Free trade agreement between the EU and the Republic of Korea (debate) 
President
The next item is the recommendation by Robert Sturdy, on behalf of the Committee on International Trade, on the conclusion of the Free Trade Agreement between the European Union and its Member States and the Republic of Korea [08505/2010 - C7-0320/2010 - 2010/0075(NLE)].
Robert Sturdy
rapporteur. - Mr President, this FTA is the first of a new generation of trade agreements launched in 2007 as part of the global Europe initiative. Global economy, instability and a stagnated mutlilateral system have strengthened the need and pursuit for increased bilateral relations. It is the first FTA in which Parliament will exercise its new enhanced powers given to it by the Treaty of Lisbon.
The FTA is designed to provide EU businesses, in a wide variety of economic sectors, with extensive and comprehensive access to the South Korean market through a series of unprecedented tariff liberalisations. It guarantees WTO-plus disciplines in the case of, for example, geographical indicators, government procurement, greater transparency of state aid and strong enforcement of intellectual property rights, and contains an all-important chapter on sustainable development.
However, while the many advantages are both immediate and conspicuous, I welcome more than anything else the fact that the FTA has an effective bilateral safeguard mechanism - a safeguard that allows the EU to restore MFN duty rates, should it be that this particular FTA has led to or threatens to cause serious injury to EU domestic industry. It is a safeguard that specifically addresses the concerns of Europe's sensitive sectors, including the auto industry, consumer electronics and textiles, and guarantees the protection they deserve. On this note I would like to thank Pablo Zalba Bidegain for the work that he did on this specific part of the agreement.
The South Korea market offers significant new opportunities for EU goods and services. It is a market that until now has remained relatively closed off, due to high tariff levies and costly non-tariff barriers. The FTA will quickly remove EUR 1.6 billion worth of EU export duties levied annually. There will be benefits for EU exporters of industrial and agricultural products, immediate savings on chemicals - approximately EUR 175 million -pharmaceuticals, auto parts, industrial machinery, and the list goes on. It is also worth noting that these figures quoted will probably be even higher, because of the increased trade. Korea is currently among those more globally valuable export markets for EU farmers, with annual sales of over EUR 1 billion to Korea. The FTA fully liberalises nearly all the EU's agricultural exports.
Exports are thus an important source of growth for the EU. They contribute to wealth and employment for European businesses and their employees and will act as one of the most important factors in stimulating the EU economic recovery. The Commission and the European Car Association have worked closely together to get this agreement.
The world is watching as Europe leads the way in improving trade and economic relations, with partners in every corner of the world looking at it. I have always said that trade is the real means of development. By removing barriers to trade and building new bridges we create new opportunities. This particular FTA offers a new approach. Complementary, of course, to Doha, it will drive Europe's recovery and growth and the European Parliament will be instrumental in determining the future of global trade policy.
At this stage I would like to thank Ignacio from the Commission. One of the economists said, Ignacio, that this is probably the best trade agreement that both parties could ever have agreed. I urge all groups to put aside protectionism and support this agreement.
Karel De Gucht
Member of the Commission. - Mr President, I wish to thank the honourable Members for all the efforts which Parliament in general, and the Committee on International Trade (INTA) in particular, has put into securing prompt assessment - and, I hope, ratification - of the EU-Korea Free Trade Agreement (FTA). This will permit its entry into force.
This complex task comprised two major processes: finalisation of negotiations on the Korea Safeguard Regulation, implementing the bilateral safeguard clause of the EU-Korea FTA, and the preparation of consent to this treaty.
I welcome the first-reading agreement between the Council and Parliament on the Safeguard Regulation. The work that was done has not only secured legislation which will provide necessary protection for EU industry, but it has also confirmed the joint commitment of Parliament, the Council and the Commission to efficient law making. This was also the first trade dossier on which Parliament acted as co-legislator under the Treaty of Lisbon. The outcome of its involvement is indeed impressive.
I will not repeat the list of benefits which the EU-Korea FTA is expected to bring to the EU economy: we have thoroughly debated them here in the past, and Mr Sturdy has just summed them up. Let me instead open a brief parenthesis to place the agreement with Korea in the wider perspective of the future of EU trade policy, as sketched out by the Commission in its communication of 9 November 2010, and to recap the basic tenets of our policy line.
First of all, we continue to favour the multilateral channel of the WTO as the first-best way to liberalise trade and lay down the rules to govern global commerce. Despite the setbacks and the deadlock since mid-2008, we continue to push actively for the conclusion of the Doha development round, 10 years now after its inception. It is still well worth clinching a deal, both for the economic gains and in the interests of furthering the WTO. That is why I took the initiative of bringing together in Davos the trade ministers of the world's seven most important trading countries to discuss, in concrete terms, how we can now proceed and enter the end-game, following the impetus given by the G20 in Seoul. I believe our meeting was a success, and senior officials are now working intensively in an attempt to stage a political breakthrough in the summer.
