving refunds. We must be more careful over price reductions and continue our interventions regarding beef and olive oil, notwithstanding the Commission's proposals.
Secondly, the reform of the CAP cannot be limited to reducing guaranteed prices and offsetting them against productivitylinked direct aid. The Commission's proposals must be amended in that respect, because they represent a fundamental analytical error. That error consists of starting from the principle that all farmers are on an equal footing in the face of the external threats arising from the GATT, which is not the true situation. Now we all know that the less specialized, more peripheral, more extensive, less productive agricultural systems, and in general those in the less favoured mountain, arid or Arctic areas, start at a major disadvantage and will be the first victims of the globalization of agricultural markets if the CAP does not grant them the minimal response they need to survive.
Thirdly, this justifies our reinforcing our horizontal measures and the aid we base on territorial areas, the environment, forests, the diversification of the productive fabric of the most highly-dependent agricultural regions, animal and vegetable health, and aid related to employment and the less favoured areas. Now, the proposal on rural development is clear enough but it should nevertheless ensure the achievement of that object and it is, in fact, a long way from doing so, in view of the sparseness of the financial resources provided. The Commission quite rightly calls that rural development policy a 'second pillar' . But we shall not have a pillar if we keep quiet; it will be no more than a stem or a cane, unless the Commission substantially alters this aid scheme.
Fourthly, I think the Commission's proposal for the direct financing of the rural development policy is the right one, because this will make it possible to improve the internal consistency of the CAP and prevent double standards and different responses to different kinds of farmers. For that reason direct financing should also apply to rural development in the regions mentioned in Objective 1.
Fifthly, although the question of extension is not in dispute, we must realize that farmers have real fears and apprehensions, in view of the enormous number of reforms and changes they have gone through and the wide present and future implications of GATT. For that reason, and also for the sake of clarity and openness, I think finance for all pre-accession measures, whether agricultural or not, should appear under a separate heading, distinct from all our common policies, and should only be integrated as each country becomes integrated.
Sixthly, although every productive sector of agriculture has its own peculiar characteristics, the fact that direct production aid only goes to those sectors which enjoyed high levels of protection in the past is causing more and more problems for social and political cohesion. The truth is that some cultures, such as Mediterranean culture, for example, have never been protected by the price system in the past and are therefore not getting the benefit of income assistance now.
In the long term this is an untenable situation which will force the European Union to think about systems based on other factors than just set-off for price reductions in the future. If this is not put right we shall in future be creating a kind of agricultural apartheid with some cultures entitled to direct aid and others excluded from it.
Seventhly, it is becoming a fundamental requirement that, in the spirit of the Amsterdam Treaty, the CAP should contribute to the economic and social cohesion of the European Union by creating a basic balance between forms of production, territories and farmers, as indeed has been declared by the Ministers of Agriculture and at the December summit itself.
Finally, and as my eighth point, it is important to emphasize that the Commission must take the coming negotiations on the future of the GATT very seriously. It has now been proved that Europe is in a unique situation based on multi-functional agriculture and the family-sized nature of its operations. Its average farm size of 18 hectares is not in the same league as that of its competitors in the world markets, whose average size runs into hundreds of hectares. We must not compare two things that are totally disparate, nor must we fall into the trap of following other people's interests. Apart from that, the rules of fair trading must cover such important matters as consumer sensitivity, environment-friendly practices and respect for human rights and basic freedoms.
Finally, I would encourage the Commission to take into consideration these guiding principles which I have suggested and which I hope Parliament will approve. If it does, we shall at last have a balanced common agricultural policy that is capable of treating farmers fairly in the future.

Cunningham
Madam President, ladies and gentlemen, CAP reform is a key element of Agenda 2000. On that subject, may I underline at the outset the essential need to build an open, constructive dialogue between the Council and Parliament on these issues. Such a dialogue, taking place within the requirements of the Treaties, can only benefit everyone involved. It can only help the common good. It will allow each institution to collaborate with the other so as encourage both to play their part fully in the decisions.
On CAP reform, the Agriculture Council has already made a successful start, with the Commission's proposals having been put to a special Agriculture Council on 31 March. The Council has acknowledged the need for reform in order to establish a clear direction for the development of European agriculture. We need this not least in order to take on board the forthcoming enlargement of the Union. There are also the challenges posed to us by the forthcoming World Trade Organization negotiations.
Let me be quite clear about this. We have no alternative but to plan ahead now to meet these challenges which we know will face us. We have already begun this important process. The Council has identified several key issues which will need to be addressed in the next phase of the negotiations on the Commission's proposals. These include the need for and appropriate extent of cuts in support prices and the timescale over which any such cuts should be achieved, the appropriate nature of compensation for such cuts, the conditions under which Member States may exercise discretion with regard to agricultural support, the future role of production constraints such as milk quotas in a reformed CAP and the appropriate balance of support between production sectors, producers and regions within the Union.
Finally, there is the question of development of the rural economy and protection of the rural environment including multifunctional agriculture. As well as addressing the need to reform individual commodities, the Council has welcomed the Commission's proposals to address the wider problems experienced in rural areas throughout the Union. Agriculture is, indeed, an important part of rural Europe but it is only one part and we need to look at what can be done on a European level for rural communities and areas as a whole. The Council has, therefore, established a clear framework for the next phase of the negotiations on the Commission proposals.
These key issues are currently being put to Heads of Government in Cardiff as we meet to discuss them here in Parliament. Detailed work will continue in the remaining weeks of the UK presidency and then continue under the presidency of our Austrian colleagues. The key to success will be to balance effectively the interests of the Union's consumers and producers and the needs of the environment in promoting a sustainable versatile structure for European agriculture. That structure needs to be robust enough to meet the challenges I have illustrated and to compete effectively on the world stage.

Colom i Naval
Madam President, I should like to state straight away that, in general terms, the Committee on Budgets agrees with the report presented by Mr Cunha.
Obviously, we would have preferred our amendments to have been definitely accepted but, in fact, there are not too many contradictions. Indeed, I think there is more agreement than anything else.
However, as far as the Committee on Budgets is concerned, there is a basic question mark over all Mr Cunha's proposals: is there money or not?
Paragraph 36 asks for increased funding and, frankly, in the Committee on Budgets we have to say we think that request is premature. And when I say premature, I mean what I say. We are not saying it is not justified. We are just saying that at the moment it seems premature.
That is why we asked at the time, in the December resolution, that a clause about the revision of the financial perspectives be included, in order to deal with this additional need should it arise.
We believe, as Mr Cunha rightly said, that the main aim of the CAP reform - or CARP, including rural policy - is not to make savings, but to improve the policy.
The fact is that since 1988 there has always been a systematic saving - between the ceiling of the first category and the agricultural budget - of the order of ECU 1000 million to ECU 1500 million per annum. Furthermore, the budget has always exceeded the implemented spending. That is why we are cautious.
But I can assure you, were we to see problems approaching, we would support the Committee on Agriculture and Rural Development in seeking to obtain that extra funding.
In paragraph 57, the Committee on Agriculture and Rural Development considers that enlargement costs should remain outside the guideline but, in our opinion, that contradicts what we said in December: that the agricultural costs of preaccession and enlargement should be covered by the guideline. In that way, we think EAGGF and the agricultural policy should really form a fund which is part of cohesion policy and not, as people have started saying, an anti-structural fund.

Pinel
Madam President, ladies and gentlemen, I wonder whether there is any point in having draftsmen of the Committees' opinions, if the Council speaks before hearing them. I shall however report to you on the opinion of the Committee on Regional Policy.
The reform of the common agricultural policy which is proposed in Agenda 2000 raises a large number of questions and some concerns. There is a fear that rural regions will suffer under this reform. There is more at stake than just agriculture, important though it is. The challenge is to achieve a balanced development of the countryside, which manages to avoid large-scale emigration from rural areas, and all its attendant problems: depopulation of whole regions and the growth of already overpopulated conurbations, which are more and more insatiable where Community funds are concerned.
However, the importance of rural development for balanced management of the countryside and the preservation of both the natural and cultural heritage and the specific characteristics of the fisheries sector and the financing needs of the Common Fisheries Policy require the creation of an independent sub-objective specifically dedicated to 'rural areas' and 'maritime and coastal areas', within the new Objective 2.
The fact that the new EAGGF regulation brings together all the measures for the development of rural areas is useful, provided that the EAGGF continues to finance only actions directly connected with agriculture, together with coastal and maritime areas, which must not be forgotten. It is also necessary for the Commission to put forward firm proposals to link agriculture with its local region: local products, labelling, etcetera. As well as improving quality, this would help us to safeguard against unfair competition from countries with low wages and without welfare protection. Our ambition should be to enable the harmonious development of agriculture and craft industries, and to promote complementary activities such as rural tourism and direct sales of produce.
We can thereby provide ourselves with the means to bring the countryside, which is threatened with depopulation, back to life, and to maintain a dynamic rural environment throughout the fifteen Member States of the Union, in accordance with the intention expressed at the recent Luxembourg Summit. This means that we must continue the actions undertaken under the current Objective 5a, in order to encourage young farmers and fishermen to invest and to set up, and also to facilitate the processing and marketing of agricultural and forestry products, and to facilitate the development of mountain regions.
These are some of the concerns expressed by the Committee on Regional Policy, which Mr Cunha and the Committee on Agriculture and Rural Development were kind enough to incorporate into the body of the report. I should therefore like to thank them.

President
Thank you, Mr Pinel. You are asking about the point of the debate. If the Presidency of the Council... Are you listening? You are not listening! Then I do not really need to say it, but I wanted to point out that the Commission, Mr Pinel, will speak at the end of the debate.

Souchet
Madam President, the Committee on Fisheries unanimously adopted the conclusions I proposed in the opinion intended for the Committee on Agriculture and Rural Development. The latter also confirmed these conclusions. However, on behalf of my group, I have tabled two amendments which revise the conclusions of the opinion on the basis of the Commission's latest proposals.
A horizontal regulation specific to the fisheries and aquaculture sector incorporating all the measures of the former Objective 5a seems indispensable, as in the case of the proposals relating to rural development.
What is the point of the Common Fisheries Policy if it is no longer applicable throughout all the Member States, and does not include the areas which are not eligible under the new Objectives 1 and 2? If we implemented the Commission's present proposals, the CFP would amount to no more than a number of technical constraints upon our fishermen and a policy of destruction of fishing vessels. This would mean moving in the direction of those who see the CFP as a transitional system, a mere prelude to the complete liberalization of the sector, whereas the aim and the justification of the CFP was to support the fishing industry in all the Member States with coastal areas.
The Committee on Fisheries therefore asks the Commission urgently to propose a horizontal regulation for fisheries which, like rural development, should be financed by the EAGGF and entered in the budget under the agriculture guideline.
The fisheries sector requires a limited volume of credits, but they are of great importance, whether they are required in coastal or maritime areas, which are vulnerable, or in rural areas engaged in mainland aquaculture.
We were all deeply shocked by the total absence of the word "fisheries' in the initial version of the Commission's communication Agenda 2000, as if the European Union had no coastline. Realizing its mistake, the Commission presented to us a draft incorporating the coastal and maritime areas in the new Objective 2. This is a step in the right direction. It is nevertheless inadequate because all the fishermen in the European Union operate within common areas, and it would be particularly inappropriate if the rates of aid implementing the Common Fisheries Policy were to vary from 0 to 75 % depending on the home port of each vessel.

Fantuzzi
Madam President, I would like to acknowledge the fine work that Mr Cunha did and say how useful it is for the next stages. However, greater conviction could have perhaps gone into seeking a clearer and more effective compromise, because this resolution has too many points. This also recalls the need to have stricter rules in Parliament's work so that we do not always end up with interminable documents in which a few good things of substance get lost in a sea of repetition and obviousness. I cannot see how this gives us a better picture.
If the aim of this own-initiative report is to condition relations on the sectoral aspects of Agenda 2000, its success will not, however, depend only on the excellent rapporteur, Mr Cunha, but I believe to a great extent on our future work. We will therefore have to see whether all together we can use this text as a starting point and advance with a coherent plan to reform the CAP. The first signs of discussion in the Council of Ministers, Mr Cunningham, do not augur well. At a time when all talk is about the World Cup, we are still passing the ball back and forth and not scoring any goals. There is agreement on the laudable definitions, like the European agriculture model, multifunctionality, competitiveness, rural development, but as soon as the focus shifts from statements in principle to concrete facts major differences emerge and everything is engulfed in the sea of special interests, with the risk of seeing a very long shopping list.
We Socialists see two risks. The first is that the entire debate will be conditioned by the price guarantees of market policy and by their exclusive nature. In this case, rural policy would still remain the weak pillar of the common agricultural policy, despite the Cork Conference and the commitment of the Commissioners. Instead, as we stated at a conference in November, structural policy must increasingly become the key policy in agriculture, with emphasis on investments in various sectors, quality and the regions. If the market is to grow in importance and traditional protections are to decrease in importance, the real market policy sustainable in the future is structural and rural policy.
The second risk is that all the problems with the horizontal regulation of the CAP - modulation, the definition of a maximum amount, cross compliance - will end up being a lost opportunity. At a time when subsidiarity is all the rage, we believe that it is a mistake to confer total responsibility for such important matters on the Member States, a choice that some would think too courageous but that in reality shows, I think, the little courage on the part of the Commission to take on decisions at European level that are in keeping with what has been said repeatedly and what public opinion is calling for, a public opinion increasingly attentive to what is happening inside the black box of the common agricultural policy.

Goepel
Madam President, I have only two comments on the Cunha report. Firstly, it is a good report. Why? Because Mr Cunha has succeeded in achieving a sensible, mutually beneficial co-existence between current position papers by the parliamentary groups and future reports on the production sectors within the framework of Agenda 2000. Furthermore, the rapporteur has kept to the recommendation by the Committee on Agriculture and Rural Development not to go into detail in his report, which did not, however, prevent him from - rightly - making the opinion of the Committee quite clear on the focal points of the future Agenda 2000.
Secondly, the protagonist in the Agenda 2000 discussion is price reductions in exchange for more or less sufficient compensation, Commissioner. We can debate it as we wish but there has to be some guarantee that farmers do not derive their incomes solely or substantially from compensation but that they can participate in the market more than before. This is exactly the point that affects our voters, the people who put us in this House and who, not being farmers, increasingly fail to understand this system of financing.
But have our voters ever asked why production price reductions - undertaken, for example, in the MacSharry reform in 1992 - never filtered through to the consumer? What will be the effect of the future Fischler reform, to give another name to the agriculture part of the Agenda? Commissioner, will bread prices fall? Cereal prices are to be reduced by 20 %, after all. Will beer become cheaper? A delight to all aficionados of this drink, as the percentage of cereal in this lovely product is by no means insignificant, and the price of cereals is being reduced! Will meat become cheaper, given the planned 30 % price reduction? What about the price of butter? Last but not least, the price of compound feedingstuff in animal feeds should become cheaper. Will we be able to expect this? If this were the case, our voters, who are not only concerned with agriculture, would certainly have greater understanding for European agriculture. But they will have to be able to see it in their wallets when they go shopping. Then European agriculture would be a great deal more credible!

Mulder
Madam President, firstly, I would like to offer my congratulations to Mr Cunha, who has worked with a great deal of enthusiasm on this report. To use a Dutch idiom: we had the impression that you 'felt like a fish in water'.
The Commission is putting three arguments forward for the Agenda 2000 proposals. Firstly, if we do nothing we will have overproduction once more. Secondly, we must prepare for the coming WTO negotiations. Thirdly, we must prepare for the accession of the central and eastern European countries. As far as I am concerned, and as far as my group is concerned, we think the third point is by far the most convincing. Maintaining peace and security in Europe is worth paying for, and the agricultural sector will also have to pay for this, just like other sectors in the European economies. My group therefore supports the Agenda 2000 proposals in principle.
The prices in Eastern and Western Europe should gradually start to converge, and this means that in our part of Europe the prices will have to fall. We believe that compensation should be awarded for this price reduction. In contrast to the Cunha report, we believe this compensation should also apply to specific products, such as milk. In addition, and this concerns a different policy, an active rural policy will have to be pursued. I believe this policy is not controversial, and we also support it.
There is another aspect besides compensation for price reduction. In our opinion, the development of new markets is decidedly missing. Much more could be done about the quality of agricultural products. How can consumers easily recognize this quality? I hope to make concrete proposals to Parliament about this later in the year.
Another omission from the Agenda 2000 proposals concerns proposals in the sphere of agrification. This can only be effective if the Commission pursues an effective policy by making the use of certain products compulsory. This does not concern subsidies or excessive subsidies, but simply saying that a certain product originates from agriculture, that it is good for the environment, and that is why we should be required to use it in a major way. This can be an effective new market for agricultural products. I should like to recommend this.

Rosado Fernandes
Madam President, Mr Commissioner, I would like to congratulate Arlindo Cunha on his excellent work, resulting from his experience as the Portuguese Minister of Agriculture and also as the erstwhile President of the Council of Ministers of Agriculture, at the time of the MacSharry reforms.
We are obviously at the stage where, after its initial pride in the child it has brought up, called the CAP, the European Union has become ashamed of that child and now treats it as though it were illegitimate. The truth is that attacks on it in the world market, by American criticism, by Fortress Europe, by the Keynes group and by all the groups whose historical situations are very different from ours, including the United Kingdom itself, have naturally made Europe ashamed of the CAP it created and which it now considers to be an illegitimate brainchild.
That is the situation we are in and it is that situation which my honourable friend Mr Cunha is at least trying to improve. It attributes importance to young farmers, to territories and territorial differences in fertility and climate throughout Europe, it attributes importance to something no-one has previously thought important; on the other hand, it places great emphasis on the expression 'rural development' , which I would rate less highly, because I know it is almost a utopian vision to aim at rural development based on agriculture. Rural development has to be effected in competition with services and industry - that is my experience in Portugal - and I, of course, have never seen agriculture bring about any development in any region whatsoever. Let us be honest about that!
I also appreciate the fact that Mr Cunha has drawn up the report with one eye on the GATT. But I would have liked the Commission at least to have thought a little. When the price reductions come, apart from the green box and the blue box, which black box will the redundant farmers of Europe be put in? I would like to know the number.

Jové Peres
Madam President, first of all I should like to thank Mr Cunha for his excellent report.
This report can be no more than a first approach to the reforms contained within Agenda 2000. Nevertheless, it has a very important added value because it has done work that the Commission should have done, given that the job of proposing legislative initiatives wrongly belongs to the Commission.
Before addressing the principles of Agenda 2000, Mr Cunha's report presents an analysis of the defects of the 1992 CAP reform. In attempting to tackle a new CAP reform, we first need to analyse the faults of the earlier one. However, the Commission has not done this. To my mind, that is one of the great merits of the Cunha report.
In trying to perform an in-depth study of the principles of the 1992 reform, none of the institutions can allow themselves to ignore its effects, which were negative in many cases. We cannot ignore the huge number of farms which have disappeared, or the effects on the social fabric of the rural environment and land use. We cannot ignore the enormous destruction of agricultural jobs, especially when our policy formulations make job creation one of the political objectives of the European Union.
Nor can we ignore the fact that the 1992 reform exacerbated all the imbalances already present in the CAP. There has been an increase in the extent to which aid is concentrated on a few farmers. The budget has become even more concentrated on a small number of common organizations of the market, while Mediterranean products receive less funding, and are subject to proposals which entail their virtual dismantling.
If the Cunha report had gone no further than this, that would still have been quite a lot. It gives a political signal that with Agenda 2000 we are playing with fire. The European Union must understand that it is on the point of taking a wrong turning. If we were to add the collateral structural policy proposals, with the new role for the EAGGF Guarantee section in the rich regions, we would be faced with a loss of geographical concentration and a loss of cohesion in the rural zones.
So we need to thank Mr Cunha once again for all his efforts, and other institutions need to understand that European construction cannot be carried out by means of abstract formulations or experiments.
The European Union also needs to demonstrate its true weight in settings such as the World Trade Organization, where its stance has most often been one of passivity and renouncing its own position.

Graefe zu Baringdorf
Madam President, Mr Cunha has presented a very good report. My group will support him. He has made it clear that in the past this intervention system led to great disparities and injustices among producers, countries and regions, and that it had a destructive effect on jobs and the quality of food. As I said before, Mr Fischler, a policy of price reduction within the intervention system leads to farms being excluded, and is fatal for farms and regions which are sensitive in their production and do not belong to the favoured sectors. Here we must make a radical change. We must move away from the intervention system and instead move towards an integrated development of rural areas, as is intended in the second pillar of Agenda 2000.
It is essential here that we offer a structural policy on a horizontal basis as in many areas we cannot sustain a policy of price reduction or a departure from the intervention system without regional markets being strengthened. This would lead to the destruction of further jobs. For this reason, we must be able to compete in terms of quality as a matter of urgency, Mr Fischler, and this should also apply to production in the world market. Those who wish to produce for the world market may do so, but they should do so without state aid! This would lead to an increase in prices on the world market, giving many farmers in Third World countries a chance once again to secure their livelihood by producing food for their countries and regions. If we continue to dump to the tune of millions, this development will constantly be destroyed and it will result in social and ecological dumping.
I would like to mention external protection briefly. This is, on the whole, confirmed by the parliamentary groups and I hope that the Commission will keep to its plan of also protecting regional development within the EU by protecting against external social and ecological dumping. This would also help to stabilize the situation in the world market, which in turn would benefit those countries that are weakest in terms of agricultural production.

Barthet-Mayer
Madam President, Commissioner Fischler, ladies and gentlemen, we all agree that our agricultural sector must be capable of contributing towards the expansion of the world market, whilst preparing for enlargement and the forthcoming WTO negotiations. We all agree that the distribution of subsidies must be improved, taking into account the multifunctional characteristics of agriculture. We applaud the Commission's stated intentions, but tremble at the proposed solutions, based mainly on the so-called inevitable trend to liberalize trade, resulting in a general decrease in prices, and with the development of raw materials on the world market as our only aim.
The competitiveness of European agriculture must not depend upon a single parameter. The quality of products, their processing, their suitability in terms of international demand and dynamic commercial policies, as well as low prices, are capable of increasing our export potential. We do not need a smaller budget, we need a better budget. We need a redirected budget to support the European agricultural model which Mr Cunha described so well in his report, a model which reconciles the necessary economic aims of agriculture with the requirements of public health, product quality, the environment, land use, rural development and aid to young people.
That is the model on which the strengthened CAP should be based, without opening the door to its renationalization. Community preference must be incorporated, and we must not forget that we have a production deficit in some product areas, such as oilseed proteins, citrus fruits, fish and wood. We should not put the cart before the horse, and we must not give up before we begin.
We shall be in a much stronger position to negotiate the CAP in the face of the WTO's demands if we reform the CAP beforehand in accordance with our objectives. Let us not underestimate what is at stake. The CAP reform and Agenda 2000 represent a choice we have to make for society. It is we politicians who must take responsibility for this. I should like to thank Mr Cunha for reminding us of this.

des Places
Madam President, ladies and gentlemen, as rapporteur on the Commission's communication Agenda 2000, I asked the Committee on Agriculture and Rural Development to draft an own-initiative report on the common agricultural policy reform, and I am delighted that the task was entrusted to Mr Cunha.
Indeed, within the framework of a very limited budget, Agenda 2000 proposes the reform of two of our most important policies: the common agricultural policy and the structural policy. At the time, I was struck by the Commission's purely budgetary approach in its proposed reforms of the COM for arable crops, cattle and diary products. The specific features of European agriculture were not taken into consideration, and in its determination to get into line with the international agricultural model, the Commission failed to define a true European agriculture model which took into consideration the specific nature of our rural development and land use.
The report originally submitted to us by Mr Cunha was a good report. The many amendments tabled by the Committee on Agriculture have made it much less coherent, and in places it even has a slight bias towards the sort of ideology which disregards the fact that above all else agriculture is an economic activity.
To conclude, Madam President, let me give an example: if we want European agriculture to continue, young people must enter agriculture. The only real policy which will encourage young people to become farmers is to offer them an economically profitable activity based on an agricultural policy which is visible in the medium term. What attitude will the European Commission have when the forthcoming WTO negotiations start in June 1999? A strategy of attack has yet to be defined, and the agricultural policy reform proposed by the Commission does not take that important international deadline into consideration. On the contrary, it wants to give farmers partial compensatory aid to compensate for price reductions, in the knowledge that such aid is limited within the current framework of GATT regulations and that our fellow citizens do not understand what it is for.

Martinez
Madam President, this morning we discussed olive oil, agricultural prices, tobacco? this afternoon, we will discuss bananas. Thanks to Mr Cunha's excellent report, we can respond to this third reform of the CAP proposed by Mr Fischler. We have had Sicco Mansholt's CAP, based on prices and incomes. As a result, we have lost 12 million farmers, which makes Sicco Mansholt the Pol Pot of agriculture. We have had the 1984-1992 CAP, with stabilisers, quotas, maximum guaranteed quantities? which was a failure. Only yesterday evening, we were informed that stocks of cereals had increased to 14 million tonnes. And now, we have a third reform, which rather reminds me of "The Leopard' by the Italian novelist Lampedusa: everything must change in order to stay the same. The reasons are the same: in 1992, we had to prepare for GATT, in 1998, we have to prepare for WTO. It is estimated that 21 % of the complaints addressed to the WTO are about Europe, and more than one third of the complaints come from the United States.
The system is also the same: it is still Malthusian and budgetarist. It is Malthusian because of its price decreases, set-asides, sale of foods on the international market and savage cuts (of vines, for example), and budgetarist, with its petty accounting and rationing, even more stringent now that we have the magic amount of 1.25 % of GDP to finance both pre-accession and accession.
In reality, the technical questions raised by Mr Cunha, relating to non-food use, the decoupling of production aid, product quality, ceilings on aid and safety, and so on, mask a real choice between two models, American or European, as Mr des Places, Mrs Barthet-Mayer and many others have said.
The keyword in the American model is "intensive' . In the United States, agriculture is a combination of chemistry with the added mystique of genetically modified organisms: nitrates, herbicides, pesticides, fungicides, and now GMMs. The keyword in the European model is harmony. Harmony between producers and family export businesses. Harmony in production areas, in the south - tobacco, wine, fruits, vegetables, olives - and in the north, resulting in a range of products which gives the consumer harmony in health, thanks to the quality of products, harmony between the mountains and the plains, aesthetic harmony, ecological harmony and mental harmony. Minister, harmony in agriculture would mean fewer British hooligans in Marseilles.
Obviously, the consequences of the American model are well known in comparison with our own: soil destruction, ground water pollution, contamination, mad cow disease and alienation. Monsanto and Pioneer, in the name of patent rights, even want to transform American farmers into workers who no longer have the right to re-use seeds.
So we must first of all protect the European model, if we wish to defend it against the archaic American model. We must use Community preference, the essential heart of Europe, to protect it. Without Community preference, there is no Europe. We must protect it by keeping prices high, which will help to maintain high income levels. We must protect it by improving the quality of our products and by increasing their added value, which justifies high prices and the exportation of our model. Exporting our model does not mean aligning ourselves with world prices, by decoupling production aid; it means providing export aid as the United States does within the scope of FAIR legislation, which maintains export credits, particularly for the benefit of the Ukraine, Egypt, Russia or South Africa. Finally, Commissioner Fischler, we must defend the European model during international negotiations. You are European Commissioner for Agriculture, not Under Secretary of State for Agriculture of the United States.

Colino Salamanca
Madam President, I too should like to congratulate Mr Cunha on the work he has done and, especially, on the arguments put forward in his report. I think his work shows that the Agenda 2000 document is tremendously unbalanced. It is very clear and very radical in certain approaches, specifically as regards prices. Nevertheless, it is very unclear as regards additional measures. Specifically, it is very radical on price reductions, which are compensated partially rather than fully, as before. It is also very radical in giving equal aid to all crops without taking their differences into account, which could mean the end of sunflowers.
On those subjects, the Commission document is tremendously clear and radical. However, in other aspects the proposals do not display the same decisiveness. As has already been said, it gives the impression that the only reason for this new reform is the demands of future WTO negotiations.
But the document says nothing about the future of European agriculture. As has also been said several times, we want this agriculture to fill Europe's land and continue to play an environmental and social role. There is no mention of the need for the CAP to respond to criteria of economic and social cohesion, or the need to guarantee a balance between crops, farmers and land. To give a negative example, we need only remind ourselves that the budgetary imbalance means that southern crops and continental crops receive different protection. In the same sense, what role do we really want the aid to have? From this point of view, the horizontal regulation does not clarify things much.
As regards rural development, I do not think the approach taken in Agenda 2000 comes anywhere near meeting the hopes raised by the Cork Conference. It seems that in the future we shall not be able to count on a real, properly integrated, truly multisectoral, adequately funded rural policy, which is capable of alleviating the problems presented by Agenda 2000's lack of balance.

Sonneveld
Madam President, my colleague Mr Cunha had the task of writing a report concerning a number of horizontal problems in the agricultural proposals of Agenda 2000, and of providing a long-term view of these problems. He succeeded in this, and the Committee on Agriculture and Rural Development also added important insights on a number of points. At the same time, this vision of the European agriculture model offers the framework for future policy on the agricultural integration of Eastern Europe. For the citizens in their capacity as consumers and tax payers, it also justifies why such agricultural and rural policy must be pursued. But the report is, of course, global. It does not analyse, for instance, which measures should qualify for EU funding and which for co-funding. The Committee on Agriculture and Rural Development has yet to work out this horizontal problem together with the Committee on Budgets.
The report tries to create a balance between competitive agriculture and the necessity to support areas and groups which, because they occupy a more or less permanently disadvantaged position, need a larger income. Yet the notion of profitability for farms has perhaps retreated too much into the background. If prices are reduced to below the cost price of the most efficient farms, then the compensation for these farms must be in proportion to their productivity. Otherwise they will also disappear, and this surely cannot be what the common agricultural policy intends. Therefore, the section of the report on dairy policy has been carelessly formulated, and as such is unacceptable.
On the issue of linking environmental stipulations to direct payments, the report rejects the Commission proposals for national criteria. Still, we shall find out that it will never be possible to formulate environmental stipulations at the EU level for all EU regions. The reality will force us into the direction of greater subsidiarity. Moreover, this offers a better guarantee that EU farmers will not be saddled with more rules and bureaucracy.

Boogerd-Quaak
Madam President, Commissioner, I think that Mr Cunha has managed to move a number of goal posts, which was much needed. He has broadened and deepened the debate, and this is something we should continue, because I believe that otherwise we will not be able to cope with the next WTO negotiations. It is my view that at the next WTO negotiations we should not raise the issue of product amounts with linked price support, but rather issues such as food quality, environmental demands and social criteria. I am therefore pleased with Mr Cunha's proposals that we should ultimately aim for decoupling production aid. In this context I would like draw the Commissioner's attention, although you are undoubtedly familiar with it, to the Buckwell report, which contains a number of interesting proposals for switching over to decoupled aid. Perhaps the report requires a little more attention from the Directorate-General of Agriculture than it has been given until now.
Madam President, I believe that the Americans with their FAIR act will most certainly take over a section of the global market, and that we have not progressed as far with our system. They also give a certain type of aid. We will therefore have to think a lot more creatively about this aspect.
To conclude, Madam President, I would like draw attention to rural development. The demographic data show that in large areas of Europe, the rural population is continuing to move into the city. We will not be able to stop this migration with agricultural policy alone; it requires a broader rural policy, as well as the resources to develop this policy. For this reason I look forward to the actual implementation of the proposals which were developed in Cork.

Hyland
Madam President, I should like to congratulate Mr Cunha. He has produced a very objective report. All of us in the Committee on Agriculture and Rural Development very much appreciate his work.
The recent proposals issued by the European Commission to reform the common agricultural policy must indeed be substantially changed, from an Irish perspective. Unless the proposals are extensively amended many marginalized Irish farms will come under pressure and some may not survive. Such a development would have serious consequences for the socioeconomic infrastructure of rural communities. The Commission proposals as they stand now, if implemented in their entirety, would have the following detrimental effects on Irish agriculture.
Firstly, in relation to the discrimination in the share-out of the milk quota, Ireland has a very legitimate claim in relation to additional quota. The proposals which do not provide for full compensation would have devastating effects on the Irish beef sector. In Ireland, as everybody knows, beef and milk represent 71 % of our entire agricultural output. The proposals, as they stand, would result in income reductions for Irish farmers, destabilize the structure of family farms, dissuade young people from taking up farming as a profession and would lead to continued rural depopulation.
We must remember that, in comparative terms, agriculture is nearly three times as important to the Irish economy as it is to the EU as a whole. In 1997 the common agriculture policy was worth £5.1 billion to the Irish economy. In the context of the Agenda 2000 proposals price reductions can only be supported if they are accompanied by full payment to farmers so as to offset the effects of the proposed price reductions. The direct payments being proposed by the Commission are not adequate and must be addressed before we can agree.
In conclusion, the CAP reform proposals are unacceptable to Ireland because they are not balanced, they do not protect the interests of Irish farming and they do not enhance rural development.

Querbes
Madam President, I hope the European Parliament will adopt Mr Cunha's excellent report. In doing so, it will express an opinion on the reform of the CAP, and will also express the reaction within the agricultural sector against the Commission's proposals.
Commissioner Fischler, the Commission has not learnt any lessons from the 1992 reform, which has increased job losses in agriculture and rural areas, exacerbated inequalities in the distribution of Community funds, kept agricultural incomes down to 60 % of the average wage, and caused imbalances in land use. Worse still, the Commission continues to confine itself to a doctrine of price decreases and productivity races, which threaten jobs, social, environmental and regional stability, and the independence and quality of food.
As the rapporteur emphasized, what agriculture and European society actually need is a CAP reform which offers a real alternative. It must fundamentally redirect a number of measures, consolidate the European agricultural model and enable agriculture to face the new challenges ahead of society, in the areas of employment, food, energy, the environment and water supply. How can we do this? What tools must we use?
The rapporteur correctly reminds us that prices and markets policy must be based on the three traditional pillars of CAP, particularly Community preference. And he makes proposals for the future. One such proposal relates to the basis of agricultural income, which must be derived essentially from the production and sale of agricultural products. By prices rather than subsidies. He raises the question of ceilings and the adjustment of subsidies on the basis of criteria which promote employment, and for the same purpose, a readjustment between northern and Mediterranean production areas. He proposes that the definition of international commercial relations should be based on clauses relating to production costs and environmental, social and employment standards. He even refers to the question of the principle of rural exception, which must set down the limits to globalization in the sector.
This report provides an excellent basis for discussion and suggests alternatives to the Commission's proposals. It will be of benefit to the farmers and people of Europe, and the Council should take inspiration from it.

Nicholson
Madam President, I would like to add my thanks to Mr Cunha and congratulate him on a very excellent report. It proves beyond any shadow of doubt that the Committee on Agriculture and Rural Development, which sometimes comes in for tremendous criticism from Members in the Committee on Budgets and elsewhere can, on occasions, come forward with very constructive reports.
As we are all aware, the report looks towards enlargement of the European Union and the WTO discussions - the whole Agenda 2000 process. It will have a very long-term effect on agriculture and as we have known it within the European Union.
There are a number of points I wish to make. It is important that we ensure that the existing family farm structure of the European Union is protected in order for it to survive. Member States are extremely enthusiastic about enlargement, but at this moment the Council in Cardiff is probably trying to cut back the contributions to the European Union. On the one hand they want enlargement while, on the other hand, they are not prepared to pay for it. They cannot have it both ways. Member States are going to have to face up to that principle no matter what approach they take. We must have a longer transitional period and extend the time before enlargement.
One other point I want to make very strongly: we must not allow the renationalization of the common agricultural policy as we have known it. I am very concerned at the proposal for national envelopes because I believe that will bring inequalities between Member States. Indeed, there is the whole problem of additionality, which we have seen in the past.
Personally, I would like to see Parliament and the Committee on Agriculture and Rural Development fully involved in the whole Agenda 2000 process.

Görlach
Madam President, my honourable friends, our colleague, Mr Cunha, has in fact presented a report which we can approve. However, we will see that problems will arise when it comes to details. As you all know, it is easy to agree on general issues but we all have different views when it comes to specific details.
With regard to the Commission's address I would say that the Commission's proposals in Agenda 2000 are definitely a move in the right direction. But they are flawed. The proposals rely too heavily on product-related subsidies. Anyone who now persists in ignoring the pressure for change in the area of agricultural policy and the opportunities of Agenda 2000 by introducing half-hearted reforms or changes, will receive his just deserts from life, the WTO and the enlargement process. For this reason I believe we must concentrate. The so-called second strong, sturdy leg or the second pillar, as the Commission says, in policy for rural areas is a very narrow support to which a heck of a lot of flesh has to be added. What we need in this reform is help to adapt farms to the markets. This can only be done by means of quality of products or quality of production, and not by means of quantity. Those who still place too much importance on going to market with huge quantities will discover that we are putting ourselves under pressure. In the WTO negotiations we, the EU, must set the conditions and not allow them to be dictated to us by the Americans or the Cairns Group.
We need to promote employment in rural areas. We need to meet unmet demand in a harmonious and well-balanced system of environmentally sustainable production. In this area, the Commission's proposal remains inadequate. And it is not right for the European farmers' associations to be telling the same tales of woe as they did two years ago. At that time the common agricultural policy was supposedly on its way out, but this was not the case. Nor will it be in future. But we can lose out - that is, if we only make a few minor changes instead of carrying out real reform.

President
We will now suspend the debate on agriculture.
The debate will continue at 3.00 p.m.

Votes
Bonde and Sandbæk
We cannot support Mr Pimenta's motion to reject the proposed accord with the USA. This is not because the agreement is the best it could be, but because it is better than the alternative. The alternative to the accord with the USA is not some other agreement with better standards. The Council's earlier decision on banning leghold traps implies that an import ban could be introduced, but that is basically all it provides for. The resolution on banning leghold traps is very limited; it applies to only 13 of the 19 species covered by the new agreement; it does not ban the use of leghold traps, only the import of furs; most significantly, the resolution only covers this one particular trapping method. In our opinion, it is hypocritical to focus on this one trapping method, however barbaric, while traps in use within the EU are no less cruel. That - and not more stringent requirements for traps - is the alternative to the agreements with Russia, Canada and now also the United States.

Deprez
I fully endorse the views of our rapporteur and wish to make it plain that I totally disapprove of the agreement between the European Community and the United States on so-called "humane' trapping standards. These do absolutely nothing to prevent cruelty to animals. I believe that it is high time we put an unconditional end, I repeat, an unconditional end, to the use of leghold traps, which inflict terrible suffering on millions of captured animals indiscriminately.
Furthermore, this agreement does not go nearly as far as the agreements with Canada and Russia, which many of us considered inadequate when we were consulted. Indeed, I consider this to be a step in the wrong direction, both from the legal point of view (with regard, for example, to the method of settling possible disputes) and in substance (I refer in particular to the increase in the time period).
It is unfortunate for animals that our competence in this matter is only consultative. We know that in all likelihood the Council will ignore our opinion and approve this proposal.
But this should not prevent us, as a Parliament, from loudly and clearly recommending the rejection of this unacceptable agreement!

Kirsten Jensen, Blak and Iversen
The Danish Social Democrats have today voted in favour of the Pimenta report urging the Council to reject the proposed accord with the USA.
However, we must admit that we find ourselves in a dilemma. We do want to find alternatives to leghold traps. Leghold traps are cruel to animals and must be banned. The difficulty is that political efforts mainly focus on doing away with leghold traps in areas where wild animals are trapped by people who rely heavily on trapping. Political efforts are even touching on the enormous number of leghold traps used in the EU to keep 'pests' at bay. The logic appears to be that if a woman wants to wear the animal's pelt as a fur, then it must not be caught using a leghold trap, but if the animal is regarded by humans as not very attractive, then we can do what we like to it. In the EU, we use thousands of traps to catch animals that are not very highly rated among animal lovers: rats and water voles.
Moreover - to a positively hideous extent - international negotiations on this matter have been so long-drawn-out, have been manipulated so much and have produced such poor results that the whole exercise ought to be done again. In weighing up the one factor against the other, we have come down on the side of supporting the Committee on the Environment, Public Health and Consumer Protection in its rejection of the motion, even though we do not endorse a hypocritical majority in the House who would like to hit the earning potential of native populations while failing to see the beam in their own eyes (to put it mildly).

Souchet
Council Regulation 3254/91 laid down provisions whereby third countries wishing to export the furs or associated products derived from 13 species should either have prohibited the use of leghold traps within their jurisdiction or ensure that trapping methods used meet internationally agreed humane trapping standards.
Although this Regulation was adopted some years ago, it is not always implemented. There is a simple reason behind this: a threat by Canada and the United States to take the issue to the World Trade Organization, if the ban is enforced.
The Commission has now presented to us a draft bilateral agreement between the European Community and the United States. Like the rapporteur, our group rejects this agreement. Once again, it reflects the tropism of the Commission, bending before the United States and Canada's determination to refuse the introduction of environmental clauses within the framework of the WTO.
If the agreement were enforced, it would furthermore create a situation verging on the grotesque. In fact, the European Union could continue to import furs derived from animals captured using leghold traps, whilst at the same time refusing to use the same type of trap to destroy animal pests in its own territory.
In fact, in wetlands in particular, great damage is done by animal pests with no market value, such as nutria, to dykes and ditches, which have to be repaired at considerable cost by local authorities and marsh associations.
It would be more logical if we adopted exactly the opposite stance instead of the Commission's proposal: for animals which have a market value, it would be logical to use the most humane traps. However, in order to eradicate animal pests, which have no market value, it would be preferable to use the cheapest and most effective traps.

