A4-0095/94

Resolution on economic and trade relations between the European Union and Russia

The European Parliament,

- having regard to its resolution of 9 July 1992 on economic cooperation between the European Community and the Commonwealth of Independent States ((OJ C 241, 21.9.1992, p. 161.)),

- having regard to its resolution of 12 March 1993 on future agreements between the Community and the New Independent States of the former Soviet Union ((OJ C 115, 26.4.1993, p. 248.)),

- having regard to the agreement negotiated by the EU and Russia on partnership and cooperation and the interim agreement under which the trade policy provisions of the partnership agreement between the EU and Russia are to enter into force in advance,

- having regard to its assent on 30 November 1995 to the conclusion of an Agreement on Partnership and Cooperation between the European Communities and their Member States, of the one part, and the Russian Federation, of the other part (94/0151(AVC)) ((Item 1(c) of these Minutes.)),

- having regard to Rule 148 of its Rules of Procedure,

- having regard to the report of the Committee on External Economic Relations (A4-0095/94),

A. whereas economic and trade relations are still developing on the basis of the trade and cooperation agreement concluded by the EC and the former USSR in 1989,

B. whereas enormous problems, particularly a worryingly unstable political situation, are being encountered as economic reforms are undertaken to create a market economy system in Russia,

C. whereas the success of the economic reforms in Russia, by far the largest single republic in the CIS, is strategically important for stability throughout Europe,

D. acknowledging the technical and financial assistance which the EU and its Member States in particular, but the other western industrialized nations too, are providing for Russia,

E. having regard to the multinational nature of the Russian Federation, which must be taken into account in establishing balanced relations between the European Union and the Government of Russia,

1. Welcomes the conclusion of the partnership agreement with Russia and calls on the Member States to ratify it without delay, so that the broadly-based cooperation for which it provides may commence as soon as possible;

2. Notes that the negotiations on the partnership agreement with Russia have resulted in a greater number of derogations than the other partnership agreements which have been concluded, which could lead to problems in mutual cooperation between the CIS States;

3. Points out that the partnership agreement not only covers trade and economic cooperation but also provides for the launching of a political dialogue and cooperation in the field of internal security, even in spheres of the Union that have been redefined by the EU Treaty;

4. Emphasizes that respect for democratic principles and human rights forms the basis of mutual cooperation and is also essential if the market economy reforms are to succeed;

5. Reiterates to the Council its disapproval of the latter's failure to comply with its obligations to Parliament arising from the Stuttgart Solemn Declaration on the European Union, whereby Parliament should have been consulted on the interim agreement;

6. Is concerned about the current economic situation in Russia, which is still characterized, four years after the reforms began, by a serious decline in industrial and agricultural output, extremely high inflation, high, though often concealed, unemployment and an excessive budget deficit;

7. Points out that the economic crisis in Russia was further exacerbated by the collapse of the USSR and the resulting interruption of traditional supply lines to enterprises in Russia and that the Russian economy has also lost many of its traditional markets; is therefore particularly pleased in this context that the partnership agreement is to promote the revival of trade among the republics;

8. Is concerned about the continuing macroeconomic imbalances in Russia, which are reflected in extremely high inflation and thus in the continuous devaluation of the Russian currency;

9. Sees the excessive deficit in the national budget and the use of central bank loans to cover it as the main causes of these unfortunate developments; hopes that the Russian Government will take suitable measures;

10. Points out that, if cooperation is to succeed, a minimum of macroeconomic stabilization is needed in Russia, and that this can be achieved only by thoroughly reorganizing public budgets and creating a monetary and currency system that restores domestic and foreign confidence in the stability of the Russian currency;

11. Notes that Russia achieves surpluses in trade both with the other republics of the CIS and with the western industrialized countries, albeit at much reduced import and export levels;

12. Is concerned about the capital flight that is depriving Russia of resources urgently needed for the modernization of its economy and threatening to counteract western financial aid;