However, as we said back in November, the bilateral and the multilateral are not enemies. Indeed, it may well be the case that liberalisation fuels liberalisation. We have pursued bilateral trade deals that generate genuine value added compared with what can be achieved through the WTO, and we will keep on doing so because the pace of multilateral progress is unavoidably slow. This has been, and is, our fundamental motivation for pursuing the FTA with Korea.
I will reiterate today the Commission's commitments to the European Parliament, which it made in relation to the implementation of the Korea Safeguard Regulation and the EU-Korea FTA.
As provided for in the Safeguard Regulation, 'the Commission will present a yearly report to the European Parliament and Council on the implementation of the EU-Korea FTA and will be ready to discuss with the INTA Committee any issues arising from the implementation of the Agreement.
'The Commission will closely monitor the implementation by Korea of its commitments on regulatory issues, including in particular the commitments relating to technical regulations in the car sector. The monitoring shall include all aspects of non-tariff barriers and its results shall be documented and reported to the European Parliament and the Council.
'Particular importance will be attached to the effective implementation of commitments on labour and environment of Chapter 13: Trade and Sustainable Development of the FTA. In this connection, the Commission will seek the advice of the Domestic Advisory Group, which will include representatives of business organisations, trade unions and non-governmental organisations. The implementation of Chapter 13 of the FTA shall be duly documented and reported to the European Parliament and the Council.
'The Commission also agrees on the importance of providing effective protection in the case of sudden surges of imports in sensitive sectors, including small cars. Monitoring of sensitive sectors shall include cars, textiles and consumer electronics. In this connection, the Commission notes that the small-car sector can be considered a relevant market for the purpose of a safeguard investigation.
'The Commission notes that the designation of outward processing zones in the Korean Peninsula, in accordance with the provisions of Article 12 of the Protocol on Rules of Origin, would require an international agreement between the parties to which the European Parliament would have to give its consent. The Commission will keep Parliament fully informed of the deliberations by the Committee on Outward Processing Zones in the Korean Peninsula.
'The Commission also notes that if, due to exceptional circumstances, it decides to extend the duration of an investigation pursuant to Article 4(3) of the Korea Safeguard Regulation, it will ensure that such an extended timing does not go beyond the expiry date of any provisional measures introduced pursuant to Article 5.
'Moreover, the Commission and the European Parliament agree on the importance of close cooperation in monitoring the implementation of the EU-Korea FTA and the Safeguard Regulation.
'To this end, in case the EP adopts a recommendation to initiate a safeguard investigation, the Commission will carefully examine whether the conditions under the regulation for ex-officio initiation are fulfilled. In case the Commission considers that the conditions are not fulfilled, it will present a report to the INTA Committee including an explanation of all factors relevant to the initiation of such an investigation.
'Upon request by the INTA Committee, the Commission shall report to the committee on any specific concerns relating to the implementation by Korea of its commitments on non-tariff measures or on Chapter 13 of the FTA.' That is the end of the quotation.
Finally, let me elaborate on two issues which are of interest to you: the Korean CO2 legislation on car emissions, and the supplementary agreement on the draft Korea-US FTA (KORUS), which was finalised in December 2010.
On 24 January 2011, Korea confirmed that certain changes will be introduced to its previous draft CO2 legislation, which satisfactorily address a number of concerns expressed by European car makers, while retaining Korea's ambitious emission reduction objectives. The changes, which the Commission welcomes, will not alter overall emissions, but will provide for fairer burden sharing between Korean and EU car makers.
Rest assured that the EU position on the Korea CO2 legislation was closely coordinated at all stages within the Commission and, in particular, with my colleague Connie Hedegaard and DG CLIMA, to avoid undermining Korea's environmental protection efforts.
As for the supplementary agreement to the draft Korea-US FTA reached in December 2010, the Commission has not identified elements therein that could have a negative impact on the EU. I will, however, contact my Korean counterpart to ensure that no competitive disadvantage arises in future for the EU automotive sector insofar as non-harmonised automotive safety standards will not be applied in a more restrictive manner than was the case at the time of the negotiations.
The Commission will be closely monitoring the implementation of this provision. In particular, the Working Group on Motor Vehicles and Parts established by the FTA will examine practical aspects of implementation to ensure that market access problems are addressed in an effective and speedy manner.
To conclude, I wish to emphasise that the EU-Korea FTA will not only provide important benefits for European exporters to the Korean market, but will also be a clear signal of our determination to pursue new opportunities in key Asian economies.