Titley
I have no option but to vote against the agreement drafted with the USA on humane animal trapping standards. It is simply not tough enough on the cruel leghold traps which so many of my constituents naturally oppose.
The author of this report has rightly concluded that millions of defenceless animals will suffer the painful death caused by leghold traps for years to come as a result of this agreement not going far enough to ban them.
The view of our citizens in the EU, not only in nations traditionally known for their love of animals like the British, has been set out in the statutory obligation of the European Commission to ban the import of furs caught in these cruel traps wherever practical.
I trust that trade considerations with the USA will not be used as a reason for not continuing the push for better standards in animal traps. We are the largest trading block in the world's history and it is time that the EU's negotiators used our influence to get a better deal for animals in these kind of international agreements. If the deal is not good enough, then they must go back to the talks table until it is.
Girão Pereira report (A4-0178/98)
Novo
We voted in favour of the Council regulation on the conclusion of the Protocol establishing the fishing possibilities and the financial compensation provided for in the Agreement between the EC and the Government of the Republic of Guinea on fishing off the Guinean coast for the period from 1 January 1998 to 31 December 1999, for the following reasons:
1.We think there is a very positive improvement on the previous protocol as regards controls on fish stocks and the corresponding allocation of financial resources to local scientific and technical programmes and to methods of supervision and control of fishing activities.2.We think the renewal of the Protocol - maintaining previous catch levels for practical purposes, but significantly increasing the amounts of financial compensation - will make it possible to reach a compromise between the need for Community fleets (Spain, Greece, France, Italy and Portugal) to continue to have access to local resources, supplying their own raw materials, and the obvious need for less developed countries to increase their financial profits. We only hope Community owners (and particularly Portuguese owners, who will be entitled to catch 200 grt a year of shrimps and send two surface longliners to Guinean waters) will make better use of the opportunities created for them.3.We must, however, express our doubts over the fact that the Community fleet will have access to Guinean waters outside a 10-mile limit when its vessels should only have access outside the usual 12-mile limit. Similarly, we have doubts about the period specified by this Protocol - only two years, and therefore less than in most EC agreements of this type - which will not provide sufficient operational stability for the Community fleet.
Souchet
Our group is speaking today on this report relating to the fisheries agreement between the European Union and the Republic of Guinea, in order to highlight an essential aspect of Common Fisheries Policy.
At the last Fisheries Council, a ban was adopted on the use of 2.5 km drifting gill nets in the Mediterranean and the Atlantic. I strongly opposed this decision, which was adopted without any scientific basis. It deprives fishermen and coastal areas of an economic activity essential to their survival. May I remind you that this decision is even more unacceptable because in order to obtain the Council's agreement, the Commission maintained the use of 21 km drifting gill nets in the Baltic, although an international regulation established by the UN recommends a limit of 2.5 km.
Let us return to the fisheries agreement with Guinea. What do we have here? This agreement provides fishing possibilities for 33 freezer-seiners and 13 pole-and-line tuna vessels. Pursuant to international law, these vessels may if they wish use drifting gill nets. What is the logic behind this according to the Commission?
As a defender of the principle of controlled resources, and supporter of professional fishermen, I cannot fail to very strongly condemn these absolutely scandalous contradictions in the Commission's attitude. The Commission should restrict itself to ensuring compliance with international regulations which permit the use of drifting gill nets. It must stop using false excuses in order to enable fishermen from one specific Member State to snatch the market shares of other Member States, by the artificial means of banning a type of fishing gear. If a drifting gill net of limited length is environmentally acceptable and not detrimental to resources, it must be acceptable for all fishermen, in every sea and every ocean.

Wibe
All of the fisheries policy which is based on the Community buying fishing rights from the poor countries of Africa is wrong. Therefore we cannot support it. In addition, the proposal before us from the Commission entails an increase in aid compared with before. Apart from the reservations on principle, you should also ask whether the aid which the EC pays to Guinea really benefits the poor population of the country. It is worth remembering that Guinea is not a proper democracy, which makes you wonder where the money actually ends up.
Trakatellis report (A4-0192)
Bonde and Sandbæk
In our opinion, it is of course appropriate to revise the provisions on genetically modified micro-organisms on an ongoing basis as new knowledge is acquired in this relatively new area of research. We believe it is particularly important to safeguard high safety levels, and this is one of the aims of the report. However, we have been obliged to abstain from voting on a number of amendments. This is largely because lay people cannot pretend to comprehend the content and consequences of these proposals. We feel it is questionable to allow such complicated, technical issues to go to the vote when people have no real hope of understanding them.

Souchet
The common position adopted with the Council at the end of the first reading provides a framework for the restricted use of genetically modified micro-organisms, and safeguards the interests of Member States.
The 35 amendments tabled by the Committee on the Environment, Public Health and Consumer Protection broadly take up the amendments presented during the discussion of the proposal at first reading. The Group of Independents for a Europe of Nations is unable to support either the amendments which aim to prevent Member States from reinforcing minimum environmental protection regulations, or those which are likely to make the proposal unenforceable, by trying to establish too high a level of precision.
The important amendments include a proposal to change the legal basis from Article 130s to Article 100a. This proposal is unacceptable as it stands, because the directive does not establish rules relating to the harmonization of the internal market; it establishes minimum environmental and public health protection regulations, which Member States must be able to reinforce if necessary.
The directive does not, in fact, regulate the movement and marketing of genetically modified micro-organisms, but only the conditions of their use in contained facilities.
Another important point (Amendments Nos 4 and 9) makes it compulsory for operators to obtain insurance cover for the contained use of GMMs. This provision is out of place in this document, because operator liability should be governed by general rules at the European level and by specific rules in the Member States. This document must not be used as an excuse for an indirect attempt to reform insurance legislation.
The wording of most of the amendments (Amendments Nos 2 to 14) is more accurate and appropriate in the common position than in the initial document. The Committee on the Environment, Public Health and Consumer Protection seems to have taken great pleasure in amending the document in such a way that it has become too complicated to adapt to technological change and unenforceable as it stands.
On the other hand, our group supports all the containment provisions proposed in Amendments Nos 15 to 35 because, unlike the preceding amendments, they are more appropriate than the common position.
Finally, our group supports Amendment No 36 tabled by the Green Group, which provides for a better description, and therefore better knowledge, of the GMMs used.
des Places report (A4-0216)
Ahlqvist, Andersson, Hulthén, Theorin, Waidelich and Wibe
We think the Commission's proposal is better than the draft report from the Committee on Agriculture and Rural Development. We are voting against the proposal to increase prices and so we cannot vote for this report. We are particularly opposed to hemp, wine and tobacco. It is our opinion that there needs to be a proper reform before 1999.

Alavanos
The Commission proposals for the 1998/1999 prices package rely on the availability of limited funds for the common agricultural policy and, according to the rapporteur's report, will lead to a reduction of approximately 2 % in prices and compensatory payments in real terms. Also, this reduction will in all probability be accompanied by a further 2 % reduction with the disappearance of the green ECU and the introduction of the euro.
According to the rapporteur, European agricultural income as a whole fell by 16.4 % in real terms during the period 1990/96, and the rural population decreased by more than 2 million people.
The continuation of price-fixing and compensatory aids for the thirteenth successive year can only be expected to lead to a further reduction in the number of farmers, while incomes in European farming will continue to fall.
The proposals for the 18 Council Regulations are simply a roll-over of existing provisions, with some exceptions which are necessary for clearly legal reasons or to fulfil Council obligations. They do not tackle the problem of farmers' incomes and their continued employment.
They cannot come about through our vote.

Cushnahan
This year's proposals are basically a roll-over from last year's prices. This would superficially imply that the situation in agriculture is fine. Nothing could be further from the truth in relation to Ireland. Irish farmers are experiencing major problems, particularly in the beef sector. The BSE crisis, the reduction in export refunds and licensing and additional problems relating to access to third country markets have all contributed to the problem.
A roll-over indicates a complete absence of a policy direction on the part of the Commission. Farmers need to know in what direction the Commission intends to take them over the next decade. They need a clear indication of a well-thought-out Commission strategy.
What is needed is the development of proposals which have as their objective the revitalization of rural economies, including the agriculture sector.

Martinez
Proposals for 18 Council Regulations on prices for agricultural products have just been referred to us. We have come such a long way! When I entered Parliament in 1989, agricultural prices were discussed with great ceremony. It was an important debate. Like church at 11 o'clock on a Sunday morning.
But now the pews are empty. Prices have already decreased so much, and Agenda 2000 is going to carve another 10 to 30 % off what is left of them, so farmers almost expect to earn less in the market than they do from budgetary aid.
The Community budget is also a rationing budget. So much so that, in real terms, 1992 agricultural prices have decreased by 2 %. The overall income of European farmers decreased by 16.4 % between 1990 and 1996, and will probably fall again in 1999.
This will have disastrous consequences in the troubled fruit and vegetables sector. It will also cause difficulties in the winegrowing sector, where the COM still does not accept wine as an important part of our civilisation. That is why a reform of the COM is needed, until Brussels accepts that new plantations are needed, and the Commission admits that an agricultural sector at the mercy of budgetary aid is extremely vulnerable. Farmers' livelihoods must be based on the prices of what they produce.
Decreasing the prices package makes farmers less independent, and therefore gives them less freedom.

Novo
We take a negative view of the Commission's adoption of an agricultural prices proposal in line with its policy of maintaining some sectors and reducing others, such as arable crops. In our view, even for those it maintains, this always represents an actual reduction in agricultural prices, because it fails to take inflation into account. On the contrary, we would like to see agricultural prices updated to allow for at least a 1.7 % rate of inflation, at the EU level, as a way of guaranteeing the farmers' income.
We also regard as extremely negative the fact that once again there are no changes or revisions for the common organization of the markets in the Mediterranean countries on the grounds that they have not yet been reformed. In that context we find it unacceptable that no set prices have been fixed for olive oil, with the clear strategy of prioritizing the need for rapid approval of the new draft regulation under discussion.
Although we consider the proposal for the extension of new plantations for special-quality vines to be a positive step, we would reject at the outset a strategy that continues to support the abandonment of viticultural land, because of the importance of viticulture to southern countries, especially Portugal. In the same way, we reject proposals to allow the blending of different musts and viticultural products, because they will encourage the sale of poor-quality wine and cause consumers to be defrauded.

Seppänen, Sjöstedt and Svensson
We voted against the report because, amongst other things, we are opponents of the EU's agricultural policy in general on the grounds of its high costs and, not least, its unfair distribution which favours big farmers. This policy area should be returned to the Member States as soon as possible.
In addition we consider it to be particularly inappropriate for Parliament to decide on price levels in a market system for agricultural produce. However, we voted for the setting up of a vineyard register, which, remarkably enough, there has not been in spite of continuous reports of abuse of Community funds in the wine sector.

Souchet
The Group of Independents for a Europe of Nations is extremely satisfied with the quality of the report and the amendments proposed by Edouard des Places.
However, we regret that the Commission has shown such a lack of imagination and has presented such a predictable prices package. We are nevertheless pleased that in response to the amendment we tabled asking for the set-aside rate to be set by the end of this month, that is, for a decision on the set-aside rate to be adopted at the same time as the prices package, the Commission has proposed a new regulation applicable to the forthcoming agricultural year. However, at this stage, the Commission's proposals are totally unrealistic. That is why my group has tabled two amendments, one asking for the withdrawal of the extraordinary set-aside, that is, the application of a penalty depending on the required set-aside rate, and the other asking for an obligatory set-aside rate of 5 % instead of the 10 % proposed by the Commission.
As well as supporting all the amendments proposed by the rapporteur and adopted by the Committee on Agriculture and Rural Development, my group has again tabled amendments in the House proposing a 1.7 % increase in institutional prices, which aim to reduce the effects of monetary erosion on farmers' incomes. It is quite unacceptable for anyone to think that production costs in agriculture are not affected by inflation. We have already criticized the fact that a constant level of prices and aid has been established in the Commission's proposals on Agenda 2000 for a period of seven years. Would it be acceptable in any other profession for income to fail to be indexed to price increases? I personally do not think so.
Finally, my group was pleased to see that the Committee on Agriculture adopted Mr des Places' proposed amendments regarding the creation of an adjustment coefficient with a view to maintaining equitable levels of income between farmers in all Member States of the European Union in order to compensate for serious drawbacks resulting from the possible disappearance of the green rate on 1 January 1999 for the Member States participating in the single currency.
Defenders of the euro claim that it will naturally be of benefit to farmers, as it will put an end to competitive devaluation, as well as the budget for agri-monetary measures. This overlooks the particularly serious consequences for farmers of the disappearance of the green rate entailed in the transition to the euro. In France, for example, the difference between the green rate and the financial rate is in the region of 2 %: there will therefore in fact be a further 2 % decrease in institutional prices and aid, from 1 January 1999. Thanks to the rapporteur's amendments, a European Parliament document will highlight an important weakness in the euro. Should farmers, whose opinion was not sought, have to bear the cost of the transition to the euro, which has been introduced for ideological reasons?
Thanks to the work of Mr des Places, Parliament will be ready to issue an opinion during this part-session. This will enable the Council, during its meetings on 22 and 23 June, to define the general legal and regulatory framework applicable to our farmers, thus allowing them to adopt decisions in full possession of the facts.
Rosado Fernandes report (A4-0218/98)
McKenna
Madam President, it is ironic that the European Union heavily subsidizes tobacco while, at the same time, it tries to fight against cancer and also educate people about the danger to health of smoking. What it should do is get rid of subsidies. It is an absolute disgrace that the other members of the Commission would not support Commissioner Flynn on this. It is one of his most positive proposals and it is disgraceful that the Commission will not support his attempts to get rid of tobacco subsidies. Every year over ECU 1 billion of taxpayers' money is going to subsidize something which is detrimental to public health and which has a detrimental effect in countries around the world where there is no proper regulation to ensure that smokers are aware of the dangers of smoking. The European Union is extremely wrong in subsidizing something which shortens the lives of its users.
The tobacco industry and tobacco growers have to realize that they will have to turn to alternative crops. One ironic aspect of this report is that they are trying to push for alternative types of tobacco. There is no alternative type of tobacco which is not dangerous to health and it is ridiculous to promote the idea that there is. The Commission should support Commissioner Flynn on this matter and get rid of tobacco subsidies in the interests of public health and of consumers.

Ahlqvist, Andersson, Hulthén, Theorin, Waidelich and Wibe
As tobacco consumption has harmful effects on the health of users, it is absurd for public subsidies to be given to tobacco production. In the vote on this report we are supporting the amendments which will phase out tobacco subsidies. If these amendments are not adopted, we will vote against the report in its entirety at the final vote.

Alavanos

1) The Commission proposal recommends quota buy-back, with a corresponding reduction in guarantee thresholds.
We are categorically opposed to this.
With the amendments of the Committee on Agriculture and Rural Development the quota buy-back systems have not been clarified. There will be a buy-back system which will be financed by the Structural Funds. A part of the quotas that are withdrawn will be transferred to a "national reserve' . What will happen to the rest has not been clarified. In general, the issue of quota buy-backs will be determined by the Commission and it is not known how it will turn out.
We do not agree with this. We request a clear formulation that the quotas that are withdrawn will not lead to a corresponding reduction in guarantee thresholds.
2) The Commission proposes that 35-45 % of the premium depend on quality. We disagree with this regulation, which is directed against large categories of growers and does not offer any substantial compensation. The amendments of the Committee on Agriculture and Rural Development recommend that this does not exceed 25 %.
We disagree radically with the proposed 35-45 %. The limit of 25 % is arguable.
3) The Commission proposes increasing deductions of 1 % of the premium to 2 % or making available resources to combat smoking and to conduct research into tobacco growing. I do not agree with this. The amended proposal of the Committee on Agriculture and Rural Development recommends a 1 % deduction with the possibility of an increase, and the financing of activities to inform the public about smoking and of research.
I say yes to measures against smoking, but no to the unilateral use of producers' resources for the fight against smoking at a time when importers, from the USA and elsewhere, remain untouched. That is sheer hypocrisy.
4) There has already been a reduction in expenditure on tobacco, in the 1992 reform (from ECU 1 329.6 billion in 1991 to ECU 1 021 billion from 1999 to 2003).
There should not be another reduction.

Bébéar
We have finally started a thorough debate on the vital changes necessary in some specific areas of the COM which face particularly strong competition from other continents. I therefore share the opinion of the members of Parliament's Committee on Agriculture and Rural Development who have adopted the Rosado Fernandes report on tobacco.
We have an opportunity today to endorse the need to provide support in this sector according to the quality of the product and to reconsider the problem of subsidies between tobacco-producing countries in the south and north. We must find a permanent solution to this problem. Tobacco produced in the north cannot continue indefinitely to be the subject of discrimination in comparison with southern varieties.
Why do we confine ourselves simplistically to defending the interests of our countries of origin, depending on whether or not they produce tobacco? Substantial support will be of benefit to the whole of this sector, which has made a consistent effort for many years to improve quality.
We must remember that tobacco, with 135 000 producers and 400 000 seasonal jobs, is a great rural employer. Even if tobacco were no longer cultivated in Europe, this would not reduce the consumption of cigarettes, as some Utopians would have us believe. We must therefore insist upon the enhancement of all high-quality tobacco products, including those produced in northern Europe. We must acknowledge their value because there is a market demand for them and their production costs are higher.
As well as this type of encouragement, the results of research, particularly genetic research, need to be more widely distributed. New plant improvement programmes must also be implemented which reflect the progress achieved in other areas. It is now possible to produce tobacco which is less harmful to human health. Let us work positively in that direction.
By banning tobacco advertising, the European Parliament recently took a balanced decision to protect the health of young people. We must now continue along the same lines, by approving the provisions of the Rosado Fernandes report.

Blot
The Commission plans to create a quota buy-back system, the stated aim of which is to decrease the volume of tobacco produced in Europe gradually. However, it is wrong to pursue such an aim when tobacco imports from third countries are so large.
May I remind you that the European Union is the largest importer of raw tobacco in the world, with a self-sufficiency level of no more than 30 %. Moreover, the intended system will not help to modernize production methods or enable young farmers to set up.
This policy is therefore contrary to producers' interests. However, within the framework currently imposed on French producers, Mr Rosado Fernandes' report defends positions which are the lesser of two evils. We therefore have no hesitation whatsoever in voting for this report.

Bonde and Sandbæk
In light of the detrimental effects of tobacco on consumer health, we cannot subscribe to maintaining or increasing EU support for the production of raw tobacco. We believe all forms of official support for tobacco production should be phased out. Out of consideration for the tobacco producers, this should be a gradual transition over a short period of time to allow tobacco producers to switch to other crops or trades.

Cars
In my opinion no subsidies at all should go towards tobacco growing within the EU. Since none of the proposals before us are aimed at an immediate decision of that kind, I have voted for Amendment No 66 (which means a rejection of the report in its entirety) and against the final adoption of the report. Otherwise I have voted neither yes nor no.

Cushnahan
At the May plenary session we agreed to ban tobacco advertising. This decision was consistent with EU health policy.
However, the subsidization of tobacco farming is clearly in contradiction of the EU's Treaty obligation to protect the health of our citizens. I regret that the Commission rejected the proposal to phase out subsidies in 1996 and instead opted for reform proposals.
The 1994 report from the Court of Auditors on the issue concluded that the abolition of tobacco subsidies would lead to considerable budgetary savings without destroying the livelihoods of tobacco farmers.
For these reasons and to be consistent on health grounds, I have supported the amendments put forward by Mr Collins and others from the Committee on the Environment, Public Health and Consumer Protection.

Delcroix
The tobacco producing sector illustrates all the contradictions and hypocrisies of society.
Tobacco is a poison and a drug.
The fight against cancer is dependent upon the prevention of addiction to tobacco. As medical research has identified one of the causes of one form of cancer, we have a moral obligation to deal with the problem at its source. We do not have any other alternative.
But the tobacco industry provides jobs and incomes for many families, and experience has shown us that prohibitions are useless as they only lead to fraud and increased criminality.
What we must do is to work in gradual stages:
Europe has without hesitation adopted costly and difficult solutions in order to reduce agricultural surpluses and prevent the depopulation of rural areas. Europe must also find the courage to solve this problem.
This does not mean we have to choose between protecting jobs or health; it means we have to protect health and ensure the redeployment of jobs.

Holm
We in the Green Group consider the fact that the EU has a system of tobacco subsidies to be quite wrong and that it sends out the wrong signals to the general public about smoking tobacco. Not very long ago the European Parliament approved the Council's proposal to ban indirect tobacco advertising. The European Parliament has also expressed the view that tobacco is a danger to health which must be taken very seriously. The Green Group shares these points of view and was instrumental in getting the European Parliament to make these decisions. The risks of smoking are considerable. We must therefore work to get people either to stop smoking or not to take it up in the first place.
At the same time it is a fact that the EU gives substantial subsidies to the growing of tobacco within the EU, currently around ECU 1 billion per year. In our view, this double morality is totally absurd. We are therefore working towards achieving an end to these subsidies as soon as possible. It would of course be best if these subsidies were phased out over the next few years. It would be best for those who currently grow tobacco and it would send out the right signal that the EU takes the tobacco issue seriously and is working towards a reduction in smoking.
The conversion premiums which exist to enable tobacco growers to grow other crops must be encouraged and given a larger budget. At the same time the budget for subsidies to tobacco growers should be reduced. Some people claim that these conversion premiums are of no help because tobacco is the only crop which can be grown where tobacco is currently grown. That is just political rhetoric and not a serious argument because growers get larger subsidies for tobacco than for other crops. Conversion to other crops must be intensified and made more attractive. The Green Group's objective is a complete end to subsidies for tobacco growing.

Martinez
The COM in tobacco provokes passionate reactions. Farmers and technical issues are forgotten - only cancer-related illnesses are remembered.
So it is considered a scandalous contradiction that in 1997 the Community spent ECU 11 million on the fight against cancer and paid out ECU 18 million on reconversion premiums and to the Community Fund for Tobacco Research and Information, although tobacco causes cancer.
It is true that there is a problem at Shiva in Brussels, where with one hand we try to fight cancer, whilst with the other hand we cause it. But this is not the only contradiction in Europe. Land is left fallow because of overproduction, but genetically modified micro-organisms are permitted because of a need to increase production and output.
If tobacco were no longer produced in the European Economic Area, imports would simply increase. Europe is already the largest importer of raw tobacco in the world and is only 30 % self-sufficient.
The problem of tobacco is like the problem of drifting gill nets. We may prohibit them at home, but we cannot prevent others from producing them, using them or importing them. This is the truth of the matter. The cultivation of tobacco prevents the agricultural impoverishment of under-privileged regions. And the poverty of the jobless is also a cause of illness.
It may be understandable to renounce the 1970 COM in tobacco on account of public health, but it does not make any sense economically.

Novo
When the common organization of the tobacco market is reformed, the emphasis must not be put on the harm tobacco causes to health, because if we do that we shall have to start by prohibiting the importation of tobacco, of which there is a severe shortage for the European curing industry. Questions of public health should be dealt with elsewhere and in other ways, within the context of education and prevention.
When the sector is reformed, the emphasis should, on the contrary, be placed on the direct and indirect employment which the sector provides, particularly in the most backward areas of the EU, many of which have no alternative crops to produce. Or, after that, it should be placed on the very important contribution which tobacco growing makes to the struggle against increasing rural desertification.
When the sector is reformed, priority should be given to measures aimed at improving the quality of the product, and there have been and are clear proposals by the European Parliament in that respect.
When the tobacco sector is reformed, we cannot deliberately promote and encourage - as the Commission's draft regulation does - the total abandonment of tobacco growing without creating credible alternatives, but quite the opposite. We should be creating conditions in which production can be maintained and new generations can follow the present growers, especially with young growers coming in.
We are worried that the Commission is ignoring - on an increasingly systematic basis - all the opinions and strategies relating to this reform that have repeatedly won majority votes in the European Parliament.

Querbes
I am voting in favour of the report that has just been presented to us for three main reasons.
Firstly, this report makes a clear distinction between the issues of tobacco production and the prevention of smoking, because they are not directly connected with production in the Union, which only covers 30 % of consumption.
Secondly, the report rejects all the amendments relating to the withdrawal of production aid, thereby defending the principle of Community aid for production, jobs and associated activities. It promotes improved quality, greater coherence between supply and demand and, within that framework, proposes to reinforce professional organization and increase the payments for some varieties.
Finally, although this report presents voluntary reconversion measures, it does not support quota reduction measures. On the contrary, it proposes to assist young farmers to enter this sector.
However, I do not support the idea of increasing the amount withheld from the payment allocated to the Community Fund for Tobacco, for the prevention of smoking. It means that tobacco producers would take the blame for, and bear the cost of, an activity for which the whole of society is responsible, despite the fact that the Fund is also used to finance research into cultivation methods.
Finally, I share the concern expressed in the report on the consequences of enlargement of the Union. I call for appropriate measures to defend the interests of producers, inasmuch as the internal market offers great potential for the development of production and jobs in this sector.

Reding
Consistent action is imperative in politics. This is why I cannot accept European provisions on tobacco growing.
Recently the European Parliament approved a directive banning the advertising of tobacco products. I endorsed this ban with conviction: tobacco advertisements are directed mainly at young people in the knowledge that nicotine addiction mostly takes hold in youth. The result is 548 000 tobacco-related deaths per year including 654 in Luxembourg.
We cannot ban tobacco advertisements while at the same time subsidizing tobacco growing. Yet this is exactly what the Union is doing by guaranteeing an annual production of 350 600 tonnes of raw tobacco and spending approximately ECU 1 000 million on it. Admittedly, the system was improved considerably by reducing the quantity (by 24 % over just 4 years) and by means of subsidies for relinquishing arable land. However, it remains to be seen whether or not control is at an optimum level.
I welcome the relative reduction in subsidies and the reconversion measures which must not, however, lead to abandoned land being taken over. Yet I am of the view that there is a significant contradiction between health policy (for which very little EU money is available) and the promotion of tobacco growing, which, moreover, is of very poor quality in Europe. For these reasons, I cannot approve the report.

Seppänen, Sjöstedt and Svensson
We voted against the proposal because it will not solve the issue of the tobacco growers' dependence on extensive EU subsidies in either the short or the long term. The proposal does not contain any reduction in financial support for the tobacco sector. Nor does it take into consideration the serious consequences tobacco growing has for health and environmental protection.

Souchet
Our group supports all the amendments proposed by the rapporteur and adopted by the Committee on Agriculture and Rural Development, because European tobacco production must be allowed to continue.
The aim of a large number of amendments tabled by our British colleagues is to withdraw all European aid from tobacco production. We are naturally opposed to this, because the European Union is a net importer of very large quantities of tobacco. Tobacco is also mainly produced in disadvantaged regions, and it is therefore necessary for tobacco production, which is very labour-intensive, to continue in order to protect jobs.
However, my group has tabled five amendments. Their main aim is to reject the Commission's proposal to create a quota buyback system. This system will not only lead to a reduction in the quantities receiving production aid and, therefore, to a decrease in European tobacco production, it will also do nothing to help modernize production and it will prevent young farmers from setting up in this area. This system will also have the adverse effect, in the medium term, of giving quotas a financial value, which will create a further financial burden on producers. It could in fact lead to quotas being considered as assets, whose value would be based on the quota buy-back value.
On the other hand, we have proposed the creation of national quota reserves to maintain the production capacity of Member States, and to contribute towards the financial stability of existing or new farms. This would also prevent the appearance of any additional costs created by quota values. May I remind you that a national reserve system already exists in other production sectors, such as sheep, cattle and milk.
My group has also tabled other amendments to the Commission's proposal, with regard to the cultivation contract auction scheme between the producer and the first processor. We consider that this is a very restrictive measure, which forgets that the tobacco production is a specific, very highly organized sector, in which distribution and processing are carried out by a small number of multinational or national companies.

Titley
I cannot back the Commission proposals for the future of the European tobacco sector. I am amazed and angered that after all the recent progress in getting tobacco giants to admit that their products cause diseases such as cancer, we have a proposal to keep using public money to subsidize tobacco producers! Is this a crazed method to keep our hospitals busy with new patients?
What exactly is meant by the idea of subsidizing higher quality tobacco - is this to promote more addictive versions of cigarettes or ones which take longer to kill their smokers? Even with the fig leaf of more publicity about the dangers of smoking, the taxpayer is still expected under these plans to stump up millions to pay the cigarette makers to make people ill.
The continued misuse of public money for this kind of tobacco subsidy is no longer acceptable. Perhaps when it all began it could be excused on grounds of ignorance about the effects of smoking - but not in 1998. If we must have tobacco production, let it succeed or fail by its own efforts as any other industry has to, not with people's hard-earned money as subsidy.
(The sitting was suspended at 1.17 p.m. and resumed at 3 p.m.)

Reform of the CAP (Agenda 2000)
President
The next item is the continuation of the report (A4-0219/98) by Mr Cunha, on behalf of the Committee on Agriculture and Rural Development, on the reform of the common agricultural policy (Agenda 2000 - Part One, Chapter III) (COM(97)2000 - C4-0522/97).

Anttila
Mr President, Commissioner, I congratulate Arlindo Cunha on an excellent report. It reveals the rapporteur's expertise in the subject. The report emphasizes the different circumstances surrounding production in the EU. It is a totally Utopian gesture to try to apply EU regulations uniformly right across the region, from Finnish Lapland to the Canaries.
The greatest challenge of Agenda 2000 will be the integration of the special needs that exist in northern, southern and mountainous regions into the EU common agricultural policy. The CAP suits the best agricultural regions in the EU. Production costs are higher in the northern regions, the mountainous regions and other parts of the EU area. This fact has to feature far more prominently in Agenda 2000.
Agenda 2000 weakens competitiveness between the production of crops and that of fodder, to the detriment of the latter. Maize feed storage aid is improving the competitiveness of milk production in six Member States, and weakening the profitability of fodder-based milk and beef production. Thus there is a need for fodder storage aid, just as the report explains. The viability of crop growing also requires equivalent special arrangements in northern EU regions.
Agenda 2000 extends EU aid to forestry. Forestry has been and must in the future be within the sphere of the free market economy. In no case must we make the forestry sector as tightly regulated and aided as agriculture. The acceptance of Agenda 2000 requires larger regional investment as part of EU agricultural policy. We have the European model of the family farming based unit, which we have to defend.

President
Mrs Anttila, I am sorry that I had to tell you to hurry up, but I am not to blame. Your Group must give you more time.

Hardstaff
Mr President, I wish to congratulate the rapporteur on his report but concentrate my contribution on rural development. It is inevitable that within the EU and, to an even greater degree, in the EU applicant states the number of jobs in agriculture will fall as a result of mechanization. Without alternative jobs in rural areas young people will leave for the cities and many more people will commute daily to towns and cities with all the negative implications for the environment of increased car use on inadequate rural roads.
Food packaging and processing jobs are currently supported by Objective 5a grants. However, there is an urgent need for additional non-agricultural jobs and small-scale enterprises in rural areas. LEADER programmes have already demonstrated great success in generating additional finance for investment in such jobs. If the rural pillar of the CAP is to become a reality we need some continued form of the LEADER programme after 2000 to maintain thriving rural communities, particularly in areas no longer covered either by Objective 1 or Objective 5(b) after 1999.
Production of wholesome food, protection of the environment and good animal welfare standards must also be key elements of CAP reform.

Ephremidis
Mr President, Mr Cunha's report is characterised by honesty and courage. It is an impartial demonstration of the anti-agricultural line taken by the common agricultural policy. It is quite correct when it says that the continued reduction in prices and other related measures have contributed to a reduction, to extremely low levels, in the number of small and medium-sized farms, and to an increase in the number of large agricultural holdings. This is the model of the agricultural policy of the European Union that Mr Fischler told us about this morning. Unfortunately, whatever compensation the Commission has introduced to counteract these negative measures has been outweighed by the exorbitant fines and excessive quota reductions which are imposed on small and medium-sized businesses, especially on Mediterranean agricultural production.
Agenda 2000 will only make the situation worse. It will serve the mammon of fat profits and work against SMEs, especially those which operate in the south, in the Mediterranean region. I have a number of recommendations, which I shall not elaborate on as I do not have the time, as you say. They are formulated as amendments and many of them have been approved by the Commission.
I just want to say firstly that perhaps Mr Cunha has made an omission: he does not give the reason for this anti-agricultural policy or say what interests it serves. We must denounce this here. Secondly, farmers will revolt and take a stand against it, and arbitrary and violent measures, such as those implemented in Greece, with 10 000 farmers taken to court and punished with stringent penalties, will not be enough.

Garot
Mr President, Commissioner Fischler, ladies and gentlemen, I too would like to emphasize the high quality of the work Mr Cunha has produced on a subject as sensitive as the CAP reform proposed by the Commission. The Commission's proposal needs, moreover, to be thoroughly reworked in order to provide a real future for all the farms in the European Union.
Various aspects need to be taken into consideration. First of all, the expectations of our fellow citizens with regard to farmers, in terms of product quality, environmental protection and even the distribution of farming throughout the countryside. Then there is the international context, particularly the WTO. We have been forced to reduce public export subsidies, and are likely to come under strong pressure to reduce official production aid unless we modify some of our distribution methods. Finally, the evaluation of the CAP, which has been in force since 1993, and from which there are lessons to be learnt.
I must be brief, and will simply say this: a decline in raw material prices and a reduction in, perhaps even the withdrawal of, official aid does not add up to an acceptable agricultural policy. Priority must however be given to two areas: competitiveness and the rational distribution of official aid. Competitiveness must in fact be increasingly achieved by supplying goods and services which satisfy the expectations of society, which relate to wholesomeness and taste, local know-how which enhances the countryside, the technology of sectors which generate added value, and diversity in increasingly segmented markets. These are the qualities, within our overall performance, which will enable Europe to show strength and originality by comparison with our competitors.
Official support for agriculture, although still necessary, will not be permanently acceptable to European taxpayers or to our competitors within the WTO, unless it takes on board legitimate social, environmental, and regional concerns. Hence the idea of ceilings of aid per farm and national adjustments, based on the principle of subsidiarity, within a framework of Community rules, to prevent distortions of competition and the renationalization of the CAP.

Gillis
Mr President, I would like to thank the rapporteur, Mr Cunha, for his report. I welcome in particular the reaffirmation of the need to be especially careful about severe price cuts in any area of agriculture. I also welcome the report's commitment to compensate fully for any cuts in the institutional price. This is in marked contrast to the Commission's document, which proposes only a 50 % compensation for one of our major agricultural products. In the light of already collapsed beef-farmer incomes in Ireland, the Commission proposal is totally unacceptable and must be changed without delay.
The report also confirms the three cornerstones of the common agricultural policy, but calls on the Commission to revise the Agenda 2000 proposals in many respects, recognizing that the continuing exodus of young people from agriculture is causing huge social and economic difficulties in large tracts of rural areas. For example, in my own country, a shocking statistic: the suicide rate now exceeds the number of people killed in motoring accidents on our roads. A high number of these totally unnecessary deaths are due to financial despair in rural areas. Under present policies, with rural depopulation rife, it is not attractive for young people to make a career in farming. The system of prices for products which are set below production costs and where income depends solely on the payment of decoupled compensation, which itself falls far short of bridging the gap to price reduction, does not provide the long-term security which well-educated young people see as a necessary requirement to their future.
This report strongly suggests that the reform proposals in Agenda 2000 should be radically altered, as it is now very clear that cutting prices has not resolved the problems of market balance, nor has it arrested the continuing decline in farm incomes, which are a vital factor in stemming the haemorrhage of young people from rural areas.

Guinebertière
Mr President, I do not wish to sound even more pessimistic than the previous speaker, but I cannot help noticing that the number of farms is continuing to decrease, and that the number of employees in agriculture has fallen dramatically... so what kind of European agriculture model do we want for the future? A model based on enlargement, the WTO model, or a distorted European model? This is the most important period in the history of the CAP. We must understand that a new direction is needed, to enable farmers to live off the land, to produce food for Europe, and also for the world market, and to keep the countryside alive, by protecting the environment and the rural landscape. Does Agenda 2000 really offer us this?
Our group is more concerned about safeguarding the livelihoods of farmers and their families than about the international market. The issue at stake is the continuity of agriculture. Above all, we must enable young people to enter agriculture, by enabling them to purchase land and have the right to cultivate it, and by making them feel confident that in Europe it will always be possible to work on the land.

Alavanos
Mr President, I wonder if Commissioner Fischler has considered the fact that the Cunha report is supported on all sides of the House and by all political groups and that, in contrast, intense criticism has been expressed regarding Agenda 2000 and the regulations for a policy on agriculture.
I think that this is well founded, since, through Agenda 2000, the Commission is doing what we see throughout the societies of the European Union, that is, it is demolishing the social state and introducing models along the lines of the United States. We see this happening in agriculture too. We cannot accept a system of agriculture based on compensatory income subsidies, which are temporary in nature and which will transform farmers from productive forces in society into recipients of the temporary charity of the state, as the European Union at present envisages. It is necessary that we support the European model of agriculture, whereby the farmer is a producer, a custodian of the environment and of cultural traditions, and the family smallholding is a nucleus of employment. This is what is important in the Cunha report and my colleague opposite described very vividly, I think, the problems resulting from its disintegration.
In this sense I think that we must support the Cunha report and oppose the Commission proposals for the enlargement 2000 programme.

Lambraki
Mr President, I in turn wish to congratulate Mr Cunha. Indeed, I believe that the primary objective that we must bear in mind in any attempt to reform the CAP is the support of the European model of agricultural development and the promotion of the economic and social cohesion of the European countryside.
This is described quite rightly in the Cunha report. I would just like to dwell on a few points.
The first comment I wish to make is that, with the new structure of the objectives that is envisaged in Agenda 2000, actions belonging to other objectives are being transferred to the EAGGF, which will naturally involve new expenditure. However, it is not clear where the resources to cover this new expenditure will come from. There is a danger that we will identify, at a financial level, the policy to develop the countryside with the common agricultural policy, and we are facing the possibility that the CAP will be assimilated and fragmented in the long term within the frameworks of other policies, such as the policy for the regions, for example.
The second is that we must pay particular attention to the danger of the renationalization of the CAP. This may come about either through granting Member States too much leeway in the management of existing resources, or through a wider interpretation of the principle of subsidiarity. The possibility of hidden national subsidies will only increase inequality between developed and less developed regions and will cause a chain reaction of problems in the economically weaker Member States.
Thirdly, we must look again at the issue of parity when looking both at the different sectors of European agriculture and the different regions of the European agricultural area. We must look again at the relationships when subsidizing small and large agricultural holdings, less favoured and developed regions, products from the north and products from the south. We must look again, for example, Mr Fischler, at the advisability of some common organizations of the market having the year 2006 as their horizon and others the year 2001. And those that have the year 2001 as their horizon happen to be the products of the south.
Finally, we must look carefully at the source of financing for the area of enlargement which concerns the modernization of the agricultural sector of the applicant countries. The possibility of financing such measures from the resources of current agricultural guidelines will cause tremendous problems. It will also transfer a large part of the cost of enlargement onto the shoulders of the less developed regions of the European Union.

Poisson
Mr President, ladies and gentlemen, Commissioner Fischler, the number of farmers in Europe fell continuously from 8 million in 1990 to 6.9 million in 1995. Small family farms are disappearing. Since 1990, the number of agricultural employees has decreased by 3.7 % per year. This is detrimental to the fabric of rural life, and to town and country planning in Europe.
The Commission has proposed to reduce prices and provide compensatory aid by means of direct income support. Would any other industry agree to sell its products at less than cost price? Not to mention the lack of job security for farmers, whose incomes would be even more dependent on direct aid, which we all know would not be everlasting. What does the Commission intend do with all those acres which will remain unsold? It is quite understandable that young people are reluctant to enter agriculture when they hear that Agenda 2000 intends to take 10 % off milk, 20 % off cereals and 30 % off beef and veal. Farming is an admirable occupation, but you have to really love it to want to become a farmer today, and unfortunately, love does not pay the bills! What advice can parents responsible for the future of young people interested in agriculture give them? Nevertheless, young farmers are our only guarantee of a future for European agriculture.

