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DOCUMENTS "COM"
COM (80)226
Vol.1980/0073

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COMMISSION
OFTHE
EUROPEAN COMMUNITIES
GenerolSecretariatCOM(80)226final
Brussels,5nay1980
FOROFFICIAL USEONLY
REQUESTFORTHEGRANTOFAGLOBALLOAN,PURSUANT TO
ARTICLE562a)OFTHEECSCTREATY,ONBEHALFOFTHE
"WESTFALENBANK AG"FORFINANCING INVESTMENTS ININDUSTRIAL
ANDSERVICEACTIVITIES INNORTHRHINE-WESTPHALIA
(FEDERALREPUBLIC OFGERMANY)
(Communication fromtheCommission totheCouncil)
COM(80)226 final

COMMUNICATION TOTHECOUNCIL
Subject;Requestforthegrantofagloballoan,pursuantto
Article562a)oftheECSCTreaty,onbehalfofthe
Westfalenbank AGforfinancinginvestments inindustrial
andserviceactivities inNorthRhine-Westphalia
(FederalRepublicofGermany).
I.BASICINFORMATION
Applicant
Beneficiaries
Projects
Location
Amountofinvestment
Globalloanrequested
InterestrebateWestfalenbank AG,Bochum
Variousconcerns
Creatingandextendingsmalland
mediumsizeconcerns
BusinessareaoftheWestfalenbank AG
inNorthRhine-Westphalia ,in
particular theRuhrregion
AtleastDM40million(+16MEUA)
DM20million(+8MEUA)
34pointsannuallyforthefirst
fiveyearson8MEUA
Jobstobecreated 400jobsminimum
II.CONFORMITY WITHARTICLE56OFTHEECSCTREATY
Thegloballoanisintendedtoassistproductive investments inareas
ofNorthRhine-Westphalia affectedbydeclineinthecoalandsteel
industry.ThisaffectstheRuhrregioninthefirstplace.Inthe
lastfiveyears15,000jobsinthesteelindustryhavebeenlostin
thatr-egionalone.Tothismustbeaddedoverthesameperiodaloss
of18,000,jobs inhardcoalmining.Unemployment intheRuhrsince
1975hasincreasingly overtaken unemployment inallotherdistricts
ofNorthRhine-Westphalia .
TheRuhrregionisoneoftheoldestandlargestareasofovercrowding
inEurope;today,likemanyothertraditionally industrial regions,
ithasstructural andlabourmarketproblems.Theseproblemsinthe
Ruhrregionareconsequential onthemonostructural characterofthe
coalandsteelindustries andtheireffectoneconomicstructure .
./.
oddress:RuedeloLoi200,B–1040Brussels-Téléphoné350040-358040-Télégraphieaddress:«COMEURBrussels»-
Telex:«COMEURBRU 21877.

-2-
EventhoughcoalandsteelhaveLostweightintheLastfewyears,
theirimportancefortheRuhrregionisstillexceptionally high.
Accordingtothecalculations oftheRhine-Westphalia Institutefor
EconomicResearch (Economicstructural programmefortheRuhrregion
-1.Continuation),thecoalandsteelsectors(end1978)had320,000
jobsavailablei.e.48%ofallpersonsemployedinindustrywhereas
17%ofemployedinallbranchesareinmining,ironandsteel,welding,
drawing,coldrollingorproducingductilesteels.Thetotalvolume
ofpersonsemployedincoalandsteelshouldbesome674,000i.e.37%
ofallpersonsemployedintheRuhrregionareeitherdirectlyemployed
incoalandsteelsectorsorinserviceanddeliveryactivities depend­
entontheirfuture.
Sincetheendofthefiftiesbelowaveragegrowthofthesteelindustry
andthedeclineincoalmininghasleddirectlyorindirectlytothe
loss-ofhalfamillionjobs.Theformernoticeable predominance of■
coalmininggasclearlydeclinedandthesteel.industry,measuredby
thenumberofemployed,hasbecomethemainelementinthecoaland
steelsector.
Changingtrendsinthetraditional coalandsteelassociation have
occurredinthefieldofenergyandsteelprocessing .Inthiscontext
thechemicalindustries (principally theproductionofrawmaterials )
arebeginningtoinfluenceregionaldevelopment .Certainlyitis
impossibletocompetewithlossesofjobsincoalandsteel.
TheRhine-Westphalia InstituteforEconomicResearchconfirmsthat
ithasnotyetbeenpossibletointroduce newbasicindustriesto
replacecoalandsteeltoanygreatextentandtherebytoconvert
economicstructuredecisively .Anevidentstructural development
hastakenplaceintherawmaterials andcapitalgoodsindustries
butdelayshavebeencausedbyequivalent worseningintheconsumer
goodsindustryandtheinsignificant servicessector.Itcanhowever
beassumedthattheRuhreconomybycomparison withstrongprevious
dependence oncoalandsteelwillinfuturedevelopfurtherdueto
theoutputofthesteelprocessingindustry.Therebytheonesided
natureofindustrywillbebroadlycorrectedbutthemediumterm
sensitivity ofthecapitalgoodsindustrieswillbecomegreater
becauseoftheveryhighdependenceoftheRuhrregiononthegeneral
economicclimate.
TheLandGovernmentofNorthRhine-Westphalia produced aspecial
programmefortheyears1980to1985forecasting acomprehensive
listofmeasurestocombatthecontinuing aboveaverageunemploy­
mentintheRuhrregion,tomakeprogresswithstructural change,
togiveincentivestoinvestment andtoimproveenvironmental
protection .Thegloballoanproposedherecouldmakeacontribution ,
ifsmall,toachievingthesetargets.
./.

