20. 10. 86 Official Journal of the European Communities No C 263/23 
2.19. Point 34 (Forestry in developing countries) 
2.19.1. The Committee is aware of the importance 
of forestry problems in developing countries. It would 
like to see European experience in forestry, which in 
some cases stretches back for several centuries, used for 
the benefit of developing countries in an appropriate 
way. 
2.19.2. Attention is drawn here to those European 
countries which for many years had — and still have — close relations with non-Community countries, 
in particular through stronger promotion of forestry 
projects included in development aid programmes. 
2.19.3. It should not be the sole objective of develop­
ment aid programmes to promote timber production 
and afforestation. The waste caused by the primitive 
use of timber for firewood in private households also 
needs to be combated. 
Done at Brussels, 2 July 1986. 
The Chairman 
of the Economic and Social Committee 
Gerd MUHR 
Opinion on the mid-1986 economic situation 
(86/C 263/09) 
On 26 November 1985 the Economic and Social Committee, acting under the fourth paragraph 
of Article 20 of its Rules of Procedure, decided to draw up an opinion on the mid-1986 
economic situation in the Community. 
The Section for Economic and Financial Questions, which was responsible for preparing the 
Committee's work on the subject, adopted it opinion on 17 June 1986, in the light of the 
report by Mr Geuenich. 
At its 238th plenary session (meeting of 3 July 1986) the Economic and Social Committee 
adopted the following opinion by 91 votes to 49 with 5 abstentions (vote recorded): 
1. The mid-1986 economic situation 
1.1. The main features of the economic situation 
Since 1984 the European Community has once again 
been going through a period of steady but relatively 
modest economic growth. On the world economic front 
the exchange rate for the US dollar once again reflects 
purchasing power parities more closely and oil prices 
have fallen. On balance these factors have stimulated 
domestic demand. 
The expectations for 1986 are that inflation in the 
Community will drop considerably, growth will 
increase and unemployment will fall in some Member 
States, if only slightly. The successes achieved in stabil­
izing price levels mean that at least some Member States 
have the chance, without turning their backs on the fight against inflation, to put more emphasis on other 
economic targets. The relatively favourable economic 
climate will make it possible to put more emphasis on 
employment so that the jobless total can be cut as far 
as possible during the upturn. 
The analysis given in 1.2 to 1.4 is based on data from 
the Commission. 
1.2. Economic growth 
The 2,7% growth rate expected for the Community 
economy in 1986 will be due mainly to domestic factors. 
Because of the fall in inflation, real personal disposable 
incomes will probably rise more rapidly than in 1985. 
The growth in real fixed investment should also increase 
No C 263/24 Official Journal of the European Communities 20. 10. 86 
to 4,9%. However, growth will receive no external 
boost because of the slowdown in export trade coupled 
with the rise in imports. 
The positive trend in capital investment will probably 
persist. Inflationary tendencies will probably weaken, 
thus making a restrictive monetary policy unnecessary; 
as a result interest rates will have room to fall. Since 
the upward pressure exerted on costs by wages is also 
relatively slight in most countries at the moment, it is 
likely that the positive trend in profits will continue 
with interest rates low and sales prospects good. This 
ought to lead to an increase in investments. 
1.3. Inflation 
Taking the EEC as a whole, prices continue to rise 
more slowly even though the present economic upturn 
is in its third year. In 1986 it is expected that they will 
increase by 3,5 %. This will be an improvement on last 
year of more than two percentage points. However, 
there are still considerable differences between the 
increases in each of the Member States though the fact 
that inflation rates in EMS countries have moved closer 
together is a positive development. 
The further slowdown in price increases is due not only 
to moderate price trends on the labour and capital 
markets but also to the prices of imports; here the 
fall in the dollar and in the prices for oil and other 
commodities has left its mark. 
1.4. Employment 
Employment has been rising, albeit modestly, since 1984 
after falling for the previous ten years and the 0,8 % 
increase in 1986 will continue this trend. However, this 
increase reflects the real growth in GNP of just under 
3 % to only a very small extent. 
Although the demand for labour has increased slightly 
overall, this has been paralleled by a rise in the supply 
of labour. This means that the unemployment rate in 
the Community will probably fall only slightly dropping 
by 0,3% to 10,8% in the Nine. However, there are 
considerable variations in the rate from one Member 
State to another. The highest rate is above 20 % and in 
some countries it is still on the increase. If the pro­
portion of long-term unemployed remains high, social 
security systems could be threatened. 