Campos
Mr President, Commissioner, Mr Arlindo Cunha's report is much better than the Commission's draft, although it goes no further than is absolutely necessary.
If I may explain, Commissioner: you are spending half the budget on about 1 % of the richest people in Europe. As you know, 80 % of that money is distributed among 20 % of the farmers. That is a profoundly unfair policy. And the report does not define a firm ceiling or a firm modulation so as to create a fair basis for the distribution of the Community's funds. I would remind you that every Community citizen pays around ECU 350 to support this policy, which makes me think the Commission cares little what it does with the taxes citizens pay.
The second point is that the agricultural policy still militates against the environment and quality, inasmuch as it is still geared to the support of production rather than production methods and the defence of quality in the food chain. Today, Commissioner, you are confronted with the problem of a growing lack of credibility in the food chain itself. With this policy, Commissioner, you are going to aggravate all the existing problems in the Community, which have not been capably dealt with.
In addition, there is no solidarity between the regions. It is unacceptable that two farmers producing the same product should not be similarly classified and equally compensated because they live in different areas of the same Community. Aid has not been regionalized. There is no absolutely obvious need for family farms to receive aid, to the detriment of large-scale producers. The whole of this policy benefits a mere half-dozen farmers and the result is plain to see: there is total desertification, at present 5 % of the population are farmers, in 2000 this figure will be around 2.5 % and we shall be distributing half the Community budget among 0.5 % of the richest producers, and the richest people, in the entire Community.

Otila
Mr President, I do not believe Agenda 2000's proposed increase in aid for the forestry sector is in harmony with the principle of market-based forestry, which does not rely on aid. The present Union aid for afforestation, forest improvements and averting forest fires is enough. Our money could certainly be invested more productively. In addition, the proposal would clearly lead to an extension of EU forestry policy, that is, to less authority on the part of Member States in the forestry sector. This, however, does not mean that the Union does not nor should not have an important role in forestry matters. For example, the certification of forests, which led to much heated discussion, should hopefully be clarified under some sort of EU umbrella certificate.
I cannot but consider the proposed price cuts for milk and crop produce, coming as I do from a northern Member State, too harsh. Where is the promise that was made at summit level to preserve the viability of the rural environment by practising agriculture in all regions of the Union? One very important question has been completely ignored by the Commission, which is the situation young farmers find themselves in, and their future prospects. We must do something about supporting young farmers when they inherit farms, and their circumstances in respect of sufficient levels of social security.
On enlargement and Agenda 2000 I finally wish to say that it is not worth prolonging the discussion as long as the institutional problems in the EU today remain unresolved.

Hallam
Mr President, I would like to thank Mr Cunha for his report. I want to repeat some of the concerns I have expressed elsewhere. One of the problems with the report is that it does not address the issue of falling employment in agriculture. When we talk about rural areas, it does not necessarily mean that we are talking about agriculture as a form of industry and employment.
We need to ensure that there is more diversification on the farm but we also need to ensure there is more diversification within the local economy. We need to look at the role of rural areas in providing dormitory accommodation to large conurbations, second ownership, recreation, tourism and so on. We also need to look at what sort of jobs are being provided. We need jobs which are based on technology, in particular the use of the Internet and ISDN technology. We also need to look at providing small-scale industrial units for starter firms in our rural areas. We need to look at a new role for the countryside.

Sturdy
Mr President, I would also like to compliment Mr Cunha on his report. One of the problems we have had in agriculture - not as a result of Mr Cunha's report but as a result of BSE - is that we have had to see vast changes in our approach to agriculture. It is not often that I can agree with the opposite side of the House but on this particular occasion I happen to agree with Mr Hallam's position.
One of the problems with agriculture is that we are not bringing young people back into it and one of the things we must do is move away from the constrictions of quotas. This is something we have to look at in the future and part of Mr Cunha's report talks about it. We also must look at getting the returns for agriculture from the marketplace. It is vital that agriculture understands that it cannot continue to have an open bucket of funding available for it permanently.
But the most important issues are, firstly, that we have a single market and that single market for agriculture must remain across Europe. Otherwise we shall see discrimination against Member States. That is why I am opposed to modulation, because it attacks the large and efficient farms. Secondly, I am opposed to the national envelope. This allows governments to control spending and hold it up.

Iversen
Mr President, the Cunha report is a key one, since this report will be indicative of the overall position of the European Parliament on the reform of the common agricultural policy. In my opinion, the report smacks of a compromise of many diverse positions on how to view the reform. Personally, I think the report is also deficient of vision. I looked in vain for any strong pronouncements in specific areas such as the environment and animal welfare.
Regarding the section in Mr Cunha's report on imminent expansion, I am nevertheless pleased to see that the Committee on Agriculture and Rural Development has adopted the amendment I tabled to include the first applicant countries in arrangements for environmentally friendly production methods from 1999 onwards. After all, we must not forget that environmental improvements are not purely the domain of the 15 current Member States. Environmental pollution does not respect boundaries. The nations of central and eastern Europe applying for admittance to the EU also have significant agricultural production. Thus, through support and collaboration, we must help ensure good, environmentally sound production for these farmers. We must avoid a situation whereby these farmers resort to sacrificing the environment as they strive to keep up with the competition of the internal market.

Keppelhoff-Wiechert
Commissioner, Mr Cunha, Mr President - Mr Cunha has been praised so much today that I would like to turn this around slightly with a minor criticism, because, as he knows himself, he did not discuss the role of women in agriculture in his report. He will certainly reconsider this before the vote and include it in the motion for a resolution, as he is in fact pro-women. Throughout the EU, approximately 50 % of all those employed in agriculture are women. They derive a high level of income for farming families by means of field work, shed work, book-keeping, direct marketing and farm holidays, etcetera.
Farms have now got the message of the European Commission and it does not surprise us very much. On the whole, it is having a very negative impact, particularly among women farmers, and I believe that the Commissioner for agriculture, Mr Fischler, felt this when he joined us at our meeting in Berlin. Women farmers are refusing to accept Agenda 2000. Their criticism is levelled at the increased adjustment of agricultural market policy and price policy to world market levels. Income policy and price policy are not sufficiently balanced, for example, in the high environmental costs, so that within a short time a considerable number of farming families will find themselves in a situation of extreme hardship. Farmers - men and women alike - fear the loss of their essential material possessions and their jobs. We also find the increased pace of gearing European agricultural policy to the world market quite unnecessary.

Botz
Mr President, Commissioner, the report by our honourable friend Mr Cunha includes two particular goals: firstly, the comprehensive approach to farming, and secondly, the ability of farms to survive and adapt, and the strengthening of this ability. However, these very two aims are under threat in the geographically disadvantaged regions of the new German Länder due to the Commission's proposals on degression and upper limits.
In terms of the ability to survive and adapt, no one in Europe has anything to teach East German farmers. Between 1945 and 1992 these farmers had to deal with three periods of short-term radical restructuring. They managed that. In the last period of restructuring, however, 80 % of the population involved in agriculture were eliminated from agriculture within two years. This was necessary. Commissioner, particularly in these regions, there is simply no alternative to the farm structures which have survived - mainly cooperatives - that is, no alternative which could guarantee comprehensive management, which is what we all wish for.
An improved, modern agricultural policy, which we all desire, must not further destabilize this form of management, as this would be contrary to the European Union's new employment policy.

Lulling
Mr President, I should like congratulate Mr Cunha on his excellent report, which does not fall into the trap of using the same tactics as the Commission at the Council of Ministers, that is, it does not divide in order to rule. It effectively addresses the concerns of the agricultural world.
Parliament's position is therefore of great importance with regard to the survival of the European agriculture model. The Luxembourg Presidency's approach, the definition of the identity of European agriculture as a reference point for CAP reform and the position of European agriculture on the world market, was ratified by the European Council of December in Luxembourg. And the model which is emerging from that approach is that of a multi-functional, long lasting, effective agricultural sector spread right across Europe, including less favoured regions, which respects the natural landscape and open spaces, and is capable of responding to consumers' concerns regarding the quality and safety of food.
Unfortunately, a number of reform measures tabled by the Commission do not take this approach into consideration. The proposed price reductions are excessive and unjustified. The proposed compensatory aid is inadequate, and will make farmers dependent on benefit. It is also likely to affect the forthcoming WTO negotiations. The future of compensatory aid, on which the survival of most farms depends, particularly in less favoured regions, is uncertain after enlargement, not to mention the fact, Mr President, that the eco-conditionality of the compensatory payments distorts them and is therefore exaggerated.

Thomas
Mr President, I would also like to congratulate Mr Cunha on his very good and timely report. I very much welcome the Commission's proposals as a step in the right direction but no one in this Chamber should really be under any illusions. This is not a substantive reform of the Common Agricultural Policy. It is, as the Commission has said at the beginning of its document, an evolution and an extension of the MacSharry proposals.
As long as the basic objectives and mechanisms remain in place with the CAP there will be no significant restructuring of agriculture within the EU. A significant majority have indicated that a common rural policy rather than a Common Agricultural Policy would bring greater benefits to Europe's rural communities. I urge the Commission to re-examine its proposals very closely so as to ensure that Europe's rural communities are not disadvantaged when they must compete for structural funding under the changes when rural areas are included in the new Objective 2.
Furthermore, although Agenda 2000 purports to adopt a more market-led approach, the proposed payments to compensate farmers for a reduction in price are not time-limited and will do nothing to break the cycle of dependence of European farmers on European subsidies; nor will they address the legitimate concerns of the taxpayer. Compensation for a change in market circumstances should be reduced and eventually stopped after a reasonable period of readjustment. Given the turmoil of the BSE crisis and the many unresolved issues surrounding food safety and imports from outside the EU, I believe that the Commission should use the opportunity presented by Agenda 2000 to ensure that consumers enjoy the highest level of protection when we enter the next century and that Europe can compete with cheaper non-EU products.

Redondo Jiménez
Mr President, Commissioner, ladies and gentlemen, I first want to congratulate the rapporteur on his report, and on having moved on very skilfully to set the guidelines for what our future CAP should look like, in view of Agenda 2000, eastwards enlargement and future WTO negotiations.
My colleagues have already dealt with questions such as price reductions, farmers' participation in the market, getting people to stay in the countryside, and involving young people and women in the sector. We still have to see how price reductions affect consumers. However, we must prepare ourselves to be on the offensive in the WTO negotiations, in order to defend our agriculture model, reject foreign models, and make the reality of rural life really matter, by protecting our social and environmental situation.
It is important to implement integral action in the rural zones, going beyond agricultural activity, although that is the basic focus - the crux, I would say. Additional financial means should be provided for other, distinct activities. Account also needs to be taken of everything to do with land use, the environment, rural tourism, job creation and the improvement and conservation of our rural and cultural heritage.
Commissioner, in the spirit of Cork, rural development should be the second pillar of the CAP. This reform of yours could and should turn into the common agricultural and rural policy - the CARP.

Novo
Mr President, ladies and gentlemen, a real reform of the CAP would mean abandoning once and for all the guidelines introduced in the 1992 reform. This has not been done, and for that reason the Commission's proposals in Agenda 2000 can be sure of opposition from farmers and their representative organizations all over Europe.
A reform of the CAP would in fact have to be comprehensive and cover all forms of agricultural production. The Agenda 2000 proposals, however, favour the meat, cereals and dairy sectors, and restrict themselves to a little individual fine tuning of sectors such as olive oil, fruit, vegetables and wine, which are fundamental to the agricultural economies of the southern countries.
Furthermore, to produce a real reform and overturn the 1992 strategy we would have to give unequivocal support to rural development, defend and above all generalize the application of Community priorities, make a special case of rural development in the world context, give decisive support to young farmers and fight rural desertification, maintain and develop market regulation mechanisms and iron out imbalances between regions, forms of production and farmers of different kinds, giving priority to family farms.
We appreciate the introduction of these aspects into the report, to which we have otherwise contributed certain amendments in the direction we suggested years ago. At the Plenary session we insisted on amendments in favour of the open and universal award of certificates of quality, support for the production and marketing of regional products, the rejection of productivityrelated criteria and most of all the introduction of a clear concept of modulation.
With these guidelines, and if our amendments were accepted, we should have created a policy framework which the Commission ought to take into consideration, and ought to amend the proposals published in connection with Agenda 2000 in accordance with that policy framework.

Santini
Mr President, the report is noteworthy for two reasons that might seem contradictory: first of all, it can go into meticulous detail and at the same time it provides a broad overview of the future of European agriculture. This occurs when the rapporteur combines the economic dimension of agricultural reform with its natural calling, which is related to the sustainable development of the area, the safeguarding of the living conditions of those working there - therefore farmers' income - but especially to the development of regional productions.
It might again seem paradoxical, but to guarantee the basic principles of the CAP - which today is suffering from a growth crisis, in the sense that it has grown too much - we must go back to the beginning. We must move away from the large industrial concerns and return to the old family farm where it all began and where in many areas it is still the best guarantee of continuity. The future of agriculture in Europe - in the Europe of today and in the Europe of tomorrow, with an additional ten or so CEECs to take into account - depends on its ability to become the driving force and vehicle of economic and social cohesion, especially in disadvantaged areas where farming is still a challenge and an act of faith. I am thinking of mountain areas which are continually threatened by a plague called exodus, especially the exodus of young people attracted by easier incomes in the lowlands; I am thinking of Arctic areas; I am thinking of areas threatened with desertification, the last front of those who do not want to give in.
That is why I agree with the rapporteur when he says that support for production can be a double-edged sword that can cut the cord of solidarity with the disadvantaged areas, favouring the growth of two forms of agriculture, one rich and one poor, and create a gap between developed regions and regions lagging behind in development. In future programming, a series of mechanisms must be guaranteed to regulate interventions and harmonise production in Europe and the Mediterranean. These mechanisms must be based on guaranteed income and forms of integration between complementary professions, definitely treating farming as the main profession.

Martin, Philippe-Armand
Mr President, ladies and gentlemen, let us not forget that the common agricultural policy is the fundamental pillar European construction. It is, in fact, the only really integrated Community policy.
What does the Commission propose, in its communication on Agenda 2000? The Commission proposes a complete reform of the CAP and structural policy limited, for budgetary reasons, to 1.27 % of the GNP of Member States. With regard to agriculture, its proposals are confined to reducing the prices of arable crops, milk, beef and veal in order to maintain a socalled balance, by providing partial compensation, theoretically enabling farmers to adapt to these price reductions.
However, at the end of December 1999, the European Union and Member States will meet at the negotiating table of the WTO, and the issues under discussion will, of course, be the reduction of agricultural aid and the almost total withdrawal of Community preference.
So what proposals has the Commission made with regard to those discussions? None, or rather an increase in compensatory aid, which as we all know will be unacceptable to our various partners. The GATT agreements set a ceiling for this type of aid, so I do not believe that such a rise would be acceptable. What strategy is the Commission going to adopt? Will the Commission have enough courage to force our American partners to accept social and environmental clauses, or the ability to do so?
Commissioner, European agriculture dates back more than 2 500 years. It cannot be compared with agriculture in countries which have existed only two or three hundred years. We are going to destroy the rural world by copying them and we will destabilize the regional balance of the whole of the territory of the Member States of the European Union.
I wish to conclude simply by thanking Mr Cunha, and congratulating him on the excellent draft report he submitted to us, but which unfortunately was amended extensively by the Committee on Agriculture and Rural Development, so that it became slightly less coherent.

Fischler
Mr President, my honourable friends, it would of course be a very attractive prospect now to go into detail on the observations made by my honourable friend Mr Cunha, and on his report. In view of the late hour, however, I will speak only briefly. I will therefore distribute to you the statement I had prepared and at this juncture I will restrict myself to a few points which I feel to be important.
First of all, I would like to take the opportunity to thank the rapporteur, Mr Cunha, and the Members of the Committee on Agriculture and Rural Development for this report. It was with great interest that I read it and I also agreed with many points in the report. However, I would have placed emphasis on quite different areas. Allow me to illustrate. One of the main aims of the Commission is of course to consolidate the European agriculture model, but in a changing world consolidation cannot mean limiting oneself to consolidating what already exists. To do so would be to serve agriculture and our farmers badly.
The common agricultural policy must be adapted and reformed because in the coming decades our agriculture will be faced with more and more new realities, new conditions and new challenges. Only thus can we guarantee the continued existence of the European agriculture model. This is exactly what the Commission is aiming to achieve by means of these proposals. Let us speak openly: I have not yet seen an alternative to the Commission's proposals which is consistent, credible and capable of consensus, at least not where longer-term prospects are concerned.
A distinguishing feature, if not the distinguishing feature, of European agriculture, is its multi-functionality, as stated in the report. This involves firstly the economic dimension. Today we basically have the choice between two different paths: we could return down the path of production using strict volume limits, but the question is whether this is really an attractive programme for the future, especially in view of a comprehensive agricultural system, enlargement towards the East and the new world trade round.
The strategy which the Commission proposes goes in another direction. It is based on improving the competitiveness of domestic agricultural products, both internal and external, a task entrusted to the Commission at the Luxembourg Summit. This brings me to a point in the report, regarding which I must warn against any false impressions. The price reductions proposed by the Commission are not an end in themselves. They are the means to improve the competitiveness of our products and thus to create new sales potential. Reduction of institutional prices must take place in such a way that, even in the case of fluctuating market prices, there is enough scope to maintain a market presence. From this point of view, I do not believe that the price reductions proposed by the Commission can be regarded as excessive. In future, intervention should serve only as a safety net in case of significant price collapses.
In relation to the arrangement of direct payments, I cannot confirm, on the basis of the available analyses, that the proposal for a single form of aid for cereal and oilseed would make the production of oilseed crops uneconomic in most of the EU. In addition, the relationship between the beef and veal sectors is in our experience not nearly as direct as the report seems to assume.
What surprised me is that there would be a deviation from the general rule in the milk sector. It states that the level of compensatory payments should be allocated in accordance with regional or individual productivity. It must be obvious that such an approach would have not insignificant redistribution effects. At a later point the report seems to suggest the increased use of direct payments for redistribution. If this is the wish of Parliament, it must be stated loud and clear.
I have taken note of the clearly expressed wish to considerably increase area subsidies and subsidies related to service to society in comparison to production-related subsidies. After all, I see a confirmation of the Commission's view in what the report says about subsidiarity and decentralization. Subsidiarity - yes; decentralization - yes; renationalization - no!
I am pleased to discover that the report follows a similar guideline to that of the Commission as regards expanding policy on rural areas and environmental protection in agriculture into a solid, second pillar of agricultural policy. I note that the direction taken by the report in a series of points actually goes much further than the Commission's proposals and that these points refer explicitly to the conclusions of the Cork conference and support a greater financial contribution for rural development on behalf of the Community.
This possibility exists under the agricultural guideline, provided that the political will is to hand and that the agricultural guideline remains in its current form, a point on which the rapporteur and I are in agreement. I also share the opinions expressed in the report in the areas of food quality and food safety.
I find the report - and I can say this here - very encouraging in many points, but it also opens up many issues which we will disagree on. I am grateful for both these facts and am already looking forward to further discussions on this and to our continued cooperation.

President
The debate is closed.
The vote will take place on Wednesday at 11.30 a.m.

2000: Economic and social cohesion
President
The next item is the report (A4-0210/98) by Mrs Schroedter, on behalf of the Committee on Regional Policy, on Agenda 2000, Part 1, Chapter II: Economic and Social Cohesion (COM(97)2000 - C4-0523/97).

Schroedter
Mr President! Economic and social cohesion in Europe is facing its second test within a short period of time. Whenever the EU integration project is facing a severe test, an attempt is made to put cohesion policy aside, although this is precisely what has made the European single market a success. Harmony and uniform development are prerequisites for stability. For this reason it is imperative that the large export countries, who owe their profits to the single market concept, be involved, at least in some very small way, in realizing the European social model. We must not allow fate to decide whether people within the European Union are numbered among the winners or the losers. I would like to say very clearly once again: anyone wishing to terminate the EU's solidarity project is attacking the very heart of the integration process. We reject outright any net contributor discussions, as these deny the basics. On the other hand, it should certainly give us food for thought that, despite considerable financial expenditure, we have not succeeded in overcoming the divide between rich and poor regions. Unemployment in the ten poorest regions is still seven times higher than in the ten richest regions. This split economic development is now continuing in rich regions, forming islands of prosperity and cutting right across society. The human tragedy of mass unemployment, poverty and exclusion are affecting increasing numbers of the population. In view of this desperate situation in terms of economic and social cohesion, enlargement to include the ten countries of central and eastern Europe and Cyprus is an enormous challenge, making the structure of politics the key to the EU's ability to enlarge. The Commission's revision proposals must not be restricted to concentration. The goal of efficiency means that we must above all recognize that traditional economic methods cannot be used to meet the challenges of increasing unemployment and the process of transforming the economies of the Eastern European countries. Jacques Delors stated in the White Paper on Growth, Competitiveness and Employment that such methods needed to be adapted for sustainable development. Essentially, we must achieve development models which are based on low consumption of non-renewable resources and achieve a balance between economy, ecology and social development.
I would like to emphasise once again to the Member States: "Administrative arrangements are not to be equated with dismantling democracy' . The European Structural Funds grant the local and regional authorities and the social players extensive rights of participation. These rights can, however, only be used by the regions in question if the Member States involve them early enough in helping to formulate plans and projects. Due to the delay in the Structural Funds Regulation by the Council - the first half of 1999 is too late for planning - we find ourselves in a dilemma in that the principle of participation is laid down in the regulation but cannot take effect because the plans have already been drawn up to ensure that the implementation period could begin on time. If we are to take "Citizens' Europe' seriously, we must succeed in securing the participation of local and regional authorities early enough and to a sufficient degree. The situation cannot be simplified by putting together different areas to be supported. Thus, Objective 2 in the Commission's proposal seems to simply pass the problem down. In my opinion it is the responsibility of the Commission to remove competition at the European level between urban and industrial areas on the one hand and rural areas on the other. The report's proposal offers the opportunity to develop transparent procedures and guarantees the rights of participation of those affected in the rural areas and the rights of the European Parliament. In this report, Parliament confirms once again its determination to support the euro region at the borders with its Eastern neighbours by means of a joint fund. The Agenda provides us with the unique opportunity of setting up this fund in a budget category and under the responsibility of a Directorate-General. Why does the Commission continue to refuse to make concrete proposals?
I am very pleased that we have succeeded in achieving broad consensus in this report and in adopting it unanimously in the Committee on Regional Policy. It is my responsibility, as rapporteur, to ensure that this consensus remains, and it is a unique opportunity for the European Parliament to demonstrate to the Council that we can reach consensus within a very short space of time. I thank all those colleagues who contributed to this succès d'estime in the Parliament, and I hope that we succeed in it.

Colom i Naval
Mr President, the rapporteur's consensus extends beyond her own committee because, on behalf of the Committee on Budgets, I think we would go along with most of what her report says.
So I just want to say that although most of our amendments have not been formally incorporated, most of them have been taken on board implicitly. Basically, our amendments only reflect this House's decision of 4 December 1997. So I do not think there is any problem on our part.
I do want to make two brief comments. For one thing, we expected a stronger reaction from the Committee on Regional Policy. As we see it, the provisional pre-accession instrument, from the structural point of view, is not a structural fund, ladies and gentlemen, but an alternative Cohesion Fund. And that could cause problems in the future. It does not have the same mechanisms and aims as the Structural Funds, so we think the candidate countries are still not really being prepared for the Structural Funds. They are going to get used to the idea of a Cohesion Fund, which is a different matter.
In the general context of the agreement, I should like to mention a point we think is perhaps fundamental. We in the Committee on Budgets want a revision clause on the financial result of the structural fund reform - and enlargement, of course. But whereas we accept the Commission's hypotheses and figures at the moment, we must point out that if the costs corresponding to pre-accession and enlargement are added to the current figures for the Structural and Cohesion Funds, there is still room for manoeuvre within the 1.27 % ceiling. In other words, if the structural appropriations are reduced for the Fifteen, it is not to avoid exceeding the 1.27 % ceiling, but in order to keep it much lower. This year, we stand at 1.14 %. And I wonder, how many decimal places of GNP are we talking about? What we are really talking about at the moment - it was discussed at Cardiff - are mere pittances, in percentage terms.
Mr President, I would just like to add that we must be really aware of the economic and political importance of Heading 2 for the process of European political construction.

Ettl
Mr President, ladies and gentlemen, from the point of view of the Committee on Employment and Social Affairs, I can but welcome Mrs Schroedter's report. It shows awareness of the problem and really gets down to the issues of enlargement. It shows that justice has been done to ideas on achieving economic and social cohesion and it shows a political effort to avoid incoherence.
Enlargement is of course not only an opportunity for positive development but shows us all today, at this early stage, that not all questions of enlargement can be looked at only from an economic point of view, nor will they be a stroll in the park. Basically, all motions for a resolution, all resolution issues of 4 December are to be found again in the Schroedter report. My concern is that we need to strike a balance between the areas of infrastructure, transport, environment and human resources in order to achieve cohesion. This must be regarded as unilateral. It must be done as a single unit and this must be discussed.
Of course, the role of the social partners is also important in this context, a topic which was broached here as well. Without the social partners we cannot achieve ratification in the developing countries, in the countries which will be joining. We need instruments for this and thus we must reorganize PHARE in order to be of significant assistance. All of this must be done. Thus, for me it is still a point for discussion.
The new definition of Objective 2 is also very important. I would just like to point out that the combination of industry and rural areas could represent an opportunity for the future. I would also point out that in the three regulation proposals shortly to be under consideration, dealing with instruments of structural policy for preparation for accession, there is sufficient time for discussion in order to create a plausible framework for the whole area and to do justice to what we want to achieve, which is a homogeneous enlargement to include the countries of the former Eastern bloc.

McCarthy
Mr President, I welcome today's debate on the Schroedter report on the Agenda 2000 chapter on economic and social cohesion as a solid basis on which to launch Parliament's more detailed and comprehensive work on the regulations governing the Structural Funds. As Mrs Schroedter said, there was a unanimous vote in the Committee on Regional Policy but I think she would also admit that was as a result of very substantial amendments tabled by many political groups, and, indeed, we have much more work to do in this area.
In response to Mr Colom i Naval, I would say that now is not the time to deal with the very detailed regulations in the Structural Funds: we will look at them when we draw up specific detailed reports.
This is a timely debate, following on from last week's discussions under the British presidency in the Informal Council in Glasgow and the General Affairs Council in Luxembourg, and in the light of today's very topical discussion at the Cardiff Summit on the progress report on Agenda 2000, prepared by the British presidency to identify those areas where a consensus exists in the Council.
Therefore, in the light of these discussions, I wish to take some time to highlight a potential approach that my group will be taking during the reform process. There is no doubt that this reform of structural and Cohesion Funds represents the most significant changes in the last ten years with a view to meeting the challenges of enlargement and EMU. Enlargement will surely offer opportunities to our regions but we will want to ensure that the proposals presented by the Commission match our objectives and priorities as socialists, namely to continue the Delors legacy of promoting jobs, sustainable growth and the competitiveness of our regions and the central objective of economic and social cohesion of the Treaty to enable all citizens, regions and Member States to participate on an equal footing. The Union's benefits must be at the forefront of our policy process. This is just as much about creating equality of opportunity as removing the disparities between poorer and wealthier regions.
We should be clear about the internal challenges we face: one in five of Europe's youth is out of work, unemployment among women is consistently higher than among men, long-term unemployment persists as a scourge of modern society.
The reform process must, therefore, combine fairness with affordability and durability, with more simplification and efficiency. It must be fair in order to ensure we give priority to our poor regions without abandoning those problem regions going through the process of economic and social restructuring in wealthier Member States. Solidarity, if it is to enjoy mass support, must be a two-way, and not a one-way process. Subsidiarity and decentralization must be the cornerstone of our future policies to ensure that our regional policies are relevant to the needs and interests of local communities.
I would, therefore, like to welcome the decision that Parliament should be fully associated with the reform process. We welcome the interinstitutional agreement and wish to see it signed and sealed under this presidency. We have had a positive letter from Robin Cook, the President-in-Office, but we need to move forward now on the more fundamental items.
Finally, I wish to raise some areas where we need to consider the Commission's proposals in more detail: efficiency, of course, is fundamental to ensure the better use of funds but if the efficiency reserve leads to more red tape and bureaucracy and an increased monitoring role for Commission staff, then I fear that all we will be doing is employing more private consultants in order to monitor those processes. So we need to look very carefully at how that reserve would work. I would be in favour of looking at an innovation reserve with the appropriate procedures of decentralization and subsidiarity.
We will be judged by our citizens on how we handle the challenge of reform. Only when the EU is seen to be contributing to the solution of major problems in society, such as poverty and unemployment, can we expect to enjoy their support and ensure the credibility of the Union and its policies and institutions.
My group will take this challenge seriously and we look forward to cooperating with the Council and the Commission in improving the Agenda 2000 proposals to gain support from the public. We sincerely hope we will be given the opportunity of sharing in the executive powers - in a spirit of codecision, I might add. In this way we can only add to the democratic legitimacy of the reform process.

Schiedermeier
Mr President, Madam Commissioner, ladies and gentlemen, firstly I would like to thank the rapporteur for her willingness to cooperate. She made a significant contribution to the quality of the report. On behalf of the Group of the European People's Party I would like to note the following: the Structural Funds must adjust their support objectives in accordance with the objectives of the treaty and the tasks of the Community. This includes inter alia the balanced and sustainable development of economic activities, a high level of employment and of social protection, equality between men and women, and economic and social cohesion and solidarity among Member States. The principle of subsidiarity must be considered to a high degree in this context, as must the financial framework. Under no circumstances must enlargement be used to reduce the upper limit of 0.46 % of Community GNP for structural spending or that of 1.27 % for total expenditure.
In my view, countries participating in monetary union can no longer receive additional support from the Cohesion Fund. Moreover, solidarity does not mean taking more assistance than necessary. Thus, for Objective 1 the 75 % threshold of per capita GDP must be adhered to rigidly. I therefore welcome a transitional period for regions currently eligible for aid within the framework of Objectives 1, 2 or 5b. The new Objective 2 is, unfortunately, not logical, Madam Commissioner. It is and remains a scrambled objective. 80 % of EU citizens live in towns, and if rural areas become increasingly disadvantaged in terms of EU support the relationship will deteriorate further. This means that migration from rural areas to the towns will increase even further.
There are two possible ways to improve the Commission proposal. The first is an independent objective for rural areas and the second is a subdivided objective with two separate budget lines. The criteria must be capable of being extended and weighted by the Member States in accordance with the principle of subsidiarity. Under no circumstances must the planned concentration of funding hold the Member States back completely from determining the level of assistance they are to receive. The upper limit of the de minimis rule must therefore be raised considerably. Aid from Objective 3 must be flexible and easily applicable. The reduction of Community initiatives to just three is to be welcomed. But PHARE-CBC funds previously earmarked for cooperation with Interreg cannot under any circumstances be used at the borders between the CEECs.
SME assistance must be increased but, even more importantly, it must be simplified, Madam Commissioner. The 10 % level for reserve funds is too much. In this way, the Commission is attempting to gain greater influence because in the end it also determines the use of these reserve funds. In my view, this is a clear violation of the principle of subsidiarity.

Vallvé
Mr President, Madam Commissioner, I would first like to tell the rapporteur, Mrs Schroedter, that she has produced a good report on Agenda 2000.
I am not going to go into the details of the future debate on the Structural Funds, but I must repeat that economic and social cohesion is a fundamental aspect of European construction and, in that sense, we should value the role of the Member States and the regions, and the contributions they should make, together with the EU, towards directly applying the principle of subsidiarity.
I think the desired simplification of the Structural Funds is a good thing, with a large Objective 2. Study is needed to find the best way to include rural areas, industrial areas in decline, urban areas and fishing areas, with a proper application of the principle of subsidiarity in all cases. Consideration should also be given to the role that regions with a legislative capacity can play in the implementation of these Objective 2 development frameworks.
In that sense, I do not think a single regulation would be valid without taking account of how each Member State will decide to apply this Objective 2, according to its internal organization.
I think the suggestion about Objective 3 is very important, especially in view of the EU's biggest problem at the moment - unemployment. And all the thinking in that area should bear in mind the future eastwards enlargement of the EU. In that respect, I think it is a good idea for the Interreg Community initiative to also provide funds for the central and eastern European countries, but without compromising the funds which go to the current EU Member States.
Finally, I would like to say that it is always good for the Structural Funds and the allocated resources to be implemented efficiently, so I hope it will be possible to determine a good approach, to distribute these EU funds as efficiently as possible.

Collins, Gerard
Mr President, Commissioner, this is the last opportunity that this House will have to express our positions on the broad principles of the reform of the Structural Funds before we start to examine the detailed legislative proposals in the coming months and it is therefore an extremely important report.
From the outset I would stress that economic and social cohesion is an enshrined principle now and for the future. It is not about the very short-term fortunes of any national political party for electoral purposes. We have an obligation to be serious about our contribution to the future development of the Union and our ambitions for a better way forward have got to meet the expectations of all the citizens of the European Union.
Broadly speaking, I am in agreement with the Schroedter report. There are, however, a couple of points that are of particular concern to me. I am in total agreement with, and strongly support, the Commission's view that there is no link between EMU participation and eligibility under the Cohesion Fund. I would stress to certain colleagues that there is no basis in the Treaty to support such a link. Amendment No 25 by Mr Novo Belenguer and others correctly represents this position and I will be glad to support it. I can accept the principle of a mid-term review for the Cohesion Fund. However, I would find it unacceptable if there were not to be provision for transition arrangements for any Member State that ceases to qualify under the mid-term review.
It is essential that adequate transition arrangements be put in place for regions such as my country, Ireland, which cease to meet Objective 1 qualifying criteria. Transitional arrangements for Ireland must be adequate in terms of the level and duration of funding so as to address our continuing significant developmental needs. Whereas the level of funding must in particular meet the needs of the less-developed Irish subregions, it is my view that they should cover the whole country during the entire seven-year period of the next financial framework. Building a solid house is a long term investment. You do not build a house on foundations that have not been consolidated. Yes, we in Ireland have made rapid progress towards the EU average in GDP but - yes - we still need new significant levels of funding for the period ahead if we are to consolidate our economic progress achieved to date. Finally, I do not believe that anyone would seriously contest our aim of reaching a situation in which our higher levels of prosperity are copper-fastened and ensured on a permanent and sustainable basis.

Müller
Mr President, Madam Commissioner, ladies and gentlemen, Agenda 2000 caused a great commotion but there is, as yet, no coordination to be seen, as the Member States are rejecting the Commission's script. Heated fights for allocation, owners of assets who make their presence felt - and in the midst of all this, we lose sight of what is actually at stake; the great, great settlement with central and eastern Europe. But what are the rules of the game? The first is that enlargement is only possible if the agricultural and structural policies are reformed. Secondly, some better-off regions are excluded from current aid, and indeed this applies both to Germany and to Sweden or, for example, Spain. If the German Länder demand that budgetary risks for the Länder be prevented in the finance regulations, it is recommended that they use the interim deadline of four to six years to guarantee this for themselves.
Thirdly, unlike the previous speaker, I believe the Cohesion Fund should be dissolved following monetary union. However, if the Spanish government and others wish to cling desperately to it, it should be said honestly - and the rapporteur does allow this opportunity - that we cannot in principle deny Poland, Hungary, the Czech Republic, Slovenia and Estonia access to it; this is the logic of the game. Those who demand things for themselves also achieve things for others.
Fourthly, if we are going to haggle about money, then let us do it properly; this would mean clarifying the net contributor debate, particularly as far as Mr Waigel is concerned. The justice gap can only be closed on the income side and not on the expenditure side. Those in favour of reform must also be in favour of dismantling agricultural subsidies. A reduction of the British rebate in agricultural subsidies and a possible move to co-financing would at the same time pave the way for a general corrective mechanism. If we adhere to these rules, there will be some kind of coordination and we will have a script which will finally allow us to reach the end of negotiations.

Féret
Mr President, Mrs Schroedter's report calls for a more interdependent Europe, where rich regions give poorer regions more help. It calls for an enlarged Europe, enlarged to the scale of the continent, where the first fifteen Member States are committed to raising to their own level the central and eastern European countries, whose average per capita purchasing power is up to five times lower than in the Member States. At the same time, in Cardiff, our intrepid Heads of State have agreed upon one thing only: to pay less, and to receive more, so Europe will take a huge step backwards.
At the same time, my region, Hainault, is now, in the Commission's own words, a "disaster area' , because of forty years of absolute Socialist rule, because European funds are being squandered by the Socialist Party's friends and accomplices, following an old Socialist and Walloon tradition. At the same time, we are blowing hot and cold on the countries of central and eastern Europe. We have invited them to join us, but at the same time, we see a mote in their eyes, their lack of democracy, when in it is our western democracies that are moribund. Mr President, ladies and gentlemen, this report is a contemporary version of the torture of Tantalus: the harder we try to reach out to Europe and the benefits it could give our fellow citizens, the more it eludes us.

Walter
Mr President, Madam Commissioner, ladies and gentlemen, we have less than a year; by then everything must be in place - everything that we want to have discussed and decided in relation to Agenda 2000. Less than a year is not much time. So we really must set about rolling up our sleeves and getting started. I believe Elisabeth Schroedter's report is a good start. It provides a great deal of information without anticipating decisions which we have yet to debate intensively. I believe this is exactly the right approach.
In past debates - at this juncture, I would remind you of the plenary session in Brussels - we have experienced what happens if we try to lay down measures rashly or in hasty speculation. These cannot be the terms under which we work; instead, we must discuss matters seriously and thus find useful solutions. The report provides some guidelines, even if I would not accept in blank everything contained in it. There are also further amendments. We will vote on it tomorrow. Then we will finally have a result. But I believe it is important that this step has been taken.
What is the aim of all this? The aim in developing Agenda 2000 is not only to distribute money. It is to achieve a balanced system. It is also a question of working together to improve and develop an instrument of aid, and of how we get along together. There can be no question of our standing here and saying "We have received money from the Member States, ' and the Member States saying, "Give it back to us - we know best how to distribute it.' No, the aim is not to achieve a European added value. We must work together on this. I believe that in many places we must point out weaknesses. In the conflict between globalization and regionalization, it cannot only be a question of bringing as much as possible back and saying to the people at home, "Do what you want with it, ' and sufficing with that.
Nevertheless, we will have to examine the Commission's proposals carefully. Here, in many places, it is necessary to introduce simplification and the transparency which has been announced. We will examine this carefully, as it has been pointed out to us that simplification, for example in partnership or in programming, would, of course, bring with it an increased level of pressure and bureaucracy, which we do not want. We will consider this very carefully. In my view, our task over the next few weeks and months will be to look at which countries need money and which countries receive it. Of course, we must also ensure that this Community instrument is developed into a transparent instrument with which we can work together for the future of our regions.

Rack
Mr President, Madam Commissioner, ladies and gentlemen, it is easy to agree on principles, certainly when the principles in question make sense. Thus, in principle, we happily agree with the Schroedter report and the proposals for the reform of structural policy within Agenda 2000. Recognizable areas of concentration instead of spreading funds too thinly, objective criteria for the allocation of EU funds, bottom-up partnership, evaluation, what more could we want? In the interests of those affected, we must want more!
Rural areas, which have already been mentioned today, have not yet been given the necessary consideration, at least not in the initial drafts. Rural areas must at least be worthy of a subgoal within Objective 2, with guaranteed funding. In order to meet with the wide approval of our citizens, for the next round of enlargement we will need the opportunities offered by Interreg and a guaranteed level of Interreg funding for the Union's border regions. Indications from Brussels regarding funding constitute better advice than words of concern from various political ultra-peripheral regions. Moreover, without upper limits on finance, some so-called net contributors will feel that too much is being asked of them. The Schroedter report will meet with broad approval only when we allow room not only for the principles but also for particular interests, and I use the term advisedly. Let us work together with the Commission and the Council to achieve a good balance in the coming months, so that we will have a result which meets with broad approval throughout the Union.

Ryynänen
Mr President, Commissioner, reforms in EU regional and structural policy have to be able to meet the growing challenges that spring from regional inequality. The development of the global economy, mass unemployment, enlargement and EMU are all factors that require a structural policy that will level out differences and create new opportunities. EU regional policy must be more adept and flexible in its attention to differing circumstances. For example, more flexibility is needed in assessing population cover and national funding, according to the circumstances of the country.
We have to keep rigidly to the Agenda 2000 timetable for debate. The effective implementation of the programmes and the participation by the different parties involved requires sufficient preparation time. Large rural areas such as eastern and northern Finand are in a critical situation as far as the future is concerned. These areas are suffering acutely from population loss. We are now in urgent need of a policy of reform for these regions that will help to bring opportunities for the development of human capital, entrepreneurship based on the new technology, and a diverse array of incentives. The focus has to be the creation of permanent jobs locally and the support of local initiative.

Amadeo
Mr President, I would like to underline the importance of the partnership principle, especially when defining programmes and their methodology. I would particularly like to underline the fact that, if the measures for the development of rural regions are not clearly defined and decided, we risk causing great damage to local and regional cooperation. Meanwhile, there is another concern that should not be underestimated, and that is the danger that in the new view presented in Agenda 2000 economic and social cohesion will tend to blur the competences and control of the European Parliament. If this were to occur, it would truly be paradoxical that at a time when we are faced with the decisive issue of enlargement, the democratic guarantee of the European Parliament would be weakened.
At the same time, we are of the view that it is useful to facilitate cooperation with non-EU countries through Interreg and PHARE, creating appropriate legal and financial instruments like, for example, common funds. We are puzzled as to the actual usefulness of the proposed 10 % reserve mechanism. Similarly, we would like to highlight the paltry amount of credits made available.
Enlargement requires a rational and effective structural policy, in spite of the budget restrictions that are imposed. In general, when we look at the innovations of Agenda 2000, we see that the number of Community initiatives is reduced from 13 to 3, that the budget for the Cohesion Fund is only ECU 3 billion, that the eligibility criteria for aid seems simplified; we also see that no major progress has been made in structural policy, which is even more important today because of the new countries seeking membership.