We are also addressing the concerns of some stakeholders by means of an efficient and effective safeguard regulation. As this is subject to the ordinary legislative procedure, both the Council and this House have been able to introduce mechanisms for responding to perceived risks should they materialise.
With this FTA and the Safeguard Regulation we have an excellent package that I hope you will support tomorrow.
Daniel Caspary
rapporteur for the opinion of the Committee on Industry, Research and Energy. - (DE) Mr President, ladies and gentlemen, international trade and exports are an important source of growth and employment in Europe. The Free Trade Agreement that we are debating today will strengthen the competitiveness of the European Union and will provide our enterprises with significantly better access to a highly dynamic region of growth. Both the European and the Korean economy will benefit considerably. Our gross domestic product will increase. That could lead to the creation of new jobs. Our exports to Korea will double in the next few years according to all the forecasts because duties and non-tariff barriers to trade will be abolished; the relief in terms of duties alone will amount to EUR 1.6 billion per year. For the European Union there will be a substantial new trade in goods and services with a value of up to EUR 19 billion.
I am particularly pleased that, in the negotiations, the Commission took full account of the negotiation recommendations expressed by the European Parliament in the Martin Report from 2008. I am also pleased that the European Commission took account both of the concerns expressed by Parliament and also of those coming from industry and it was also able to dispel some concerns just in the last few weeks. Something that I have never experienced before in the area of foreign trade is positive feedback even coming from the agricultural sector, which is usually more likely to be a problem for us in the area of trade negotiations.
In the area of agriculture, the agreement will facilitate access to South Korea for European agricultural products from 1 July 2011. Up to now, only 2% of our agricultural products reach the South Korean market duty free. For pork, annual duties amounting to EUR 240 million are paid, and for milk and milk products the figure is around EUR 100 million. All of these barriers to market access for our domestic agriculture will now be removed. I would be pleased if, for this area in particular, the European Commission would consider how we could set up some kind of market access programme, not only for small and medium-sized enterprises, but also for agriculture in the countries that will profit from the Free Trade Agreement.
Above all, I would be pleased if we were also to ensure that our partners in South Korea now actually implement the trade facilitation measures promised in the agreement. I call for it to be clearly monitored whether new barriers to trade are introduced, and I would, in particular, like to congratulate the Commission.
What the Commission has achieved and what Parliament's rapporteurs have achieved, particularly in the trialogue negotiations, is an example to us all. I hope that we will have a broad majority in favour of this agreement in this House tomorrow.
Pablo Zalba Bidegain
on behalf of the PPE Group. - (ES) Mr President, ladies and gentlemen, Commissioner De Gucht, early in this parliamentary term, which is my first, one of the matters I first heard discussed was precisely the Free Trade Agreement with Korea. Certain sectors of European industry, especially the automotive industry, were unanimous in opposing this agreement. As a citizen of Navarre and Spain, where the automotive industry represents a substantial part of our economy, I felt the duty to become involved in order to improve, if not the agreement as this was no longer possible, the safeguard clause, which was where Parliament could introduce improvements.
Thus, we set out to achieve two objectives. Firstly, to protect the industry and its jobs, and secondly, to make the agreement more attractive for the industries concerned, particularly the automotive industry. Our aim was not just to avoid outright rejection, but to gain their support for the agreement. I believe that here today, we can say 'mission accomplished'. This is all thanks to Parliament's hard work and expertise.
I should like to express my gratitude to the rapporteur and to the shadow rapporteurs of both reports for their outstanding work. Thank you Robert. And thank you also for your words.
Recognition is also due to the members of the Committee on International Trade, led by its Chair, Mr Moreira. ¡Muito obrigado!, Vital.
I would also like to thank the Belgian Presidency of the European Union for their excellent work. Their effort has had its reward in the form of the agreement we finally reached in December.
Lastly, I would like to highlight the work of the European Commission, and particularly Ignacio Bercero's contribution, for which I am most grateful. Tomorrow we will vote in favour of a clause which will be more effective, easier to apply and will genuinely protect European industry. Today, concerns on the Free Trade Agreement with Korea have hugely diminished. Indeed, we might say that they have all but vanished. Today, the opportunities this agreement brings clearly outweigh the uncertainties. The European Parliament should be proud of a job well done.
Bernd Lange
on behalf of the S&D Group. - (DE) Mr President, Commissioner, ladies and gentlemen, the Treaty of Lisbon has in fact put trade policy on a new footing. The EU is solely responsible for trade policy and Parliament gives or withholds its consent. In that respect, we have gained a new responsibility. We can only enable this new responsibility to take shape if we act together. We have proven that very clearly in this matter. In this regard, I would also like to thank the rapporteurs and shadow rapporteurs.