1.5. Comments on the medium-term outlook 
The drastic fall in oil prices — reducing the inflation 
rate — and the slump in the value of the dollar are the 
mains reasons why the above picture of the economic situation in 1986 is more favourable than was expected 
when the Commission presented its Annual Economic 
Report for 1985/86 and drew up its cooperative growth 
strategy for more employment. It is true that the fall in 
oil prices and the dollar has both positive and negative 
effects, but the former are likely to outweigh the latter. 
However, the rosier outlook for 1986 by no means 
lessens the need for a medium-term cooperative strategy 
aimed at reducing unemployment appreciably within 
the framework of a more fruitful social dialogue. 
There is a good chance that the present upturn may 
continue for some time yet, not least because of the 
trend in commodity prices. A slowdown in price rises 
is the best guarantee that the recovery will be main­
tained, for downturns are frequently due to inflationary 
pressures and the restrictive economic measures taken 
to counter them. 
Saying that the upturn may continue does not mean, 
however, that there is a prospect of a continuous 
increase in growth rates in the Community. Rather, it 
should be assumed that even if there is no cyclical 
falling-off in growth it will have to adjust gradually in 
the course of 1987 to the medium-term in productive 
potential. It is to be feared that it will be below the 
3,5 % figure which the Commission is aiming for in its 
cooperative growth strategy. Under these circumstances 
growth by itself cannot solve the present problem of 
the mass unemployment and other measures will have 
to be taken to improve the employment situation. 
As a rule, medium-term forecasts are fraught with more 
uncertainties than short-term forecasts. At the moment 
this is particularly true of the strategic parameter 
formed by oil prices, whose future course is so difficult 
to predict that forecasts — such as those produced 
by the Commission — are based solely on working 
hypotheses whose validity has to be checked continu­
ously. However, it is highly likely that for a number of 
reasons inflation will be a major problem in only a few 
Member States. On the other hand, the problems of 
unemployment and the threat to international competi­
tiveness are likely to remain as acute as ever. The 
medium-term prospects here will depend mainly on 
what use is made of the larger room for manoeuvre in 
the field of economic policy. Thus it is particularly 
important to what extent the cooperative growth strat­
egy for more employment is put into practice and is 
successfully adapted to the changing economic circum­
stances. 
2. Implementation of the medium-term cooperative 
growth strategy for more employment 
2.1. Trade relations in the Community 
A cooperative strategy should not be based solely on 
the attitudes of employers, workers and governments 
in the individual Member States. For such a strategy to 
20. 10. 86 Official Journal of the European Communities No C 263/25 
be successful the Member States must coordinate their 
economic and financial policies and thus reduce the 
serious trade imbalances within the Community. Not 
until more balanced trade relations have been estab­
lished will countries still in a weak trading position be 
able, within the framework of a cooperative strategy, 
to fulfil the demand role attributed to them. 
In principle, economic and financial policies must be 
coordinated if the EMS is to function smoothly. How­
ever, cost and price trends in EMS countries have 
repeatedly differed in the past. The realignment of EMS 
parities on 6 April 1986 created a better basis for 
establishing more evenly matched terms of competition 
and more balanced current accounts within the Com­
munity. There is thus now a greater chance that the 
cooperative growth strategy for more employment can 
be successfully implemented — provided the price effect 
to the parity adjustments is not offset by unilateral 
action, e.g. the measures currently being discussed in 
some Member States for the agricultural sector. The 
problems facing agriculture must be tackled by joint 
structural measures. An extension of the EMS would 
help to establish the balanced trade relations being 
sought. 
2.2. Moderation of real wage increases 
Real wage moderation is supposed to contribute 
towards a continuous improvement in profitability and 
the volume of investment as long as unemployment 
remains high in the countries of the Community. 
Whether or not this is achieved depends, however, on 
other factors such as interest rates and sales expec­
tations, for a growth in profits does not lead automati­
cally to a growth in investment and employment. Invest­
ment in capital goods, in industrial and commercial 
building and in public infrastructure is particularly 
important for medium-term growth prospects. More 
investment in new capacity is especially desirable, for 
it creates new jobs. This type of investment's share of 
total investment will probably increase as the slack in 
the economy is taken up. 
Real wage moderation is also intended to make labour-
intensive production more profitable and halt the fall 
in capital productivity in the Community. However, it 
is doubtful whether wage moderation alone will result 
in the application of more labour-intensive production 
processes, thereby improving the situation on the labour 
market. Identical technology is used in countries with 
vastly different wage levels to produce the same goods. 