Lage
Mr President, ladies and gentlemen, our financial forecasts for the years 2000 to 2006, upon which our cohesion policy depends, will be decided in March next year, according to the Cardiff Summit, after the effects of the German elections have been put into perspective.
Thus Mrs Schroedter's report, while it is a good piece of work, is merely a preliminary step, although it is imbued with the best of cohesion philosophy. But we are bound by circumstances, in the light of the vote a fortnight ago in the European Parliament, which was unexpectedly hostile to the countries that benefit from the Cohesion Fund, to take the matter up again in the form of some amendments to the Schroedter report.
The vote on these proposals represents a significant test of the present sensitivity of Members of the European Parliament. It will indelibly mark out the difference between national selfishness and Community solidarity, between the laws of the market and the ethical imperatives of cohesion, in short between words and actions. And let it not be said that the Cohesion Fund is intended to help its beneficiaries to join the euro, and nothing more. That is mere sophistry: false reasoning masquerading as sound argument. The fact is that the need to keep the Cohesion Fund is even further justified with the coming of the euro.
Economic geography and history show us that when the market is unified, harmonized, extended and supplied with a single currency there are advantages for the whole, but on the other hand there is also a strong tendency for already existing geographical centres and economic groups to be strengthened, to the detriment of the most peripheral and outlying regions. These are real risks which should not be underestimated; on the contrary, the Fifteen should be working to counteract them. How? By giving priority to the principle of balance within our territory and to policies of cohesion. This is why the Cohesion Fund must be kept and why, in short, it would be a very serious mistake to abolish it.
The European Parliament, which over the years has championed the principles of solidarity, would seriously compromise its reputation if it did not now unequivocally keep faith with its traditions and the values on which it is built.

Hatzidakis
Madam Commissioner, the efforts of the European Union to achieve economic and social cohesion within its borders must continue unabated while there remain substantial inequalities at both regional and national level and while such tendencies are, in certain cases, on the increase, despite the significant steps that have been taken towards achieving nominal convergence. This situation, together with the imminent enlargement towards countries of central and eastern Europe, places increased responsibilities on the European Union, which impose a new way of dealing with social and structural policies in the future.
Against such a background, the first substantial issue to be raised is that of the structural perspectives, which is an issue which must be clarified as soon as possible so that we know what money we will have at our disposal, in order that we can determine in a responsible way the relevant policies. This is an issue which, of course, belongs chiefly within the powers of the Council.
The Community budget, up to 1.27 % of Community GDP, of which 0.46 % is allocated to structural policies, may well prove to be inadequate in the future to cover satisfactorily both existing and new countries and policies. On no account must enlargement turn out to be at the expense of current Member States, especially the poorest. That is why the financial perspectives must be re-examined, before the first wave of enlargement, with a view to dealing with the new requirements and developments which will have arisen or which, by then, will have become more apparent.
The regions of Objective 1, which are those with a per capita GDP lower than 75 % of the Community average, in other words the poorest and those with the greatest needs, must continue in the future to receive two-thirds of Structural Fund resources, as recommended moreover by the Commission. The share of financing for these regions must remain high, while they must be even higher for island regions due to the special problems they face, as recognised moreover by Article 130a of the Amsterdam Treaty. The implementation of an integrated policy, based on this provision in the new Treaty, is also necessary for the islands, in order to deal with the special problems that arise because of their island status. It is also right to reduce the Objectives from six to three as well as the Community initiatives from fifteen to three, for the purposes of simplification and focus. Finance equivalent to 5 % of resources also seems logical to me but there certainly needs to be a doubling of resources for innovative actions which, precisely because of their pioneering and guiding nature, may prove to be especially advantageous.
I would like to finish by stressing that in the future there must still be a Cohesion Fund for the financing of large structural projects in the fields of transport and the environment, in which countries with a per capita GDP lower than 90 % of the Community average must once again be able to participate.

Izquierdo Collado
Mr President, I want to congratulate Mrs Schroedter on her report, and tell her that the best thing about the report - and she should not be upset by this - is that it is indebted to the proposals made by the Commission, and specifically the Commissioner here with us today, Mrs Wulf-Mathies.
This report is in line with the Commission proposals, and that is exactly where its strength and positive nature lie. It has another positive aspect: it is going to allow us to go back over the incredible events of the last part-session when, because of a series of mistakes, a conclusion was reached on the Cohesion Fund which does not represent the majority view of the House, as we will have the chance to find out in tomorrow's vote.
I want to ask Mrs Schroedter to please try to educate a certain member of her group a little, because she has certainly taken full account of what the Cohesion Fund is, and what cohesion means. The Cohesion Fund is provided for in the Treaties, should continue to be provided for in the Treaties, and to change it would mean changing the Treaties. It cannot be presented as an option for some countries which do not want to give up certain subsidies. We are talking about the Treaties, and those countries with less than 90 % of Community income have a continued right to the Cohesion Fund, because that is what is said by the rules of the Fifteen with which we have provided ourselves.
Mrs Schroedter certainly has understood what cohesion is. And cohesion cannot be understood without the fundamental link to the internal market which now, with the single currency, is a full internal market.
The positions achieved are also the positions achieved by those countries, regions and companies which, in a common market, have enjoyed a situation of privileged competition. That is why cohesion arises: so that this competitive privilege can be borne in mind, and the least favoured regions can be helped.
Let us be logical when we talk about cohesion, Mr President.

Arias Cañete
Mr President, I want to start my speech by joining previous speakers in congratulating Mrs Schroedter on her report. She certainly deserves those congratulations, because of her hard work in preparing her report and, especially, because of the efforts she has made to seek compromises between the various political groups. These compromises have meant that this report was approved almost unanimously in the Committee on Regional Policy.
Among the report's conclusions, I would like to emphasise - because it is so important for cohesion policy - the express recognition that two-thirds of the total Structural Fund resources should be allocated to the Objective 1 regions. Only by concentrating resources on the least favoured regions can we reduce regional disparities within reasonable timescales.
I think the reference in recital A to the Cohesion Fund's important role in promoting the harmonious development of the Community is very positive. However, not only do I think the statement in recital L should be incorporated into the conclusions, but I also think it needs to be worded in such a way as to clarify the debate currently underway, in view of the vote on the Berend amendment in the last Brussels part-session.
So I think the text of Amendments Nos 5, 6 and 14, presented by members of the PPE Group, the ARE Group and the PSE Group, brings the debate back to more reasonable terms, without hasty pronouncements. These amendments support the maintenance of a Cohesion Fund after the year 2000, without prejudging the final position of the European Parliament, which will be expressed in the context of the legislative procedure on the Cohesion Fund. They allow this House to begin the debate with the necessary composure and respect for the Treaties, in an atmosphere of parliamentary calm, unaffected by electoral stances arising from the important national elections underway.
I think that, as the report underlines, it is very important to reclaim powers for the bodies responsible for European regional policy, with respect to the programming and monitoring of programmes within the framework of rural development, otherwise the coherence which should characterize all aspects of regional policy will be lost.
I conclude by thanking our rapporteur again for her excellent work, which will serve as a guideline for the Committee on Regional Policy in its task over the next few months, in analysing the highly reasoned and balanced legislative proposals presented by the Commission.

Bösch
Madam Commissioner, Mr President, ladies and gentlemen, I believe we must be careful - in the context of the solidarity always mentioned in connection with economic cohesion of the Union - not to repeat the fairytales told to us by the Council and other powers, sometimes even the Commission. On the one hand, we cannot plan, with the approval of all Member States, an enlargement of the kind that is obviously planned here - the poorest and most sizeable enlargement which Europe's history of integration has ever known. On the other hand, we cannot believe that we will have to pay less than in the past or indeed that we can maintain existing structural policies and Member States' incomes as they were in the past.
Our fellow citizens will not accept this and indeed it is also an insult to our own intelligence. Thus, it will be a question of proper distribution. In this regard, some colleagues are indeed right. We not only have a north-south conflict in the area of cohesion but also, to a certain extent, a north-north conflict. Here I must point out to some of the preceding speakers that there is no point in only considering structural policies as such. Of course, no later than October, when the Commission adds up the income side of Agenda 2000 and says that this country has to pay so much and that country has to pay so much, we will have a new debate on expenditure in category 2 of the structural policies. For this reason it is also important that we include, for example, expenditure on agriculture. The Committee on Agriculture and Rural Development cannot make its own decisions on this and say that none of it is its concern. I am directing this particularly at our Bavarian representative here. Of course, this is to be included as, if we have major new tasks ahead of us, and that is a certainty, then it poses a challenge to our solidarity. Then it will no longer be possible for the second richest country in this Union to be a net beneficiary because of this - crazy - agricultural policy; then our fellow citizens of the Union will no longer accept such a policy.

Berend
Mr President, Madam Commissioner, ladies and gentlemen, firstly I would like to express my approval of the priorities of this report, which owes its current form not least to the cooperation of the rapporteur and to many changes in committee. We are in favour of the proposed concentration of funding for development and structural adjustment of underdeveloped regions (Objective 1), as proposed by the report and by the Commission. We support the strict application of the criterion of a regional per capita GNP, expressed as purchasing power parities of level NUT 2, less than 75 % of the Community average, for the selection of future Objective 1 regions.
Two-thirds of the structural funds appropriations for Objective 1 do in fact guarantee the necessary concentration of funding for the regions most in need. In this context, however, I would remind the Commission not to deviate from the strict application of this criterion. In simple terms this means that all Objective 1 regions are entitled to receive equal funding. In view of the regional orientation of Objective 1, the criterion relating to national welfare is not suited to equal treatment. On the contrary, it creates new inequalities and thus, we reject it.
Like the report and the Commission, we are in favour of financing European structural policy while maintaining the ceiling of 1.27 % for own resources and the percentage of structural funds at 0.46 %, and also of not deviating from these central points in the context of enlargement. As far as the Cohesion Fund is concerned, we agree with the rapporteur that after the year 2000, we should have a Cohesion Fund as support for reaching the convergence criteria. However, we do not want the continuation of the existing one, as currently provided for by Agenda 2000. A translation error relating to this will be corrected tomorrow by means of a corrigendum.

Varela Suanzes-Carpegna
Mr President, Madam Commissioner, ladies and gentlemen, economic and social cohesion is an essential objective of European construction, and just as important as monetary union or the single market. If the effort towards cohesion has been important, the economic data show that so far it has not been enough.
To make sure that people understand what we mean, we are not talking about charity here, or about indefinite, indiscriminate subsidies. Cohesion is synonymous with solidarity and fairness in the different efforts of the various European regions to achieve competitiveness. Cohesion is the other face of the single market and monetary union. In that context, and in the context of enlargement, economic and social cohesion will be needed more than ever, and rightly so.
Monetary union and the single market will mean that investment is centred on the rich countries more than ever. Enlargement will make solidarity even more necessary, when cohesion has still not been achieved among the Fifteen.
So the Cohesion Fund is an essential instrument. The Cohesion Fund is needed by the current Member States which have a per capita GNP of less than 90 % of the Community average, as established by the Treaty, regardless of whether or not they join monetary union.
Lastly, the opinion of the Committee on Fisheries attached to the Schroedter report mentions an injustice which I want to underline: the inadequate structural attention paid to the fisheries sector in Agenda 2000. The special nature of coastal regions, which are generally peripheral and highly dependent on fishing, with no easy employment alternatives, means they need the structural support of a horizontal regulation to include the whole European coastline, to give these zones the concrete actions they so badly need and should have, but which do not exist at the moment.
So I conclude by congratulating the rapporteur and calling for real improvements in economic and social cohesion in Europe.

Viola
Mr President, Commissioner, ladies and gentlemen, I would like to congratulate the rapporteur and say that Agenda 2000 puts a brake on the development of cohesion policy with a cut in the percentage of the expenditure objective decided in Edinburgh from 0.46 to 0.39 %, considering that heading 2 of the budget must give up ECU 7 billion to pre-accession. That is why we are calling first of all for the creation of a new budget heading - heading 7 - a reflection on the 1.27 % that should be revised when the dates and numbers concerning enlargement are known, and a distribution of funds that leaves the cohesion policy the way it was decided, without reducing it to a kind of privilege for a few.
I actually wonder whether Agenda 2000, in wanting to concentrate the distribution of funds as much as possible, has taken into account the actual needs of regions or whether it has blindly chosen a figure as the maximum criterion. I also have doubts as to the choice of per capita GDP as an absolute reference. This figure should be examined thoroughly so that it accurately reflects the socio-economic condition of a region, otherwise, we will find ourselves with obvious distortions of reality like, for example, in the case of the island regions. How does a Eurostat parameter show the major difference that exists between the 76 % achieved by an island region and the 76 % achieved by a region on the mainland?
Several items in the chapter on cohesion policy in Agenda 2000 leave me puzzled, beginning with the 10 % reserve. I will just say here that I would like to see some rethinking of the Cohesion Fund as soon as possible so that in the near future it is not eliminated but regionalized.

Wulf-Mathies
Mr President, ladies and gentlemen, I would firstly like to thank you, Mrs Schroedter, for the report and the resolutions which are critical and constructive and offer a further opportunity for discussion of Agenda 2000 in the European Parliament. I would like to emphasize in particular the broad agreement between the European Parliament and the Commission, which is very positive, especially as regards the significance of economic and social cohesion, but also as regards common goals such as sustainability, combating unemployment, increasing the competitiveness of the regions, the importance of human resources and equality of opportunity.
We are starting to see some progress in the Council too. The British Presidency has gone to great lengths in recent weeks, not only in the Council working parties but also in the informal Council in Glasgow, to initiate a first political discussion on the reform of the Structural Funds.
Perhaps the most important message from Glasgow is, in my view, that there was no fundamental opposition. The political philosophy of the Commission's proposals was broadly confirmed. It is also significant that the Ministers accepted the connection between simplification and decentralization on the one hand, and increased accountability on the other. But on this issue - as several speakers said - considerable discussion is, of course, still required.
Allow me to clarify the following once again in relation to the balance of the overall package. Firstly, enlargement will not be at the expense of the poorest regions. On the contrary, genuine Objective 1 regions will be the beneficiaries of this reform. I would specifically mention, in this regard, that the existence of the Cohesion Fund and adjustment in line with the Stability Pact are part of the Commission's overall proposal.
Secondly, concentration efforts are distributed equally and fairly among all Member States and are not at the expense of either rural areas or other problem regions.
Thirdly, the pre-accession package contains an attractive offer for those states wishing to join and does not place excessive strain on the current Member States.
Allow me to say, regarding your doubts on the financing of enlargement, that Agenda 2000's overall package is financed cleanly. However - and I would emphasize what was said here - the proposals on the reform of more important Community policies and on the gradual inclusion of applicant countries form one unit. One is not possible without the other. The applicant countries are also required not to allow their efforts to achieve the Community acquis to diminish.
If all participants proceed rationally, enlargement can be achieved without additional cost to the European taxpayer, even if growth should prove to be lower. In addition, when discussing finances we should not forget the advantages of enlargement, politically and in terms of security, but above all for democracy and economic progress. I believe that we are not exactly giving a welcoming impression to those Members who view accession to the Community as a way of belonging to a democratic system which guarantees peace.
With regard to your request that a single financial instrument be provided for the pre-accession strategy, I would point out that the Commission, in accordance with the instructions of the Luxembourg European Council, has proposed three financial instruments. Because of the different legal bases, one would not, after all, simplify things for us any more than the attempt which we have now made, which is to try to make the process as uniform as possible by means of the coordination regulation and the functioning of the three regulations.
You, like many Member States, are in favour of a close interlocking of the pre-accession instrument with Interreg. I would point out that it is not sufficient, in the area of cross-border activities, to restrict ourselves to ISBA; instead, we should place emphasis on Interreg, PHARE-CBC. Moreover, PHARE will continue to be responsible for introducing regional policy in the accession countries by means of small projects and institution building. In continuing PHARE-CBC, the Commission considers it necessary, in the context of cross-border cooperation and in contrast to the decisive "No' of the draft resolution, to devote greater attention to the Eastern borders; this is also linked in with the pre-accession strategy. However, and here we are in agreement, this must not result in the Western borders being neglected. Strengthening cross-border cooperation is of particular importance, not only for acceptance of enlargement towards the east but also for purposes of introducing the procedures and substance of regional policy.
Partnership and an integrated approach are the innovative elements of the new Structural Funds regulation. I thank you for the support of the European Parliament for the growth of this partnership. However, it surprises me that after years of discussion about the necessity of integrated regional development strategies, the integrated approach should suddenly be called into question. And yet all the experiences summarised in the cohesion report show that structural policy was particularly successful in all places where infrastructural measures, support of private investment and the development of human capital were components of a uniform regional policy.
I would consider it to be dangerous if we were to end up with fragmented activities and a sectoral patchwork, which would be inconsistent with an integrated regional development strategy and thus particularly with efficiency of aid. Moreover, one programme per region is a considerable simplification which, nonetheless, in no way excludes the possibility of a detailed consideration of various problem areas or an objective examination of rural areas.
I considered your request for a subdivision of Objective 2 into two subgoals - or indeed the creation of an independent goal - to be counterproductive. It is precisely this competition between town and country that we wish to overcome by means of a regional development strategy, Mrs Schroedter. There can be no question, dear Mr Schiedermeier, of the rural areas being disadvantaged. Looking to the future, that is first of all the application of Objective 2 in line with the principle of subsidiarity, with the opportunity for countries and regions to select a considerable number of the areas, and the horizontal support in Figure 3, goodness knows this cannot in any way be seen as neglect of rural areas.
I am pleased that the European Parliament's proposal for a performance reserve is approved at least in principle, and hope that we can still dispel your scepticism by means of range and feasibility. This also applies to the Commission's proposal to create incentives for good financial management of the programmes. I agree that we must yet discuss this critically but I would ask you not to allow yourselves to be affected by particular ministerial interests.
The Austrian Presidency is determined to have the main points of the reform ready for judgement before the Council Summit in Vienna so that the whole package can be adopted early in 1999. Here I hope for the active support of the European Parliament and ask you to focus all your efforts on this and not on an interim regulation.

McCarthy
Mr President, on a point of order. Could you inform Commissioner Fischler's cabinet that mobile phones are not allowed in this House. It is discourteous to Members and interrupts the debates.

President
Thank you, Mrs McCarthy. We have all noted your remark. That includes the Commissioner, of course.
The debate is closed.
The vote will take place at 11.30 a.m. tomorrow.

Common organization of the market in bananas
President
The next item on the agenda is Mr Thomas's report (A4-0220/98), on behalf of the Committee on Agriculture and Rural Development, on the proposal for a Council Regulation amending (EEC) Regulation No 404/93 on the common organization of the market in bananas (COM(98)0004- C4-0046/98-98/0013(CNS).

Thomas
Mr President, today we are considering a Commission proposal which will bring the European Union banana regime into line with a ruling delivered by the WTO dispute settlement body. Although many of us would like to, we are not at liberty to alter the judgment and many of us, myself included, would criticize the way that decision was reached and the method by which the original complaint was taken.
However, that said, the European Union is required to put new arrangements into place by 1 January 1999. The world trade in bananas is a very complex business with many players and conflicting interests. I firmly believe that although we must work within the legal framework of our international commitments, our primary objective must be to protect EU producers and those countries to which we have committed our support in the context of the Lomé Convention.
The provision of quality fruit at a reasonable price is just one aim of the banana regime. However, world trade should not be driven solely by economic considerations. We have a duty to contribute to the fight against poverty and towards the protection of acceptable social and environmental standards.
I broadly support the Commission proposals which make as few changes as possible to the existing regime. The Commission proposes maintaining the existing tariff quota at its current level of 2.2 million tonnes at the same rate of duty of ECU 75 per tonne with an additional autonomous tariff quota of 353 000 tonnes at a rate of ECU 300 per tonne to take account of an enlarged European Union.
My main concern with the Commission proposals is that duty-free access to bananas from traditional ACP suppliers up to a ceiling of 857 000 tonnes will continue while at the same time the current licensing system will be abolished and individual countries will no longer be allocated a share of the quota on a country basis. The licensing system is one element of the banana regime condemned by the WTO which must be replaced.
The Commission proposal does not detail how licences will be allocated and this gives rise to concern. I urge the Commission to preserve a balance in the supply of bananas on the EU market and to ensure that in allocating a quota they use the best possible statistics which take account of changes in trade flows in recent years. It would be totally unacceptable if those ACP countries which have traditionally provided bananas for the EU market and whose economies depend on the revenue they receive from the banana trade lose out when new arrangements come into effect.
The Lomé Convention refers to individual states and not the ACP as a whole and the WTO ruling recognizes the commitment the EU has made to the ACP states. Traditional ACP suppliers also risk losing out as a result of the increasing involvement of American multinationals in banana production in some of the non-traditional ACP states. I trust that the Commission will monitor this situation very carefully and bear this in mind when allocating market access.
I am pleased that in this context the Commission has brought forward proposals for a financial package of ECU 370m to assist ACP banana producers and bridge the competitive gap between the ACP and Latin American bananas. Mr Liese is the rapporteur for the Committee on Development and Cooperation for these proposals and they are linked with mine. They should be treated as an urgency this week.
It is important to have a mechanism which will enable ACP states to expand their production. I have suggested that the Commission include an expansion coefficient in their calculations. It is easy for an Englishman to forget that 17 % of the bananas eaten in Europe are produced domestically. I would like to thank my Spanish and Portuguese colleagues for the time they have taken to ensure that I was fully instructed on this fact.
We discussed EU banana production and its importance to the industry in some of the more peripheral areas of the Union at some length. The Commission proposal does not contain any specific measures to favour our own banana producers who stand to lose as a result of the changes to the regime. I therefore proposed in my report that the maximum quantity for EU bananas be increased by 15 % from the present level of 854, 000 tonnes to 982, 000 tonnes and that the standard reference income be raised by 20 %.
In this way we can ensure that EU producers also benefit from the growth in the market. The ECU 78m which will be saved as a result of higher duties should be redeployed to facilitate banana production in those regions of the EU such as Madeira, the Canaries and Crete whose economies to a large extent depend on this crop.
Finally, I would like to make a special mention of Somalia. The civil war and severe flooding have devastated the banana industry. We have a duty to extend a helping hand to the people of Somalia and ensure that they can rebuild what was a flourishing industry. I urge the Commission and the Council to be flexible and show some compassion. There is much more I could say about my report. I hope colleagues will support it as it was overwhelmingly supported in the Committee on Agriculture and Rural Development.

Cardona
Mr President, ladies and gentlemen, the European Union consumes approximately four million tonnes of bananas every year. 76 % of these are imported from nonEU, non-ACP countries, most of whose plantations are controlled by American companies.
So far as we know, this form of production, or this way of producing bananas, has no environmental or social concerns. Thus, from the point of view of production in the European Union - which, as you know, includes the island of Madeira, which is part of the territory of Portugal - we have been protecting either common production or production in the traditional ACP countries. That protection has been provided by subsidies and preferential treatment which is expressed in a special system of import certificates and a customary duty-free import quota.
That system, as you know, has been challenged by the United States and some Latin American banana producers as an alleged breach of Article 13 of the GATT. As a result, the Union has been requested to change the system by the dispute-settling body of the World Trade Organization.
The Commission has accordingly put forward a amendment to Regulation 404/93 on the common organization of the market in bananas. That amendment is the subject of our report. Having examined and studied all its aspects, particularly its budgetary implications, the Budgetary Committee essentially agrees to the proposals on the legal side of the matter; however, particularly bearing in mind the resulting implications for its own producers and for traditional ACP producers, the Budgetary Committee has drawn up a series of amendments to the law - which it hopes may be included in the report by the Committee on Agriculture and Rural Development - the purpose of which is, by means of an annual report by the Committee, to control and keep checks on the financial consequences of the new system and examine the proposed aid framework.

Carlotti
Mr President, ladies and gentlemen, Commissioner Fischler, the establishment of a European market for bananas in 1993 has had largely positive results: a sevenfold increase in intra-Community flow, convergence and stability of prices, renewed confidence in producer countries and, finally, an increase in the market shares of European operators by comparison with American operators.
More specifically, of the three great multinational companies which control three-quarters of the world market in bananas, only Chiquita's market share is decreasing, which I have to say is the result of strategic and management errors. Chiquita therefore only has itself to blame. However, this company with its colonialist attitude, which is used to getting its own way, by force if necessary, and which has been convicted several times for abusing its dominant position, blames European regulations, and what is more, the American government and certain other countries have followed its example. Of course, Chiquita's president has an important political role and great political influence, as he gave over one million dollars to the big political parties during the presidential elections in the United States.
So, the problem has nothing to do with the principle of liberalization of the European market in bananas. The COM has apparently expanded the market. The essential problem has something to do with our view of the economy which is opposed to that of the United States, especially when such an important country allows it decisions to be dictated by an utterly unscrupulous company.
Faced with the WTO rulings, and after having exhausted all other means of recourse, the Union has in fact decided to bring the COM in bananas into line with the rules of international trade. The Committee on Development and Cooperation accepts the solution proposed by the Commission and amended by the rapporteur Mr Thomas, whom I must thank for having incorporated many of our proposals. We accept it because it complies with the 1993 compromises: it respects the interest of the various sources of supply, and takes into consideration the Union's commitments, that is, Community preference and preferential access for ACP countries, pursuant to Protocol 5 of the Lomé Convention.
In many African, Caribbean and Pacific countries, bananas are the main crop, the only crop to generate exports, the main employer. They are the "single engine' of fragile economies, trying courageously and obstinately to enter the modern world. This new regulation will test the Union's political ability to defend its policies and its identity.

Cunningham
Mr President, I wish to begin by congratulating David Thomas, the rapporteur, on his excellent work on this crucial issue of our trade in bananas. I also wish to offer an apology, Mr President, to you, Parliament and Commissioner Fischler, for I have to leave immediately after this speech for a bilateral discussion with my Dutch colleague, Jozias van Aartsen, about this dossier and price-fixing generally, before the Council next week.
After all the hard work that has gone into this dossier, I am optimistic that the Council will be able to arrive at an agreement at our June meeting. Today is an opportunity, therefore, for me to express my sincere appreciation to Parliament, David Thomas and all his colleagues for the speed with which this issue, this complex and, as we know, controversial dossier, has been considered.
Ever since the latest WTO dispute began two years ago, we have accepted that, in the event of an adverse ruling, the Union would have to bring its arrangements into line with those WTO rules. The Union committed itself to do that immediately, once the ruling was published. We now have until 1 January next year to get the revised system into place. That is why we must reach agreement at next week's Council so that there is enough time for the detailed rules to be agreed and implemented before that deadline.
The revised arrangements will not be as favourable as the present arrangements for the producers in the ACP countries, to whom we have obligations under the Lomé Convention. Taking my presidency hat off for a moment, we in the United Kingdom are particularly concerned about the situation of the Caribbean producers. Because of our long-standing relationship with the region we are acutely aware of their current dependence on banana production to sustain their whole economy.
The Council recognizes the importance of bananas, both in terms of exports and employment, for those Caribbean and, indeed, all ACP countries, and for the ultra-peripheral areas of the Union. At the same time, we accept that the revisions the Commission is proposing are the best way forward in the very difficult circumstances following the ruling by the WTO. It is important, therefore, to reach agreement as soon as possible, both inside the European Union and outside it, too, in order to provide the stability in the market that both producers and traders require.
Regrettably, while we seem to be moving towards an acceptable deal within the European Union, the signs from some of the WTO complainants are less helpful. These countries have, of course, been following the negotiations on the revised arrangements with close interest. They claim that what the Commission is proposing is not sufficient to bring the bananas regime into line with the ruling.
I must say that I find this attitude very disappointing. I hope that once the United States and others have a chance to look at what the Council agrees, they will accept that we, working together with the Commission, have found a reasonable way of honouring all our international obligations - that is obligations under the Lomé Convention as well as obligations under the WTO.
I certainly hope that is so, because the uncertainty created by the ongoing threat of further WTO action would be neither conducive to the proper functioning of the market nor to the ability of ACP and EU growers to adjust to the new arrangements.
I firmly believe that the proposal represents a carefully judged reconciliation of the Union's obligations under the WTO and its commitment to the ACP countries under the Lomé Convention. I am determined to reach agreement in the June Agriculture Council, and I am most grateful for the European Parliament's helpfulness in making this objective possible. I once again apologize for having to leave.

Fischler
Mr President, Mr President-in-Office of the Council, ladies and gentlemen, I would firstly like to extend my warmest thanks to the rapporteur, Mr Thomas, for his report on the reform of the common market organization in bananas. The starting point which made it necessary to reform those points of the common market organization in bananas which regulate trade with third countries is well known. I would like to add at this point that the WTO rules do not affect internal Community rules; for this reason they do not need to be changed.
Nine major series of questions stand out from among the large number of amendments. The first problem concerns autonomous tariff quotas and the balance sheet. In the Commission's view, the relevant amendments do not take into account the supply requirements of the enlarged Community of Fifteen. We must also ensure that we fulfil the valid expectations of those traders who previously had privileges.
I would also like to note that each increase in autonomous tariff quotas benefits non-traditional ACP countries and that EU producers always profit from an increase in consumption as their production quantities are not limited. The Commission cannot, therefore, accept Amendments Nos 11, 15, 23, 27, 28, 30, 31, 46 or 53.
The second problem concerns the regulation on deficiency payments. The Commission proposal ensures that the regulation is in line with the WTO provisions, which nonetheless do not affect internal Community rules. Thus, in the Commission's view, it is neither necessary nor appropriate to change the deficiency payments regulation. I would like to emphasize, however, that the income guarantee for EU producers is always granted, without full compensation, regardless of the actual market price.
Amendments Nos 5 to 8, 10, 21, 22, 24 to 26, 48 and 51 therefore constitute a problem for the Commission. As far as the ACP suppliers are concerned, a subject dealt with in Amendments Nos 3, 6, 9, 36, 48, 55 and 57, the existing preferences are retained in the Commission proposal. We believe that access is gained to the Community by means of the third preamble in the original regulation. Special assistance should be laid down in the Commission proposal in the form of a special framework of assistance for the traditional ACP suppliers which, it is to be hoped, will be accepted soon and which was previously the subject of the vote in the urgent procedure. Thus, the Commission believes that in this context, changes to our proposal will not be necessary. I should add, in relation to Amendments Nos 48 and 55, that the revision of the WTO mechanisms lies outside the scope of this regulation.
As regards Amendments Nos 14, 28, 45, 50 and 52 concerning non-traditional ACP bananas, in the Commission's view access of non-traditional bananas to the Community market by means of the ECU 200 preference is already sufficiently guaranteed.
With regard to Amendment No 50, it should be noted that the allocation of 857 000 tonnes applies only to the traditional ACP suppliers and that this fixed provision guarantees access to the Union's market. Amendments Nos 16, 17 and 32 refer specifically to Somalia. If we were to grant Somalia a special quota, this would clearly be an infringement of WTO provisions, as would preferential granting of licences. In any case, Somalia benefits from the overall ACP quota, although it did not sign the last Lomé Convention.
The next problem area concerns import licences and the licence system. A balanced supply is guaranteed by the quotas for third countries and not by the licence system. Furthermore, the details of the licence system for bananas and the coefficients of expansion to calculate the number of licences to be allocated every year to each group of traders are decided in the course of the management committee procedure. I cannot, therefore, approve Amendments Nos 12, 13, 33 to 35, 44 or 49.
I will now turn to the question of proper conditions of competition, which I know is very important to many of the Members of this House. This question concerns Amendments Nos 1 to 4, 18, 19, 37, 38, 40, 44, 54, 55 and 58 to 60. I would emphasize that the Commission is very much in favour of proper conditions of competition and organic production methods. In our opinion, the corresponding measures should be taken across the board and not just for bananas. This question is currently being discussed by the services concerned in order to clarify the position of the Commission on the issue of proper conditions of competition. Thus, I do not wish to pre-empt the results of these Commission discussions.
Amendment No 29 aims to ensure that smaller suppliers, in particular smaller ACP countries, are not disadvantaged by the introduction of tariff quotas. The WTO provisions, however, already offer smaller suppliers higher protection and we will comply with these provisions. Thus, in the Commission's view, it is not necessary to change the original wording.
In the Commission's opinion, there is still sufficient time, before the review at the end of 2005, for the regulation to prove that it is fully workable and for its efficiency to be tested. For this reason I cannot accept the amendments which suggest different limits for the duration of the regulation or for the review.
The Commission welcomes the European Parliament's constructive cooperation in this extremely difficult and sometimes emotional subject, which is of the utmost importance both within the EU and from an international point of view. The Commission's caution regarding the amendments tabled is linked to the fact that we must strive to avoid a second WTO panel in this matter, as this would certainly cause considerable harm to the standing of the European Community and its institutions.

President
Thank you, Commissioner Fischler.
The debate is closed.
The vote will take place at 11.30 a.m. tomorrow.

Question Time (Commission)
President
The next item is questions to the Commission (B4-0474/98).

President
Having welcomed Commissioner Wulf-Mathies, and once she has got settled, I invite her to reply to Question No 45 by Richard Corbett (H-0501/98)
Subject: Money-laundering and transition to the single currency
Article 3 of the 1991 Council Directive on the prevention of the use of the financial system for the purpose of money-laundering establishes an identification requirement for customers involved in any transaction amounting to ECU 15 000 or more. Will this be applicable to monies changed from national currencies to the euro? If not, why not? If necessary, will the Commission put forward proposals to ensure that the transition to the euro provides a unique opportunity for nullifying the value of large sums of money in the hands of criminal gangs and others?

Wulf-Mathies
Mr President, the terms of the Council Directive on prevention of the use of the financial system for the purpose of money laundering also apply fully to the period of transition to the euro in terms of the exchange of national currencies into the single currency. However, according to the Directive, only the laundering of drugs money is prohibited. This is why it is planned to extend the ban to a broader spectrum of serious crime. According to the Directive, anyone wishing to open a bank or savings account must provide identification and the data recorded regarding identification must be kept for at least five years. Moreover, identification is required of all customers concluding transactions of over ECU 15 000. This is the case regardless of whether the transaction is carried out in a single operation or whether it spans several operations which are, or appear to be, linked.
Where there are grounds for believing that customers are not acting on their own behalf, measures must be taken to determine the real identity of the persons on whose behalf those customers are acting. If there is any suspicion of money laundering, the identity of the customer must be established regardless of the amount of the financial transaction. All suspicious transactions must be reported to the relevant authorities. The Commission expects continuous vigilance on the part of credit and financial institutions in the run-up to the changeover to the euro; during this transition, criminals may attempt to channel their cash back into the financial system or to exchange national currencies into other currencies. This applies equally to the actual changeover period.
At the same time, the Commission admits that banks could face further difficulties in exposing suspicious transactions, in particular those under the ECU 15 000 threshold, if a large number of unknown customers appear at their tills. The Commission is continuing its internal consultations on the effects the changeover to the euro may have on the fight against money laundering. This problem should also be tackled by the money laundering contact committee set up within the framework of this Directive. In addition, the Commission will soon be adopting its second report on the incorporation of the money laundering Directive into national law, and expects to present it to Parliament before the summer recess.

Corbett
Thank you, Commissioner, for that detailed answer which is quite encouraging. But I would urge you to go further and ensure that this unique opportunity is seized. The black economy is largely a cash economy. Drug dealers and others like dealing in cash rather than through bank accounts because it leaves no trace. With the transition to the euro, they will at some point have to convert old notes and coins into euros and, at that point, there is an opportunity for control and follow-up of leads that have perhaps been given from other sources. That is why a full and proper application of this directive and the further measures that you refer to is essential so that we can use this occasion to have an extra bonus in the transition to the single currency, over and above the economic benefits that it is going to bring us. May I urge you to persevere.

Wulf-Mathies
Mr President, I think we are in agreement on the most important points. We will continue to observe matters carefully and will endeavour to respond to potential problems using the proposed new directive. However, we must recognise that old banknotes may be exchanged by honest citizens, too, who simply prefer the piggy bank to the High Street bank. Thus, above all we must exercise great care in ensuring that banks provide the necessary information and precautions.

President
Question No 46 by Georgios Anastassopoulos (H-0542/98)
Subject: Commission obligation to monitor the use of Community funds to prevent them being used for Government propaganda
Given that the Greek Government is using substantive amounts of Community funding (for instance, Drs. 1.5 billion from the CSF) for Government propaganda and television broadcasts, without respecting the balance of political power in Greece and without giving MEPs the opportunity to inform Greek public opinion, will the Commission say:
What Community funds have been used over the last three years for actions of this kind and why has it failed to carry out controls so as to ensure compliance with the principles agreed on with Parliament? Since prefectural and local elections are taking place in Greece in 1998, does the Commission intend, in the light of the accusations which have been levelled, to change the present system so as to prevent the unilateral use of Community funds for government and ministerial propaganda and to highlight the Community contribution to the development of Greece?

Wulf-Mathies
Mr President, under current Community law the Member States provide appropriate publicity for campaigns assisted by the Structural Funds to draw the attention of potential beneficiaries and of trade associations alike to the opportunities offered by these campaigns, and to inform the general public about the work of the European Structural Funds.
The operational programme "Technical aid within the Community support framework for Greece' provides for the implementation of an action plan for publicity and information, for which ECU 6.2 million was made available. The national and regional programmes and the Community initiatives also include publicity and information campaigns which are provided with less funding. In accordance with the principle of subsidiarity, the Greek authorities are responsible for proper implementation of the tendering and award procedure for information and publicity campaigns.
Before the invitation to tender was issued, the Commission was consulted on the corresponding specifications. The Greek ministry responsible consulted the Commission on the action plan and on the national "Publicity and information' guide, in order to ensure a consistent approach. All actions taken by the Greek authorities in terms of publicity and information are in accordance with the provisions of relevant Community guidance.
As far as the Commission is aware, the advertisements on television and radio and in the press are politically neutral. Also, there have been no complaints so far regarding the campaign introduced in 1997. Indeed, Mr Vice-President, as we understand it, the person asking the question played an active role in the campaign himself. Again, in the talkshows held in 1997, participation of Members of the European Parliament to represent the major political groupings was secured.
The Commission will ask the Greek authorities responsible to guarantee ongoing balanced participation. As municipal elections are being held in Greece in October 1998, it has been agreed with the Greek government that the publicity and information campaign co-financed by the Structural Funds is to be postponed from August to October in order to forestall any possible criticism.

Anastassopoulos
I wonder if the Commissioner can be satisfied with the reply she has given me, when there are complaints. And I am afraid that the neutrality the Commissioner asserted does not exist. Have the Commission services not informed the Commission that use is being made of Community resources for government propaganda and for the promotion of ministers? Let us not confuse certain information action plans in which the European Parliament also participates and in which I co-preside over a committee with Commissioner Marcelino Oreja and give guidelines, and in some of which Greek MEPs have also participated. The one has nothing to do with the other. Recently Greek MEPs have not been taking part in some of these information programmes and this is one of the aspects of the complaint.

Wulf-Mathies
Mr President, I believe I made it abundantly clear that with the exception of one isolated case we were not aware of any complaints and that we have now taken preventive action. I believe this guarantees sufficient impartiality. Of course, where such information is concerned, we cannot prevent the relevant Ministers from issuing this information. In my opinion, this is even necessary in the interests of correctness of information.
But allow me to emphasize once again that in Greece, in our opinion, not only is party political neutrality guaranteed; some particularly positive steps have also been taken, for example Commission and European Parliament projects in high schools in Greece, which we consider to be exemplary. I wish that other Member States would make this a subject of study in schools. In this respect we assume, therefore, that the necessary precautions have been taken to prevent abuse.

President
Thank you very much, Mrs Wulf-Mathies. However, I would ask you to spend a little longer on the subject matter of this question, because I have received two requests for the floor, and according to the Rules of Procedure, I am obliged to grant them. Mr Hatzidakis has the floor first, for one minute.

Hatzidakis
Madam Commissioner, what you have told us is of course constructive, that is, that between the end of August and the end of October the transmission of these "politically neutral' advertisement slots will stop because, in my opinion, they are not. Nevertheless, I thank you personally for this intervention on the part of the Commission, because it really is important, in view of the municipal and prefectural elections in Greece, but over and above that I wish to dwell on two points.
Balanced participation in these programmes does not exist. There was a programme, Commissioner, in which there was not a single representative of the New Democracy Party, which is the second largest party in the Greek Parliament, representing 38 % of the electorate, and we did not have a representative. You must look into that. It is interesting to note that, as coordinator of the Group of the European People's Party on issues of regional policy, I have never been invited to appear on such a programme. I do not say this as a personal complaint, but simply so that you can understand the climate and act accordingly.
I will conclude by asking you this: do you know whether, in the regional business programmes, the regulations concerning the allocation of advertisement slots to advertising companies have been complied with? I am not referring to the national slot, where the regulations have been observed, but to the regional programmes. Has the Commission been informed that the regulations have not been complied with there?