Trade policy is not an end in itself. Its purpose is, firstly, to strengthen jobs and industrial development in the European Union and, secondly, to improve conditions for people in other countries of the world. The aim of trade policy must be to achieve both of these goals. We therefore need to assess this agreement from this viewpoint. Overall, this is a step in the right direction towards fulfilling these two requirements. However, we certainly do have a few points of criticism, for example the question of duty drawback in South Korea, which will bring one-sided competitive advantages for certain sectors of industry in South Korea, particularly in sensitive areas such as the automotive industry. It was therefore right for us to have very intensive talks about a safeguard clause and also to have jointly implemented such a clause, which provides for the close monitoring of precisely these points, so that we can be certain that the possibilities provided by duty drawback in South Korea do not lead to a distortion of competition in Europe. Parliament has rightly established safeguards here.
Secondly, this agreement also has the purpose of improving the situation in South Korea for our colleagues there. South Korea still has improvements to make with regard to Chapter 13, in particular the question of the core labour standards laid down by the ILO. Two absolutely crucial core labour standards - No 87 and No 98, relating to collective bargaining - have not be implemented or ratified. Section 314 of the penal code relates to the obstruction of business. Neither of these things is in line with the nature and the provisions of this agreement. Thus, Commissioner, I am relying on you, and on the statement that you have given in support of the safeguard clause, to change this situation in South Korea so that this agreement will represent a blueprint for the future to enable globalisation to proceed in a fair manner.
Michael Theurer
on behalf of the ALDE Group. - (DE) Mr President, Commissioner, ladies and gentlemen, we are currently witnessing a historic situation, because the Free Trade Agreement with South Korea that we are debating and that we intend to adopt is the first Free Trade Agreement that has been debated under the new Lisbon system, which grants Parliament full power of codecision.
This makes an important area of policy - trade policy - more democratic. We, as Parliament, consider this to be important. The debate here in Parliament has also shown that, as regards safeguard clauses, we were able to include important concerns expressed to us by workers, companies and associations in an improved safeguard clause that is intended to protect the interests of industry and, above all, jobs in the future by creating a level playing field and fair conditions for competition and avoiding asymmetries. That is what we as the Group of the Alliance of Liberals and Democrats for Europe have concentrated on.
As shadow rapporteur for our group, I am pleased that we were able to be successful in this regard. The duty drawback mechanism, which caused us concern to start with, has now been explicitly included in the safeguard clause and there is the option for industry, and also for Parliament, to call on the Commission to carry out an investigation. A monitoring process is planned, which is intended to be established in a transparent way via an online platform, and there is greater scope for the investigation of the factors that will decide whether significant damage has been done to European industry. Mechanisms for monitoring to be carried out by the Commission, particularly for sensitive sectors in the event of increased imports, are also provided for. We can start with this and focus on the advantages associated with the South Korea agreement, such as the considerable reduction in duties - the Commission expects enterprises in Europe to be able to save EUR 1.6 billion.
I would therefore like to thank Commissioner De Gucht, who has personally worked hard to enable us to reach a compromise, including with the Council. I would also like to thank the rapporteurs and shadow rapporteurs, especially Mr Sturdy and Mr Zalba Bidegain, for their excellent work. We have achieved something really good here.
Yannick Jadot
Mr President, Commissioner, this is in fact the first major Free Trade Agreement that Europe has passed for some years, and when it comes to free trade agreements, it must be said that you do not lack ambition - South Korea, Canada, India, Mercosur. There is not a single country or area that escapes the European Commission's ambitions where free trade agreements are concerned.
In the case of this agreement, we have seen that there will only be winners, but I still wonder who the winners will be when I am told that they will be in the agricultural sector. As the elected representative of Brittany, I can tell you that in in that region which produces more than 60% of French pigmeat, the few benefits to be had by the agri-food product firms do not compensate for reductions in tourism, degradation of the environment and the health of workers, and farmers' losses.
There are, indeed, also a great number of losers, and do we, here, have a vision of what economic and social Europe will be like after all these free trade agreements have been signed? No we do not, and nor do we know, at the end of the day, whether there will be any industrial or economic sector left to benefit from these free trade agreements.
Moreover, and most importantly, Commissioner, try as you might to tell us that we are not questioning South Korea's environmental and climate policy, that is not true. We are going to be able to export enormous saloon cars, those cars of which the manufacturers who make the least amount of effort to combat climate change are rewarded by this agreement.
For the first time, the European Union is questioning the climate policy of one of its trading partners. Has the European Commission started to change, under pressure from Canada, its directive on fuel quality?