The parties to collective wage agreements, however, 
negotiate nominal wage increases which are generally 
dependent on the improvement in productivity and the 
rate of price increases. Real wage moderation is likely 
if the rise in nominal wages does not absorb all the room for manoeuvre created by these factors. Wage 
trends in the Community as a whole have satisfied this 
condition in recent years. 
There is a widespread fear, however, that growth in 
the Community might suffer if real wage growth were 
to be moderated, for the purchasing power of con­
sumers would be curbed. This is a very valid fear 
if real wage moderation does not lead to a rise in 
employment and investment. If the real disposable per­
sonal incomes of workers and the recipients of transfer 
payments continue to fall behind, action should be 
taken inter alia in the field of consumer policy to try 
to improve their lot. The creation of more competition, 
the introduction of a consumer-related information pol­
icy and quality controls are possible measures. 
Finally, it should be noted that the progress made by 
individual countries of the Community in adjusting 
their supply side conditions varies considerably. Their 
rates of inflation and balances on current account and 
the trend in the rates of return on capital demonstrate 
this. A cooperative strategy means that each country 
should use the different possibilities at its disposal for 
real wage growth. This, too, helps to coordinate trade 
flows and avoids the re-emergence of imbalances. 
2.3. Demand support 
If real wage increases are to be moderated throughout 
the Community as part of a cooperative strategy, pri­
vate consumption can hardly play a special role in 
supporting demand. However, lower interest rates and 
slower price rises (caused by cheaper imports) could 
boost real demand. It is also likely that private invest­
ment will stimulate demand. The sought-after improve­
ment in the ratio between returns on capital and interest 
rates would have this effect. Above all, however, the 
growth in capacity utilization is likely to stimulate 
investment demand. 
An increase in public investment is also necessary on 
employment and environmental grounds. Public sector 
borrowing requirements will continue to curb public 
investment in some Member States, but higher growth 
and the tax revenue resulting therefrom, together with 
the drop in inflation, will give the public sector more 
scope for increasing expenditure in real terms. These 
opportunities should be exploited, since the public sec­
tor expenditure is mainly channelled into building pro­
jects and the building sector has considerable idle 
capacity. In addition, production is considerably more 
labour-intensive in these sectors than in manufacturing. 
Money should be invested not only on environmental 
protection, but also on the building of infrastructure 
and the restructuring and modernization of the 
economy. 
So that regional discrepancies can be reduced, the Com­
munity's regional policy should grant different levels 
of aid to private and public sector investments. The 
No C 263/26 Official Journal of the European Communities 20. 10. 86 
integrated Mediterranean programme is particularly 
important in this connection. 
Improving international competitiveness by promoting 
investment in general should ensure that the Com­
munity keeps its share of the growing market in world 
trade. 
2.4. Neutral monetary policy 
The rates of inflation in almost all countries of the 
Community are very low to average. A policy of moder­
ation with regard to real wage growth and the drop in 
the price of oil and the value of the dollar will further 
reduce the rates at which prices are increasing. It would 
be wrong under these circumstances to adopt an anti-
inflationary monetary policy in order to reinforce the 
shift to price stability. Such a policy would not fit in 
well with the need to strengthen demand either. 
If the upturn in the Community is to last, however, it 
will be necessary to prevent any rekindling of inflation. 
Hence a neutral monetary policy is required. In other 
words, in each country the money supply should be just 
enough to sustain existing growth and price trends. In 
this way monetary policy will support the trend towards 
lower cost and price increases and prevent any fresh 
acceleration of prices. However, such a monetary policy 
would not attempt to stabilize prices still further by 
reducing the money supply. A neutral monetary policy 
also safeguards the level of interest rates and, if price 
increases decline, will even provide room for a drop in 
rates. 
2.5. Reduction of working time and employment 
policy 
Despite the only moderate rate of growth in the Com­
munity, the idle industrial capacity rate has decreased 
in many countries in recent years. Growth is likely to 
run into a capacity constraint after 1986. Even a sharp 
increase in investment will increase capacity only gradu­
ally. The odds are therefore against an average growth 
of 3,5% throughout the 1980s despite the cooperative 
growth strategy. 
If the employment situation is to be improved, the 
cooperative growth strategy should therefore include 
the reorganization and reduction of working time, 
which need not hinder this strategy. The 3,5 % target 
for growth set in the cooperative growth strategy is, on 
the contrary, what we should aim for and every possible 
attempt should be made to achieve this target. How­
ever, the employment situation will not be radically 
improved simply by increasing growth. 