Wulf-Mathies
According to our information, the Community Directives and provisions have been adhered to. I would consider it appropriate if you would pass on to us any specific cases of complaints you may have. We are not some kind of general remote monitoring organization. If there are problems, we look into them individually. But I do not believe that a theoretical debate here in Parliament will serve any useful purpose.

President
Thank you very much, Mrs Wulf-Mathies, but as I said, I would like you to stay on the same subject because Mr Seppänen also wants to ask you a supplementary question. Mr Seppänen has the floor for one minute.

Seppänen
Mr President, Commissioner, this problem does not just concern Greece. I maintain that in Finland too Commission money and resources are used for purposes of political propaganda that are biassed and ignore the fact that there are various national groups in our country that view critically the decisions that are taken by the EU. For this reason, I would turn your attention to the fact that in Finland money is used, for example, for the purpose of bringing the euro into the market, and that money is for the exclusive use of citizens' organizations that have a positive view of the euro. Commissioner, do you really believe that only the people who said 'yes' should be allowed to use funds for propaganda?

Wulf-Mathies
I will say it once again. It is a question of the principle of subsidiarity. That means that the Member States are responsible for publicity campaigns within the framework of the general provisions laid down by the Commission. If there are specific complaints, we should investigate them. I consider it difficult to pursue this theoretical discourse.

President
Question No 47 by Charlotte Cederschiöld (H-0556/98)
Subject: Excise duties
The Swedish Government has introduced a bill (Proposition 1998/97: 100) to extend powers to carry out checks on the payment of excise duties, owing to the increase in cross-border trade in alcohol and tobacco. One firm involved in such trade is the German company, Warendienst OCC GmbH, which arranges deliveries from Germany to individuals in Sweden via the Internet. It is proposed that the customs service should have the right to seize and, in some cases, confiscate goods if there is a risk that the excise duties will not be paid. It is also proposed that customs should be given powers to open private consignments where it is suspected that they contain alcohol or tobacco.
Does the Commission consider this draft law to be compatible with the principles which govern the internal market and those enshrined in the European convention protecting personal correspondence?

Wulf-Mathies
Mr President, Mrs Cederschiöld, the provisions of the internal market do not preclude Member States from exercising domestic controls. Community rules expressly provide for excise duties to be charged in accordance with procedure in the Member State concerned. Member States can therefore set up their own monitoring systems, provided that these do not give rise to any frontier formalities and are in accordance with the general principles of Community law relating to non-discrimination and proportionality.
The Commission was not able to examine the proposed amendments in detail but, according to the information available, the provisions in question do not appear to be inconsistent with the principles of the internal market.

Cederschiöld
Thank you for your reply. However, my question was whether this proposal was compatible with the Convention on Human Rights, since the personal import of tobacco products and alcoholic drinks from other EU countries is a civil right under EC law.
The law which is to become effective on 1 July gives the customs authorities the right to open private mail and parcels from other EU countries. This is not compatible with Swedish constitutional law or with EC law, according to the learned EU specialists who have expressed an opinion. Even the Law Council, the Attorney-General and the bar association in Sweden do not think this is allowed. The proposal is in fact contrary to human rights, which only allow restrictions on mail confidentiality if the country's economic well-being is threatened, which is not happening in this case. Here people would be able to seize and forfeit 'suspected' lorries through a simple court order without impartial, public legal proceedings.
I would just like to ask whether Commissioner Wulf-Mathies thinks this is compatible with human rights, and whether crossborder trade is not more important than a Member State's right to charge taxes.

Wulf-Mathies
Yes, Mrs Cederschiöld, I am afraid I must disappoint you, as the Community is not a party to the European Human Rights Convention. For this reason it is not appropriate for the Commission to comment on whether national legislation is in agreement with individual provisions of the European Convention.

Andersson
I would like to thank the Commissioner for her reply which clarified matters. As I see it, the question put by Mrs Cederschiöld was a contribution to the Swedish election debate since we have an election in September. There is one party in the Swedish Parliament which is opposed to the proposal currently before the Swedish Parliament, namely the Conservative Party. However, the rest of the parties think the current proposals to maintain the excise duty rules and to maintain the age limits which we have on the sale of alcohol and tobacco are compatible both with the single market and the European Convention on Human Rights. Besides, these issues can be put to the test. An overwhelming majority of the parties in Sweden share the Commissioner's view that the proposals we are discussing here do not conflict with the single market.

President
Thank you very much, Mr Andersson. Mrs Wulf-Mathies does not wish to reply to that question. Mrs Cederschiöld knows that the Rules of Procedure do not allow me to let her take the floor. So, Madam Commissioner, ladies and gentlemen, I suggest we now move on to Question No 48 by Pedro Marset Campos (H-0573/98)
Subject: Agreement of 18 May 1998 between the EU and the USA on the extraterritorial sanctions laid down in the Helms-Burton (Cuba) and ILSA (Libya/Iran) laws.
Since the EU has undertaken to inhibit and discourage future European investment in assets expropriated in Cuba, can the Commission say whether it considers:
that the agreement gives provisions laid down unilaterally by the USA extraterritorial validity;
that the agreement will seriously jeopardize the interests of European investors in Cuba;
that the EU must apply this agreement even if the US Congress refuses to play its part;
that the agreement undermines the national sovereignty of the Member States and weakens the EU's negotiating position in the MAI and the WTO? Mrs Wulf-Mathies, I invite you to reply to Pedro Marset Campos' question.

Wulf-Mathies
Mr President, the agreement reached between the European Union and the USA at the London Summit on 18 May is a package solution with the realistic prospect of a lasting settlement of the disputes with the United States concerning the Helms-Burton Act, the law on sanctions against Iran and Libya and the more general problem of extraterritorial sanctions.
Despite this agreement, the Commission holds to its position that these laws violate the law of nations. Thus, at no stage did the Community recognize their legality. In case measures should be taken against persons or companies from the Community, it has reserved the unlimited right to take the case up again within the framework of the WTO. The agreement reached is of a purely political nature and does not constitute the legitimization of US laws which continue to be illegal.
The package solution includes three points. The first is an agreement on certain disciplines which prohibit new investment in illegally expropriated properties. The second is the USA's promise to eschew future extraterritorial legislation in an agreement on the transatlantic partnership for political cooperation, and, of particular importance for the Community, the assurance of the US government that it will suspend application of the two contentious laws to the Community and to businesses from the Community - that is, the guarantee of the so-called waiver. The Community has received clear agreement that the US government will immediately try to obtain authority from Congress to issue an unlimited exemption from Title 4 of the Helms-Burton Act, the waiver.
It is important that the Community does not apply the agreed disciplines before the exemption is actually issued. The European Union will only fulfil the agreed obligations when the USA complies with its part of the agreement. There will therefore be no advance concession from the European Union. A very important factor in the agreed disciplines on the prevention of new investment in illegally expropriated properties is that investments made before 18 May are exempt from this ban.
These disciplines therefore apply only to future investment in properties which the Member States are convinced have been expropriated illegally. They state essentially that no aid may be granted either by the state or by businesses for investment in illegally expropriated properties. Investments which have not received state aid are not affected. I will repeat this to ensure that it is clear: the disciplines are not applied by the Community before the US Congress has given the President of the United States the authority to issue an exemption from Title 4 of the Helms-Burton Act and this exemption has come into force.
In addition, the agreement on disciplines for investment in illegally expropriated properties provides that the Community and the USA bring these disciplines up jointly in the negotiations on the multilateral investment agreement.

Marset Campos
Madam Commissioner, first of all, thank you for your full and thorough reply.
Nevertheless, I continue to harbour understandable doubts about the behaviour of the European Union in these negotiations of 18 May, for the following reasons.
Firstly, I should imagine the Commissioner is already aware of the importance to Spain of our relations - economic, social, cultural and everything else - with Cuba, and that any type of sanction would therefore do great harm.
But the second question I would like to ask, in the light of your reply, is that on the one hand, the text released to the public said that the European Union undertook to inhibit and discourage future investments, and in your reply you said, also directly, that this referred to expropriations which are considered illegal.
So, my specific question is whether that means acceptance of the US position on these questions and the indirect adoption of the Helms-Burton Act.

Wulf-Mathies
Mr President, I would like to emphasize once again that we are in fact dealing only with future investment and state aid for future investment. It is crucial that, before we actually implement this, the American government should commit itself to waiving extraterritorial legislation and also that it issue this waiver. This means, therefore, that it is a deal based on mutual interest, if you wish, and first of all the American government must repeal the effect of the HelmsBurton Act for European investment before the European Union reciprocates.

President
Thank you very much, Madam Commissioner. I still have two supplementary questions on the agreement of 18 May on the Helms-Burton Act. Mr Newens has one minute to ask the first of these.

Newens
Mr President, if the waiver on titles 3 and 4 of the Helms-Burton Act goes through - which is unlikely in view of the statements of Senator Jesse Helms - would not efforts to deter future public support for investments in so-called expropriated properties be contrary to agreements made by individual European Union Member States and Cuba? In that case, which would have the overriding force? Should not the United States be encouraged to make a settlement with Cuba over compensation for nationalized properties as other states, including those in Europe, have done? In these circumstances there would be no case whatsoever for the Helms-Burton Act.

Wulf-Mathies
Mr President, I really would not like to speculate on what might ensue if Congress did not adopt this regulation as both we and the American government would, of course, stake everything on it being passed. Furthermore, the agreement is not concerned with a ban on investment in Cuba but only on the part relating to state aid.

President
With that reply, we have come to the end of this block of questions. I thank Mrs Wulf-Mathies for coming here and answering our questions.

President
Mrs Cresson, we welcome you, and I invite you to take the floor to reply to Question No 49 by Bernd Posselt (H-0567/98)
Subject: "Destructive embryonic research'
What is the Commission's position on "destructive embryonic research' , and are such research projects assisted with EU resources?

Cresson
The legitimacy of research using embryos is one the most complex and sensitive ethical questions which can arise in science. It is also an issue on which there are the widest possible differences in the perceptions, approaches and regulations of the various Member States. The main problem is to strike a balance between the interests of infertile couples and the sick, and respect for fundamental ethical principles and the moral and religious convictions of various sections of the population.
Careful attention is generally paid to ethical aspects of research in the field of life sciences and technology during the implementation of the Union's research programmes. Some types of work are therefore explicitly excluded from the Fourth Framework Programme on biomedicine and health. This is the case with research on human cloning or research leading to transmissible genetic modifications in particular. On the other hand, research using foetal and embryonic tissues is not prohibited as such. This type of research is of great interest in areas such as medically assisted procreation, and the diagnosis and treatment of cancer or genetic diseases.
Like all proposals presented within the framework of the research programme on biomedicine and health, proposals relating to research involving the use of human embryos or foetuses nevertheless have to comply with regulations and legislative provisions, defining the ethical requirements in force in the countries where the research is carried out.
Proposals of this type that have been submitted under the Fourth Framework Programme have been examined by a group of experts on the embryo and foetus, set up by the Commission, with particular responsibility for evaluating the ethical aspects of research carried out within the scope of EU programmes. One of the aspects taken into consideration in this evaluation was the lack of alternatives to the proposed method. The group's opinions have been forwarded to local or national ethics committees responsible for granting the preliminary authorizations as required by the Commission. All the provisions in force relating to ethics in the field of life sciences and technology will be maintained in the Fifth Framework Programme.
Considering the sensitivity of this question, I shall ask the ethics group chaired by Mrs Noëlle Lenoir to issue an opinion, before the specific 'Life Sciences' programme comes into force. The approach to ethical questions relating to research involving embryos is therefore based on the need for such research in order to increase our scientific knowledge in the interest of patients, whilst at the same time respecting fundamental ethical principles and the diversity of national feelings.

Posselt
Madam Commissioner, if I understood your reply correctly, exhaustive embryo research projects are assisted. In any case you have not expressly ruled it out and you pointed to national standards.
But are there not also EU standards now? I would remind you of the most recently adopted patents directive for biotechnological inventions; here, with regard to cloning, we said quite clearly that a human being is a human being from the beginning - that is, from the moment of conception, and thus has the right to protection, and in this regard we clarified this considerably in the interinstitutional dossier, the result of which goes far beyond the statements of the advisory body on the ethics of biotechnology. I am of the opinion that the standards we have developed in connection with the patents directive are the clearest EU standards thus far, and that we must develop our own EU standards on this basis as it cannot be satisfactory in the long term, as we have said, for the Commission to proceed differently in terms of aid depending on the state concerned.

Cresson
Yes, Mr Posselt, I agree with you entirely that it would be highly desirable for us to have European standards.
Apart from a number of basic regulations, to which I referred earlier, such as the prohibition of human cloning, I also said that the regulations are different, perhaps even extremely divergent, in the various Member States of the Union. I have furthermore had a table drawn up showing the situation as it stands today, country by country. I do not think this is an ideal situation, and we must do everything we can to draft a general regulation. But it will also need to be acceptable to the various Member States.
However, the Commission does not consider that research involving embryos should be excluded as such from the Union's research programmes, and just now I referred to the opportunities that such research can provide in very important sectors.
Provided compliance is ensured with fundamental ethical principles, such as those I have mentioned, the Commission believes that research of this type may be legitimately carried out, in the interests of scientific progress and in the interests of patients.
It seems to me that a precedent would be created if we were to align the relevant provisions with the most restrictive national legislative provisions, because, of course, it would be possible to try to adopt common standards on the basis of the most restrictive provisions. That precedent could mean that the same principle would be adopted as a solution whenever there are differences between national legislation. You will be aware that this is the case in a large number of areas, which could have negative repercussions with regard to research and for citizens.
We have not yet completed our discussion of this subject and I understand your question perfectly, and agree that it is pertinent. However, we are in a situation where some Member States have a very restrictive attitude, and others, on the contrary, have a far more lenient attitude.
Should we authorize the manufacture of embryos for the purpose of experimentation? Some Member States, one in particular, would go so far as to allow this, whilst other Member States - in fact most other Member States - have a far more restrictive attitude.
The Commission cannot impose the most restrictive standard as a single standard, nor do I think that would be desirable. Furthermore, we must be extremely vigilant from the ethical point of view, and we have only just started our discussions. I therefore consider that we have some very important work ahead of us. With the resources at our disposal today, we have no option but to continue our discussions, and to try to persuade Member States to adopt a common definition, but I repeat, we do not have any means of compelling them to do so.
This is why we can only adopt a position of principle, the principle of respect for fundamental ethical values, and for the time being all we can do is accept the situation as it stands in the Member States.

President
As the author is not present, Question No 50 lapses.
That brings us to the end of the set of questions to Mrs Cresson. I thank her for attending and for her collaboration.

President
Question No 51 by Alexandros Alavanos (H-0498/98)
Subject: Cultural cooperation between the European Union and international organizations
Article 128 (3) of the Treaty on European Union states: "The Community and the Member States shall foster cooperation with third countries and the competent international organizations in the sphere of culture...' The UN organization UNESCO is an authoritative and universally recognized world body responsible for cultural, educational and scientific cooperation.
Will the Commission say whether the European Union cooperates with UNESCO and what action is taken to implement European Parliament resolutions? Mr Oreja Aguirre, I welcome you and invite you to reply to Mr Alavanos' question.

Oreja Aguirre
Mr Alavanos, cooperation between the European institutions and UNESCO goes back many years. It was basically established through an exchange of notes in 1964, followed by another in 1973, and was confirmed by Article 128 (3) of the Treaty. More recently, a cooperation agreement signed by the Community and UNESCO in 1996 removed certain normative barriers which had considerably hindered cooperation actions in the past. But project related cooperation problems still exist, caused by the current differences between the financial regulations of the Community and UNESCO, and by their implementation.
In practice, although relations between that organization and the Community institutions are excellent, cooperation between them has not so far resulted in a significant number of joint activities, for various reasons. In particular, because of its global remit and scant financial means, UNESCO does not consider Europe to be one of its main priorities in regional terms. From that point of view, I can only stress that the fields of intervention of the European Union and UNESCO complement each other.
With respect to the cultural sphere, UNESCO and the European Union, within the context of their respective competences, regularly exchange information and data in certain sectors of common interest, such as statistics or goods, often take part in specialist meetings organized by either one, and sometimes finance certain projects jointly. We also cooperate with UNESCO in the areas of education, information and the fight against the illegal use of drugs. This collaboration could serve as an example for closer collaboration with UNESCO in the cultural field, in the context of the EU's external action.
As for the future, cooperation between the EU and UNESCO is mentioned in Article 5 of the proposed Framework Programme for Culture for the period 2000-2004, which I had the honour of presenting to the Commission very recently. That programme has been approved by the Commission, and I have presented it to the European Parliament and the Council.
Once it has been approved, this programme will constitute the frame of reference within which cooperation on an equal footing can be strengthened, including from a financial point of view. I hope Parliament will approve this framework programme, and after that we shall have to see how we can operate in the future.

Alavanos
I very much thank the Commissioner for the comprehensive reply that he has given me and for giving me the opportunity to make the rejoinder which is at the very heart of the debate. One of the fundamental positions of UNESCO which relates to Europe, which is not totally cut off from Europe, and which was decided upon by the General Assembly in 1982, is the return of the Parthenon marbles from the British Museum to Athens. This concerns Europe directly and you know that there is tension between the Member States of the European Union on this matter.
I would like to ask the Commissioner if, in his opinion, a country has the right to place this issue within a European Union context, based precisely on Article 128, paragraph 3 of the Amsterdam Treaty, which provides for cooperation with international cultural organizations. I would like to take this opportunity to ask the Commissioner how he would comment on the great devastation that has befallen the Parthenon marbles and which was revealed last week in the British press.

Oreja Aguirre
Mr Alavanos, I am aware of what that represents, and I share your concern. But you know that with the means available to us, with the means provided by the Treaty and, furthermore, within the context of cooperation with UNESCO, that route does not offer any solution.
I know your sensitivity towards an institution such as UNESCO, and I must tell you that the matter you have raised, like many other matters, demands that we should cooperate more, and not ignore each other.
And I want to tell you something else. We are here in a hemicycle which is also used by the Council of Europe. And in this hemicycle, in other capacities, I have proclaimed the need for greater harmony between three institutions concerned with culture: the European Union, which has a restricted range, the Council of Europe, which has a wider range, and UNESCO. And I think we are at least going to try to achieve that.
A few years ago that was not possible, because we did not have the instruments to do it. This is no longer the case. Today the Community has such an instrument in Article 128. So I would like to see how the three institutions concerned with the cultural sphere can progress together in the same direction. In many cases, we turn our backs on each other instead of looking in the same direction.

Ephremidis
Mr President, I must say that the Commissioner has tried to respond to the significance of the issue and the question. But I would like to ask him not to regard the matter as simply of concern to Greeks. It is a sensitive issue which must affect every civilized person and this Community as an organization, since much has been declared about respect for our cultural heritage, which in this case is at risk, not only from the event that Mr Alavanos referred to and which was denounced in the English press, but also because of the fact that these marbles do not have independent artistic value. They of course have autonomy, but they gain their value when they are united with the body they belong to and that is the Acropolis. The English are dragging their feet in this affair in the most uncivilized way - how can I describe it? - and they are still refusing to return them. There are similar cases which may concern your own country.
I would ask you, as the European Parliament, to address the matter more courageously and more realistically, regardless of the cooperation you may ensure with other organizations.

Oreja Aguirre
Mr Ephremidis, when we consider Classical Greece and its artistic riches, we are all Greek. So I sympathize with your wish to identify with something which, of course, goes far beyond its national meaning. And allow me, as a European, to share that sensitivity with you.
I also want to say that, at the moment, we have no further legal routes by which to address the matters you raise. You know that very well because you are very knowledgable about the Treaty. But for that reason, I want to go back to the idea of sensitivity. I think it is very important because, in the end, sensitivity is also a part of our European cultural tradition.

President
Thank you very much, Mr Oreja Aguirre.
Ladies and gentlemen, we now come to Question No 52 by Mr Mihail Papayannakis. He is not with us. In fact, he cannot be with us because he has just lost his 25-year-old son in a dreadful accident. Allow me to pass on to him our solidarity and sympathy. In accordance with the Rules of Procedure, Mr Alavanos is taking over the question.
Question No 52 by Mihail Papayannakis, which has been taken over by Alexandros Alavanos (H-0544/98)
Subject: Implementation of the "Television without Frontiers' Directive
TV viewers/consumers in Greece have repeatedly complained that popular TV programmes are interrupted all too frequently by a flood of advertising. Taking into account the Second Commission Report (COM(97) 523 final) on the implementation of Directive 89/552/EEC which confirms that advertising in Greece exceeds the quantitative thresholds, will the Commission say whether Articles 10 to 18 of the Directive in question are being correctly implemented by the Greek authorities and, if this is not the case, whether it intends to take the measures provided for by Article 169 of the EC Treaty?

Oreja Aguirre
Mr Alavanos, the Commission has already started proceedings against Greece, in accordance with Article 169 of the Treaty, because of the incorrect implementation of certain provisions of Directive 89/552.
At the moment, the Commission is studying that country's reply. I am sure you will appreciate that I cannot give you any further information at this delicate stage of the proceedings. It would be highly indiscreet of me to go any further.
However, I repeat that the procedure has been initiated in accordance with the rules laid down in the Treaty.

Alavanos
Mr President, I would first of all like to thank you for your warm words about the drama that our colleague, Mihail Papayannakis, is going through. I think that you express the feelings of all the Members and of the whole of Parliament.
I would next like to thank the Commissioner for the reply he gave to my question and to simply say to him that I understand the reply. I just wish to express my fear, my intense concern, that, with all this bureaucracy, the time-consuming procedures which are in force in relation to Article 169 and the commitology procedure, this blatant violation which is occurring in Greece concerning the advertisement slot will continue for a long time to come.

Oreja Aguirre
I will just say that now the procedure is underway, we are exchanging correspondence with the Greek authorities. The Commission's services are currently studying the latest reply from those authorities.
It is a difficult case. It is not simple because Greece has incorporated the directive properly and has imposed fines on the broadcasting organizations which break the rules. So what the Commission has to do now is show that these fines may perhaps not be enough to actually dissuade those broadcasters from breaking the rules.
That is what we are studying at the moment.

President
Question No 53 by Robin Teverson (H-0568/98)
Subject: European Cultural Institutes
I understand that a European institute for cultural itineraries is opening in Luxembourg in addition to a cultural centre funded by UNESCO, the Council of Europe and the European Commission. Given the importance of Europe's cultural tapestry, I would like to have details of the European Commission's role in these centres, from their inception, and the financial implications. In addition, what other kinds of organizations which promote Europe's rich heritage does the Commission support?

Oreja Aguirre
Mr Teverson, the Commission is not participating financially in the creation of the European institute for cultural itineraries in Luxembourg. According to the information we have received from the Luxembourg authorities, the centre has been created within the context of a cooperation agreement between the Council of Europe and the Luxembourg authorities.
Of course, the Commission takes a favourable view of this initiative because, given the importance of the European cultural network, the centre can make a positive contribution to improving the link between cultural heritage and cultural tourism on a European scale.
At present, the Commission has the means to provide financial support for European cultural centres in the context of the Raphael programme, which supports joint and cooperation activities, but does not give aid for them to be set up. It provides aid for the development of joint and cooperative activities, but not for their establishment.
That is what I wanted to clarify in relation to Mr Teverson's question.

Teverson
I thank the Commissioner for his reply which is fairly comprehensive. I do not wish to say much more as a supplementary except that we, in Cornwall - in the south-west of the United Kingdom - which I represent, have been very thankful for the support that some of the Commission and Council of Europe programmes have given to upholding our Celtic cultural identity.
One statement I would like to make as a British Member of the European Parliament, in response to some of my colleagues' comments earlier on, is that I personally would like to back the campaign to move the Elgin Marbles back to Greece. That is right and it has my support.

President
Perhaps that may be necessary, in any case, because Mr Rübig has requested the floor for a supplementary question. You have the floor for one minute, Mr Rübig.

Rübig
Mr President, I believe that educational systems are of particular importance in Europe because our culture is based largely on educational values. It would be a considerable contribution not only towards promoting education but also an essential basis for lifelong learning. We should therefore investigate the method to see whether best practice models and benchmarks could not be included so that we can see how an opportunity for Europe can be developed in the various educational possibilities offered.

Oreja Aguirre
I want to say to the honourable Member that I think one of the things we must consider when putting the framework programme into operation is precisely the fact that, in cultural matters, we must not get bogged down in what we might think of as high culture. We have to project it towards other areas, such as culture and nature, culture to combat the problems associated with a lack of solidarity - in other words, how culture can help with social inclusion - and also culture and tourism.
For all those things, I think training is essential. In that sense, the proposals I will be presenting for the development of the framework programme will be along those lines, if the honourable Members approve it.
You should not imagine that I am ignorant of the role played by high culture. It forms part of our heritage, of course, but I do not think we should limit ourselves to high culture. Two weeks ago I attended a meeting between nine large cities, which addressed the subject of culture as a means to combat exclusion, and I was very encouraged by that meeting. That is a step in the same direction as the honourable Member was just talking about. So let us open up the field of culture to new horizons and new frontiers.

President
Question No 54 by Ioannis Theonas, which has been taken over by Vassilis Ephremidis (H-0595/98)
Subject: Preservation of the historic bridge to Monemvassia
The bridge linking the Pelopponese mainland and the historic fortress of Monemvassia is in imminent danger of collapse. This sixth century bridge is a monument of great historical value and still carries the only road to the ancient fortress. It has suffered severe damage from both the action of the sea and the huge amount of motor traffic which crosses it, especially throughout the tourist season.
Do the Community programmes for preserving the cultural and architectural heritage include shared funding for the repair of the damage to the Monemvassia bridge so that they may make a contribution to the urgent action needed to preserve an important monument from the Byzantine period?

Oreja Aguirre
Mr Ephremidis, the Commission shares your concern about the conservation of the historic Monemvassia bridge, which I have had the good fortune to visit, and which really is part of the heritage of us all.
As you know, the framework for action to support cooperation initiatives to conserve and improve our architectural heritage is provided by the Raphael programme, which was adopted last year, and has a budgetary provision of ECU 30 million for the four-year period from 1997 to 2000.
I would like to inform Mr Ephremidis that the Commission's services - the DG X services - will give very careful consideration to any application from the relevant authorities as long as they meet the eligibility requirements for action through Raphael, as published in the Official Journal on 31 March. I also want to tell you now that the deadline for applications this year is 10 September. So I would request that the application be made before 10 September, and you can rest assured that, although I do not make the final decision, I will personally ensure that this important matter receives special attention.

Ephremidis
I wish to thank the Commissioner and to assure him that, as far as I am concerned, I will do what I have to do, that is, I will convey to the inhabitants of Monemvassia the interest that you have shown. I will say that, before September, as you have said, they must put forward the proposal in any way they think necessary. What is more, I will go with you, because I think that they will spontaneously invite you to visit Monemvassia again. To the extent naturally that you have pushed forward the issue and the damage to the bridge has been repaired, you will be able to go and see the monument, the Castle, and the whole of Monemvassia, because the whole of Monemvassia is a historical place full of monuments, history, reminders of the past and culture. And in this way you will be helping thousands of tourists who go every now and again to the Peloponnese and want to visit this place, but the destruction and the damage to the bridge prevents them from doing so.

President
Mr Ephremidis, I am glad you are so enthusiastic, but I would be grateful if you would wait for me to give you the floor before you speak. Please do not do my job for me. I have to earn my pay.
Mr Marcelino Oreja Aguirre, would you like to reply to Mr Ephremidis' supplementary question?
(Interjection from Mr Ephremidis)

President
But I have not given you the floor. Why are you speaking?
Mr Marcelino Oreja Aguirre, you do have the floor, granted by this Presidency.

Oreja Aguirre
Mr President, I want to tell Mr Ephremidis, whom I have known for many years and respect greatly, that I undertake to do what I have stated here in this House. I hope we will be able to watch the start of the restoration works together. Of course, the application will have to be presented in the correct manner. Although I am not the one who makes the final decision, I am responsible for making sure that decision is taken properly, and will do so.

President
Thank you very much, Commissioner. You can rely on Mr Ephremidis to accompany you, even if the work does not start for 20 years.
Ladies and gentlemen, that is the end of that block of questions. I would like to thank Commissioner Marcelino Oreja Aguirre.

President
Having welcomed Mr Van Miert, I propose that we now move on to Question No 55 by Felipe Camisón Asensio (H-0500/98)
Subject: Unfair competition in international trade
In the Commission's view, what are the common principles which should be established to prevent practices of unfair competition in international trade? Mr Van Miert, I invite you to reply to Mr Camisón Asensio's question.

Van Miert
I would be glad to deal with this question, as it is a problem the Commission has recognized for a number of years. That is also the reason why we as a Commission took the initiative as far back as in 1994 to set up a group which we asked to consider a number of measures we might propose if necessary. This group produced good work, and the Commission subsequently made some suggestions to the Council of Ministers, which accepted these suggestions. This meant that, for the first time, this affair was put on the agenda of the World Trade Organization. This explains why, in the context of the World Trade Organization, a working party is looking into the problem of competition and trade, with a view to making a number of suggestions.
I obviously cannot anticipate the result of this work, although the work in itself seems to be progressing very well. I cannot hide the fact that not everyone is completely happy about this initiative from the European Commission. In America, for instance, there is some hesitation. However, during my recent visit to Washington I noted that there is also the will and desire to continue thinking with the European Union about how this problem could be dealt with positively in future.
What kinds of things are we thinking of? Firstly, we are trying to, as it were, expand a number of basic rules regarding competition policy at the global level, and to see these rules incorporated into the legislation of various countries in the world. We also want to improve the enforceability of these rules and, if necessary, deal with certain conflicts afterwards in a specific framework, which we believe would ideally be a global framework.
This is roughly the state of affairs. There is no more I can say about it, unfortunately, but I am pleased to be at the disposal of the European Parliament, and I will return to this issue once the working party has finished its task, in particular with regard to the talks we will be having with our American colleagues.

Camisón Asensio
Commissioner, you recently told the WTO ambassadors - and have confirmed it here today - that there is a lot of unfair competition at international level in the current global economy, and that since it is subject to different jurisdictions, it therefore causes serious problems.
You even said today - and then as well - that the ideal solution would be a global agreement able to solve the problems which arise at national level, by jumping to a different scale.
It would indeed be ideal to create competition structures which include basic principles, such as restricting abusive practices and concentrations, common principles to prohibit unfair competition in the international sphere, and the development of a cooperation instrument based on experience gained in this field. We think that all sounds very good, Commissioner. It would be ideal. I think it is a good idea to carry on thinking about it, but it is urgent. When are we really going to see something practical done about this urgent matter?

Van Miert
Unfortunately I cannot predict when there will be concrete results, because as I have just indicated, there is still some hesitation from the side of America, as well as in South-East Asia, where there is a great deal of resistance. After all, as you know, their markets quite often remain tightly closed, whereas it is competition which allows markets to open.
At the moment we are trying to get as much support as possible for this initiative from the World Trade Organization in the context of the working group. Because one thing is clear; the European Union is the most active member of the most active authority actually trying to make progress. But it is also very important that we reach a certain understanding with our American friends to be able to pursue the objectives with more force. But having said this, I am not naive, nor is the Commission; it will take a lot of time, but is important that we support this issue, and that we send out a clear signal. Because globalization is moving forward and because more and more problems are arising globally, it is necessary to have certain rules which can also be enforced worldwide.

Watson
As you say, Commissioner, competition policy is a way of opening up markets. We in this House have urged you to apply it to World Cup tickets, which I see have now become a subject of intercontinental trade. Could I ask you, Commissioner, what you think about President Chirac's reported attack on President Santer at the European Council for the way the Commission intervened to make more World Cup tickets available to non-French citizens, and what the Commission will do to defend the powers conferred upon it by the Treaties; what you think about the current ticketing arrangements, in the light of recent World Cup matches; and whether you will now take FIFA and the CFO to the European Court of Justice on the basis of the legal opinion that has been obtained by Parliament?

Van Miert
This seems to be a slightly different question but I am happy to give an answer or to state my position. There is no doubt at all that this question goes far beyond the national boundaries: it is a question of common interests. Therefore, the Commission, which received a considerable number of complaints, as you know, had to do its job, which means it had to investigate these complaints. Since there was, and is, clear discrimination, the competition rules apply. Therefore we will continue with this case, and the statement of objection is under preparation. But, as you know, we have to stick to the rules ourselves, in particular the procedural rules. If new elements are brought to our attention, obviously we need to have the opinion of the organizing committee as well. That is the way things have to be tackled. So we will continue, in spite of some comments which have been made.
By the way, if we want to be nearer to the public - to the citizens - we have to behave as we are doing. It brings our institutions nearer to the public when they see that we do indeed take their complaints seriously.

President
Thank you very much, Commissioner. Thank you for interpreting the content of the original question so generously, given that the Rules of Procedure do not oblige you to reply to questions which go beyond the strict scope of the original question. I know how generous you are, and I thank you, and I hope we can still go back to the real subject of Mr Camisón Asensio's question. Mr Wibe has requested the floor to ask a supplementary question. You have the floor for one minute, Mr Wibe.

Wibe
I will try to be very brief and to the point. I was interested when you, Commissioner, spoke of the fact that you discussed urgent measures against unfair competition. Could you say more precisely what these measures concerned? Did they concern taxes, capital income or any kind of common treatment for foreign investors? Could I just have a little clarification on this issue?

Van Miert
Mr President, indeed, this is the subject of further discussions and deliberations as to what could be put into what I would call a basket of basic competition rules, which would then be applied worldwide, but by national competition authorities.
One of the things we are considering, for instance, is that export cartels are carving up the markets worldwide. That this might happen in some cases should be considered by all competition authorities as flying in the face of one of the most basic principles of sound competition policies. This is just one example of what may be discussed. That being said, we should continue to make a distinction between trade issues and competition issues, because trade issues concern attitudes or measures taken by authorities, while competition-related issues are mainly derived from attitudes by companies, so constitute private behaviour. We should keep this distinction.
Let me give a concrete example to illustrate what kind of difficulties might occur. The Americans had a very high-powered case, the Kodak case, where their complaint was that the Japanese market was too close and did not allow American competitors real access to the market. They took the case to the World Trade Organization but at the end of the day the panel said it was none of their business because these restrictions, or the difficulties put in the way of market access in Japan did not arise because of governmental measures, but were the result of the private behaviour of Japanese competitors. So it was a competition case and this case showed the Americans that they could not tackle this kind of question through the instruments of the World Trade Organization. For that, either you would need a bilateral agreement with Japan to ensure that they would also apply competition rules in a normal way to open up the markets; or else we could think what might be done in a broader framework like the World Trade Organization, but specifically designed to tackle competition issues and competition problems.

President
Question No 56 by Sören Wibe (H-0511/98)
Subject: Support for production in peripheral regions
It recently became clear that the Volvo plant in Umeå is not being allowed to receive assistance towards transport costs from the Swedish government. The consultants' report on which the Commission's decision was based was secret. Volvo and the Swedish government believed the report to be flawed, but, because it was classified secret, any errors that had been made could not be corrected.
The decision has now been taken, but all those involved must learn a lesson for the future, so that events such as these are not repeated.
Will the Commission operate more openly in future and allow the authorities of the Member State concerned to see the documents on which its decisions are based? Commissioner, I invite you to carry on your discussion with Mr Wibe and reply to his question on production in peripheral regions.

Van Miert
Once again this question is being put to me by the honourable Member and I am happy to reply to this question. Firstly, we have sorted out with the Swedish authorities how this regime has to be phased out. As you know, it is regarded as operating aid, which is out of the question in the transport sector. We have an agreement. It is a fair and balanced one which will phase out this type of aid by 2002. So we have an agreement.
The question is related to a report drafted by an expert who is consulted from time to time by DG IV when we have to deal with automotive issues or problems. But this is only done for internal use by my department. In this case this report was drafted with the aim of conducting some fact-finding as to whether the Commission should open the procedure: not take a decision but open the procedure. Some of the elements of this report were taken on board. The facts presented by the Commission when we opened the procedure have been published in all official languages. Everyone who was interested was invited to give their opinion about our fact-finding in relation to the opening of the procedure.
Therefore, it is an internal business matter and I would like that fact to be understood. It could happen that some of these reports will be of very little use to our services. Sometimes they may be of more use. But it is a strictly internal matter.
Obviously, the position taken by the Commission when it opens a procedure and the basis on which this is done can be challenged by the governments or by the companies concerned. The Swedish Government and the Volvo company were in a position, then, to respond to what we put as evidence, according to our findings, at the opening of the procedure.
There should be no misunderstanding about the aim of such a report. It is not for taking the final decision. It is just for opening the procedure which then starts the real investigation. As I said earlier, fortunately we have now reached an agreement with the Swedish Government and it is a fair one. That is the general context. I would ask you to understand one thing. We have to tackle so many cases - about 600 state-aid cases per year. Some of them are very complicated. From time to time we have to call in experts to help our services; not for taking decisions as such but for trying to construe the facts. I hope you will allow us to continue to do so.
Take, for example, the Crédit Lyonnais case. We had to call in some experts. If every piece of expertise had to be made public, it would be impossible for my services to conduct their business as they should. By the way, from time to time the information involved is very sensitive and the companies are the first to ask us not to divulge it. So please understand that we are adamant about being as transparent as we can. The Commission has been criticized in Cardiff by some people because we explain our policies over and over again, why we take decisions or why we do not. Some people are not happy with the fact that we explain our policy and try to be as transparent as possible. Please understand that in order to be able to do our job properly from time to time we have to call in experts in a confidential way.

Wibe
I would first like to thank the Commissioner for his very detailed reply. However, I believe we have somewhat differing views with regard to transparency. In Sweden it is quite impossible to imagine that something a civil servant does should be kept secret from the elected representatives. As the Commissioner quite rightly says, the contents of the report concerned have become outdated, but the report itself has become an important issue of principle for us in Sweden as far as transparency is concerned.
The Ombudsman of the European Parliament, Jacob Söderman, has now intervened on this issue and written a letter to Jacques Santer requesting that this report should be published retrospectively. My precise question is this: Are you now going to publish this report, and, if so, when?

Van Miert
We have already had a meeting with the services of the Ombudsman. Obviously we allowed them to look into the document. But, for the reasons I explained earlier, we have to stick to the working method which has been used successfully. In order to investigate - because it is part of the investigation, not part of the decision-making, that is the difference - from time to time we have to find out some specific things and so we call in experts.
So we still feel very strongly that this should remain within the limits of the services being able to come up with something substantial. Accordingly, it does not belong to the part which should be publicized. It is part of the investigation.
Once that has been done then you have the next phase which is completely transparent. What the Commission publicizes is available to everyone. That is the difference we would like to keep. Apart from that, we have demonstrated over and over again our eagerness to be as transparent as we possibly can. By the way, the Commission is now being taken to the Court because some companies and some people find we are too transparent.

Sjöstedt
I would also like to thank the Commissioner for the detailed reply he gave.
I have two supplementary questions. Firstly, has this issue been formally decided by the Commission in that the Ombudsman has made a formal request to the Commission to publish the report? Has the matter been rejected by the Commission collectively, or is it the Commissioner's own opinion that this report should not be handed over?
Secondly, does the fact that the company concerned and the Swedish state, that is, the parties concerned, will read the report and have access to the information play any part in the Commission's judgement? Or is the judgement based solely on the Commission's internal situation?

Van Miert
I am a little sorry that Mr Sjöstedt has put a question that has already been put to me previously. As I explained earlier, we were asked this question by the Ombudsman and our services were immediately able to explain to him what was happening and a copy of the report was supplied to him. This is the correct way to handle things when the Ombudsman makes a request. We also explained why we think that in future we should be able to continue to work as we have been doing because this report looked into the various kinds of activities which took place in the plant. There can be no operating aid to assist the automobile industry. This is a general rule. It cannot be allowed in Germany or in Belgium or in Sweden. As far as that problem was concerned, there was no difference of opinion but we had to be given some advice about the nature of the various activities at the plant.
Once advice has been received, the services, under my responsibility, who discuss the situation with me, try to assess what is relevant to the opening of the procedure, but this is not a decision. We feel that we should have the option of establishing the facts and constructing a case. What happens later should be completely transparent. I am in full agreement with you, but if we are required to make public every single piece of advice, sometimes in very complicated cases, it would make life completely impossible. We already have a lot of trouble monitoring all the state aid cases. There is a lack of human resources. Cases are becoming more complicated so please allow the Commission services to do their job properly. If we are asked to explain things - e.g. why something was done or was left undone - we are always available to you, to the Ombudsman and to other people as well.

President
Thank you very much, Mr Van Miert.
Ladies and gentlemen, it is now 7.00 p.m. We have come to the end of the time specified by the agenda for questions to the Commission. So Questions Nos 57 to 105 will be dealt with in writing.
That concludes Question Time.
(The sitting was suspended at 7.00 p.m. and resumed at 9.00 p.m.)