We believe that we are putting Europe's ambitions in the wrong order: the environment and the climate must come before trade. That is why our group will vote against this agreement.
Helmut Scholz
on behalf of the GUE/NGL Group. - (DE) Mr President, Commissioner, with the EU-Korea Free Trade Agreement signed in October 2010, which has been assigned the attribute by the Commission and the Council of being the most ambitious agreement of its kind ever to be negotiated between the EU and a highly industrialised state, the bilateral protection duties are to fall by around 98% in the next five years. The trade exchange between the EU and Korea is supposed to double in the medium term and that - so it is said - will speed up economic growth and the creation of jobs and prosperity. My group and I have justified doubts about this prediction.
Quite apart from the mantra of the role of free trade as a kind of saviour of the global economy that is currently in a precarious state, which is also reflected in the Free Trade Agreement itself, it is not clear from this agreement whether it will, or will able to, help us deal with the global challenges arising as a result of climate change and the necessary fundamental economic restructuring. What are the efficiency criteria and what are the free trade criteria? At the same time, Commissioner, the Free Trade Agreement that has been concluded hardly contains any references to sustainability for the future, oriented change or international economic cooperation. An agreement is being concluded in which the fundamental standards of the International Labour Organisation are still being contravened.
(The President cut off the speaker.)
Anna Rosbach
Mr President, tomorrow we will vote on the Free Trade Agreement with Korea, and this has been a long time coming. Most of us will agree that this is a win-win situation. It will be particularly beneficial for Europe's farmers and economic operators. However, we must not ignore the fact that the agreement does not only bring advantages for European companies and Korean farmers. Some sectors will benefit from the agreement, whereas others will inevitably lose out. Thus, in future, EU citizens will be able to buy cheaper technology products and cars from Korea. In return, Korea will get badly needed food from Europe as well as medicines and luxury goods. The agreement may also lead to better environmental and working conditions in Korea - that is something worth mentioning and to be pleased about. I hope that the agreement can enter into force quickly, especially as the EU wants a first-mover advantage over the United States, which is also in negotiations with Korea in respect of a similar agreement. Finally, I would like to thank all of the rapporteurs involved for their untiring and highly competent work.
Laurence J.A.J. Stassen
. - (NL) Mr President, tomorrow we will be voting on the free-trade agreement with South Korea. I must say that it looks good at first glance. The delegation of the Dutch Party for Freedom (PVV) is a strong supporter of free trade. Unfortunately, the European Union could not resist adding a safeguard clause to the trade agreement. This means that non-competitive companies will be protected when unable to hold their own when faced with competition from Korean products.
In other words, should the European consumer choose to buy Korean products, rather than European ones, for the simple reason that the former may be better quality or cheaper, then trade barriers will once again be erected. Look how the vicious European reflex towards protectionism and market intervention is rearing its head again.
Mr President, free trade that does not entail any disadvantage for European industry is, of course, an illusion. Therefore, trying to overcome this by including a safeguard clause and offering compensation to disadvantaged industries is a totally misguided solution.
This will allow industries that are competing poorly to carry on doing what they have always done, instead of adapting to the competition. Worse still, who will ultimately be footing this bill? Exactly: our citizens, unfortunately. As consumers, they will be forced to pay over the odds for their purchases and, on top of that, as taxpayers, they will even have to cough up the required compensation.
How am I supposed to explain to my constituents that they will soon have to foot the bill if, for example, Fiat loses some of its market share to Kia? These rules have no place in a free trade agreement. In practice, this is nothing other than subsidising inefficient companies on the backs of European citizens. Free trade? What a great idea, but please let us drop this safeguard clause.
Elisabeth Jeggle
(DE) Mr President, ladies and gentlemen, South Korea is indeed a very important market for products from European industry - that has been emphasised and cars have been highlighted - but also for farmers. I would emphasise that we need it to be a win-win situation. There is a new generation coming up, which is a good thing. The agreement with South Korea contains a chapter on sustainable development, which covers labour standards, environmental policy and a monitoring mechanism that is to involve civil society. That is also good.
The Free Trade Agreement is a step in the right direction, and I would like to thank everyone involved and emphasise that some excellent work has been done. Nevertheless, I would also call for clear rules for the production chain as a whole, particularly with regard to food. We should not only consider the end product, and it should not only be the agricultural industry that benefits; farmers should benefit, too.
In the interests of European consumers and our farmers, when trade flows are liberalised it absolutely must be ensured that agricultural products that are imported into the European Union meet our high standards in respect of environmental, animal and consumer protection, including at their point of origin and throughout the production chain.