The reduction of working time can take on a variety 
of forms. Basically, if it is linked to a reduction in plant 
operating times, capital productivity may fall and the 
scope for growth and the distribution of wealth will be 
reduced. Given the limits to growth mentioned above, 
a cutback in the utilization of capital stock would cause special problems. So that plant operating times can be 
maintained or improved, a more flexible approach to 
the use of manpower should not be ruled out. The two 
sides of industry should seek compromises which take 
into account (a) the employers' concern for keeping 
capital costs as low as possible and (b) the workers' 
concern for having their living and working conditions 
protected by law or collective agreements. 
The possibility that the labour force may gradually 
shrink in the 1990s is no reason for keeping working 
time at its present level. Failure to cut working hours 
will postpone the solution to the employment problem 
for too long. 
As long as unemployment remains at its present 
extremely high level, the cooperative growth strategy 
and the policy of reducing working time will have to 
be backed up by special labour market measures, e.g. 
the training/retraining of the jobless and those in work 
and the encouragement of mobility, all in the context 
of a thoroughgoing social dialogue. 
3. Further considerations 
3.1. Internal Community market 
The preconditions for, and effectiveness of, the cooper­
ative growth strategy can be improved by developing 
the internal market, since a larger market and keener 
competition are likely to cut costs and stimulate growth. 
The benefits will be felt by the Community as a whole, 
though it is to be assumed that these benefits — which 
are the result of structural change — will differ from 
one country to another. 
These structural changes will have regional and sectoral 
consequences and affect firms, workers and consumers. 
From an economic angle the form taken by the process 
of structural change and the speed at which the process 
is carried out are of key significance. The economy's 
adaptability is basically determined by the adaptability 
of firms from the point of view of technology and 
personnel (management and workforce), and by the 
social acceptability of structural changes. Adaptability 
also varies a good deal from one sector of the economy 
to another, e.g. the situations in growth and ailing 
sectors differ considerably. 
It will be necessary to assess these structural effects and 
influence the sectoral, regional and social processes by 
a socially-tempered industrial policy. Otherwise, the 
various socio-economic groupings may not accept 
the measures which will have to be adopted by the 
20. 10. 86 Official Journal of the European Communities No C 263/27 
governments if the internal market is to be completed. 
On the other hand, support for the internal market 
can be secured by taking steps to compensate for the 
drawbacks which the process of structural change (a 
process determined mainly by market forces) will have 
for individual groups. The higher aggregate economic 
output resulting from the completion of the internal 
market will make it easier to finance these measures. 
The Commission is called on to give the adjustment 
processes a socially-acceptable boost with the aid of its 
structural funds. 
Community structural reports should be produced as 
an information base for these measures. These reports 
would also help determine the medium-term outlook. 
It should not be forgotten that Spain's and Portugal's 
membership of the Community will pose new structural 
problems. For this reason, too, it will be necessary to 
have better information bases for a forward-looking 
structural policy. The aim here should be not to gloss 
over the effects of market adjustments but rather to 
increase the adaptability of the markets and lessen the 
risks of market adjustments. 
3.2. Energy policy 
Despite the short- and medium-term advantages of the 
fall in the price of oil and consequently of other energy 
sources, a problem is posed by the fact that lower 
Done at Brussels, 3 July 1986. energy prices could stimulate demand and reduce efforts 
to (a) find oil substitutes, (b) develop new sources of 
energy and (c) contain energy consumption in general 
in the long term. As a result, oil prices could rise 
again and influence the trend in prices. Therefore, some 
thought should be given to how it might be possible to 
avoid erratic movements in the price of oil or at least 
restrict their effect on costs, prices and employment. 
The common energy policy has been helping to solve 
longer-term structural problems in the Community for 
years. The Commission should therefore examine in 
detail the effects which the trend in oil prices has on 
the Community's and Member States' energy policies. 
From the economic policy angle it is not just a question 
of the fall in the export of capital goods from the 
Community to oil-producing countries as a result of 
the latter's deteriorating balance of payments; just as 
important are the effects on the Community's efforts 
to keep indigenous energy sources competitive. The 
development of new technologies for tapping energy 
sources is particularly important here, not only in the 
context of international competition but also as regards 
the consequences for the general development of new 
technologies, which plays a leading role in the Com­
munity's research and industrial policies. The Com­
mission is asked, after examining the effects of the trend 
in oil prices on energy policy, to submit proposals which 
meet the Community's energy policy objectives. 