Common organization of the market in bananas (continuation)
President
The next item is the continuation of the report (A4-0220/98) by Mr Thomas, on behalf of the Committee on Agriculture and Rural Development, on the proposal for a Council Regulation amending Regulation (EEC) No 404/93 on the common organization of the market in bananas (COM(98)0004 - C4-0046/98-98/0013(CNS)).

Kinnock, Glenys
Mr President, many of us in Parliament and in the ACP were rather unhappy with the proposal for a global quota. With that in mind, last week I secured for my group agreement to an amendment which I believe will help to ameliorate the consequences of the proposed changes. I very much hope that this House will support that amendment.
The Commission proposal does not in any way safeguard the access of the smaller and weaker ACP suppliers. The risk is that they will be displaced because the traditional volumes will be grown and supplied by others. Therefore, if we are to have a global quota, can we not have a guarantee that all traditional suppliers will be able to sell their traditional volumes? We should insist that if there is a global quota, we must have enforceable and effective guarantees that ACP traditional bananas will be able to get into our markets on at least the level of access assured by Lomé.
I would hope that a form of words can be devised in the Council meeting on Monday that will take this issue of guaranteed access into account. Cameroon, Côte d'Ivoire and Belize are expanding their production and export capacity. They will be able to increase production up to and beyond the point at which the quota will be over-subscribed. Thus, multinationals in these countries will follow their usual routes of putting profit first and the interests of the ACP will never figure in their calculations.
Is it fair to give these multinationals still further advantages over our traditional producers? Should we be persuaded to do their work for them and should we be bullied by the continuing ability of multinational companies and the United States of America to collude so well with the WTO against our interests and the interest of our traditional suppliers? Indeed, today the President-in-Office of the Council was able to tell us of a very offensive letter he had received from the Secretary of Trade in the United States. I do not think the European Union should be pushed around in this way by the United States and its friends in the multinational banana-producing countries.

Fraga Estévez
Mr President, first of all I should like to congratulate the rapporteur, Mr Thomas, on his balanced report and his willingness to negotiate, which has fostered dialogue and compromise at all times between the representatives of the various interests involved in the COM in bananas.
In my opinion, the Commission proposal, which aims to adjust the COM in bananas strictly to the WTO decisions, has to be criticized on a basic point: its unbalanced treatment of Community producers and operators, in neglecting to include alternative mechanisms to compensate them for the loss of category B licences. We have to remember that this mechanism was proposed by the Commission itself in order to guarantee the marketing of the Community banana and now, being one of the main points condemned by the WTO, it is not being replaced by anything else.
So we think it is essential to implement a mechanism to encourage marketing, since the current compensatory aid is only granted to the marketed product. This means that in order to receive such aid, the Community banana would have to opt for lower prices in order to make its marketing more attractive, thereby upsetting the market and increasing aid costs disproportionately.
It is also necessary to review the regimen of aid for loss of income, as laid down in Article 12 of Regulation 404/93, through an increase in the overall reference quantity and the flat-rate reference income, as Amendments Nos 22 and 33 to Mr Thomas' report reflect so well.
As for the licence regime, we fully agree with the views expressed in the report, where it says the reference period should be taken as the shortest and most recent period for which data exist. It also talks about retaining a two year transitional period, justified by the legitimate confidence inspired among category B licence operators by being able to transfer the certificates, as provided by current Community regulations.
As for the Commission proposal on the autonomous tariff quota, I would just like to recall that we also agree with the Thomas report and with the tradition which has been followed here since the Santini report. I do not think we should disturb the balance of the Community supply sources.
Lastly, export certificates should be reinstated into Community regulations and demanded from all the countries which supply the Community, including the ACP countries, since including them in that way would be compatible with GATT regulations. They should be seen as a way of avoiding fraud with respect to banana origin, and the risks of falsifying the repetition of import quantities.

Aldo
Mr President, having listened to the Commission this afternoon and noted Mr Fischler's numerous and categoric rejections of our amendments, I think it is time we reflected on the usefulness and role of Parliament in this matter, as well as the importance which is accorded to the political wishes we express through our requested opinions.
I do not want to repeat the reasons for the Union's lack of control over the destiny of this sector, sacrificed as it is on the altar of globalization. Nevertheless, I would remind you that Community production of bananas is specific in every way, for it is an activity carried out in the ultra-peripheral areas which suffer the difficulties we are all aware of, and that it covers only 20 % of market requirements. Furthermore, given the aims laid out in Regulation 404/93, and more particularly the assurance of sufficient income for producers, it is difficult for us to understand why the Commission has considered it unnecessary to provide for adjustments to Title III of the regulation, due to the significant amendments which will be made to the trading arrangements with third countries.
Furthermore, in spite of some reluctance on the part of the rapporteur, I am happy with the Committee on Agriculture and Rural Development's proposals and reaffirm that Community production must benefit from the consequences of the most recent enlargement and a possible increase in the market. The system of support to Community production must be adapted to the new rules, due to the raising of the flat rate reference income and to a development in the measures which opens up the right to compensatory aid. The reestablishment of Article 16 of the regulation is a necessity for better developments in market prospects.
Mr President, this is briefly my opinion on the direction which the European Parliament's opinion must take with a view to reconciling our interests with those of other producer countries.

Querbes
Mr President, ladies and gentlemen, Parliament is right to denounce the desire of the American multinationals to obtain the dismantling, by the WTO, of the Community system for trade in bananas. Our determination has enabled the Community preferential arrangements and aid to Union producers, who have long been in line with social and environmental standards, to be respected. The Commission's attitude has, unfortunately, been a very different one in which their proposals yield to the WTO's injunctions, with a 16 % increase in the tariff quota which takes no account of the risks of job and income losses on the part of Community producers.
Conversely, the concern of Mr Thomas' report is to propose ways of supporting the incomes of Community banana producers. It modifies the Commission's proposals by reducing the increase in additional tariff quota from 353 000 to 100 000 tonnes, by increasing by 15 % the Community banana quota eligible for compensatory aid and by increasing this compensatory aid by 20 %. By adopting these measures and this report, which has my full support, we will be appealing to the Council to reconsider the European Parliament's amendments.

Graefe zu Baringdorf
Mr President, this organization of the market in bananas demonstrates that politics can still take precedence over economics. Protesting before the panel still does nothing to alter the fact that we are taking a political stance, that we are setting up external protectionist measures geared to social and, not least, ecological points of view. However, it also demonstrates it is not only the interests of the producers that are coming to fruition here. In considering the position of the Americans, who scarcely have any banana producers of their own - if any at all, or only in Hawaii - then it becomes apparent that they are now making use of the panel to push through their own capital interests, or those of the major fruit companies.
Germany's position, too, was not carried by banana manufacturers or producers, but by the interests of commercial enterprise. But it is a very positive sign that, despite this, we are able to talk about a political settlement.
Commissioner Fischler, this should enable us to take courage in other areas of agricultural production in which we do not produce any surpluses either - we should take courage in disputes with the WTO and take a political stance, not worrying about the possibility of having to face a panel, but instead making use of this or accepting it in the interests of achieving sensible settlements for agricultural production in Europe.

Barthet-Mayer
Mr President, ladies and gentlemen, as the most important tropical fruit produced in the world, the banana constitutes a considerable economic concern for producers in the ultra-peripheral areas of the European Union and for the ACP countries. Produced under unfair conditions often based on non-existent or disregarded social criteria, the dollar banana competes unfairly, and often immorally, with producers working within more regulated production systems which are fairer but of course more expensive. Naturally the dollar banana is cheaper to produce - for a reason! Mrs Carlotti this afternoon outlined the Chiquita company's practices to us. Furthermore, a great deal of well-founded information reveals that some exporting countries practise production methods which are contrary to our own technical and environmental standards. I am thinking of the numerous health problems, even deaths, caused by pesticides used on banana plantations. What is worse, social conditions are often unacceptable and this should encourage us to demand a clean up of the rules of international trade at the forthcoming WTO discussions, where the Commission's negotiators would do well to put the social and environmental clauses back on the agenda.
In the face of the pressure being exerted by the WTO and the exporting countries' multinationals on the European Union to open new quotas, let us not go further than real need dictates. A more reasonable estimate for the autonomous quota is 100 000 tonnes. Above all, let us make our trade conditional upon the principles which we uphold within the European Union, especially respect for human rights and sustainable agriculture, and let us encourage the actions of those producers who wish to move in this direction, as suggested in a number of the amendments. Finally, let us apply the principle of Community preference, whilst at the same time respecting the commitments made within the framework of the Lomé Convention.
I would not wish to end without also congratulating Mr Thomas on his report, which on balance we support.

van Dam
Mr President, revision of the organization of the market for bananas is urgently needed. Under the pretext of development aid, the Union has set up a costly and inefficient organization of the market. As far back as 1995, the World Bank condemned the European banana policy. Although the regulation was designed for small producers in the developing countries, according to the World Bank it is hardly benefiting them.
The European banana policy is based on a system of import licences. With the introduction of the B-licences, the European traders, who traditionally had been importing bananas from the ACP countries, secured an important share in the market in "dollar' bananas. While this was in the interest of these importers, the farmers in the ACP countries were none the better for it. The lively trade in category B licences has pushed up the price of bananas on the European market, which resulted in a reduction in consumption. So there is every reason to take the WTO complaint about the category B licences seriously.
But it is precisely in this crucial component of the organization of the market that the Commission has displayed little creativity. The Commission is simply opting again for an allocation of the licences on the basis of traditional trade flows. This proposal has also been adopted by Mr Thomas in his report. Truly a missed opportunity!
It is high time a change was made. Instead of the traditional importers, we must give preferential treatment to those who grow bananas in an environmentally and socially responsible way. This change is lacking in both the Commission proposal and in the Thomas report.
I support the rapporteur's proposals for a promotion fund and the specific provisions for fair trade bananas. But as long as the European market remains closed to new initiatives because of a licensing system, I am afraid that the fair trade bananas will not get a fair chance.

Martinez
Mr President, Mr Thomas' report concerns the issue of amending the 1993 COM for bananas in accordance with the World Trade Organization's request, in order to respect Article 12 of GATT. This is the first legal certainty, if I dare call it that.
We have a second certainty, a statistical one this time, which is that the European Union consumes four million tonnes of bananas annually: 20 % come from the Canaries, Madeira, Guadeloupe, Martinique and Crete, and 80 % from elsewhere - ACP bananas and 2.2 million tonnes from Central America.
The third certainty is a historic one: from the very beginning, the signing of the Treaty of Rome was delayed several hours because General de Gaulle wanted to protect Cameroon and Ivory Coast bananas, whilst the Germans wanted to protect Central American bananas. Indeed, a number of Germans who moved to Central America in 1945 have never accepted the COM and they submitted the issue to the European Community's Court of Justice.
Apart from these figures and history, everything else is unclear. And legally unclear. There is of course the 1993 COM, of which we do not know a great deal: there are customs duties, tariffs at ECU 850 per tonne, tariffs at ECU 75 per tonne; there are import quotas, category A and B licences, third countries, ACP countries. All of this is challenged by the Geneva panels, of whose composition, working methods and even decisions we know nothing. There is not one Member here who has had the text of these decisions in his hands. Legally, therefore, it is unclear. We make do within this confusion, but it goes no further than that. The only two things we understand, and which are, in actual fact, essential, are that firstly the 1993 COM was working well: we had managed to achieve a balance between Community bananas, ACP bananas and even dollar bananas. It was the United States who could no longer accept this arrangement. They had been granted 2.2 million tonnes when they wanted 2.3 million. Then, with the arrival of Austria, Finland and Sweden in the EU, they wanted 2.5 million. And we gave them presents in the form of customs duties - ECU 775 per tonne - ECU 1.9 billion offered as a present to three multinationals! This was not enough!
The second certainty is the imperialism on the part of the United States of America, to which a lesson must be added: it may not be obvious, but the Geneva panels raise questions concerning six European policies. Firstly, development policy in Africa, in any case in the ACP countries; employment policy in Madeira, the Canaries, Guadeloupe, Martinique and Crete; regional policy in the ultra-peripheral areas; human rights, which Mr Barthet-Mayer mentioned earlier, since dollar bananas are, after all, slavery bananas, the product of human exploitation by three multinationals. Payments of ECU 50 per month instead of ECU 50 per day in Guadeloupe or Martinique! It also brings into question budgetary policy, because the European Union is, after all, making a present of ECU 1.9 billion to three multinationals. Where are the financial interests of the European Union? On top of this we must add ECU 370 million of financial assistance to the ACP countries who are victims of the new COM. Finally - and this is of great importance - it challenges the legal policy of Europe, because the laws of Brussels, of Luxembourg, of the Court of Justice, have all yielded in the face of the law of Geneva with regard to the issue of bananas, the issue of hormone-impregnated meat, the issue of hormones in milk and, only yesterday, the issue of leghold traps. Each time the diagnosis is the same: prescriptive power has been transferred from Brussels to Geneva. It is also the same for the codex alimentarius standards. In other words, without even realizing it, the European Union has been legally superseded.

Medina Ortega
Mr President, I would like to thank Mr Fischler for being kind enough to join us again this evening because I think it is important for him to follow the debate, although it has to be said that the Chamber is not exactly full.
I should like to disagree a little with Mr Martinez about how much we knew about the WTO decisions. The matter was discussed in the European Parliament's Committee on Legal Affairs and Citizens' Rights, and in that committee we studied both the WTO working group's statement and the Appellate Body's decision.
And it turns out that the European Community was very badly defended. We find that the WTO Appellate Body was chaired by a former US senator, and that nobody was present in either the working group or the WTO apart from representatives of what we might call free-trade theories, or the new or dominant theory. So the views of the agricultural sectors of the EU were virtually undefended.
Furthermore, the Commission's legal advisor told us that, in all, he only had five lawyers to defend the Commission's point of view, against the battery of hundreds of lawyers available to the US Government, assisted moreover by the multinationals.
I am glad Mr Fischler is here. At the moment, a group of Canary Island banana farmers is in the public gallery. These people have devoted their whole lives to their work, and at the moment they have no alternative to banana farming. If the Commission proposal goes ahead as it stands, and the sector does not receive more protection, we are going to find ourselves with a production sector which is now unprotected, whereas prior to the adoption of Regulation 404/93 it was fully protected. And these people cannot move elsewhere or turn to alternative crops.
So in my opinion, I think the Commission would do well to support a lot of the amendments presented by this Parliament - those tabled by the Committee on Agriculture and Rural Development. I hope that next week the Council can finally achieve a good Community regulation which allows a certain level of protection to be retained.

Sonneveld
Mr President, it would be good if the European Union resisted the temptation to thoroughly revise the present banana regulation. There are a great many diverging interests in this sector. That is why there is the risk of creating one problem by solving another. We therefore have to start by aiming the revision at solving the WTO problems which have arisen. This apparently has been the Commission's intention. This is why I support the Commission proposal to set the autonomous tariff quota at 353 000 tonnes in connection with the expansion of the EU. I also accept the duty of ECU 300 per tonne for this autonomous tariff quota, assuming that this will not give rise to new WTO difficulties. After all, the present duty is ECU 75 per tonne. In doing so, the European Union is giving a good signal. The costly, extremely artificial and bureaucratic category B licensing system will be abolished and the ACP countries compensated for lost income. The liberal banana import system of the new Member States will be integrated politically even further into the considerably less liberal EU system. The burden of this extra bit of protection is borne proportionally by the EU tax payer and the EU consumer, and it does not discriminate between the non-privileged banana-exporting third countries.
It would be good if the European Union would also give an adequate response to another unmistakable development, namely the EU interest in fair trade bananas. The problem is not so much the need to support commercialization of fair trade bananas; access to the import quotas is actually the biggest problem. The Commission must not close its eyes to this. It should reserve definite space for this category in the daily management of the import licences, while being authorized to do so by Council and Parliament.

Wibe
Mr President, with this regulation we will have five different import quotas and customs duties for the import of bananas. That is absurd. Moreover, I do not believe that this new system will be approved by the World Trade Organization, so presumably we are going to have a new solution in a few years' time.
Nor do I think that it is right for us to use trade policy for our aid to developing countries. The great risk of such a policy is that we lock the countries into an obsolete production structure, in this case into the production of bananas. Our policy towards the ACP countries resembles what we in Sweden call 'Döbeln's medicine' , that is, it helps for the moment, but in the long term it is harmful.
Both for European consumers and for the populations of the ACP countries it would be better to have free trade combined with direct aid than the present complex quota and customs duty system.

Liese
Mr President, ladies and gentlemen, I must voice my opposition to the Thomas report. I am speaking on behalf of a large segment of the Group of the European People's Party; not the whole party, but a very sizeable segment of it. The Thomas report calls for increased protectionism, whereas what is really needed is less protectionism. We find Amendments Nos 11 and 28 particularly unwelcome, as they represent a drastic reduction in quotas for the three new Member States. A total of 10 % is being cut from Latin American bananas, and still more problems will ensue.
I very much doubt whether the Commission's proposal is in keeping with WTO ratios. However, I am quite certain that the demands made by Mr Thomas and the Committee on Agriculture and Rural Development would in any case lead to enormous problems with the WTO. We keep hearing - as we have heard in today's debate - that we must protect the small, independent producers in traditional ACP countries and the EU against the 'big bad' multi-nationals in Latin America. The organization of the market clearly does not do this.
You are all invited to a talk in the press room tomorrow morning with an independent producer from Costa Rica who produces fair trade bananas and has great difficulty with the way the market is organized. Small producers in Latin America - of whom there are many, in Ecuador, too, for example - are the hardest hit, and that is why we must give more support to fair trade bananas and vote against the Thomas report on this point.

Correia
Mr President, ladies and gentlemen, may I begin by congratulating the rapporteur, David Thomas, on an excellent report on the proposal for a Council Regulation amending Regulation No 404/93 on the common organization of the market in bananas.
The rapporteur's proposals are an excellent attempt to reconcile the interests of all the parties involved, that is to say of Community producers, of the ACP countries and other non-EU countries and of consumers, in a fair and balanced way, keeping to the rules of the internal market and the common organization of the market.
All the same, the question of abolishing the system of allocation of B certificates ignores the consequences this decision will have for Community producers. As you know, the distribution of import licences has been one of the basic principles of the common organization of the market in bananas, and serves to restrict the quantities of Central American bananas coming in so as to safeguard sales of Community bananas.
The Commission and the Council will have to define the measures they propose to take to stop this gap, clearly and without time limits. Among the various measures that should be taken, we think the overall reference income should be adopted and increased by around 20 %, so as to restore the necessary income guarantee to Community producers, and the Community should undertake to reduce the independent quota to prevent a possible glut on the market which would jeopardize sales of Community bananas. Quite apart, that is, from vital additional aid which will be needed to give Community producers back the necessary resources for disposing of their production, thus offsetting the high cost of transport.
For all these reasons we unreservedly support Amendment No 25, Article 1 (new), in order to protect the interests of banana producers in the Autonomous Region of Madeira.

Fernández Martín
Mr President, once again we are faced with a debate on the reform of the COM in bananas, and we need to recognize that this time the reform has been forced on us by the result of the dispute within the WTO.
I must say, Commissioner, that this time, in general terms, we share the views expressed in the Commission proposal, because we need to modify the current import licence regime and make it compatible with WTO rules.
Our experience of market behaviour during the last few years suggests that we should take this into account when it comes to setting import quotas, in order to avoid flooding the markets and causing prices to drop, as happened last year in the case of France.
So we think an autonomous tariff quota of 100 000 tonnes, as already requested by Parliament, is better suited to market demands than the 350 000 tonnes proposed by the Commission.
Furthermore, we need to find a formula to allow continued exempted access for traditional ACP producers with whom we maintain economic, commercial and political obligations which cannot be ignored.
Maintaining this sector in the banana-producing regions of the EU is the very reason for the existence of this COM. Nobody has been able to call into question the validity and legitimacy of this COM, despite the constant attacks it has been suffering.
We need to guarantee the survival of Community production, and the EU's banana farmers need their current income levels to be guaranteed.
The banana sector is one of the most important economic resources of the ultra-peripheral regions of the EU. They cannot do without it, not just for economic reasons, but also for employment reasons.
Taking it for granted that the Commission shares these objectives, we need to know what mechanisms they are contemplating in order to sort out the import regime for third country production. Also, we do not yet know how the Commission plans to compensate Community producers for losses they suffer as a result of not having a licence regime like the one currently still in force.
Commissioner, it would be good to clarify and overcome the two uncertainties I have just indicated: guarantees for maintaining production and income levels. That is what the sector is hoping for from this new reform.

Iversen
Mr President, I would like to begin by praising the Commissioner's proposal, for it endeavours to strike an admirable balance between the different producers' interests. Reasonable consideration must be given to EU producers, while we must maintain our Lomé and WTO obligations. In reality, there is precious little room for manoeuvre. However, fair trade bananas are one area in which we can improve the Commission's proposal. The Commission's proposal to support ACP producers paves the way for changes in production, and there must be due regard for the environment, but that is not specific enough. Thus, it is vital that our amendment should propose arrangements for fair trade bananas. In this regard, I am not suggesting a particular quota, but rather, support for changes in production, a definition of fair trade bananas, arrangements for labelling and monitoring, and support for publicity and marketing of fair trade bananas. Arrangements for fair trade bananas would benefit EU producers and ACP producers alike, and I therefore hope these aspects will be worked into this proposal.

Mendonça
Mr President, ladies and gentlemen, the problem of the banana market has given us another opportunity to declare in this House that it is the principal obligation of the institutions of the European Union to defend the interests of its Member States and their regions in every situation, and to honour the commitments they assume in agreements with other countries, without submitting to the interests of the World Trade Organization.
In the case we are now debating, the Commission may be given the benefit of the doubt when it tries to reconcile the interests of Community and ACP banana producers with the requirements of the World Trade Organization's panel of judges. The Commission must understand that the flooding of the European market with large quotas of cheap bananas from non-EU, nonACP countries will seriously affect the income of Community producers and make it almost impossible for traditional ACP countries to compete with Latin American producers.
We cannot set aside the fact that some of our ultra-peripheral island regions, which are marked out by their isolation and low levels of economic development, are among the European banana-producing regions. It is not enough to recognize the existence of ultra-peripheral regions in the Treaty of the Union; it is more important that in all circumstances there should be specific and substantive expression of the support which those regions, which expect a great deal of us, call for and demand from the Community.
In Madeira, an autonomous region of Portugal, it would cause incalculable economic, social and environmental damage if the European institutions gave in to pressure applied to them for the purpose of defending interests which are not those of European citizens.

President
The debate is closed.
The vote will take place on Wednesday at 11.30 a.m..

Freedom of establishment in the transport sector
President
The next item is the recommendation for second reading (A4-0215/98), on behalf of the Committee on Legal Affairs and Citizens' Rights, on the common position established by the Council with a view to the adoption of a Council Directive amending Directive 96/26/EC on admission to the occupation of road haulage operator and road passenger transport operator and mutual recognition of diplomas, certificates and other evidence of formal qualifications intended to facilitate for these operators the right to freedom of establishment in national and international transport operations (C4-0174/98-97/0029 (SYN)). (Rapporteur: Mrs Maria Berger).

Berger
Mr President, Commissioner, even if he is leaving us now, ladies and gentlemen, the Community had conceived regulations as long ago as 1974 with the goal of harmonizing conditions of admission to the occupation of road haulage operator and road passenger transport operator. However, in recent years, central, basic conditions in the transport industry have undergone major changes.
The present proposal for a directive comes in response to these changes. The proposal aims to guarantee that at least somewhat similar statutory terms will apply for all hauliers right across the EU. The occupation of road haulier is already second to none in terms of being a truly European occupation. In a matter of days, from 1 July 1998, this will be reinforced still further through the final clearance of cabotage. This occupation, too, will thus be able to benefit fully from the terms of the internal market, and hauliers will enjoy unrestricted admission to the market throughout the Union.
In fact, the directive under discussion here today should have been in force by 1 July 1998. I must therefore emphasize that Parliament has worked extremely fast and that the Council has been responsible for the delays, having spent rather a long time on the common position; that is why this deadline has not been met.
Regardless of the actual date, however, we must respond to the fact that changes in operating and production processes in industry and retail in line with the just in time strategy have led to faster, more flexible and, at the same time, higher quality transport services, demanding ramified and ingenious systems of logistics.
Today, we are confronted with a situation whereby smaller and smaller consignments need to be transported with increasing frequency. There is also a noticeable shift from traditional company transport to professional goods transportation, and larger and larger operators are emerging, offering both haulage and logistics solutions. On the other hand, we are also seeing increasing numbers of small enterprises entering the market place by virtue of their flexibility and the cost savings they offer, accepting haulage suitable only for smaller vehicles, even for transboundary movement.
The public is becoming increasingly exacting as regards transport services, especially in terms of environmental protection, technical safety and abiding by social provisions. The emphasis varies greatly from country to country. Standards in the applicant countries of central and eastern Europe in particular are, without doubt, decidedly lower.
Thus, we have to be aware that operators from these countries in particular will be competing more and more with operators within the Union. Thus, quite apart from the present concrete directive, I would like to pick up where I left off at first reading in my quest to examine the extent to which steps can be taken under the auspices of existing European accords with the nations of central and eastern Europe, prior to their joining, to bring them gradually into line with EU regulations in this area.
At first reading, the Committee on Legal Affairs and Citizens' Rights expressly welcomed all the Commission's proposed harmonization measures. These concerned greater requirements with regard to financial capacity, personal efficiency and specialized knowledge as well as the enlargement of the area of application of the directive.
As rapporteur, I also wanted to see stricter regulations adopted to combat fraud in joint transit procedure and to regulate the transit of live animals. I wanted to see regulations adopted setting greater requirements with regard to financial capacity. I wanted a tighter definition of the concepts of share capital and reserves to be adopted. My proposals at that time were adopted by a very sizeable majority both in the Committee on Legal Affairs and Citizens' Rights and in the plenary session.
However, in its common position, the Council has only accepted two of our proposed amendments and these changes are actually more in the nature of legal technicalities. I am particularly disappointed that in the common position, the Ministers of Transport did not even take up my amendments on combating fraud, when these had the support of the Commission. Thus, I have resurrected most of my/our demands from first reading, and once again, they have been unanimously adopted by the Committee on Legal Affairs and Citizens' Rights. As before, I still consider it extremely important to bring anti-fraud provisions into the domain of haulage operators. I also propose deleting various items added by the Council, as well as introducing supplementary tests for hauliers who have acquired their credentials in a different Member State. I would ask for your support in the vote.

Sindal
Mr President, the second reading of Mrs Berger's text deserves to do well. At first reading, I thought we and the Commission had made good progress. I can understand the Council being a little more cautious in the text we received subsequently. But what is it all about? As Mrs Berger said in her introduction, it has something to do with fair competition. It also has something to do with transportation, environmental considerations, integrity, etcetera. I am in no doubt that the House agrees on what it is about, but perhaps we are more worried about how to get it through. Regulations are fine. That's great. But in my view, free will can go a long way. For instance, I am confident that in the trade - within Member States - road haulage is being developed along the lines of sustainability, focusing on quality and service. There has to be the will to make implementation a reality in all Member States.
The committee's proposal on Community transit and procedures is sensible and deserves the support of Parliament and, in due course, that of the Commission and Council as well. I would like to ring a little alarm bell about one proposal, however. The amendment in question is Amendment No 11, where there is a kind of weighting of offences. The amendment proposed by the House reads, "... convicted of serious offences against the rules in force concerning road haulage' . What is "serious' supposed to mean? Who is going to define how serious something has to be before intervention is necessary? This is a kind of grey area, giving free reign to spite, so I would prefer us to retain the original text, stating: "... convicted of offences against the rules in force ...'

Mosiek-Urbahn
Mr President, ladies and gentlemen, as always, differences in national regulations lead to distortions of competition. Moreover, competitive pressure from third countries has also recently increased considerably.
The proposed amendments to the common position bring the harmonization process one step further forward; they are based on the revised basic conditions - the newly-developed just in time strategy, for example. They take account of trends in the road transport of goods. To my party, an important consideration is that in addition to the requested greater requirements with regard to the integrity of the operator, environmental protection and professional duty, there is also a need for greater requirements with regard to combating fraud in Community and joint transit procedure.
This is one inference from the conclusions of the report by the committee of inquiry concerned. Regrettably, we cannot agree to Amendment No 8, part 1. In this respect, we prefer the text of the common position.
In reviewing an operator's financial capacity, both capital and reserves should be considered. In a time of crisis, for example if a major customer leaves, a haulage operator needs to be able to use more capital as a temporary measure for restructuring purposes without running the risk of failing a test of financial capacity during such an emergency, while if elements of reserves had been considered, such as unrealized gains, credit guarantees and similar banking information, the operator's financial capacity might have been judged positively. This would ensure that financial capacity would be appraised primarily on the actual solvency of the operator.
The criterion of haulage operator integrity serves to protect the public from injury and danger. Thus, for serious violations of relevant regulations, an operator's licence would be withdrawn. Withdrawing licences for any offence, as originally proposed, would mean that, in extreme cases, even exceeding the speed limit could have far-reaching consequences for the fate of the firm. This would surely be unjustifiable in terms of the proportionality rule; this was why the Committee on Legal Affairs and Citizens' Rights rejected this proposal.
I really must thank the rapporteur both for her report and for taking this line.

Fitzsimons
Mr President, I welcome Mrs Berger's report which seeks to bring common standards to road haulage operators in Europe. However, I must say that it is simply not good enough for British authorities to allow a situation to arise whereby Irish hauliers are denied access to and use of British roads, as happened when ports were blocked last Sunday for 16 hours. The European Treaties have espoused a need for the freedom of movement of goods, persons and services within the territories of the European Union. This should be protected and maintained at all times. This freedom is enshrined in the legal right upon which the basis of the European Union is founded. In fact, one must welcome the recent position of the Internal Affairs Council of Ministers' meeting, at which it was agreed that the procedural red-tape would be cut, to allow the European Commission to demand reasonable action by Member States to unblock roads or ports within days of blockades being set up as a result of strikes, or face action in the European Court of Justice.
Finally, I should just like to reiterate my recent call for Transport Commissioner Neil Kinnock to intervene once again in the matter of ensuring that the French authorities pay up outstanding claims by national road haulage associations arising as a direct consequence of the blockade of French motorways last year. There is still £2m outstanding to Irish road hauliers resulting from this strike which must be paid by the French Government immediately.

McIntosh
Mr President, I welcome this common position and I think it will give road hauliers free access under similar conditions of operation and in particular will open up access to cabotage. I congratulate the rapporteur and welcome this common position.
It is favourable to small businesses with one exception which I come to in a moment. In my view it fits in positively with the principle of subsidiarity. However, I cannot support Amendment No 8. In my view, this would create a high level of immobilised transport undertakings capital, which would be unacceptable. It would create a very precarious situation especially for small businesses and I would be very interested to hear the Commissioners' views in this regard. Like Mr Fitzsimons who wishes to keep all roads open against blockades I invite the Commissioner this evening to make sure that in fact her own country will continue to allow free movement: in fact that principle has been breached twice in the past two years under the nominal excuse of industrial action. Commissioner Kinnock felt unable to intervene in this regard but it is a breach of free movement and I hope the Commissioner will enter into the spirit of the single market tonight and ensure that it does not happen in future.
I also hope that the Commissioner will go some way this evening towards expressing some willingness to resolve the situation whether there are huge disparities of tax. In particular, fuel rates in the UK seem to be astronomically high whereas in many other Member States they are very low and this creates distortion within the single market.

Cresson
Mr President, ladies and gentlemen, I would first of all like to thank you for your work on this initiative, which aims at strengthening current legislation by making the conditions of access to these professions stricter, by harmonizing the application of the three criteria and by widening the scope of the directive.
I am therefore happy to be able to accept many of the amendments presented by the Committee on Legal Affairs and Citizens' Rights. Firstly, I would like to say that I am pleased with the amendments which make the text clearer and the proposal more coherent. Amendments Nos 2, 3, 8 and 11 will therefore be taken into account.
Secondly, although initially the Council did not consider it necessary to take action with regard to combating fraud, the Commission continues to consider this an important aspect and feels that tough measures should be taken with regard to the dishonesty of some people in this sector. This is why I accept Amendments Nos 1 and 11, along with the second part of Amendment No 7. The first part of this amendment is, however, too vague and could lead to control measures out of all proportion.
Finally, the Commission remains of the opinion that it is desirable to provide for the possibility of flexibility in the control measures, particularly in the case of small and medium-sized enterprises which could face financial difficulties in the short- term at the time when they are evaluated against the criteria for financial standing. This possibility is especially important due to the emphasis currently placed on employment at European level. Amendment No 10 can consequently be accepted.
Mr President, there is one area in which the Commission cannot accept the amendments presented. Although the Commission is extremely favourable to the principle which underlies these amendments, the aim of which is to remove factors relating to problems known as "diploma tourism' from the common position, it cannot accept that the compromise solution, arrived at with such difficulty, should be rejected. The Commission remains convinced that the temporary nature of the proposal, combined with the need to consult the Commission in all cases, is a sufficiently restrictive basis for its application. The Commission is also convinced that the implementation of the new requirements with regard to professional competence will make this measure unnecessary. This is why the Commission cannot accept Amendments Nos 4, 5, 6 and 9.
Mr President, Mrs Berger's report is both realistic and well founded. She continues to make a constructive contribution to the Commission's initiative and enables us to reexamine certain questions with the Council. I hope that, on this occasion, the Council will realize the advantages of these amendments. We all wish to see stricter standards applied in this sector, along with a series of coherent criteria, to ensure that only reputable transport operators remain in the market, providing a high quality service in the interests of their clients and of society as a whole.
Thank you for your support. I am sure that it will continue to be forthcoming.

President
The debate is closed.
The vote will take place on Wednesday at 11.30 a.m.

Fifth Framework Programme for RTD
President
The next item is the recommendation for second reading (A4-0226/98), on behalf of the Committee on Research, Technological Development and Energy, on the common position established by the Council with a view to the adoption of a European Parliament and Council Decision concerning the Fifth Framework Programme of the European Community for research, technological development and demonstration activities (1998-2002) (C4-0182/98-97/0119(COD)) (Rapporteur: Mrs Godelieve Quisthoudt-Rowohl).

Quisthoudt-Rowohl
Mr President, Madam Commissioner, ladies and gentlemen, I can honestly say that this evening you see standing before you a very happy rapporteur. Once upon a time we began with one proposal by the Commission that we wished to have amended. I recall that at first reading we dealt with some 750 amendments and - looking over to the other side of the House - they either got through or did not get through, as the case may be, in the midst of much highly controversial debate here.
Next I would like to thank the Council. Much to our delight, Parliament, and not least I myself as rapporteur, found the common position of the Council so satisfactory that we would now merely like to improve a few points. No matter how good a paper is, it is and always will be capable of improvement. Thus, we have concentrated on a relatively small number of points. In committee last week, we adopted some 40 amendments, almost all of them unanimously. As always, there was a bit of debate on a few points of detail.
It will come as no surprise to you that the House wishes to increase the overall budgetary level for the Fifth Framework Programme on Research. Thus, in committee, we once again unanimously adopted the original sum put forward by the Commission of ECU 16.3 billion. The Commissioner has assured us all along that this amount was arrived at following thorough research and mature reflection. We will take her word for it; we are not merely hoping for the support of the Commission, we are absolutely banking on it in conciliation.
We also unanimously adopted amendments delineating the involvement of the European Parliament during the implementation of the programme. We no longer wish to take our leave as the legislative body for policy on research after we adopt this framework programme presumably tomorrow and then after conciliation.
The much-acclaimed flexibility demanded by the Commission is not synonymous with the whim of the Executive. Hence, we believe the Commission should be required to report to Parliament. Moreover, in our opinion, there could well be a review in the middle of the implementation of the programme whereby its content would be open to re-definition. The overall direction of the programme ought perhaps not to be changed, but we could nevertheless consider whether everything we are deciding right now is still relevant.
Further, we are actually somewhat disappointed that not all the improvements for small and medium-sized enterprises were adopted by the Council. To be quite honest, I am rather amazed, because support of the middle classes as employers is constantly being lauded, particularly in terms of the creation of new jobs. This is where action on employment will come from. We have therefore unanimously adopted these proposed amendments and reintroduced them.
One final comment - which I know will be a sticking point. The treaty clearly states that research is integral to internal policies and that for such budgetary matters, joint budget authorization by Parliament and the Council applies. Correspondingly, we have also amended the common position wherever the research budget is mentioned rather than internal policies; this was done, incidentally, with the full agreement of the Committee on Budgets. We hope this will serve to increase transparency and constitute a qualitative improvement. The quality of European research is, in fact, its strength. If the quality is good enough - not merely adequate, but excellent - and if the decision-making processes are transparent, the advancement of European research will also be more readily accepted. Today, this is a question we hear all too often: Does it have to go through the European Union? Are there not any other ways? In future, we will have to be able to demonstrate that this is absolutely vital.
In conclusion, I would like to thank the members of the Committee on Research, Technological Development and Energy and all the members of the advisory committees as - after tough debating, in some cases - we have succeeded in adopting such a consistent paper by a very comfortable majority.

Tannert
Mr President, ladies and gentlemen, as Social Democrats, we have never had the least doubt that we would only be giving our partial support to the Council's common position on the Fifth Framework Programme for Research. We primarily agree with its thematic structure, because this takes account of our most important proposals from the first reading, including initiatives on socio-economic basic research. However, we have our doubts as to the adequacy of the Council's proposals on the budget, financing arrangements and management. I would like to make four fundamental comments.
The first relates to concentration. There is still no significant reduction in the number of areas. A reduction in the number of projects and the scope of the specific programmes is, however, essential to serious concentration. The second concerns modernization of institutions. In the interests of efficient administration, the Commission must bear the brunt of responsibility for implementing the programmes. The programme committees must confine themselves to coordinating strategic and normative issues. Parliament must be actively involved in monitoring the implementation of the programme.
The third concerns social innovation. Innovation is one of the key objectives of the programme. However, innovation is not limited to a technical process; it is also a social process in need of optimization through investment in a qualified workforce and new types of labour organization. Europe could gain a decisive competitive edge here. This is one of the reasons why we are calling for an additional initiative in the area of the information society. The fourth relates to growth. The concept of growth must once and for all be taken out of the dead end which is a purely quantitative meaning. Ecological stability must emerge as a locational advantage of the European economy and hence, the overriding credo of the programme.
I would also like to make just a few comments on the budget. It is a scandal in the history of Community promotion of research that the Council has no intention of even keeping pace with inflation in the furtherance of research. In real terms, what the Council has in mind is a 4 % reduction. My party only agreed to the inter-party compromise of ECU 16.3 billion negotiated in the run-up to this second reading under the constraint of coming up with a qualified majority; otherwise, we would have set the figure far higher. As we enter the 21st century, more Community efforts will be required in order to make decisive improvements to industrial competitiveness, to avoid large-scale ecological damage and to combat the economic exclusion of entire segments of the population. Correspondingly, investment in research would need to be calculated in accordance with the principle of saving up to make public provision for the future. Unfortunately, it was not possible to achieve a consensus on this with the conservative side of the House.
Let us at least join forces to demand what was agreed as the lowest common denominator in the report by the Committee on Research, Technological Development and Energy - the Commission's allocation entered in the budget. Finally, I would like to thank the rapporteur for her efforts, including her successful efforts to bring about a large number of workable compromises and some reasonably consistent parliamentary action.

Scapagnini
Mr President, the vote of the Fifth Framework Programme is an important opportunity for our House to confirm the need to guarantee European research the necessary support to face the great challenge of globalization. The added value of European research is now a proven reality and, on the eve of the year 2000, the existing connection between research and economic development is clear and obvious.
People specifically want research and technological development to provide concrete answers to problems like ageing or disability. And I am also thinking of employment - the major challenge at the end of this century - and in this sense I confirm the need to involve producers in the activities of the Fifth Framework Programme, and I am particularly thinking of the role of small and medium-sized enterprises. In this respect, I actually believe that two and not three small and medium-sized enterprises - as provided for until now - can, through cooperative research activities, jointly entrust third legal entities with appropriate research capacities with the task of solving their common technological problems. At the same time, I would like to stress the need for the JRC to strengthen its ties with other research institutes so that it can develop its function as a centre for the transfer of technology, something we have all repeatedly stated in committee.
Clearly, cuts in funding cannot be made in a sector that is the future of our young people and our economies. To go without research today means being less efficient and competitive tomorrow. It is extremely important to assert Europe's role in this way. In conclusion, I therefore hope that we all play our own role and hope, like those who spoke before me, that the Commission and Council will be able to back Parliament's position on funding.