I will support the position of the Committee on International Trade tomorrow, but where further liberalisation efforts are concerned I would call strongly for the food sector and farmers also to be taken into account.
Vital Moreira
(PT) Mr President, in my capacity as Chair of the Committee on International Trade, I should like, first and foremost, to express my satisfaction that we are about to successfully conclude our first major test in exercising the codecision powers that the Treaty of Lisbon has granted us in the area of trade agreements. I feel that we exercised our powers with a great sense of responsibility, and I believe that it is only right that I should thank the rapporteurs and shadow rapporteurs, and also express my gratitude for the spirit of cooperation on the part of the Commission and the Council, under the Belgian Presidency, during the negotiations on the safeguard regulation.
It should be noted that in the vote that took place in the Committee on International Trade, there was an overwhelming majority in favour of recommending approval of the trade agreement and adopting the regulation on the safeguard mechanism. This demonstrates that Parliament is capable of forming a broad-based political coalition for more openness in international trade, in line with one of the principles laid down in the trade agreement itself, in fact.
The trade agreement is, to my mind, mutually beneficial. With the mutual opening of both markets, each economy can profit from their competitive advantages. The trade agreement will not only remove tariff and non-tariff barriers, but will also encompass the opening up of the public procurement market, safeguard intellectual property rights, and protect employment rights and environmental standards.
Once the agreement has been ratified, which will be tomorrow, I hope, we must move resolutely to the next stage, which is its implementation.
Niccolò Rinaldi
(IT) Mr President, Commissioner, this agreement contains a clause that does not convince us and has never convinced us. I am talking about the refund of customs duties that Korea will receive for imports of products from China or other countries. We have already discussed this, but as a liberal democrat I consider this measure to be deeply flawed. It is a kind of export subsidy, and I would like it if, when voting on this agreement, we had an assurance that this clause will not set a precedent and will not be included in any other future agreements.
Tomorrow's vote will conclude one leg of the journey we have undertaken together, but only one leg, because the relationship between Parliament and the Commission must continue, not least with regard to the actual implementation of the safeguard clause. For the sake of European industry and European workers, we cannot make any mistakes when implementing it, or else we will face great problems in future agreements.
This is the Year of the Rabbit in the Far East, so I hope European industry will run like a rabbit, taking advantage of what this agreement can offer it.
Gerald Häfner
(DE) Mr President, ladies and gentlemen, I still remember very well how - as is happening now in Egypt and Tunisia - the people in Korea, particularly the young people, took to the streets and, in the face of police truncheons and weapon, fought for freedom, democracy and self-determination. What has happened since then is unbelievable. It is unbelievable how much has been achieved in Korea in respect of democracy, self-determination and freedom, but also with regard to the economy and now increasingly also the environment. This makes Korea a good example for many other Asian countries, and it is also a country our ever closer cooperation with which I very much welcome, along with our work to break down customs barriers and to establish fairer trade.
Nevertheless, we are rejecting this agreement today and there are a number of specific reasons for this, some of which have been mentioned by my colleague Mr Jadot. In addition to what has been said, I would also like to mention the regulation in the area of the financial sector, which we consider to be a step in the wrong direction. However, there are also fundamental reasons for this. We are concluding more and more free trade agreements, each one giving rise to another one. What we need is not a patchwork of more new individual agreements, but just and fair rules for world trade as a whole.
William
Mr President, a free trade agreement cannot only be about tariffs. It also has to be about intellectual property rights.
A business in my constituency, Avon Protection, is a world leader in the manufacture of gas masks. Avon believes that its patents have been infringed by a South Korean firm making what are quite simply copies. There is meant to be patent protection in South Korea, but will a Korean court really find in favour of a British company against a Korean business?
For free trade to work, there has to be a level playing field and, yes, a safeguard clause such as Pablo Zalba Bidegain's is useful, but the other signatory must also ensure that the agreement is indeed a two-way street, otherwise the Free Trade Agreement which should benefit both parties simply becomes completely one-sided.
Gianluca Susta
(IT) Mr President, Commissioner, ladies and gentlemen, I think it is wrong to have turned the debate on the Free Trade Agreement with Korea into a stand-off between supposed neo-protectionists and die-hard free-traders. I also think it is wrong for the Commission to have acted more like a service economy development agency than the political government of 500 million Europeans, which should strike a balance between considerations relating to growth on the one hand, and to employment and distribution of wealth on the other.
What differentiates us from the United States, which has not yet ratified this agreement - and we know why - and this also applies to relations with Korea, is the very fact that no world economic power exposes its quality - and I stress the word 'quality' - manufacturing industry to inevitable dismantling processes, sacrificing it on the altar of financial interests, setting white-collar workers from the City of London against the white-coated workers of modern European factories, which is exactly what Europe does not need in the wake of the crisis.