The Chairman 
of the Economic and Social Committee 
Gerd MUHR 
No C 263/28 Official Journal of the European Communities 20. 10. 86 
APPENDICES 
to the opinion of the Economic and Social Committee 
APPENDIX I 
I. VOTING 
A roll-call vote was taken on the opinion as a whole. The following members, present or represented, voted 
for the opinion: 
Amato, Bento Goncalves, Beretta, Berger, Bernasconi, Berns, Bleser, Boddy, Burnel, de Caffarelli, Cal, Calvet 
Chambon, Carroll, Cavazzuti, Ceballo Herrero, Cuenca Valdivia, Curlis, Dassis, Dassoulas,, De Bruyn, De 
Grave, d'Elia, Delia Croce, De Tavernier, Dos Santos, Drago, Elkan, Emo Capodilista, Engelen-Kefer, 
Estevao, Etty, Flum, Geuenich, Glesener, Goris, van Greunsven, Hammond, Hilkens, Houthuys, Jarvis, 
Jaschick, Jenkins, Kamizolas, Kirschen, Kitsios, Laca Martin, Landaburu de Silva, Lojewski, Maddocks, 
Margalef Masia, Margot, Masucci, Meraviglia, Mols Serensen, Mourgues, Muniz Guardado, Murphy, 
Nielsen B., Nielsen M., Nielsen P., Nierhaus, Ognibene, Plank, Proenca, Pronk, Quevedo Rojo, Raftopoulos, 
Ramaeker, Rangoni-Machiavelli, van Rens, Riera-Marsa, Roseingrave, Rouzier, Sai'u, Santillan Cabeza, 
Schmitz, Schoepges, Schwarz, Silva Augusto, Smith A.R., Smith L.J., Spijkers, Strobel, Vallejo Calderon, 
Vasseur, Vassilaras, Vercellino, Weber, Williams, Zoli, Zufiaur Narvaiza. 
The following members, present or represented, voted against the opinion: 
Antonsen, Aparicio Bravo, Arena, Bagliano, Binnenbruck, Bredima, Breitenstein, Broicher, Cammann, Cash-
man, Ceyrac, Corell Ayora, Costa, De Bievre, Dore, Dracos, Fernandes, Fortuyn, Fuller, Hannon, Hemmer, 
Kelly, Kenna, Law, Lencastre, Lopez de la Puerta, Low, Machado von Tschusi, Martin Almendro, Masprone, 
Neto da Silva, Noordwal, de Normann, Pearson, Pelletier, Poeton, Querleux, Schnieders, Stahlmann, Staratz-
ke, Storm-Hansen, Swift, Tamlin, Termes Carrero, van der Mensbrugghe, van Melckenbeke, Wagner, de 
Wit, Zinkin. 
The following members, present or represented, abstained: 
Conde, Delourme, Marvier, Muller, Vanden Broucke. 
APPENDIX II 
Defeated amendment 
The following amendment was defeated in the course of the discussions. 
Text of 2.5 to be replaced by the following: 
'2.5. Employment policy 
The favourable impact which the moderate improvement in economic activity has had on employment has 
not been sufficient so far to make any significant inroads into unemployment in the Community. This is why 
the cooperative growth strategy for more employment must be actively pursued. 
This strategy embraces real wage moderation, the training and retraining of manpower, mobility incentives 
and the reorganization and reduction of working time. 
As an integral part of the 'policy-mix' on growth and employment, shorter working time can lead to a fairer 
distribution of work. At the same time more leisure-time will create new needs and these needs will also 
have to be satisfied — in other words the policy on shorter working time can also be regarded as part of the 
policy on growth. 
The scale of the possible impact on employment, however, will vary greatly according to the nature and size 
of the reduction in working time and according to the special circumstances prevailing in each country, sector 
and firm. It is therefore up to the two sides of industry to show imagination in determining the most suitable 
kind of reduction of working time in each individual case. Measures have already been taken in several 
Member States. 
The Committee would also emphasize that measures to reduce working time can only have a positive impact 
on employment if they do not lead to an increase in unit costs and hence an impairment of international 
competitiveness. The value of a reduction in working time therefore depends also on the conditions under 
which it is introduced.' 
Voting 
For: 53, Against: 91, Abstentions: 6. 