Plooij-van Gorsel (ELDR)
 Mr President, ladies and gentlemen, Commissioner, on behalf of the Group of the European Liberal Democrat and Reform Party I would like to congratulate the rapporteur Mrs Quisthoudt on her report and thank her for the work she has carried out, because it is above all thanks to her that the Committee on Research, Technological Development and Energy has managed to come up with a unanimous proposal for the budget of the Fifth Framework Programme.
The Group of the European Liberal Democrat and Reform Party is delighted with the budget proposal, in terms of both its level and the substantive allocation. I therefore hope that this Parliament will once again speak with one voice.
My group does have a problem with Amendment No 31, however; this amendment makes it possible to depart from the generally used definition of small and medium-sized enterprises. Firms with up to 500 employees (instead of those with up to 250 employees) are entitled to research grants specifically aimed at small and medium-sized enterprises.
As rapporteur for the specific programme on innovation and SMEs, I do not agree with this. In my experience it is the small firms, in particular those that promote European innovation, that fall between two stools. In a definition which classifies companies with up to 500 employees as small and medium-sized enterprises, this means that most research funds will go to the larger companies with 300, 400 and 500 employees.
In addition, however, the smaller firms especially must be encouraged to take part in the innovation process. This is the area in which growth is highest and in which jobs are created. And in the areas of information and communication technology and biotechnology in particular, a great many small, innovative firms are active. They should benefit to an optimum level from the European research funds. A restriction of the definition does not exclude larger companies from participating in the Fifth Framework Programme. A broadening of the definition gives small companies an even smaller chance to claim the already minimal SME budget for the coming four years. My group will vote against this amendment.

Pompidou
Mr President, Commissioner, ladies and gentlemen, the Committee on Research, Technological Development and Energy has come to a unanimous agreement regarding the minimum essential budget for the Fifth Framework Programme for Research and Development. This has been largely due to our rapporteur's tact and listening capacity, and I would like to pay tribute to her.
Parliament concurs with the Commission's opinion, and must send a unanimous message to the Council concerning the issue of financing, in order to approach conciliation - which is proving to be difficult - from a position of strength.
I would like to draw your attention to a limited number of amendments which touch on the heart of European research. This heart is made up of men and women, our scientists and engineers. The European Union must offer them the recognition they deserve, along with the necessary motivation, by each year organizing a European Grand Prix for scientific and technological research, as proposed in Amendment No 34. This heart is also made up of our research infrastructure. The European Union must mobilize all possible means to support it. We must make sure that the Fifth Framework Programme draws equally on the Structural Funds, the European Investment Fund and funds from the European Investment Bank. This is the aim of Amendment No 18.
Similarly, the Joint Research Centre must enjoy more autonomy with, naturally, the counterbalance of an independent evaluation procedure as provided for in Amendment No 19.
Finally, Amendments Nos 20 and 21 restore coherence and concentration to the Fifth Framework Programme by dealing in parallel with health issues linked to our nutrition and environment. This is where the heart and arteries of every European are at stake.
Ladies and gentlemen, by adopting these amendments by a strong majority, we will approach the co-decision procedure under the best possible conditions. It is a matter of building a European science and technology policy which lives up to our ambitions, that is, one which is at the service of all Europeans.

Marset Campos
Mr President, first of all I want to congratulate the rapporteur on her work, which is very careful and very sensitive to all the opinions expressed in committee, which has meant that the report has arrived at this stage with a high degree of unanimity. That backing bears witness to the work done by the rapporteur.
In the few seconds I have available, I want to focus on what I see as a serious contradiction in the construction of the European Union which is taking place.
We are aware of and admit the fact that Europe is behind North America, Japan and even some other regions which are increasing the GNP destined for research on these matters. Nevertheless, we are decreasing our investment, and it is also decreasing in every Member State of the European Union.
I wonder how we can make any progress, with the prospect of reduced research spending.

Bloch von Blottnitz
Mr President, please allow me to present my criticism in note form, so to speak, because I only have a short time to speak. Firstly, I would like to discuss the financial provision. According to the Treaty of Dublin, this should have been 6 %. That is now out of the question. I would simply like to point out that America has just decided on an 8 % growth rate, or a total of 32 % over four years. Next, I would like to address the total disparity between nuclear and non-nuclear energy. We have earmarked ECU 1 260 million for nuclear energy and ECU 1 004 million for non-nuclear energy - including coal and renewable energy.
I think this is because we are forever chasing the mirage of fusion. Thus, we would not be doing justice to the task if, for example, I only made reference to the Kyoto Convention. Besides, an even more pressing task is to probe who actually benefits from growth and what form that growth should take. Does it make people happier, healthier or more contented? Does it reduce unemployment? We need to pay far greater attention to this.
The other matter concerns information technology. We are entering an era when a segment of the population of the EU - and, not least, citizens of other countries - will in all probability no longer have any part in knowledge because these people are excluded - they cannot participate in the new information technology. This will lead to a major disparity, not only in the European Union, but also in many other countries with which we do, of course, have to collaborate, for example in Asia or in the developing countries. I do not know how we will resolve this. We need to spend a lot more money in working with this trend. It is not just about energy or the environment; it is also - and more pointedly - about the consequences of the rapid growth of information technology.

Desama
Mr President, Commissioner, like everyone else I would naturally like to add to the well-deserved compliments the rapporteur is receiving and perhaps note that when we embarked on the Fifth Framework Programme, Parliament had two clear demands to make. The first related to the form and structure of the Framework Programme. We wanted to break with the linear model of research, which belonged to the past, in favour of an interactive model which linked targeted actions to generic technologies. These demands were satisfied right from the stage of the Commission's proposal.
Secondly, we wanted the Framework Programme to be responsive not only to the desire to ensure the competitiveness of our industries, but also to be an instrument responsive to social demands. On this point, too, the Commission moved largely in the direction of our expectations. And the good news which has come from the Council in the common position is that it has not only confirmed what we have achieved with the Commission but that it has gone further towards Parliament's position than the Commission did.
The bad news, on the other hand, has been that the Council does not provide, or does not provide us with, the political means with which it is itself in agreement. Thus, given that we cannot express an opinion on behalf of the Council but that we can at least make ourselves heard, I would like to say three things to the Council. The first is that we have not decided to make many concessions - and I must stress this point - particularly as we are on exactly the same wavelength as the Commission. So, we will not change our minds. The second is that if, in spite of everything, necessity dictates that we must accept a reduction to below the 16.3 billion level, there will be no linear reduction. It will be hard luck for some of the Council's priorities. Thirdly and finally, there are some things which we consider to be essential, such as the independence of the Joint Research Centre and, to reply to Mrs Bloch von Blottnitz, the essential tasks of the Euratom Treaty, including thermonuclear fusion. But that is my personal opinion.

Matikainen-Kallström
Mr President, I would like to warmly thank Mrs Quisthoudt-Rowohl for preparing this report. The Fifth Framework Programme must be got off the EU decision-making treadmill as quickly as possible, so that competitive European research can continue without interruption when the present phase of the programme has ended. The Commission cannot be allowed to slow down the decision-making process by drawing out the debate until it goes to conciliation. Stubborn persistence in attitude does not produce results.
A very important area of research for the future in the Fifth Framework Programme is water. Clean drinking water, surface water and groundwater is now, and will continue to be, a very important issue for the EU; for example, 2 % of surface water in the EU is being threatened with pollution. That is why research must help preserve this vanishing natural resource in those areas that still have clean water. More attention should be paid in research to, for example, the capability of mineral deposits to work as indicators in studies of groundwater. If ever there happens to be radioactivity in a given area, mineral deposits will reveal this without the need for the time-consuming examination of groundwater.
It is important for European research and competitiveness that the Framework Programme budget be as large as possible. Only then can we be certain of enjoying high standards in the future in Europe.

Elmalan
Mr President, the four previous framework programmes for research largely funded precompetitive research projects halfway between grass roots research and the commercial development of products. These programmes had the quality of developing cooperation between scientists, universities and business, but they had only a small impact in social and economic terms and did not enable Europe to catch up in many fields, especially the sectors of the future. These shortcomings were largely due to the inadequacy of appropriations, their dilution amongst too great a number of programmes and a lack of flexibility in the allocation of appropriations to respond to new needs.
In the Fifth Framework Programme, the Commission has corrected these faults by concentrating appropriations on fewer, more targeted activities, by looking to improve their management and to simplify procedures. These directions were overall approved by Parliament and the Council, but a disagreement arose regarding the amount of appropriations. Whilst the Commission and Parliament are demanding a substantial increase in appropriations to bring them to ECU 16.3 billion over five years, the Council has given a figure of 14 billion, which in real terms represents a decrease in comparison with the Fourth Framework Programme. Given the European Union's backwardness in the field of research in comparison with competitor countries, appropriations should be increased to ECU 16.3 billion and substantial improvements should be brought about in their use and in the implementation of projects.

Linkohr
Mr President, I, too, would like to congratulate the rapporteur. I know it is a difficult task - a bit like squaring the circle. Irreconcilable interests often have to be reconciled. It is critical for Parliament to remain united now. We have one clear adversary, the Council. We will only be able to resist the Council if we stay on the course we have just mapped out, and I would also ask the Commission to support the House in this.
My second comment addresses a problem that we unfortunately will not be able to solve with the Fifth Framework Programme for Research. I would like to draw attention to this now. It is the increasing north-south conflict of industrial competitiveness. Unfortunately, the southern states have cut back their research expenditure more severely than has been the case in the north, although the southern states only had a relatively low level of expenditure as it was. This will lead to an even greater northsouth divide in the future.
I would like to ask the Commission to devote special attention to this subject, not because I believe the Fifth Framework Programme for Research can solve the problem - there is far too little money for that. But the political will must come into being in the south - and by that I mean countries with a smaller gross domestic product - as well as in the north. The latter are not always richer, but as a rule, they spend more on research.
We need to come up with a solution to this; otherwise, the divide will only get bigger. It will cost us dearly and we will not be able to bridge it by stepping up regional policy. I am asking you to reflect on this. In any case, thank you very much, and I do hope we can stand united as we oppose the Council.

van Velzen, W.G.
Mr President, Madam Commissioner, ladies and gentlemen, I would like to start by thanking the rapporteur, Mrs Quisthoudt, for the excellent work she has done. The main issue in this second reading concerns the disagreement with the Council over the budget for the Fifth Framework Programme. The Council proposes a maximum amount of ECU 12 740 billion, excluding Euratom, whilst Parliament proposes just over ECU 15 billion. The essential difference therefore concerns this additional 2 billion which this Parliament wishes to allocate to the four research themes, namely the quality of the existing and user-friendly information society, competitive and sustainable growth, energy and the environment.
Mr President, it is essential that Europe's competitiveness is increased, that the social issues in this area are resolved, and that the Council is persuaded to adopt the position of Parliament. Research is one effective method of guaranteeing employment in the European Union in the long term. It now appears that a conciliation round with the Council is unavoidable. In view of our experience as Parliament with respect to the role of the Commission in the conciliation procedure involving the additional ECU 700 million for the Fourth Framework Programme, I would like to urge the Commission to determine its strategy for the conciliation procedure in close cooperation with the European Parliament. We can only get the Council on our side if Parliament and Commission act jointly on this issue. The Commission should avoid giving the Council the impression that the Commission attaches less value to the level of the research budget than the European Parliament does. I insist on a response from Madam Commissioner to this question, and I would like to know whether she is prepared to jointly develop such a strategy.

McNally
Mr President, I am rather sorry that we are discussing such an important subject late at night. I do not think it is appropriate. However, I should like to give my congratulations to the rapporteur. She is a lady who drives a very hard bargain, I have to say. But I enjoyed our very interesting discussions and I am very pleased that we achieved a result.
The theme of the week, as expressed in Cardiff, is 'let's bring Europe to the people' . What better way of doing that than engaging the best brains in Europe on behalf of the people to tackle the problems which worry the people? That is what the framework programme is for.
I am very pleased about the attention that is now being given to the theme of gender balance, of mainstreaming throughout the Community's policies, including the Fifth Framework Programme. I would sincerely like to thank our Commissioner, Mrs Cresson, for her attention, which will be appreciated by many people in this Parliament.
Another leitmotif of the Fifth Framework Programme has to be sustainable development. We have to bear in mind all the time that resources are finite and that we must improve life for everyone in the Community. Like others I have some doubts about the wisdom in the Euratom part of the Fifth Framework Programme of spending hundreds and hundreds of millions of ECUs on research into nuclear fusion which will not generate electricity in the lifetime of anyone in this Chamber tonight. But so be it.
Socio-economic research which tells us how our society is growing and what we could do to make it better is essential. What I want to see in the Fifth Framework Programme, which did not happen in the Fourth in all areas, is attention to the implications for society of the research which these brains are working on. That was meant to happen in the Fourth Framework Programme and it did not. We seriously want the socio-economic implications of every piece of research to be looked at in the Fifth Framework Programme. That is very important as well as for some specific areas such as information technology and others where there are very clear societal implications.
I hope that the Council of Ministers is intending to act rationally. It is not rational to make a cut in real terms in research in 1999 and the beginning of the next century. That is irrational behaviour. I hope, therefore, that they are quite clear we will not accept something which cuts the Fifth Framework Programme in real terms in comparison with the Fourth. That is exactly what this Parliament does not want. We are bringing Europe to the people. As I said earlier on, we can only do that with an adequate budget.

Schierhuber
Mr President, Madam Commissioner, ladies and gentlemen, as the author of the statement on behalf of the Committee on Agriculture and Rural Development, I must congratulate the rapporteur. I welcome the Council's common position, which has taken up the concerns of the Committee on Agriculture and Rural Development, incorporating a separate point on energy, the environment and sustainable development into the topic. I would particularly like to emphasize the fact that the Council has expressly stressed organic substances in its chapter on ecologically friendly energy systems, including renewable energy sources. That is a big success, underlining the positive re-thinking process in EU policy. The facts from Austria, Finland and Sweden show that it is possible to step up the use of renewable energy sources; renewable energy sources account for between 20 and 25 % of energy consumption in these countries.
EU policy is aimed at sustainable development and the sustainable utilization of natural resources, achievable through increased use of these types of energy sources.
To me, this is also very important in view of environmental protection, particularly with regard to further developing rural areas. In this connection, I also welcome the fact that the Council has come out in favour of the sustainable development of agriculture, fisheries and forestry. At the same time, I would like to emphasize that in a truly integrated rural economy, mountainous regions must also be considered. I am critical of the low level of funding.

Adam
Mr President, the rapporteur has my congratulations on being able to bring to Parliament this evening a report which is commanding widespread support and which I hope will serve us well in the conciliation that lies ahead.
The first point I want to make is that, in relation to finance, we must not allow a fall in real terms in the amount we give to research. Let me give a simple example. The oil price per barrel is now at its lowest level ever. Yet the United States is quadrupling the amount of support it gives to the supply and service industry in the oil sector. When we set out the Fourth Framework, the Third Framework, the Second Framework, the First Framework, society was poorer than it is now. And yet, are we to believe that we are now poorer in our aspirations for what we want in the future? It cannot be.
There are two very specific points I want to mention. Firstly, we must have solid fuel within the purview of this programme. We may not like coal, but coal use throughout the world is increasing and we should not forget that. Secondly, we need to add in the work for disability as well as for the ageing population. They are not always the same thing, but we need to have regard to this problem in our society.
My final point is that we must realize that we are rich in what we have already achieved in our research programme and we must exploit it more than we have in the past. If we could achieve that in the Fifth Framework Programme, we would be very happy indeed.

Cresson
Mr President, Madam Rapporteur, ladies and gentlemen, we are now at the start of a crucial stage in the procedure for adoption by co-decision of the Fifth Framework Programme for Research and Technological Development. Thanks to the work accomplished by our three institutions, especially Parliament, the issues are now clearly defined and the positions clarified. It will soon be time for decisions to be taken.
I will centre my speech around three points: firstly, the financial allocation to the Fifth Framework Programme, which has been raised as an issue in many of the previous speeches; secondly, the Commission's position on the draft recommendation which has been submitted to you for second reading; thirdly, the question of a launch date for the Fifth Framework Programme.
Regarding the financial allocation to the Fifth Framework Programme, I would first of all like to thank the rapporteur, Mrs Quisthoudt-Rowohl, along with all the members of the Committee on Research, Technological Development and Energy, for the quality of the work they have achieved. A draft recommendation has been produced in less than three months. This is all the more remarkable as this is a difficult and complex subject on which people's starting points were far from in agreement, as Mrs Quisthoudt-Rowohl and other speakers mentioned earlier. You were able to make the necessary efforts to move closer together. I would naturally like to congratulate the rapporteur for her negotiating skills, but also all the Members involved in these efforts for having reached a compromise and having been able to discern between what was important and what was not so important and to come to an agreement on the important issues.
On behalf of the Commission, I would like to express our great gratitude to the Committee on Research, which supported our proposal aimed at providing the Fifth Framework Programme with a budget of ECU 16.3 billion. It is true that this figure is the product of a process of reasoning which includes: firstly, inflationary measures; secondly, the increase in gross domestic product - as Mr Adam said earlier, we are richer than we were a few years ago, and we should take this into account - and, since in all political discourse and at all the summits we hear talk of research being the absolute priority, an increase in real terms of 3 %, something which seemed to us beyond question. As I have publicly stressed on many occasions, the figure of 14 billion adopted by the Council on 12 February is not acceptable, far from it. I would like to reassure those who may still have doubts on this point. I earlier heard Mr van Velzen wondering if the Commission still upheld the same position and was ready to define a strategy with Parliament. The answer is - of course - yes, we uphold the same position and we are determined to fight with you so that, rather than a reduced budget, we have an increased one because, as has been noted by all corners of this Parliament, in comparison with our major competitors we are effectively in a situation where all - or nearly all - of the Member States are reducing research budgets, whilst continuing to repeat that they should be increased. Every day, current events remind us of the fundamental role of research in social and economic progress and its essential contribution to growth, competitiveness, employment and the quality of life of our citizens. I would like to thank those of you who have highlighted the research dimension of the quality of life, along with its social and societal dimensions, for the aim of research is not only to increase competitiveness.
In the new paths that we have explored in the area of research at a European level, paths such as the fight against cancer, the increase in new services as part of the electronic information networks, studies on earthquakes and climatic phenomena, research and technological development are at the heart of all economic success and are essential for solving the problems which confront society. This can clearly be seen in the concept of key actions, an excellent instrument in this new approach to research, which I am glad meets with the full approval of Parliament. It is true that we have tried to focus, but we have also tried to adopt a global approach to each problem. Mr Adam earlier spoke of the ageing of the population: there is a specific key action on this theme. But let us not delude ourselves: real impact will only be achieved if the Fifth Framework Programme is provided with the means to live up to its ambitions. Achieving this objective will not be easy, since there is a clear difference between the position shared by Parliament and the Commission and that of the Council, and recourse to the conciliation procedure seems inevitable.
It is within the perspective of this procedure that the question which is the subject of my second point is raised, namely: the Commission's position on the draft recommendation at second reading. Our common goal must be to reach an overall agreement as quickly as possible within the conciliation committee. Regarding the structure and content of the Fifth Framework Programme, the Council's common position reflects a number of the amendments you introduced at first reading and which the Commission took up in its amended proposal quite well, but this is not the case for many of the other amendments. The Commission is anxious not to delay the Council's decision on the second reading. Unanimity is still essential, given that the Treaty of Amsterdam has not been ratified, even if it has been decided that from now on research should be discussed by a qualified majority. The chances of achieving unanimity with regard to a new amendment to the proposal are extremely small. The Commission has thus opted to maintain its modified proposal without including amendments other than those already incorporated as they stood or largely unchanged at the conclusion of the first reading. This position seems all the more justifiable to me now that we are about to prepare a range of measures moving in the same direction as a large number of these amendments. I am thinking in particular of the group of amendments relating generally to the implementation and management of the Framework Programme.
At the time of the ministerial conference on management of the Framework Programme, which was held on 28 April in London at the initiative of the British Presidency, I had the opportunity of presenting the measures envisaged by the Commission to the Research Ministers. I had previously commissioned a study and I had consulted the Member States, who were able to organize their representatives into three working groups. Extremely detailed preparations took place which resulted in the interministerial conference in London. By way of example, I would like to present to you some of these measures. Firstly, the setting up of a new consultation and opinion structure based principally on consultative groups composed of experts from all walks of life. Secondly, the simplification of procedures and, as far as possible, the shortening of delays in the processing of proposals, which everyone is asking for: each time the Member States request the establishment of further committees it means - it has to be said - that the procedure will be delayed yet again. This is what I explained at London. You cannot have your cake and eat it. A further measure is the strengthening of information and assistance networks for small and medium-sized enterprises. Earlier, Mr Scapagnini and others spoke of the SMEs. We have paid particular attention to them. Furthermore, I would like to remind you that SMEs which have benefited from Community research funds have increased by around 30 %; 75 % of these SMEs had never before benefited from a research programme. It is true that what was said earlier about businesses, the definition of an SME, the figure of 500 employees in relation to innovative companies, innovative SMEs, start-up companies which are beginning to appear everywhere, it is true that all of these are important. We have to consider how we can help those small enterprises which are truly innovative - and, I may say, truly small - as much as possible.
Let us move on to talk about the execution of regular comparative exercises of national and European organizations' performance in terms of managing research programmes. This comparison has, in fact, already been initiated, and may surprise some Member States because it will be noted, when all is said and done, that the administrative costs which the Commission is constantly criticized for are often less than those of some Member States' bodies. Thus if we carry out a benchmarking exercise, I can inform you that it is rather favourable to the Commission and its administrative actions.
All of these initiatives should not only help us to move the Fifth Framework Programme forward and make it an effective, transparent and open instrument, but also facilitate the evaluation of its ways of working and its results, in the direction desired by Parliament. I fully share this point of view. I think we will be all the more credible if we are open and clear and lend ourselves - very willingly, believe me - to evaluation exercises undertaken by independent experts, the results of which we could ask the representatives of all the Member States to examine. In this respect we have little to fear because we have a high quality administration and our procedures are perfectly transparent.
I would like to make two observations: firstly, the Commission has every intention of intensifying its efforts in order to improve the information provided to Parliament on the progress of programmes, as well as on the measures implemented to increase efficiency in the management of programmes. Our cooperation will not end with the Council's decision on the Fifth Framework Programme, on the contrary it will continue. I was both very pleased and interested to have discussions with representatives of the Committee on Research in particular because the suggestions you made, which enriched our deliberations considerably, enabled us to progress a great deal. If you wish, ladies and gentlemen, the Commission is ready to organize a seminar on the management of the framework programme with Parliament. If you wish, I will be more than happy to organize this seminar.
Secondly, within the framework of the conciliation procedure, the Commission is determined to work towards an overall compromise which carries the clear mark of the European Parliament and, in return for certain compromises, an agreement on the content of most of the amendments does seem possible.
I now come to my final point: the Fifth Framework Programme must be launched as soon as possible, which brings me to the issue of timetable. As I have already had the opportunity of highlighting before Parliament, in order to avoid a damaging interruption of European research efforts, the specific programmes of the Fifth Framework Programme must be operational as from the beginning of 1999. Thanks in part to the efforts of the European Parliament, the procedure for adoption of the Framework Programme has been able to continue along a steady path. This momentum must now be maintained if we want to keep to the envisaged time frame. This will not be easy, given the divergence of views regarding the financial allocation that many of you have sought to highlight. But I am sure of being able to count on the European Parliament in this respect and thank you in advance for your efforts. Please be assured that, with regard to this matter, we are in full agreement. I would like to reiterate this: from your point of view, within the framework of the negotiations, you can count on the resolute support of the Commission to provide the Framework Programme with an overall financial allocation which lives up to its ambitions.
I would now like to say a few words on some of the speeches. I have mentioned small and medium-sized enterprises. Mrs Plooij-Van Gorsel mentioned the ceiling figure. It is true to say we have made an effort and that those efforts will continue. I dearly wish to help small innovative businesses.
Mr Pompidou mentioned the possibility of a European Grand Prix for science and technology. Although this proposal does not fall within the sphere of the Framework Programme for research and development, I do think that it is a very good idea and would like to study it. He also drew our attention to the problem of nutrition, which is to a large extent on the agenda and which is increasingly going to draw the attention of our citizens.
I am in full agreement with what Mr Marset Campos said. Indeed, one cannot fail to be amazed that Europe can drop its guard when the United States and the other main European competitors are in the process of increasing, in real terms and sometimes in considerable proportions, their research efforts.
Mrs Bloch von Blottnitz, we have delayed the decision on the problem of fusion. It has been postponed by at least three years. I think this change is a move in the same direction as your concern.
I would like to thank Mr Desama for his contribution. He said that we have broken with the linear model to move towards a far more interactive model and that we have given priority to the generic aspect of problems as compared to their selective angle. We are equally concerned with the social aspect. I am in sympathy with what he said regarding the JRC. In fact, I told the Council that if the budget was overly reduced we might have to consider the closure of one of the seven JRC offices, and that it would be for the Council to tell me which one. Obviously, when you get to this level of detail, it always becomes that much more difficult.
I agree completely with Mrs Matikainen-Kallström's comments on water. Within the key actions there are also points covering this issue.
Mrs Elmalan spoke of the problem of correcting the organization of research action in the Fifth Framework Programme, which has by no means been systematic enough. We have tried to concentrate this, to correct our failings, with the aid of the suggestions you have been kind enough to make.
As always, I listened with a great deal of attention to Mr Linkohr, particularly in respect of the differences between north and south. It is true, but our budget represents only around 5 % of the total budget of Member States. Thus if the Member States do very little, I cannot see what we can do. This said, we have cooperation agreements with a certain number of States, especially in the south.
I earlier said how much I appreciated Mr van Velzen's speech. He is completely right when he says there is a common strategy and that we will have the opportunity of discussing it within the framework of the conciliation procedure.
Mrs McNally particularly highlighted the Commission's desire that the proportion of women should be a little - I will not say higher because we still have a long way to go - but a little more balanced in comparison with the current situation. The conference which we organized in Brussels - Women and Science - was very successful and had a good impact, not so much in the general media but within scientific circles. I personally was extremely satisfied with the manner in which this conference took place. I think that all those who took part, both men and women, were very happy with it.
Mrs Schierhuber's comments on biomass were very interesting. But it seems to me that there have been many discoveries with regard to new technologies in the field of energy, even if it can be said that there is a problem of research. It is the will to apply them that is lacking. For once it seems to me that there is an even greater lack of will than of resources devoted to research. If there is a policy for alternative energy and if certain Member States want to promote it, we will of course support them in this.
Mr Adam said that we were richer now. Indeed, we are not very rich, but we are nevertheless a little richer than a few years ago and I do not see why our research should become poorer when, the world over, it is precisely the opposite which is occurring.

President
The debate is closed.
The vote will take place on Wednesday at 11.30 a.m.

Energy for the future (renewable sources of energy)
President
The next item is the joint debate on two reports, on behalf of the Committee on Research, Technological Development and Energy:
A4-0207/98 by Mrs Rothe, on a communication from the Commission on energy for the future: Renewable Sources of Energy - White Paper for a Community Strategy and Action Plan (COM(97)0599 - C40047/98); -A4-0199/98 by Mr Linkohr, on network access for renewable energies - creating a European directive on the feeding in of electricity from renewable sources of energy in the European Union.
Rothe
Mr President, there is already ample testimony to the European Parliament's positive view of renewable energy in numerous resolutions. Under the motto of "talk is cheap - we want some action!' , Parliament has already requested a strategy and a concrete plan of action in two reports, also tabling some proposals of its own. The Commission must have been aware that Parliament had high expectations of the White Paper.
Commissioner, I can assure you today, you have not disappointed us. Even though we would have preferred the White Paper to get down to specifics to a greater extent, it does point the right way. The Committee on Research, Technological Development and Energy gives its unmitigated support to the goal of doubling the use of renewable energy by the year 2010 as a minimum goal, as stated in the report. However, we expect binding commitments between the Commission and Member States as to goals for the individual countries, broken down by type of energy and annual power prognostications. These very Member States must be prepared to take up their responsibilities.
The White Paper correctly highlights the major importance of difficult conditions of competition for renewable energy sources. In this respect I will focus on just one point, the matter of fair access to the electricity network. The reality of energy policy in the Union demonstrates that countries that do have specific input arrangements for electricity from renewable energy show the highest rates of growth. Through my report and, in more detail, the report by my colleague Mr Linkohr, we are prompting the Commission immediately to table a motion for a resolution that would organize conditions of access to the electricity network for "green' electricity in such a way that the investment in plant and running costs for the production of electricity from renewable energy sources would become practicable, enabling wide market penetration regardless of the type of system chosen.
Legislative measures such as those just described, as well as concrete, special policies are needed to support renewable energy. Therefore, I welcome the Commission's plans for a major breakthrough campaign for renewable energy in fulfilment of one of Parliament's demands. The only other thing we are now proposing is that this campaign should be complemented with an information campaign on "solar heating and solar heating power stations' .
The White Paper gives special prominence to organic substances in the question of doubling renewable energy sources. That is a very positive signal, particularly for rural areas of the European Union. But, Commissioner, if we are to take these proposals seriously, there surely has to be a corresponding logical step in the proposals for the reform of the common agricultural policy. There is clearly a lot of catching up to be done; perhaps you could put that to your honourable friend Mr Fischler.
By and large, promoting renewable energy sources is not the sole domain of energy policy. This task applies to all Community policy right across the board and must also be given considerably greater consideration in the special financial promotion programmes of the European Union, whether within the Community or in programmes in third countries, since the necessary resources for the breakthrough campaign alone will cost the public coffers an estimated ECU 4 billion.
If political will is combined with political creativity at Union level and at national and regional political levels and channelled into new energy sources, doubling looks set to be achieved before 2010 - I am sure of that. New approaches are also needed, notably in construction policy. For example, we are asking for a "solar architecture' action programme in Member States. Following the successful example of the blue flag, perhaps golden suns could be awarded to hotels and resorts.
The policy of helping renewable energy to make a breakthrough is just as much an opportunity as a necessity. A doubling by 2010 would give an annual reduction of approximately 400 m tonnes of CO2 ; this alone would fulfil two-thirds of the requirements of the Kyoto objective. Between 500 000 and 900 000 new jobs could be created, new industrial impulses would be unleashed, new export possibilities would open up, and not least, intensified use of renewable energies represents the answer we need to the finite nature of fossil fuels and the problems of atomic energy sources. Commissioner, this time we really do want to see some action!

Linkohr
Mr President, I am picking up where Mrs Rothe left off. Oil currently costs approximately USD 13 per barrel. Electricity and gas prices in the European Union are set to fall between 20 % and 30 % as a result of increased competition. That is what we wanted, after all. However, the question arises - what chance does renewable energy have at all, then, since we know that it tends to be rather expensive, in some cases far more expensive than conventional forms of energy?
The proposal tabled here - and I hope Parliament will agree to it - does provide an answer to this: fair access to the electricity network for electricity from renewable energy sources in return for reimbursement that makes the investment in plant practicable for the operator. This is, incidentally, a procedure we have used many times before. Currently, for example, a parliamentary initiative by the Committee on Legal Affairs and Citizens' Rights on a period of grace for innovations has been brought before the national bodies for patent legislation. This procedure is permitted under the Maastricht Treaty. Parliament can take the initiative; at any rate, it can vote on it. The Commission is then free to take up this initiative. As a rule, the Commission would be well advised to stand by the decision of Parliament.
Since I am only too well aware that this is a very complex issue, I do not pretend that what has been penned here is the last word in wisdom. That can be said of very few of our decisions in the European Parliament, anyway. It would be presumptuous to say that one's own paper really is the best thing we have for the next hundred years to come. Nevertheless, it is a contribution. Therefore, I recommend that Parliament should vote in favour of this motion for a resolution, together with its annex, because the annex only says that the Commission should give due consideration to the enclosed text. Please consider the content very carefully. It may well be that you have better ideas. I will gladly bow to superior wisdom. Please take that into consideration. Hence, I would like to ask my colleagues to assist the Commission in this regard through the official channels as we go to the vote.
Up until now, the European Parliament has shown unity regarding renewable energy. We have dealt with several reports - the Mombaur report, the report on energy policy by Wim van Velzen, the two Rothe reports on the Green Paper and the White Paper. Now we have this report bearing my name. Each time, the House has lent its unified support to renewable energy forms, and results have been forthcoming. I say that for Parliament in all modesty. It also helps the Commission to know that Parliament stands united behind renewable energy forms. Thus, I appeal to my colleagues to remain on the course we have mapped out.
The content of the proposal - due to shortage of time, I will not read it out, as you can all read it in your mother tongue - the actual message of this proposal is that we should mobilize private capital to promote renewable energy in the European Union. As we know from the White Paper referred to by Mrs Rothe, the strategy for the promotion of renewable energy will cost some ECU 80 000m - ECU 100 000m over the next decade. I ask you: where is this money coming from? It is definitely not coming out of national budgets. It is not coming out of our regional budgets - we have too little room for manoeuvre for that. Neither is it coming out of the European budget. We could try, but there is no way we could come up with ECU 80 billion - ECU 100 billion.
This can only be done through the mobilization of private capital. That is, in fact, the objective of this paper. Accordingly, I ask you once again for your support. The current debate also helps shape public opinion in Europe, for without this unified public opinion in questions of renewable energy, we would not be able to keep the promises we made in Kyoto, the same promises we will, no doubt, be reiterating in Buenos Aires. Following on from Mrs Rothe's comments, may there be action to accompany our words! Those who come after us will thank us for it.

Schierhuber
Mr President, Commissioner, ladies and gentlemen - we are currently debating the future of European agriculture on all political fronts. The support of multi-functional rural areas is a key point. Using replenishable raw materials as renewable energy sources brings this goal within reach, and I therefore wholeheartedly welcome the Commission's White Paper on renewable energy.
However, at this juncture I have to criticize the inadequate proposals for reform in Agenda 2000. The Commission's objective, according to which renewable energy sources would reach a proportion of 12 %, is laudable and corresponds to a doubling of the current proportion. However, a further increase is vital and entirely feasible, as Austria, Finland and Sweden testify.
Organic substances have tremendous potential for the future development of rural areas as a whole. Jobs will be created through decentralized production and use, promoting integrated development. Regional purchasing power will be increased in tandem with value creation, and income and living standards will rise. The result will be a reduction in demographic migrations and thus, the retention of intact rural areas with their irreplaceable value in terms of leisure and relaxation. In order to promote renewable energy sources accordingly, uniform tax reductions or tax relief would have to apply throughout Europe. Likewise, reimbursement for electricity input from renewable energy sources would be needed right across Europe in order to set up a reliable legal framework for its development and use. In parallel, the Commission should also advocate an increase in duty on fossil fuels.
Self-regenerating raw materials are of particular significance especially in view of the imminent enlargement of the EU. The Commission should initiate a pan-European information campaign on the introduction of renewable energy sources, and I urge it to do so. The success of organic substances is largely dependent upon their acceptance by our citizens.

Ojala
Mr President, I would like to thank Mrs Rothe warmly for the excellent work she has done in preparing this report on future renewable energy sources. In my opinion, Mrs Rothe has succeeded in presenting the effect of renewable energy sources on employment and regional policy quite well in her report. The effect on employment is greater than with other energy sources. There is a good argument both for using renewable energy and for the decentralized production of energy, particularly in the regions of the EU that are remote, sparsely populated and which have high unemployment. By supporting research and development in renewable energy we can create hi tech jobs for these regions and so improve conditions for sustainable development.
There are widely differing resources to exploit in different regions; for example, biomasses, solar energy and wind power. Energy policy development should always take stock of local conditions.
In my opinion, the Commission's announcement does not give sufficient attention to the importance of wood as a renewable energy source. Wood as a source of energy production remains largely unexploited in, for example, the northern regions of the EU. This has not been emphasized sufficiently in Mrs Rothe's report either.
Supporting renewable energy through taxation will be unavoidable if Member States wish to fulfil the goals set for the Union at the Kyoto climate conference. With tax controls we will be able to increase both the use of wood-based and other biomassbased energy as well as the combined production of electricity and heating. In this way the Union's energy policy can be more clearly based on renewable sources and not, for example, on the further building of nuclear power plants with the risks they entail.

Graenitz
Mr President, the Commission has called its White Paper "Energy for the Future' . We truly are speaking of matters pertaining to the future here - human health, the conservation of the natural basis of life, careful use of resources, securing supplies and the independence of supplies from possible crisis areas of the world and lastly - of paramount importance to all the members of my party - jobs. I believe renewable energy can contribute to achieving all these goals, which are integral to the sustainable, environmentally sound development of the Union. Thus, I would like to thank the Commission for its White Paper and Mrs Rothe for her report, as well as everyone else who has been working on the report to make it so admirable and meaningful. We need to increase the proportion of renewable energies in all Member States as rapidly as possible. To this end, we must implement strategies that promote specific action, because renewable energy is regional energy. Action is necessary in regional, agricultural and transport policy, and, of course, also in research and economic policy, as well as, ultimately, in fiscal policy.
We also need to discuss how we can better motivate people to use renewable energy. In my own region, renewable energy accounts for 30 % of energy consumption and people often say with pride, "I use solar heating in my house!' We ought to be hearing that from a lot more people in the Union, whether it is solar power, wind power or something else again.
One final point in closing: if we truly wish to promote renewable energy, a legal basis will have to be drawn up to allow these programmes to be implemented accordingly.

Kronberger
Mr President, I will begin with Mrs Rothe's report. The White Paper on renewable energy sources is without doubt one of the most significant - or perhaps even the single most significant - ecological document produced by the Commission in recent years. The Green Paper was highly acclaimed for its excellent analysis, but it was also loudly criticized for taking too little account of practical considerations for implementation. This weakness has not been totally surmounted, but it has at least been assuaged by means of a helpful take-off programme.
Mrs Rothe's report constitutes one more qualitative step towards the acceptance of renewable energy sources. The 41 points listed represent a decidedly successful combination of competent, well-informed demands for further development of the thinking behind the White Paper. It is to be hoped that it will be given the most extensive consideration possible. Mrs McNally's Amendment No 2 recognizes the need to set a minimum level of reimbursement for electricity produced from renewable energy sources in consideration of social and ecological use.
I would like to add a further two thoughts. Firstly, changing over to renewable energy sources is not only of importance in terms of the ecology or of socio-economic considerations such as the creation of jobs. Renewable energy sources are also worth striving for to conserve resources and promote future export business. Another significant point is that renewable energy sources would also be of consequence to peace policy, above all. We find ourselves in the thick of struggles over the distribution of the Earth's resources in Africa, the Middle East, the Caucasus area and around the Caspian Sea. A peace deal for the 21st century can thus only be achieved through the changeover to renewable energy sources.
The second thought is that renewable energy sources really only have one single enemy. Not the big multi-national companies or the suppliers of natural gas or traditional energy companies. Their one and only enemy is ignorance of the fantastic possibilities these energy sources offer humanity.
Mr Linkohr's report does throw up some very constructive ideas, for example in chapter 2 paragraph 3, which states that there needs to be a right to input electricity produced by renewable energy sources into the grid. However, regrettably, the report restricts itself largely to so-called funding and special funding for the promotion of renewable energy sources. Accordingly, we cannot really talk about an input directive, but about a directive on input funds. There is a grave difference here. Reimbursement along uniform and harmonized lines in all Member States is a prerequisite to the acceptance of renewable energy sources. This should be calculated in such a way as to make the investment in plant for the production of renewable energy sources worthwhile. There are plenty of exemplary models for this in Europe; German input legislation and the Danish model spring to mind. Amendment No 3 proposed by Mrs McNally relates to this requirement and should therefore be embraced without reservation.
This criticism of the report is in no way a fundamental rejection of the proposed funding model; it is, however, intended as a clear signal that, in its existing form, it simply cannot fulfil its purpose - the practical implementation of the specifications of the White Paper. The demands of the European Parliament need not be any more reticent than the ideas of the Commission.

McNally
Mr President, we would not be able to have this debate if Commissioner Papoutsis had not presented us with his White Paper and we thank him very much for it. The priorities of the current presidency are environment, jobs and crime. As far as the environment and jobs are concerned, renewable energy is extremely relevant - I am not so sure about crime! We certainly know that this is an important contribution to both those priorities.
Mrs Rothe has written an extremely wide-ranging report and I am delighted to see that there are supplementary reports from three other women. It must be a record that all the reports on this important issue are by women Members. Mrs Rothe has 41 conclusions and I ask colleagues to read these conclusions carefully. Each of them is sensible. We know the barriers for renewable energy. They are legal, financial, administrative, etcetera. Her Recital G makes it clear that we will not make much progress without a reliable legal framework of one sort or another. We could hope for an energy chapter. We could have hoped for an energy treaty like the Euratom Treaty. That was my wish, but I accept that a charter is a little more realistic. So, let us try for that. Mrs Rothe and Mrs Graenitz are quite right to point out that many other policies are taken up by renewable energy, and there is a whole list: environment, agriculture, regional, transport, etcetera.
I would like to turn now to Mr Linkohr. Reproach has been made in my presence that it is not the European Parliament's job to put forward this sort of initiative. Why on earth, then, were we given the powers to do so? Were we given powers on condition that we would never use them? That is absurd. Of course not. The intention was that we would use those powers, and I urge you to think very carefully before you reject this constructive measure.