All this, Mr Sturdy, Commissioner, has nothing whatsoever to do with neo-protectionism. Otherwise we would have to include in this category the Spanish, German, Polish, Portuguese, French and Italian Industry Ministers who, in the 10 February edition of Le Monde, reiterated the need to make Community interest central to the work of the European institutions, stating that in this case it definitely could not be protected by the safeguard clause, however worthy it may be.
An excellent academic exercise in the field of international trade relations has taken place, but we have failed to act in Europe's interests. For that reason ...
(The President cut off the speaker)
Marielle De Sarnez
(FR) Mr President, this Free Trade Agreement is the first to have been examined since the Treaty of Lisbon came into force and that is why we MEPs believe that it really cannot come into force until we have obtained robust guarantees, guarantees that must, furthermore, act as a model for future trade agreements. It will therefore be up to us - to you and to us - to ensure the proper implementation of these mechanisms in order to protect the European economy in the event of distortions of competition.
However, that should not in any case exonerate us from strategic thinking in two areas. Firstly, in order to guarantee that competition is genuinely fair, it is essential for social, health and environmental standards to be taken into account in trade agreements. That is an essential requirement.
My second point is that Europe must finally provide itself with the instruments necessary to retain or recover production capacity, for example industrial or agricultural production capacity, and to retain - and this is absolutely vital for its future - its technological progress.
Claudio Morganti
(IT) Mr President, ladies and gentlemen, I only hope that what we are discussing right now does not end up being an additional and perhaps final death blow to our economies. We are already flooded with goods produced at low or very low cost, arriving mainly from east and south-east Asia. Many Italian companies, especially SMEs, have been brought to their knees due to unfair competition. This means that they cannot compete on the market, with tragic consequences as far as the economy and especially employment is concerned.
This agreement provides for various safeguard and protection clauses, but who can assure us that these rules will really be applied later on? There are still too many unknowns, and the possible benefit to be had by a few large producers cannot always rebound on the smallest producers alone. In my region, Tuscany, our textile industry - historically a driving force - is already in a serious condition due to Asian competition: I only hope that Europe itself does not deal the death blow to this sector, and probably many others besides, with this agreement.
We will not vote for this agreement.
Peter Šťastný
- (SK) Mr President, since the start of negotiations in May 2007, the Free Trade Agreement with South Korea has had a long and difficult journey. Despite the clear benefits to both sides, some key sectors of European industry were exposed to serious risks. I also expressed my reservations on the floor of this Parliament, and I called for fair and balanced rules of the game.
The solution was the bilateral safeguard clause. I would like to thank Robert Sturdy and Pablo Zalba Bidegain for their leadership as rapporteurs, as well as everyone else involved. Thanks to their combined efforts, the economies of the EU and South Korea will be billions of euros better off. From July 2011, the real victors in this agreement will be the consumers and citizens of both sides.
Mario Pirillo
(IT) Mr President, ladies and gentlemen, everybody has said that the free trade agreement with the Republic of Korea is an institutional and strategic innovation on the part of the Union. On the contrary, it is an unbalanced agreement that will have a negative impact on the European manufacturing industry.
The elimination of duties on Korean products in return for a rise in environmental and social standards in Korea cannot be considered fair. The Korean shipbuilding industry benefits from substantial state aid, which has enabled it to attain a 30% share of the world market. This means that European industry, be it automotive, textile, chemical or any other, must defend itself against competition that if not unfair in form, is unfair in fact.
The introduction of the safeguard clause is an appropriate measure, but it is not sufficient to patch up the many weaknesses in the agreement. I therefore call on the European Commission to be more prudent if it really wishes to defend European economic interests.
João Ferreira
(PT) Mr President, this is the pinnacle of a vision of trade that is geared solely towards competition instead of towards harmonisation and reciprocity; that is to say competition between countries, producers and workers.
Large economic groups and transnational companies are, as always, expected to see a profit worth millions of euros with this Free Trade Agreement. However, as always, the other side of the coin is missing: the sacrifice of millions of small producers and small and medium-sized enterprises, environmental sacrifices, the destruction of production capacity and jobs, and the onslaught on wages and workers' rights.
This agreement will primarily affect countries like Portugal and the regions that are most dependent on the sectors concerned: textiles, automobiles related components, and electronics. It is significant that the rapporteur himself has already predicted the inevitable redundancies throughout Europe, but we also know that trade unions and rural organisations in the Republic of Korea are against this agreement.
It is therefore clear who the winners and who the losers will be when it is eventually concluded.