13. Sees an urgent need for a significant improvement in conditions for private investment in Russia, which are impaired particularly by the absence of an efficient public economic, fiscal and judicial administration;

14. Believes that, despite the current difficulties, Russia will eventually become an important economic and trading partner which has, on the one hand, considerable potential as a source of raw materials and will provide EU suppliers with significant marketing opportunities, but whose economy should, on the other hand, be integrated into the European division of labour;

15. Considers it appropriate, therefore, that it has been agreed to consider in three years' time the possibility of creating a free-trade zone embracing the EU and Russia;

16. Emphasizes the importance of the approximation of legislation for which the partnership agreement provides and of the obligations in the spheres of competition law, the protection of intellectual property and state aid, which are intended to create fair conditions for mutual trade;

17. Considers it necessary for the policy of opening markets to be continued, but recognizes that, while applying strict standards and exercising due restraint, the EU must be able to take the measures for which its commercial policy provides to protect itself against disturbances of its markets and against dumped or subsidized imports from Russia;

18. Acknowledges the cautious opening of the EU to natural persons from Russia in the cross-border provision of services; also points out that temporary employment in the EU can make an important contribution to further vocational training; calls on the Member States of the EU, therefore, to consider the extent to which bilateral agreements that take account of the labour market situation on both sides can be reached on this aspect;

19. Considers the arrangements regarding inland waterway transport as less satisfactory in that, only immediately after the entry into force of the partnership agreement, will Russia and the EU be negotiating on the gradual granting of reciprocal access for shipping companies to their respective inland waterways, enabling them to provide services linking up with international maritime transport;

20. Views the introduction of compulsory AIDS tests for foreigners entering Russia as placing a serious restriction on the opportunities for business people from the EU which were agreed under the partnership agreement;

21. Supports Russia's efforts to gain early admission to the World Trade Organization (WTO), provided that it complies with the obligations arising from the GATT, GATS and other Uruguay Round agreements and makes a balanced offer of tariff concessions;

22. Is aware that, once Russia joins the WTO, the provisions of the partnership agreement concerning trade, the cross-border provision of services and the conditions governing the establishment of businesses will have to be revised and expects Russia then to improve access to its markets and the conditions governing operations and establishment for EU undertakings;

23. Is confident that closer and better structured cooperation in the areas of agriculture, mining, industry, vocational training, transport, telecommunications, energy, environmental protection, science and technology, aerospace, action against drug trafficking and money laundering and cultural affairs will make for a major contribution from the EU in support of the reform process in Russia and act as an effective complement to the technical assistance provided under the TACIS Programme;

24. Welcomes the conclusion of a steel trade agreement between the EU and Russia, to run until 1996, providing for import restrictions for Russian steel products, which will help to stabilize the European steel market and yet at the same time provide Russia with significant export opportunities in this area;

25. Hopes, moreover, that the partnership agreement and supplementary agreements yet to be negotiated on trade in nuclear materials and cooperation in the nuclear sector will help to prevent illegal trade in fissionable materials and to improve safety standards at Russian nuclear plants;

26. Expects the conclusion of the European Energy Charter Treaty to be a valuable complement to mutual cooperation in this sphere, especially in the exploration for and exploitation and transport of energy sectors;

27. Recognizes the importance of the textile trade for the development of the Russian economy and calls on the Commission to consider the possibility of revising the textile agreement negotiated with Russia in 1993, especially in the light of the outcome of the Uruguay Round;

28. Accepts that financial assistance over and above that provided under TACIS, particularly in the form of untied balance of payments credits, does not seem appropriate at present, given Russia's trade surplus and massive flight of capital; considers that effective financial support for Russia could be better provided by project-related credits, possibly through the EIB;

29. Welcomes the setting up of a Joint Parliamentary Committee, which will enable the European Parliament and representatives of the Russian Parliament to keep a critical eye on the implementation of the agreement and to make recommendations to the Cooperation Council for the widening and deepening of mutual cooperation;

30. Instructs its President to forward this resolution to the Council, the Commission and the governments of the Member States and the Russian Federation.