Robles Piquer
Mr President, Commissioner, the Parliament and Council directive on the internal electricity market - which of course arose out of a Commission initiative, and represents so much work by our colleague Mr Desama - clearly recognizes, in two points, the importance of renewable energy sources. In one of these points, it clearly says that the Member States can demand that network operators give priority to installations which generate electricity using renewable energy sources.
Mrs Rothe's second, excellent report is along the same lines. It refers to the Commission White Paper, just as the Green Paper was referred to before. We can only give it our most enthusiastic support.
Since time is short, allow me just to underline paragraph 40, which calls upon the relevant authorities to prepare what the text refers to as a treaty on renewable energies, EURENEW, which combines the European acronym with the English word "renew' .
If, as I expect, Mrs McNally's amendment is accepted, I dare say we shall talk not about a treaty, but at least about a charter. We have the example of the European Energy Charter, which was inspired by special circumstances, in Eastern Europe. Now we have another set of special circumstances: moving from the potential to the actual, and turning the new challenge presented by renewable energy into valid legal documents. So I have little to say on this.
I also want to mention Mr Linkohr's initiative, very briefly because time is short. I think it is an excellent initiative, although I must also admit that it provokes some negative reactions. My colleagues who have yet to speak will not fail to mention that. Not because of the principle, Mrs McNally, not because we want to relinquish our rights, but because of the content of some of the provisions which, to my mind, suggest that this document should be considered further and subjected to a better analysis within the Committee on Research, Technological Development and Energy. Otherwise, there is a serious risk that this important document may be rejected and fail to obtain enough votes in this House. That, Mr President, would be a great pity.

Plooij-van Gorsel.
Mr President, ladies and gentlemen, Commissioner, I would like to congratulate both rapporteurs, Mrs Rothe and Mr Linkohr, for their reports which contain many recommendations for stimulating the use of renewable energy.
Our future energy supply must be based on renewable sources of energy. Renewable sources of energy that generate electricity should be given preferential development. Rules for supplying such energy to the grids are also part of this issue.
My group welcomes Mr Linkohr's initiative for a directive on the supply of electricity from renewable energy sources to the electricity grid. But we are facing a classic dilemma. On the one hand it is an excellent signal to the Commission and the Member States to make proposals in this sphere. But on the other hand, the proposed regulation in the annex is too detailed and, in my group's opinion, not always in keeping with the principle of subsidiarity. Overregulation does not belong in a liberalized energy market.
In conclusion I therefore say to you that we will vote in favour of the legislative resolution, but unfortunately, we are not able to support the proposals in the annex.

Seppänen
Mr President, surprisingly little attention has been paid to the idea that increasing the use of renewable energy sources is also a security policy. EU dependence on imported energy is growing. In twenty years time 94 % of our oil, 80 % of our coal and 75 % of our natural gas will be imported from parts of the world which are very often unstable. This also speaks in favour of the increased use of renewable energy resources.
We see, however, a conflict between worthy aims and insufficient means. It is quite clear that at the present rate the 15 % share for renewable energy is not going to be achieved, and it will not be possible either to reduce greenhouse gas emissions by 8 % by the year 2012. There is a particularly clear contradiction, as has been said here, between the White Paper and Agenda 2000. That is that the increased use of biomasses is, above all else, a matter of agricultural policy and not energy policy. I myself would prefer to have the heat from the sun and the heat from the earth.

Ahern
Mr President, renewable energy has been something of a lame duck in the Community. We talk about it but we do not use it. The practical effects of our past proposals have been rather small. Even in the buildings of the European Union and the Parliament there is no real attempt to incorporate renewable energies in a serious manner. The White Paper could become a point of change and I thank the Commission for their initiative in this way and also the excellent reports of Mrs Rothe and Mr Linkohr which make practical proposals for change.
We could be about to really influence the energy agenda for the year 2000 and Mr Linkohr's proposal for the right of access for renewables to the electricity network is crucial. For electricity production the introduction of a Community-wide law on inputs to the grid is a most important step. Throughout Europe, inputting electricity at specific prices is an instrument for gradually dealing with the centralised structure through secure access to the market for decentralised electricity production from renewable sources.
Mrs Rothe's report also has excellent practical proposals and although the Commission's targets are extremely modest given what is technically feasible it is the actual implementation of even modest targets that must be our first objective if we are to achieve anything real. Campaigns such as the one million roofs, the one hundred solar communities and the golden sun awards are visionary ways of making renewables real to people on the ground and I know that they will be very interesting if we can actually pursue them in a practical way.
One of the sectors of the European Union with a high percentage of CO2 emissions is the construction sector, and technological decisions in the construction sector have a long-term effect on the emission rates of all our Member States. The attention that we must pay to buildings but are not yet paying is a crucial aspect of these reports and I recommend the practical effects of those to all of us.

Wéber
Mr President, as I mentioned during the discussions on the ALTENER II project, Luxembourg already has a supply system, that is, a guarantee on the part of the State regarding the price of electricity from alternative energy sources. Whilst congratulating Mrs Rothe and Mr Linkohr on their report, I would like to speak about an ongoing technical problem, that is, the fact that access rights to the grid for a guaranteed minimum remuneration is not sufficient. Often, landowners are not willing to make their land available to the management of a renewable energy system - windmills, for example - to enable the windmills to be hooked up to the nearest distribution station.
What can be done? We must base the principle of the public utility of alternative energy production firmly in national legislation, which would enable the expropriation of land from owners opposed to these forms of electricity crossing their lands. We know very well that the nuclear industry is a strong lobbyist, particularly with regard to the cultural associations, and particularly in my country. We will put an obstacle in the path of this lobbying in order to offer a true opportunity to wind energy.
This said, Mr President, I will conclude by insisting on the fact that the Commission should truly establish the principle of public utility.

van Velzen, W.G.
Mr President, Commissioner, ladies and gentlemen, I should like to thank the rapporteur for this own-initiative report. The Group of the European People's Party warmly supports the supply of renewable energy to the existing electricity network. The rapporteur has taken the trouble to delve deeply into the practices of various Member States, and, on the basis of this, has developed a concept directive.
Nevertheless, Mr President, we unfortunately have some fundamental objections to the way this draft directive was worked out in the annex. Firstly, it is debatable whether this Parliament should take the place of the Commission by working out a directive in such detail, which in fact has to be drafted by the Commission. My group would have preferred a report that did no more than formulate general principles, leaving the Commission the space to interpret the directive on the basis of consultation with the Member States. This leaves more scope to take into account subsidiarity and the introduction variants and routes taken by various Member States.
As an example I would like to mention that the rapporteur is thinking in terms of two main models which exist in Member States. The Dutch model of 'green certificates', which allows much more space to the energy partners to express their own responsibility, is at loggerheads with this regulation. Amendment No 1, submitted by Mrs McNally, does not resolve this issue. This example shows that the draft directive has not quite taken shape.
Secondly, there is a profusion of regulations. We believe that this is the wrong signal to give to the increasingly liberal energy market. We believe another mixture of instruments could be applied, namely mechanisms such as price, the development of an energy stock market, a buy-back obligation, as well as education. We think it is particularly regrettable that the instrument of regulation was opted for.
Let there be no misunderstanding: the PPE Group shares the intentions of the rapporteur completely, but disagrees for reasons of principle with the details. That is why, with much regret, my group will not support the annex to his proposal. I ask the rapporteur to refer his report back to the Commission so that a better and wider consensus can be achieved.

Desama
Mr President, the whole debate on energy now centres on two issues. The first is the notion of guaranteed supplies, which is necessarily undergoing major developments. The second is clearly the climatic consequences of energy.
This was the issue at Rio and Kyoto. Faced with the issue of climate, there are obviously alternatives to fossil fuels. The two alternatives are, on the one hand, nuclear energy - whether you are in favour or not, it is an essential answer to the problem - and, on the other hand, renewable energy sources whose only handicaps are that they are far from having reached the same degree of maturity as nuclear energy and that they raise a certain number of problems on an economic level for those who invest in the sector.
Faced with these difficulties, how can the share of renewable energy sources be increased, a share which we know will, in any case, remain a modest one? On the one hand, we can put our trust in the market, by telling ourselves that the internal market for energy has been liberalized. Yet we know very well that it will take a very long time for the market for renewable energy to truly gain a foothold. A completely voluntarist action is thus required, and this is what makes Mr Linkohr's initiative interesting, despite the objections which can be raised on one or other aspect of his proposal. Mr Linkohr has in fact put the problem very bluntly and has gone one step further than the previous excellent reports, the most recent of which was the report by Mrs Rothe.
To hide behind the complexity of the problem as the Group of the European People's Party is doing by not voting for the Linkohr report is quite a puzzling attitude. It amounts to depriving oneself of the right of initiative which is recognized within the Treaties. Consequently, we cannot accept this view. I believe we should vote for Mr Linkohr's report. We must do this in order to give the Commission an effective way of proposing a whole range of actions in favour of renewable energies.

Adam
Mr President, renewable energy is essentially about producing electricity. We have a conceptual problem in understanding the demand for electricity in our society and how it is growing; and indeed, how much electricity comes out of a conventional power station. An extraordinary statistic is that if you took all the wind-farms in the world and put them in the United Kingdom they would still only provide 10 % of the United Kingdom's electricity demand. That gives you a perception of how far we have to go in promoting renewable energies.
There are three essential points. Firstly, we need to clear the way for planning permissions. In the United Kingdom planning permissions, perhaps more than anything else, are holding back the development of renewables. We need also, as the Linkohr report says, to have access to the grid and perhaps even to make sure that the grid is near to where we want the renewable energies to be. There is sometimes a problem in the geographical locations: wind energy, for instance, is very often in areas where there are no grid connections in the first place. So we have problems in that regard.
Linking all this together is the need to find a mechanism for giving financial support while these energies grow - a mechanism which is not just open-ended but also has within it an element of competition which will eventually help to drive down costs. We have seen evidence of that being possible. I hope that as a result of these debates - and I know that we have all got reservations about the detail - the Commission will come forward with a proposal which will help us to move into an era where renewable energies will provide more of our electricity supply.

Papoutsis
Mr President, ladies and gentlemen, I would first of all like to congratulate both rapporteurs, Mrs Rothe and Mr Linkohr, on their splendid work. It is true to say that both reports make a substantial contribution to the debate on promoting the use of renewable energy sources. Their views indeed enrich not only the proposals that have already been put forward, but also those that we are now preparing.
During the preparation of the White Paper the Commission made every possible effort to take into consideration the 1997 resolution of Parliament concerning the Green Paper on renewable energy sources. As a result, the White Paper essentially expresses in large measure the positions of the European Parliament.
We have now set in motion the review of all existing programmes and actions for the promotion of renewable energy sources at the level of the Member States and, of course, at a Community level. I have to say that, further to the White Paper, we have been briefed on the development of a series of national action programmes for the promotion of renewable energy sources. It is clear that the considerable effort that we are urging Member States to make over the next decade has already begun to take on a specific shape. Nevertheless, there is still a great need and much scope for further action. And, of course, there can no longer be any excuse for inaction, in view of the pledges made at Kyoto.
In this context, I would also like to express my satisfaction at the endorsement given by the European Parliament to the ALTENER programme. I also wish to inform you that the ALTENER programme came into force with the recent Council decision of 18 May.
The Rothe report contains a number of constructive proposals. First of all I wish to assure you that we are making every effort to complete the examination of existing programmes and measures throughout the whole of the European Union within the current year.
With regard to the campaign for the take-off of renewable sources, we, in the Commission, are at the stage of planning measures in various sectors and we are also preparing the necessary activities for the purpose of information and dissemination. More specifically, with regard to buildings, we will examine construction legislation, with a view to incorporating provisions in favour of renewable energy sources, especially solar thermal power.
In order to promote the reduction of CO2 emissions from coal we will encourage the joint use of renewable energy sources and the conserving of energy in buildings. We are also studying the way in which we can promote more fundamentally the penetration into the market of the use of solar thermal power and, especially, photovoltaics. In addition, in order to diffuse good practices, we are studying, inter alia, the inauguration of awards as well as the carrying out of other actions that are proposed in the campaign for take-off.
With regard to the issue of the promotion of renewable energy sources via other Community policies, we are studying how we can make better use of the continuing reform of the Structural Funds and the common agricultural policy, as well as the policy of energy production. More especially indeed, within the framework of the European Commission proposal for the regulation of the European Fund for Regional Development, in Article 2, which lays down all the sectors which will be funded as a priority in the next financing round, the growth of renewable energy sources is categorically referred to as one of the basic priorities. And I believe that this is the basis for the allocation of considerable resources, while at the same time fully abiding by the principle of subsidiarity, as shaped by the Community frameworks to support renewable energy sources.
In addition, issues related to the financing of actions in the sector of renewable energy sources via various other Community programmes will, I believe, be tackled during negotiations - and also during the budget procedure - which are expected to take place within the next few years. I hope that the European Parliament will give special priority to renewable energy sources in the context of its own role, in relation, of course, to the budget.
With the regular progress reports and follow-up reports which are envisaged in the action plan, we hope to ensure that the defined objectives are better realized and that they are suitably adapted as necessary. Of course there will always be the possibility of discussing the progress of the penetration of renewable energy sources with all the interested bodies and of course with the European Council throughout the entire twelve-year period during which this strategy will be implemented. Of course the action plan will be amended following recommendations whenever this is expedient.
Turning now to the Linkohr report, I have to say that the Commission agrees with the conviction of the European Parliament that the right of access of renewable energy sources to the electricity market is of decisive importance, especially with regard to our objective of doubling the share of renewable energy sources in the energy balance by the year 2010. Last March the Commission submitted its first report on demands for harmonization, which are provided for in the directive for the electricity market. This report focuses almost exclusively on the matter of renewable energy sources and underlines the fundamental issues which must be examined during the preparatory stage. The Commission is continuing its analysis of the way in which all possible obstacles can be overcome, in view of the developing situation in the Member States.
The aim of the Commission is, by the end of the current year, to submit a motion for a resolution for joint rules concerning the electricity produced by renewable energy sources. This motion for a resolution must, on the one hand, give a powerful boost to the production of electricity from renewable energy sources and, on the other, ensure a harmonized approach within the Community.
I also wish to thank Mr Linkohr for his detailed and reliable advice. His report will be of help to us, especially during the phase in which we find ourselves today, that is, the preparatory phase of our proposals on this very issue.
With the Rothe and Linkohr reports the European Parliament is continuing to provide sustained support and advice for the promotion of renewable energy sources. Once again I wish to thank you and to assure you that the European Commission regards the promotion of renewable energy sources as one of the chief energy and environmental priorities for the immediate future.

President
The debate is closed.
The vote will take place on Wednesday at 11.30 a.m.

Counterfeit and pirated goods
President
The next item is the report (A4-0223/98) by Mr Valdivielso de Cué, on behalf of the Committee on External Economic Relations, on the proposal for a Council Regulation amending Regulation (EC) No 3295/94 laying down measures to prohibit the release for free circulation, export, re-export or entry for a suspensive procedure of counterfeit and pirated goods (COM(1998)0025 - C4-0159/98-98/0018(CNS)).

Valdivielso de Cué
Mr President, Commissioner, ladies and gentlemen, bad ways, profit and the human condition in general often lead us down certain dark alleyways, which are easier and more profitable than the legally established routes, in order to satisfy our desires to get rich quick.
That is the general basis of my report: the establishment of measures designed to prevent certain types of activity, such as the illegal use of trade marks, or the manufacture or marketing of pirated goods. Such practices are very widespread, although that does not make them any less illegal.
I would like to give a brief definition of counterfeit and pirated goods.
"Counterfeit goods' means goods, including the packaging thereof, bearing without authorization a trade mark which is identical to the trade mark validly registered in respect of the same type of goods.
"Pirated goods' means goods which are or embody copies made without the consent of the holder of the copyright or neighbouring rights in relation to a design or model.
Moving on to the report proper, I should point out that it mentions the importance of the problem, underlining the macroeconomic and sectoral impact and subsequent social consequences of the phenomena of counterfeiting and pirating.
This impact is very difficult to measure. Nevertheless, I felt it appropriate to request the Commission to make increased efforts to assess the monitoring and repercussions which may follow the entry into force of this Council regulation, and subsequently to communicate them to the parties concerned.
The Commission has proposed introducing into the new regulation a series of proposals which substantially modify the earlier regulation currently in force.
Among the most significant proposals, we underline extending the regulation to a new intellectual property right, such as certain patented inventions, which constitute an essential aspect of intellectual property and occupy a very important place among all the means available to protect innovation. Such protection is essential, given that this coverage provides a suitable framework for the investment in research and development which is so important for the development and competitiveness of European products in the face of international competition.
Customs services are also being given the chance to intervene in new customs statuses: goods in a free zone or warehouse and goods under customs supervision. The regulation is also being adjusted to take account of the introduction of the Community trade mark, so that the right holder will be able to lodge a single application for customs protection, instead of the fifteen currently required to cover the whole of the territory of the Union.
So those are the most important new features included in the modification of the regulation. In addition, the European Commission - which I would like to congratulate on what I think is a good piece of work - held a series of meetings and discussions with different business and pressure groups who had certain aspirations they wanted the new regulation to meet. In that respect, the Committee on External Economic Relations has stated its opinion on the following matters. With respect to the controversial question of non-commercial imports in travellers' personal luggage, two amendments aimed at restricting this sort of situation were rejected in that committee.
The European Commission considers that, within the ECU 175 limit, imports of a non-commercial nature are permitted. In my opinion, this matter raises a basic problem. It is probably illegal but, nevertheless, is provided for de facto by this regulation. Even so, the European Commission feels that this relative permissiveness has the effect of favouring small-scale trade and promoting tourism.
The problem of Community harmonization of the penalties which Member States are obliged to impose has become a very difficult problem, mainly due to the coexistence of different legal systems and traditions in the various Member States. In any case, the report states that such penalties must be effective and proportionate and constitute an effective deterrent.
Finally, I should like to mention and stress the importance I have tried to give in the report to the possible non-commercial disposal of confiscated goods. In a world in which millions of people live in conditions of extreme poverty and need, I hope Parliament will be understanding and give its support. It is absolutely outrageous to destroy these confiscated goods, rather than try to find a non-commercial way to dispose of them and go some small way towards meeting some of the needs of those people.

Plooij-van Gorsel
Mr President, ladies and gentlemen, Commissioner, I would like to start by congratulating Mr Valdivielso on his report. The problem of piracy and counterfeit goods is very real and a threat to European industry. Companies are not only disadvantaged in their sales to the European market, they also do not get a chance to expand their export to developing countries. The market in the developing countries is contaminated, we can safely say flooded, with counterfeit goods. I saw this once again for myself in Indonesia not so long ago. The problem is extremely acute for digital products. Given the state of technology it is almost impossible these days for consumers to judge from the quality of the product whether or not it is authentic.
Mr President, my group is pleased with the inclusion of patents in the scope of the regulation, but is worried about control. Who should carry out controls and where? Customs officials? Will they be trained to do so? Ladies and gentlemen, trade flows should not start to take a different course on account of differences in customs control. My group's question to the Commission is therefore: how does the Commission intend to guarantee uniformity of border controls on this issue, in particular in those places where, after enlargement, the European external borders will be monitored by customs officials from a different legal tradition, who are a long way from fully integrating European legislation.
In conclusion, parallel imports should not and cannot be prohibited. This is not a solution. The internal market should not be hindered by protectionism. The free movement of goods provides healthy competition, and that is good for the consumer.

Linser
Mr President, the protection of material and intellectual property is immovably enshrined in our legal system. This control is of immense value not only to the individual, but especially to the economy. The protection of property includes the protection of patents on inventions, guaranteeing the viability of research and development. The dismantling of internal borders makes customs points for traffic with third countries the last instance of control to prevent the infringement of property rights by means of the import or export of illegal, counterfeit goods.
However, for this protection to be effective, water-tight pan-European standards of security need to be in place to prevent illegally produced counterfeits from reaching the European market through weak links in the chain - in other words, countries known to have less rigorous customs arrangements. Thus, we challenge the Commission to scrutinize the customs points of all such Member States very carefully and ensure that they guarantee a sufficiently high standard of security to do justice to the importance of protecting intellectual and material property.

Ferrer
Mr President, there can be no doubt that European companies have had to undergo far-reaching reorganizations in order successfully to meet the challenges of an increasingly competitive and open economy.
Nevertheless, these efforts alone are not enough. It is also essential, among other measures, to establish a legal framework which guarantees respect for the rules which govern the world of commerce.
In this context, we should welcome the Commission's proposal to amend the regulation on trade in counterfeit and pirated goods. The aim of this amendment is to extend the scope of the regulation and adjust it to developments in Community rules on intellectual property rights.
Faced with competition from third countries - especially emerging economies, whose low labour costs make it very difficult to compete with them - it is essential to combat the falsification of trade marks, designs and models, and to protect intellectual property, given that the main competitive advantages of European industry are product quality and, especially, creative ability.
That is why the Commission's text represents such an opportunity. It proposes to suspend customs operations in cases where the goods concerned are suspected of being counterfeit or pirated goods covered by an intellectual property right, at the request of the right holder. And that, in turn, is why the Commission needs to accept the amendments contained in the Valdivielso de Cué report, insofar as those proposals will help to guarantee respect for international trade rules in matters of intellectual property, and will make it possible to combat commercial practices which cause serious harm to European companies.

Papoutsis
Mr President, ladies and gentlemen, the support of the European Parliament for the Commission proposal clearly demonstrates the desire of all of us to fight hard against fraudulent imports in the context of lawful and balanced competition.
First of all I would like to thank all of you and especially your rapporteur, Mr Valdivielso de Cué, as well as the Committee on External Economic Relations for the thorough and detailed work which has been completed in a very short space of time. I am especially delighted with this report, as it is being presented today, because it is necessary to give Parliament the opportunity to express its view on the three basic innovations in this text. And here I am referring, first of all, to the broadening of the scope of the provision on customs protection to include certain patents. I am also referring to extending the regulation to include all goods which are held under customs supervision and, finally, I am referring to the institution of a procedure to lodge a single application, which will be valid for all Member States, for the benefit of the validly registered Community trade marks.
With regard to the question put to me by Mrs Plooij-van Gorsel, I would like to say that in fact the Commission is coordinating an effort on the part of Member States to train customs officials in respect of the unified application of control measures. We believe that, in the future, in the next few years, and with a view of course to enlargement, we will have achieved the widest and best possible training of customs officials.
The proposed amendments naturally take account of the Commission objective, which consists in strengthening the possibilities of effecting controls along the external borders of the Community. However, the Commission, more for technical than for political reasons, cannot adopt all of the proposed amendments. The Commission is able to adopt Amendment No 6 without any reservation whatsoever. It cannot adopt Amendments Nos 4 and 5 for the simple reason that they go against certain amendments of a structural nature. Indeed, the position of Amendment No 4 on the text of the regulation should have been different and the Commission could then adopt it because there is such an agreement. In addition, with regard to Amendment No 5, the exemption from control of medicines whose compatibility with the legislation relating to patents has already been proved, which the European Commission approves, could be framed with greater precision. However, the Commission cannot adopt Amendments Nos 1, 2, 3 and 7. It cannot adopt Amendment No 1, as the fee must be proportionate to the cost of the service provided, since by its very nature this cost varies from Member State to Member State according to the size of the means that must be mobilized. The Commission cannot adopt Amendment No 2, as the security that the customs authorities may require is used to cover their responsibility in the case of goods held unjustifiably. Given that this is a national responsibility it is not necessary for the security to be obligatory, since the public authorities must at all events always be regarded as reliable. Nor can the Commission adopt Amendment No 3, as the compensation of the holder of the goods, the details of which fall within the sphere of the law of each Member State, is always considered to be in full. Finally, the Commission cannot adopt Amendment No 7, since, in practice, experience has shown that the data obtained in the context of the implementation of the regulation do not offer the possibility of an analysis being undertaken of the kind envisaged in the amendment in question. The results of the operation of such an instrument, which are obtained by the Customs Union, are measurable and the Commission analyses them in detail in the report it has presented to you.
The phenomenon of the irregular exploitation of intellectual property, the roots of this phenomenon and all of its repercussions are themselves a different issue, which goes well beyond the scope of the present regulation.
In closing, once again I wish to thank your rapporteur and, of course, all who have contributed to this work today during the presentation and examination of this directive.

President
The debate is closed.
The vote will take place on Wednesday at 11.30 a.m.

Second WTO ministerial conference
President
The next item is the debate on the Commission announcement on the conclusions reached at the second WTO ministerial conference from 18 to 20 May 1998 in Geneva.

Brittan, Sir Leon
Mr President, between 18 and 20 May I led the European Commission delegation to the ministerial conference of the WTO which was held in conjunction with the commemoration of the 50th anniversary of GATT, the WTO's predecessor. President Santer represented the European Union, together with many Heads of State from around the world.
Both the ministerial conference and the 50th anniversary commemoration were successful. There was recognition, rightly, that the GATT system has made a tremendous contribution to the growth of employment and economic stability over the past 50 years and the participation by so many countries in that system and the fact that over 30 additional ones are keenly awaiting membership is a clear reflection of that recognition.
There was also recognition that in today's global economy further trade liberalization within the rule-based system of the WTO is the surest way to maintain and spread that prosperity. Those messages in favour of the WTO system were expressed by virtually all countries at the conference, both developed and developing.
On 20 May the conference adopted a ministerial declaration which encourages and enables us to work to achieve the objective of further trade liberalization as a means to secure greater prosperity and stability. The conference reiterated the importance of all WTO members fully implementing their obligations under the WTO which all WTO members are clearly committed to. The European Community, for its part, expressed its view that by and large implementation of the Uruguay Round has been proceeding well but where an individual country is having difficulties, we are ready to provide technical assistance to ensure that implementation proceeds properly. That pledge was welcomed by some of the lesser developed countries.
Secondly, the ministerial declaration inaugurates a process to prepare the ground for a decision to be taken at next year's conference in the United States on further multilateral liberalization. That process, the work programme that has been set up, does not pre-empt next year's decisions but makes it possible to take ambitious decisions next year if, as I hope, we decide to do so. The process we authorized will respect existing timetables but also allow work where necessary to be intensified so that all the elements are in place for decision-making next year.
We hope that a decision will be taken next year to launch a comprehensive new round of negotiations - the millennium round - which would cover not only the subjects already agreed to be negotiated, such as agriculture and services, but other areas and sectors of importance to European industry and business, such as industrial tariffs, investment and competition rules, government procurement and so on. It is the view of the European Union that our economy would greatly benefit from agreements in those fields and I believe that is in the interests not only of our industrialized partners but of developing countries too.
I took pains to explain during the ministerial conference why a new round would be the right way forward and perhaps it is worth referring to the arguments today. Firstly, it is only through a comprehensive approach that all sectors and interests can be confident that their particular concerns will be covered in the negotiations. Without a comprehensive round, there is a risk of certain sectors and legitimate areas for future work being left to one side. With a round the agenda-setting process is far more wide-ranging and there will be far more options for ultimate decisions than would be the case if a narrower, sectoral approach were pursued.
Secondly, this comprehensive approach means that the built-in agenda, the Singapore work programme, and new items, too, can be discussed. A round also involves the so-called single undertaking approach whereby, as in previous rounds, all participants must accept the whole outcome of the negotiations, not just pick-and-choose. That means that issues which are difficult for some but important for others cannot be blocked in isolation. That is the key to a successful outcome.
Finally, a comprehensive round implies a single end date which attracts strong political attention at the highest level within member governments and thereby brings pressures to bear to conclude negotiations in time.
At the ministerial conference there was considerable support for our approach and it is very significant that President Clinton was careful not to rule out such an approach and Mrs Barshefsky also indicated that work could be done which would enable such an approach to be pursued if a decision was taken next year to that effect. Of course our ideas do not yet command universal support and I hope that the consensus-building process will continue in such a way to enable an agreement to be reached to that effect next year. That is what we will be working towards.
In making the case for further trade expansion and liberalization we must explain clearly to our respective electorates the importance of trade liberalization for promoting growth and creating jobs. We have to demonstrate to all interested groups the benefits flowing from that and we must show that trade and other legitimate public policy concerns, for example those relating to the environment, are not mutually incompatible but could instead work to mutual advantage.
At the ministerial meeting I stated my belief that we need to tackle head-on the criticism that trade is necessarily disruptive of the environment. A determined effort to resolve some of the difficult trade and environment issues would go a long way towards reassuring public opinion. And this call drew support, notably from President Clinton, for our idea of a high-level meeting as the way to take this forward.
The Ministerial Declaration reflects the recognition that we have to persuade broader civil society as we carry out our work in the WTO and we have to find new ways to engage representatives of civil society in the process. We have to demonstrate to them the benefits of the system to ensure that it remains transparent, and we have to listen to their concerns. The Community has been very much in the vanguard of calls for this kind of approach.
Before concluding I should refer to the resolution of the European Parliament regarding the outcome of the Ministerial Conference. I welcome the resolution and can agree with much of it. It rightly notes the enormous positive contribution of the GATT over the last 50 years and the achievements of the multilateral system in general. It also reflects the support of Parliament for continued multilateral liberalization, a message which we welcome and intend to take forward as we prepare for the new round.
Parliament also raises some legitimate concerns about the need to ensure that developing countries fully benefit from the WTO system. I do not share the view that the WTO has benefited only the industrialized countries, but I am the first to recognize that we should continue to make all possible efforts to ensure that further liberalization continues to benefit the poorer members.
The resolution also - and I welcome this - stresses the importance of better integrating environmental and other issues in WTO work and increased dialogue on the WTO with our various social partners.
Parliament has, finally, made some observations on the recent agreement over the Helms-Burton Act reached with the United States. I do not agree with Members on that. The settlement was unquestionably a good result for the European Community and in no way detracts from our longer-term objective of seeing those laws repealed. It is good for Europe because it will permit our countries to invest in Cuba and Iran, but it also includes a strong commitment from the American administration to resist future attempts at extraterritorial measures. It is entirely consistent with the spirit of the WTO whose rules expressly encourage settlement of differences through bilateral means. And, of course, if the Americans do not honour their commitments - which I have no reason to believe would be the case - we will reserve the right to return to the WTO dispute settlement, as we can do.
I should like, finally, to place on record my appreciation of the participation of Members of the European Parliament at the conference. Their participation was welcome and effective. I look forward to a similarly close association with Parliament in the coming months as we prepare for the Third Ministerial Conference.

Elchlepp
Mr President, ladies and gentlemen, Commissioner - the ministerial conference in Geneva could not, of course, answer all the many open questions concerning sensible ongoing development for the WTO. I am thinking of adherence to social standards and the reduction of adverse impact on the environment due to manufacturing, as well as involvement in the current negotiations on multilateral investment accords of developing countries not actually represented in the OECD. A corresponding WTO code of conduct for multi-national firms would thus be worth advocating. Such a code would give clarity, providing international terms of reference. In order to permit the undisputed benefits of world-wide trade to become a tangible reality to as many people as possible - not only shareholders and big companies - we must continue to work intensively, within the framework of the WTO, with the consequences and by-products of world trade as they affect national distribution of prosperity. If this is not tackled, free trade will be discredited altogether and the advances in prosperity achieved thus far through the WTO will melt away.
However, one positive outcome of the WTO ministerial conference is that, in the face of increasing uncertainty among international economic players as a result of the crisis in Asia, it confirmed the need to keep the multilateral liberalization of world trade on course. Nevertheless, this liberalization is not an end in itself. As the ministerial declaration stated, it must benefit all concerned. Unfortunately, that is not yet strictly speaking the case, because, at the end of the day, the undertakings made at the Singapore summit and reiterated at the 1997 high level meeting in Geneva - to facilitate market access for the least developed countries - must be put into practice by all WTO members. The EU has taken a step in the right direction by harmonizing market access conditions to include those non-ACP nations that are among the world's least developed countries.
Of course, the least developed countries must take action themselves to drive world market integration and internal growth forward step by step through economic diversification. In many cases, this necessitates new thinking on the part of those in positions of leadership; that has to be stated clearly. Today, the balance of payments in many developing countries is weighted not only by debt, as addressed in the ministerial declaration, but also by other factors, for example, keeping to traditional energy imports.
Thus, for example, we need to build up genuine cooperation between the EU and developing countries in the energy sector in order to give developing countries and third countries alike the possibility of developing their own alternative energy production under their own steam. The House has already addressed this in detail earlier this evening in a different context.
All in all, I would like to use this report as an opportunity to point out that the European Parliament needs to make its voice heard more audibly regarding the future of world trade policy if it is to follow government cooperation more critically in this area; in terms of employment policy, this is very important. It is my impression that at the national level, this area tends to get lost in the slipstream of debate on domestic policy.
Sir Leon Brittan, we really appreciate that you yourself have always been prepared to appear before the Committee on External Economic Relations to report on current development in the WTO. However, what we need is formal Parliamentary participation in WTO matters; we particularly need written annual reports on the activities of the Commission in this area. That would be very much appreciated.

Kittelmann
Mr President, first of all I would like to say a belated "good morning' . I am pleased to see, Sir Leon, that you have taken the opportunity to make a statement when, due to pressure of time, we can neither reply to what you have said nor even really go into it. I am pleased about the appraisal of the work of the European Parliament, the resolution and your gratitude for our presence in Geneva. I can guarantee that we will continue to push for collaboration and we are grateful for the small measure of cooperation.
Naturally, at the start of the round in Geneva, the emphasis was more on celebration and proclamation, because 50 years of GATT was indeed reason enough to celebrate. It was a look back at a time of success. We focus on what we have achieved so that criticism of what has not yet been done will be made relative.
As the European Parliament, we should have had higher expectations; we should have urged the Commission and the Council not to let the USA have precedence alone. However, we also know that European Parliament criticism of the fact that not much has been achieved in terms of trade, the environment and social norms is largely down to the developing countries themselves quite understandably dragging their heels on these issues. We should also take care not to overburden ourselves with our own demands so that what we hope to achieve will remain credible.
The previous speaker said he expected more demands by the European Parliament. I would say, conversely: in the decisions, the hearing and many other things we have had a part in, our expectations have often gone beyond the realms of possibility for what could be implemented at the time; however, I may be wrong here.
Sir Leon, I am pleased that we will be having another round in New York. The Commission is assuming that it will have to be a major round. The Commission must not limit itself. It must ensure that everything is addressed. Commissioner, with that as a policy, you can count on the support of the European Parliament.

Kreissl-Dörfler
Mr President, the WTO ministerial conference in Geneva was no pièce de résistance ! Even a born optimist like Sir Leon Brittan could only describe it as "relatively successful' . Its reception in the press was even clearer. The non-event in Geneva got to the heart of the matter: 50 years after the establishment of the GATT system, there is no reason to celebrate. Global disparities have worsened. The poor countries have become poorer, in many areas the environment is on the brink of collapse, advances in workers' rights are being dismantled.
Instead of continuing to carry liberalization to extremes, it should principally be a question of evaluating the years that have gone by. What has gone wrong when the developing countries are losing even more of their share of trade? What is wrong when WTO panels routinely rule contrary to the interests of the environment and humans? We do not need trade in genetically modified food to be liberalized; we need some mechanism to protect us from it! The WTO is in need of constitutional reform! Trading in products manufactured under harmful conditions must no longer be forced through by a panel. In concrete terms, Sir Leon Brittan, are you prepared to press for Article 20 of the GATT to be amended?
There is another matter of great importance: we need transparency. Today, the EU requires good government on the part of third countries before development aid can be granted. We are demanding good government of the WTO. Very importantly - and also for the Greek government - we demand good government on the part of our own governments before we enter into a new round of negotiations.

Newens
Mr President, it is always argued that an increase in global trade engendered by the removal of trade barriers is a means of achieving greater prosperity and higher living standards for all. Labour standards ought therefore to be our concern. I wish to urge most strongly that the WTO collaborate in full with the International Labour Organization to ensure that core labour standards are observed as was recommended in the final declaration of the 1996 Singapore Summit. Developing countries should implement the ILO Convention to achieve a level playing field and to carry on the struggle against world poverty.
The second issue I wish to raise is that of Cuba and the Helms-Burton Act. I believe, despite the Commissioner's assurance, that it was a mistake for the European Union to have agreed to the winding-up of the WTO panel which was established to deal with the objections to the Helms-Burton Act in return for the agreement of 18 May between the European Union and the USA, as it appears to accept an element of the extraterritorial validity of US law. As I understand it, provided that there is a waiver of Titles 3 and 4 of the Helms-Burton Act, the European Union will cooperate in establishing a registry of alleged expropriated properties and will withhold public support from, and discourage investment in, such properties in future by its Member States or its citizens. It seems unlikely, despite the Commissioner's optimism, that the United States Congress will agree to waivers of Titles 3 and 4 without any change of political control, if one takes into account the statements of Jesse Helms.
I welcome the Commissioner's statement that we shall return to the WTO panel if necessary. If, however, the waivers were agreed, would it really be compatible with the principles of the WTO for the European Union to accept the idea of withholding public support for investments in Cuba and discouraging companies from investing? Would an agreement to do this override agreements between Cuba and individual European Union Member States and be enforceable in the European Court? Is no account taken of the fact that unlike other states the United States has not attempted to reach an agreement on compensation for properties which were nationalized? And why should the European Union agree in these circumstances to abide by an agreement which in so far as it accepts the idea of withholding support for investment in expropriated properties goes along with an element of the Helms-Burton Act?
By taking some action to secure a kind of out-of-court settlement, it seems that the European Union has made concessions not compatible with the principle of the WTO. I would be most grateful if the Commissioner could comment on these issues and clarify the situation, particularly with regard to trade with Cuba.

Castellina
Mr President, Commissioner, I certainly do not want to begin a discussion at this time on the fate of the World Trade Organization, but I would like everyone to know my opinion, which is not an enthusiastic opinion on this conference and on the function carried out by this body. The idea was that by liberalizing trade we would overcome the damage caused by protectionism before the war, and this would bring prosperity and jobs. It was no coincidence - I always point this out because it seems significant to me - that the title of the first conference in Havana was 'Trade and Employment' : employment was one of the objectives. Things did not turn out that way. The Havana Charter never came into force because the United States never ratified it, and all the measures that had been provided for to accompany the liberalization of trade with the necessary measures for development were never adopted. Today, all we have left is free trade which has produced serious tensions, including in Geneva. We need only think, for example, of the malaise that pervades UNCTAD.
The liberalization of trade does not create free markets but often amplifies imbalances because it gives the strongest greater freedom to rule. I think that we should give considerable thought to all these issues before the third millennium round gets under way.
I would like to make a final observation regarding the Helms-Burton law which, Commissioner, we have discussed many times. I do not know whether the Americans will manage to stick to the commitments made, I have my doubts. Already it seems to me that the Europeans have accepted commitments not to invest in nationalized property in Cuba - and virtually all property is - and these seem to be serious commitments to me. You yourself, Commissioner, heard, like I did in Geneva, President Cardoso of Brazil complain because non-European countries are naturally excluded from all agreements. I do not think it a very handsome sight to see Europe play a universal role, protecting its own firms and caring nothing about what happens to the firms of the rest of the world which have less bargaining power than we do.

Brittan, Sir Leon
Mr President, first of all, as Mr Elchlepp said, it is right that all issues have not been resolved at the meeting. There was no possibility or intention to do so: the meeting was designed to provide a plan and a direction for the future and to identify the issues, and that is what it has done. Many of the issues Mr Elchlepp mentioned will have to be worked on as we develop that way forward. I much appreciate what he said about the European Union's strong stance on the least-developed countries. We will continue to press in that direction. I agree with what he said about cooperation in the energy sector.
What Mr Kittelmann said about developing countries is also very important. It is very important for those of us who have strong links with the developing countries to persuade them that it is in their interests to cooperate in discussions on matters such as trade and the environment; to explain that we do not have protectionist intent in that direction and that we understand their feelings about our asking them to do what we can afford to do but which they feel they cannot afford to do. We have to try to enter into a constructive dialogue on that subject.
I do not agree, of course, with the fundamental premise of Mr Kreissl-Dörfler. But with regard to Article 20, I think the possibility of getting some kind of further interpretation of that - if not an amendment - is a very real issue that needs to be discussed at the high-level meeting on trade and the environment - if we have it, as I hope we will.
I certainly agree with Mr Newens that there should be cooperation between the ILO and the WTO as agreed at Singapore. But as far as Helms-Burton is concerned, there is absolutely nothing that is agreed which is incompatible with the WTO, which, as I said in my opening observations, positively sets up the system which is not designed to litigate issues to the bitter end and establish points, but to encourage the parties to settle their differences. Of course, if they are settled, nobody gets everything they want. But we have made it quite clear, first of all, that if the United States is unable to meet its commitments we have the right to go back to the WTO; and, secondly, that it is not the case, as Mrs Castellina said, that we are committed to not investing in Cuba. That is just not the case! There is no restriction whatsoever on investment in Cuba: there is only a statement that, in the circumstances of the Americans' compliance with the agreement, we are not going to give public support for investment, but that only applies to new investment in property that we consider has been expropriated contrary to international law. So the question of whether that is so is something that would have to be determined on a case-by-case basis.

President
On this matter I have received the motion for a resolution B4-0666/98, on behalf of the Committee on External Economic Relations, pursuant to rule 40, paragraph 5 of the Rules of Procedure.
The vote will take place on Thursday at 12.00 noon.
(The sitting was closed at 00.35 a.m.)