Bastiaan Belder
(NL) Mr President, this trade agreement with South Korea is ambitious and comprehensive. It will help remove major trade barriers and European companies will be able to benefit from that. Increased access to the South Korean market will improve European companies' market position.
Given the fact that other major players, such as the United States, Chile and the EFTA countries, aspire to or have already entered into trade agreements with South Korea, this is a very important step. With this agreement, the European Union has shown that it is not cutting itself off from open and sustainable trade, at a time when some other nations are showing protectionist tendencies. Trade offers a way out of the economic crisis. However, free trade must not be allowed to lead to freebooting.
The steel and car industries are worried about this, and not entirely without reason. Therefore, when implementing the agreement, we must closely monitor whether all the conditions are being met and we must ensure that we are able to deploy bilateral safeguard clauses, quickly and effectively, if necessary.
Karel De Gucht
Member of the Commission. - Mr President, I will try to be extremely brief.
First, regarding the question asked by the Earl of Dartmouth, in a case involving the infringement of intellectual property rights, including patents in third countries, it is appropriate that the operators concerned have recourse to the available enforcement means, including legal proceedings if necessary, as this is a case between two private firms.
In the specific case of Avon Protection, it would be appropriate for your constituent first to seek redress for the alleged infringement of the patent via the existing legal framework in Korea. Should the available enforcement in Korea not be fair or expeditious enough, then the Commission could look into the matter.
Regarding the remarks made by Mr Jadot, the initial draft of the Korean legislation would have forced EU car makers to reduce the CO2 emissions of their cars twice as much as Korean car makers. This was mainly because the proposed emission cuts were not proportional, but highly progressive, depending on the level of emissions of the respective cars. Consequently, despite being responsible for only a small share of car sales in Korea - 3% in 2009 - and therefore of total CO2 car emissions in Korea, EU car makers would have been asked to contribute disproportionately. Their average emissions reduction between 2009 and 2015 would have been 23%, compared with just 10% for their Korean counterparts, which account for 95% of total car sales in Korea. Such burden sharing would not have been fair, and that is why we discussed it with the Korean counterpart.
Finally, I would like to thank everybody involved in this legislative process - the Committee on International Trade (INTA), the Commission rapporteurs, the Chair of the INTA Committee, the Council and my own staff at the Commission - for what, I would say, is a very good example of what the ratification procedure should be under the Treaty of Lisbon.
Robert Sturdy
rapporteur. - Mr President, I would like to thank the Commissioner also. The whole process has been excellent. Over the years I have worked on a number of codecision procedures and I have to say this has been one of the best. The debate among my shadow rapporteurs has been phenomenal. We have had extremely good input from virtually everybody.
I would like to take this opportunity to thank Mr Moreira, the Chair. Without his expertise, I do not think we would have got a satisfactory conclusion on the comitology issue - a particularly difficult sticking point towards the end of the negotiations. There have been a number of issues raised today. I would just like to say to Mr Jadot: I think your pig producers in Brittany may well benefit significantly hopefully, Yannick, because pig producers across Europe are having a bad time. I only pick on that because I am involved in agriculture.
As I said, the quality of the debate has been excellent. There always will be two views and Mr Susta is absolutely right: there is always a split between the protectionist and the free marketeer.
I would just say that we cannot stick our head in the sand and close the door and expect the world not to move on without us, because it will move on without us. We live in a global market, whether we like it or not. There are problems with that but it is a fact. I believe quite strongly that this offers huge opportunities for the European Union to move out of its problems with the financial crisis. We have set a standard for future agreements. However, they will not be as easy as this one. I am sure that we will move onto other far more difficult ones and we look forward to working with the Commission on that.
I would like to thank everyone who has taken part in the debate tonight. It has been excellent and it shows how comprehensive this House can be.
President
The debate is closed.
The vote will take place at midday tomorrow (Thursday, 17 February 2011).
Written Statements (Rule 149)
George Sabin Cutaş
I think that the entry into force of the EU-Korea Free Trade Agreement would have a positive impact on the European Union's economy. Firstly, it would help achieve customs duty savings estimated at EUR 1.6 billion a year. We would also see an increase in trade, especially in the services sector where the future growth in trade is estimated at 70%, and in the agricultural sector where, just at the moment, European Union exports to Korea have an annual value of EUR 1 billion.
At the same time, this is an ambitious and innovative agreement. It is the first in a new generation of free trade agreements which contain both a chapter on sustainable development and compliance with labour standards and a monitoring mechanism in which civil society will be involved. The fears about the difficulties which Korean competition could cause the Union's more sensitive industries, such as the car industry, are dispelled by the inclusion of the Safeguard Clause in the agreement. This will be used to impose measures for monitoring imports and exports and evaluating the impact of the agreement on the various sectors.
