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DOCUMENTS "COM"
COM(80)626
Vol.1980/0199

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(80 »626 final
Brussels /28th October 1980
»
COMMISSION REPORT TOTHE COUNCIL
ONTHE OPERATION DURING THE YEAR OFAPPLICATION 1979 OFTHE SYSTEM
FOR STABILIZING EXPORT EARNINGS SET UPBYTHE DECISION
ONTHE ASSOCIATION OFTHE OCT WITH THE EEC
/' '■ .1.V
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,-J
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V-"' .
V.\;■''.p.,
"■57
C0MC80 )626 final

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1.Article 29oftheInternal Agreement onthefinancing andadministration
ofCommunity aidrequires theCommission toprepare anannual comprehen­
sive report ontheoperation ofthesystem forstabilizing export earnings
asregards theACP States and theoverseas countries andterritories .
2.TheCommission presents simultaneously totheCouncil thefifth comprehen­
sive report ontheoperation during 1979 ofthesystem setupbytheLom6 '
Convention forstabilizing export earnings .
3.This comprehensive report isconcerned with theapplication fortheyear
1979 ofthesystem forstabilizing export earnings setupbytheCouncil
Decision of29June 1976 onthe association ofthe overseas countries and
territories with theEuropean Economic Community .Itdeals with :
Ci)general developments since thefourth report wasdrawn up;
(ii)theresults ofthefifth year ofapplication ofthesystem ;
(iii)theeffect ofthetransfers ontheeconomic development ofthe ,re­
cipient countries ,andonthedevelopment ofexternal trade .
I.GENERAL DEVELOPMENTS
4.Three former OCT have acceded tothe Lom6 Convention :StLucia on28June
1979 ,Kiribati on30October 1979 and StVincent on27December 1979 .
5.However ,pursuant toArticle 1(5)ofthe Internal Agreement onthefinancing
andadministration ofCommunity aid,those ACP States which areformer OCT,
that have become independent and have acceded tothe Lom6 Convention under
Article 89continue inthe future tobecovered bythe fund forstabilizing
the export earnings oftheOCT,provided for inArticle 1(3)(c)ofthat
Agreement .
s ■ . -
6.Themachinery forcooperation with the countries and territories asdescribed .
in ,the reports for theyears 1975 to1978 continued tofunction satisfactorily .
7.Inaccordance with Article 22oftheDecision ,information ontheutilization -
ofthe resources transferred during 1979 will bepresented totheCouncil at
alater date .
8.Reference should also bemade totheexchange ofviews between theMember
States and theCommission which ,asin1978 ,enabled answers tobegiven
torequests forinformation ,andproved very useful andfruitful .
II.FIFTH YEAR OFAPPLICATION OFTHE SYSTEM
9.The Commission has received two requests fortransfers forthe year ofappli­
cation 1979 from theOCTappropriation .These requests were received from
twoOCT,which have become ACPStates through accession totheLom6 Conven­
tion under Article 89,namely the Islamic Republic oftheComoros ,and Dominica
10.InSeptember 1979 ,Dominica received anadvance payment of2,480,000 EUAon
the1979 transfer ,duetothetotal destruction ofthecountry 'spotential
banana exports ,following hurricane David inAugust 1979 .

-2-
11.The twoapplications for1979 were eligible since thedependence and
fluctuation thresholds provided forbytheDecision ontheassociation
ofthe OCT with the EEC had been exceeded under the conditions set .
12.Examination ofthe trend oftotal exports from the countries and terri­
tories concerned didnotshow anysignificant change ,andconsequently
there wasnoneed forconsultations within themeaning ofArticle 21(4)
ofthe Decision . •
13.Theoverall results for the latest year ofapplication oftheDecision
are asfollows :
OCT Product Amount oftransfer inEUA
ACP -
Comoros
Domini caProduct
Cloves
BananasAmount oftransfer inEUA
431,155
2,892,944
3,324,099 .
14.Both countries concerned received non-repayable transfers .Thus ,for
1979 ,100 %ofthetransfers were therefore made intheform ofgrants .
15.Thetransfers cover twoproducts :bananas <87%)and cloves (13%).
16.These transfers compensated forfalls inearnings resulting from local
circumstances .
17.With regard tothe reconstitution ofthe resources ,theCommission ,in
accordance with Article 23(3)oftheDecision ,andthepractical ar­
rangements embodied intheexchange ofletters which takes place on
theoccasion ofeach transfer ,carried outthenecessary investigations •
inconnection with thetransfers made fortheyears 1975 to ,1978 in
favour ofOCT which had undertaken tocontribute tothe reconstitution
ofthesystem 'sresources .
Investigations showed that inthecase ofKiribati ,theconditions laid
down inthe Decision had been met .The Commission has notified the res­
ponsible authorities ofKiribati ofitsfindings . ■' t .
18.In1977 ,theauthorities ofKiribati andtheAnglo-French Condominium
ofthe New Hebrides were informed that the conditions for reconstitution
hadbeen fulfilled .Kiribati wasexpected toreconstitute 174,972 EUA
with respect tothe1976 transfer .Pending adecision ontheir appli­
cation for achange ofstatus under Article 23§6oftheDecision ,
the Kiribati authorities have not made the contribution available to
the fund .
19.TheNewHebrides wasrequired toreconstitute 1,103,499 EUAwith respect
tothe 1975 transfer and327,364 EUA with respect tothe1976 transfer .
TheBritish authorities have reconstituted 50%ofthe total 1,430,863
EUA requested .The French authorities have informed the Commission Ser­
vices ,that they will make available their contribution inthenear
future .