20. 10. 86 Official Journal of the European Communities No C 263/29 
APPENDIX III 
The following members, present or represented, voted for the amendment: 
Antonsen, Arena, Bagliano, Bento Goncalves, Berns, Binnenbruck, Bredima, Breitenstein, Broicher, Gammann, 
Costa, De Bievre, De Tavernier, Dore, Dracos, Fernandes, Fortuyn, Fuller, Hannon, Hemmer, Kelly, Kenna, 
Law, Lencastre, Lopez de la Puerta, Low, Machado von Tschusi, Martin Almendro, Marvier, Masprone, 
Muller, Neto da Silva, Noordwal, de Normann, Pearson, Pelletier, Poeton, Querleux, Regaldo, Rolao 
Goncalves, Sa'iu, Schnieders, Stahlmann, Staratzke, Storm-Hansen, Swift, Tamlin, van der Mensbrugghe, van 
Melckenbeke, Vasseur, Wagner, de Wit, Zinkin. 
The following members, present or represented, abstained: 
de Caffarelli, Cashman, De Bruyn, Estevao, Emo Capodilista, Margot. 
The following members, present or represented, voted against the amendment: 
Amato, Aparicio Bravo, Bazianas, Beretta, Berger, Bernasconi, Bleser, Boddy, Bonety, Burnel, Cal, Calvet 
Chambon, Carroll, Cavazzuti, Ceballo Herrero, Ceyrac, Chalioris, Conde, Corell, Ayora, Curlis, Dassis, 
Dassoulas, De Grave, d'Elia, Delia Croce, Delourme, Dos Santos, Drago, Dunet, Elkan, Engelen-Kefer, Etty, 
Flum, Geuenich, Glesener, Gomez Martinez, Goris, van Greunsven, Hammond, Hilkens, Houthuys, Jarvis, 
Jaschick, Jenkins, Kamizolas, Kirschen, Kitsios, Laca Martin, Landaburu de Silva, Lojewski, Maddocks, 
Margalef Masia, Masucci, Meraviglia, Mols Serensen, Mourgues, Muniz Guardado, Murphy, Nielsen B., 
Nielsen M., Nielsen P., Nierhaus, Ognibene, Proenca, Pronk, Quevedo Rojo, Raftopoulos, Ramaekers, van 
Rens, Roseingrave, Rouzier, Santillan Cabeza, Schmitz, Schoepges, Schwarz, Silva Augusto, Smith A.R., 
Smith L.J., Soulat, Spijkers, Termez Carrero, Tixier, Vallejo Calderon, Vanden Broucke, Vassilaras, Velasco 
Mancebo, Vercellino, Weber, Williams, Zoli, Zufiaur Narvaiza. 
Opinion on relations between the European Community and the Member States of the 
Association of South-East Asian Nations (ASEAN) 
(86/C 263/10) 
The Economic and Social Committee decided on 4 July 1985, acting in accordance with the 
fourth paragraph of Article 20 of the Rules of Procedure, to draw up an opinion on relations 
between the European Community and the Member States of the Association of South-East 
Asian Nations (ASEAN). 
The Section for External Relations, which was instructed to prepare the Committee's work 
on this subject, adopted its opinion on 10 June 1986. The rapporteur was Mr Nierhaus. 
The Committee adopted the following opinion unanimously with one abstention at its 238th 
plenary session (meeting of 3 July 1986): 
General comments 
1. This opinion is intended to provide suggestions 
for possibilities and requirements for more intensive 
cooperation between ASEAN and the European Com­
munity. It therefore concentrates on those fields where, 
in the Committee's view, there are possibilities for 
action to develop cooperation further. These are sum­
marized in a recommendation, based on the 
accompanying report drawn up by the Section for 
External Relations. The Committee drew its infor­
mation from a great variety of sources. For example, 
the Section for External Relations Study Group respon­
sible for the preparatory work invited representatives of the ASEAN States' Embassies to the European Com­
munities to a meeting in order to hear their views on 
the subject of ASEAN/European Communities cooper­
ation. 
2. The Committee considers the formation in 1967 
of ASEAN, comprising Indonesia, Malaysia, the Philip­
pines, Singapore, Thailand and (since 1984) Brunei, to 
have been very beneficial. The Committee feels that of 
all the regional groupings of Third World States, or so-
called 'newly industrializing countries' (NICs), ASEAN 
has made the most promising start towards achieving 
a higher level of cooperation in the future. The relative 
political stability of its Member States, promoted by 
the Association, has encouraged economic growth in