/
-3-
III.THEBANK
Bochum.istheseatoftheWestfalenbank AG.Thebankhasalsoa
branchinDusseldorf .
SharecapitalisDM75million(alsoDM148millionreserves);
99%ofthesharecapitalisownedbytheBayerische Hypotheken und
Wechselbank AG,Munich.(Mortgageandexchangebank.)
Asubstantial partofthebank'sactivityisthesupplyofcredits
tomediumandmajorbusinessundertakings .In1978creditsaccounted
forDMthousand2,138,038,ofwhichfouryearcreditsaccountedfor
DMthousand1,457,684.Loansanddebentures wereDMthousand464,807.
IV.•THEPROJECT
TheCommission willmakeavailabletotheWestfalenbank DM20million
(about8millionEUA)forthreeyears.Thesemeanswillbesupplied
totheWestfalenbank inoneormoretranches accordingtothe
measuregoverningthegrantofsubloanstoprojectseligibleforaid.
TheWestfalenbank AGwillsubmiteachprojecttotheCommissionfor
approval.Thedecisiononindividual Loanswillbetakeninconform­
itywiththeaimsandcriteriapublished bytheCommission (O.J.No.
C178/2of27July1977andO.j.No.C82/8of29March1979)taking
accountinparticular ofthenumberofjobscreatedandreservedinpriorityfor
formerECSCworkersinrelationtothesizeoftheloancontemplated
andtheamounttobeinvestedinfixedcapital.
Therateofinterest,applicable toaninstalmentofthegloballoan
paidtotheWestfalenbank AG,willapplytoeachsubloanfinanced
fromthisinstalmentofthegloballoan.Arebatemaybegranted
additionally .Thegloballoanwilltakeaccountofthespecialcredit
requirements ofsmallandmediumsizeconcerns,whichfrequently have
fewerpossibilities ofaccesstocapitalmarketsthanotherconcerns.
TheCommission believesthatgloballoansareparticularly adaptedto
thecreationofjobssinceinvestments perjobcreatedareoftenless
forsmallandmediumsizeconcernsthanforlargerconcerns.
TheWestfalenbank AGwillreporteverysixmonthstotheCommission on
theusetowhichthegloballoanhasbeenput;itwillalsoreport
annuallyonthere-employment offormerECSCworkersinindustrial
concernsfinancedthankstothegloballoan.
ψ
V.IMPACTOFTHELOANONTHERE-EMPLOYMENT OFREDUNDANT COALAND
STEELWORKERS
Itisforecastthatindividual aidedprojectswillcreateatleast
400newjobsforformercoalandsteelworkers.Itisimportantthat
investments beassistedoutsidethetraditional coalandsteel
association inordertobroadentheonesidedeconomicstructurein
theRuhrregion.
./.

VI. CONCLUSIONS
TheCommission considers that the request complies with theconditions
ofArticle 562a)oftheECSC Treaty .Inconsequence ,ithasauthorised
thegrant totheWestfalenbank AGofaglobal loan ofDM20million
(about 8.024 MEUA )orofanequivalent amount .The rate ofinterest
will besubject toarebate ofthree percentage points annually for
the first five years following payment orpayments ofthe loan (namely :
240,000 EUA).
TheCommission asks theCouncil togive itsassent totheforegoing
decision .