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20.Inaccordance with Article 20 (3)oftheDecision /theunexpended balance
atDecember 1980 fortheyear ofapplication 1979 -will beasfollows :
1979 allocation
1978 carry over
repayment received
expected repayments
1979 transfers
10,089,021 EUA
III .EFFECT OFTHE TRANSFERS ONTHE ECONOMIC DEVELOPMENT OFTHE RECIPIENT
COUNTRIES AND ONTHE DEVELOPMENT OFEXTERNAL TRADE
21.Article 29ofthe Internal Agreement onthefinancing andadministration
ofCommunity aidstipulates that theCommission 'sannual report shall
.indicate inparticular theeffect ofthesystem ontheeconomic develop­
ment ofthe recipient countries and onthedevelopment ofexternal trade .
22.Thesame article stipulates also that theCommission shall forward tothe
■Member States the -reports ,which itreceives .The1979 transfers infa­
vour oftheOCT were carried out inJuly of1980 .Atthepresent time ,
none oftherecipient countries hasasyetprovided theCommission with
information relating totheeconomic effect ofthetransfers received .
"Details will bepassed totheCouncil ,when they become available .
23.The Commission will atalater date forward tothe Member States the
specialized forms ,which describe theuseofresources transferred to
Belize ,Comoros ,Djibouti andTuvalu fortheyears ofapplication 1977
and1978 .These reports maybethesubject offurther exploitation .4,000,000 EUA
+9,413,120 EUA
+ - -
+
-3,324,099 EUA

ANNEX1
BreakdownofStabextransfersfor1975,1976,1977,1978and1979
accordingtonationalcurrencyrequestedbytheOCT
Nationalcurrency.Amounttransferred inEUA Proportion oftotalinX
FrenchFranc1975 ί1976
(1);(2)1977
(3)1978
(4)1979
(5)Total
(1975-1979 )1975
(1)1976
(2)1977
(3)1978
(4)1979
(5)Total
(1975-1979 )
i
1,658,697 ¡879,2001,260,556 219,552 431,1554,449,160 41.926.686.281.813.0 36.1
GermanMarki
139,650 J- - -139,650 3.5- -- - 1.1
PoundSterling2,161,609 I2,421,155 202,714 48,7712,892,944 7,727,193 54.673.413.818.287.062.8
ί 'BelgianFranc·¡-!
s1 s- -■ .- - .- - - -
ï i
Dutchguilder !-,-
! ί- - - - - - -- - -
Total 13,959,95613,300,355Ί ¡1,463,270 268,3233,324,099 12,316,003 100.0100.0100.0100.0100.0'100.0

ANNEX2
AGGREGATE TRANSFERS FOR1975,1976,1977,1978AND1979
1.BreakdownbyOCT(inEUA)
O.C.T. Product Amount1975Amount1976Amount1977Amount1978Amount1979Totals
Belize Sawnwood 139,650 202,714- m 342,364
Çomoros(1X2) Copra
Cloves
Ylang-ylang298,304 286,508 367,784
552,547
170,59639,253
180,299 431,155.991,849
1,164,001
170,596
1,090,927 219,552 .2,326,446
Djibouti(1)(2) Rawhides,skins
andleather256,894 265,328 169,629- • 691,851
Dominica (1X2) Bananas
- 2,892,944 2,892,944
Kiribati(2) Copra 1,200,321 1,083,098-.- -2,283,419
NewHebrides Copra 1,103,499 327,364- ..- ■■-1,430,863
SolomonIslands(1)(2)Copra
Woodintherough138,502
761,2451,273,640
--
- ■1,412,142
761,245
899,747 ι2,173,387
Tuvalu(1)(2) Copra 61,541 64,417 48>771- ·174,729
TOTAL•3,959,956 3,300,355 1,463,270 268,323 3,324,099 12,316,003
(1)OCTmentionedatarticle23§3oftheDecision
(2)OCTwhichhavebecomeindependentduringthe"life"oftheDecisionbutcontinueto"benefitfromthefundforstabi­
lizingtheexportearningsoftheOCTprovidedforinarticle1(3)(c)oftheInternalAgreementonthefinancingand
administration ofCommunityAid.

