RESOLUTION OF THE ECSC CONSULTATIVE COMMITTEEon the restructuring of the iron and steel industry and organization of the steel market as from 1 January 1987(86/C 326/03)

(adopted at the 259th session of 17 October 1986 by 56 votes for, 8 votes against and 4 abstentions) THE CONSULTATIVE COMMITTEE Having regard to - the Council Decisions of 27 November 1985 on liberalization of the steel market, -the pursuant measures so far taken by the Commission and the consequent alarming disorder in the development of the market, production and hence also employment in the European Steel industry, -the proposals made by the Commission to the Council for organization of the steel market in 1987 (doc. COM(86) 503 final) , -the Community action programme to assist the worst-affected steelmaking areas (doc. COM(86) 422 final) , -the General Objectives Steel 1990 (doc. COM(85) 450 final) , -the report on the General Objectives Steel 1990 (doc. COM(86) 515 final) , -the aids code which ceased to operate as from 31 December 1985, -the prohibition of subsidies from public funds for the coal and steel industries under the terms of Article 4 of the ECSC Treaty, -the explanations provided by the representatives of the Commission of the European Communities, (a) points out that excess capacity for hot-rolled steel products, at not less than 20 million tonnes per year, is still too high; (b) recognizes that the process of restructuring the Community steel industry has thus not yet been completed; (c) notes at the same time a disquieting tendency of the balance of external trade in steel products; (d) considers that under present circumstances it is premature to further continue the liberalization process; (e) fears that this will provoke a renewed acute crisis in the Community steel industry at a time when the consequences of the last crises have not yet been fully overcome, with devastating economic, financial and social consequences, even in the few steel undertakings in the Community which have reached the threshold of profitability; - therefore urges the Commission, the Governments of the Member States and the Council of Ministers of the European Community 1. to halt immediately the liberalization process begun on 1 January 1986; 2. to devise an emergency plan to prevent a further acute crisis in the Community steel industry; 3. to curb the runaway growth in steel imports; 4. to prepare and introduce the second phase of the restructuring of the Community steel industry in such a way that its structural problems (principally the reduction of the excess capacities described in the General Objectives Steel 1990 as well as restoration of the industry's competitiveness) can be overcome by means of negotiated solutions and not through ruinous competition; 5. to proceed with the liberalization of the Community steel market in parallel with the continuation of the restructuring of this important industrial sector; 6. to make a positive decision with respect to the transfer, from the general Community budget to the ECSC budget, of the ECU 122,5 million required to finance the social measures up to the end of 1986. In addition, the Council of Ministers should decide, as a matter of principle, to finance the social measures proposed by the Commission for the coming years as well, since the own resources of the ECSC are inadequate.