• 1 - ■
2.Breakdown byproduct
Product1975 1976 1977 1978 1979···,'·.··"'VTotal
Amount X Amount X Amount X Amount X Amount X Amount ;■■■■* -
Bananas- - - - · - - - - 2,892,944 87.0 2,892,944 23.4
Cloves- - - - '552,547 37.8 180,299 67.2 431,155 13.0 1,164,001 9-5
Copra 2,802,167 70.76 3,035,027 92.0 367,784 25.1 88,024 32.8 - '■ - 6,293,002 51Λ
Rawhides ,skins
and leather 256,894 6.49 265,328 8.0 169,629 11.6 • _ _691,851 5Jí
Sawn wood 139,650 3.53- 202,714 13.8'- ■"- - - 342,364 2Λ
Wood intherough 761,245 19.22•- ' - - - - - - - 761,245 6.2
Ylang-ylangmm mm mm - 170,596 11.7 - - - -170,596 1.4
TOTAL 3,959,956 100.00 3,300,355 100.00 1,463,270 100.00 268,323 100.00 3,324,099 100.00 12,316,003 100.00
..11. Λ_
Products 1975 X 1976 X 1977 X 1978 X 1979 X νTotal ζ
suffering from eco-
nomic situation 1,316,443 33.24 551,836 16.72 202,714 13.85 48,771 18.2
1 2,119,764 17.2
suffering from local
circumstances 2,643,513 66.76 2,748,519 83.28 1,260,556 86.15 219,552 81.8 3,324,099 100.00/
10,196,239 82.8
TOTAL 3,959,956 100.00 3,300,355 100.00 1,463,270 100.00 268,323 100.00 3,324,099 100.00 12,316,003 105UD0
I

3.Natureoftransfers
I1975 %1976 X1977 X
Grants1,516/48638.301,889,893 57.261,260,556 86.15
Loans2,443,470 61.701,410,462 42.74202,714 13.85
TOTAL3,959,956 100.003,300,355 100.001,463,270 100.001978 X1979 XTotal X
268,323100.003,324,099 100.008,259,357 67.06
-■- - -4,056,646 32.94
268,323100.003,324,099 100.0012,316,003 100.00

.4.Utilization ofannualinstalments
1975 %1976 X1977 X1978 X1979 XιTotal X
Disbursements 3/959/95699.003/300/35582.511/463/27036.58268/3236.703/324/09983.1012/316/00361.58
Reconstitution- -61/1331.53- -715/43217.90- –776/5653.88
Balancé" 40/0441.00760/77819.022/536/73063.424/447/109111.20 675/90116.908/460/56242.30
Annualinstalment 4/000/000100.004/000/000100.004/000/000100.004/000/000-4/000/000100.0020/000/000-
(

5.Reconstitution oftheresources madeavailabletothesystem
(situationaftertheyearofexamination 1979)
1975 1976 1977 1978 1979Total
1.Originaltransfer
Belize(sawnwood) 139/650- 202/714- -'342/364
Kiribati(copra) 1/200/3211/083/098-.- 2/283/419
NewHebrides(copra) 1/103/499327/364- -1/430/863
TOTAL 12/443/4701/410/462202/714-. -4/056/646
2.Recordedamountsto-
bereconstituted
Belize-1975transfer - 61/133- - -61/133
-1977transfer - - - - ·"-
Kiribati-1975transfer- - 245/021283/219-528/240
-1976transfer - - 174/972209/816–384/788
NewHebrides-1975transfer- 1/103/499- -1/103/499
-1976transfer
1– m 327/364-· -327/364
TOTAL- 61/1331/850/856493/035-2/405/024

6.Financial situation 1975-1979
Annual Instalment .
XAmount foreseen tobedrawn
during theproceeding year1975 1976 1977 1978 1979
4/000/000
04/000/000
o4/000/000
04/000/000
04/000/000
o
Instalment Available
+Amount carried over from
proceeding year
♦Reconstitution
+Amount foreseen tobedrawn
from the next instalment4/000/000
04/000/000
40/044
61/133
04/000/000
800/822
1/850/856
04/000/000
5/188/408
493/035
04/000/000
9/413/120
0
TOTAL
XTransfers4/000/000
3/959/9564/101/177
3/300/3556/651/678
1/463/2709/681/443
268/32313/413/120
3/324/099
Remaining sumtobecarried
Over thefollowing year 40/044 800/822 5/188/408 9/413/120 10/089/021