ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(80)41
Vol.1980/0016

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COMMISSION
OFTHE
EUROPEANCOMMUNITIES
GeneralSecretariotCOM(80)41 final
Brussels,1stFebruary1980
FOROFFICIAL USEONLY
RECOMMENDATION OFTHECOUNCILDECISION
ONTHESTANDTOBEADOPTED BYTHECOMMUNITY ATTHE
INTERNATIONAL NEGOTIATIONS 'ONTHEAMENDMENT OFCERTAINS PROVISIONS OFTHE
.ARRANGEMENT ONGUIDELINES FOROFFICIALLY SUPPORTED EXPORTCREDITS
C0M(80)41final

EXPLANATORY MEMORANDUM
On4April1978theCounciladoptedadecisionontheapplication of
certainguidelinesinthe,fieldofofficially supportedexportcredits.
Asaresultofthisdecision,theguidelines setoutintheinformal
arrangement negotiated on22February1978havebeenapplicable since
1Aprilthatyearinrespectofofficially supportedexportcreditsto
non-Community countrieswherethemaximumrepaymentterm,asdefined
inthattext,isnolessthantwoyears.
TheArrangement providesforaminimumcashpayment,observation ofmax­
imumrepaymenttermsforcreditandminimuminterestrates.Theseterms
andinterestratesvaryaccordingtotheGNPperhead,withtheresult
thatrecipientcountriesaresubdividedintothreecategories :rich,
intermediate andpoor.
Likethenon-Community countriessupplyingexportcreditsthatareparties
totheArrangement,theCommunity hasuptonowfoundthattheseguide­
linesoperatefairlysatisfactorily .
>•
However,sincetheArrangement onofficially supportedexportcredits
enteredintoforce,worldeconomictrendshavemadetheirimpactonthe
exportcreditssector.
Theproblemoftightening upexportcreditsmustbeviewedinthelightof
variousconsiderations orfactors,namely:
(i)thesignificant riseininterestratesonthecapitalmarketsince
theArrangement enteredintoforceandthegapbetweentheserates
andtheminimumrateslaiddownintheguidelines;

•• .• . ... . .. . ............ --– -– - ■■ ■ • ^.. 1 Miiifìi
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(ii)theneed toLimit budgetary expenditure connected with measures
tofacilitate thefinancing ofexports ;„
(iii)theincrease ofthegross national income incertain countries
receiving credits ; ''
I
(iv)theincreasing difficulties being experienced bythedeveloping
countries inobtaining credits orrepaying thedebts they contract .
This state ofaffairs calls forfirmer discipline intheexport
credits sector ,accompanied byadjustments tothecredit terms
specified intheArrangement .IntheCommission 'sopinion ,firmer
discipline isparticularly necessary primarily asregards export
credits tothe rich countries .Official support should nolonger
begiven forexport credits intended for countries inCategory I.
However ,inview ofthe current situation and theoverrabrupt
nature ofsuch asolution ,the Commission considers that attainment
oftheaims listed below could bring about amarked improvement :
Ci)officially supported export credits should begranted tothe
rich countries only inexceptional cases and therepayment
term should innoevent exceed five years (itshould be
mentioned that theactual understanding considers the limit
offive years asnormal credit length forrich countries ),
and even then besubject toprior notification ;
(ii)asmarket rates have risen significantly over thepast months ,
itwould beadvisable toincrease the rates currently specified
intheArrangement by1.5% inrespect oftherich countries
and 0.5% for the intermediate countries .
Credit rates forthepoor countries will remain unchanged .
Thestagnation ofgrowth intheindustrialized countries and
thespiralling price ofenergy have hittheeconomies ofthose
developing countries which donothave oilvery hard .
Thenewminimum rates will bereviewed annually asthere can
benocertainty that thepresent levels will bemaintained ;

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(iii)thepresentlistofrecipientcountries,whichisbasedonobjective
data,viz.thestatisticsongrossnationalincomeperheadpub­
lishedby.theWorld'Bank,willhavetobecorrected.Thedata
concerned (situationat1975)nolongertallywiththefactsand
takesnoaccountoftheaccessionofanumberofcountriesto
independence .Thenewlisttobecompiledshouldalsobereviewed
atregularintervalssothatcountriesmaybetransferred fromone
categorytoanotherifneedbe.
ForthetimebeingtheCommissionsuggeststhattheotherprovisionsof
theArrangement shouldremainunchanged.However,itmayquitepossibly
putforwardfurtherproposalsinthequitenearfutureshoulditprove
necessaryordesirabletoadjustorimprovetheArrangement .
Theabovementionedmodifications oftheUnderstanding couldbepresented
duringtheregularreviewoftheUnderstanding nextMay.However,taking
accountoftherapiddevelopment ofthematter,theCommissionisofthe
opinionthatanurgentsolutionshould.besoughtbeforethereviewin
May.Inconclusion,theCommissionconsidersitadvisablethatthe
Councilshouldapprovethedirectives ontheCommunitystandinthis
matterandthereforerecommendsthatitadopttheattacheddraftdecision.

Recommendation ofthe
COUNCIL DECISION
onthestandtobeadoptedbytheCommunityat
theinternational negotiations ontheamendment
ofcertainprovisionsoftheArrangement on
GuidelinesforOfficiallySupportedExportCredits
THECOUNCILOFTHEEUROPEANCOMMUNITIES,
HavingregardtotheTreatyestablishing theEuropeanEconomicCommunity,
λ
andinparticularArticle113thereof,
HavingregardtotheCommission'srecommendation ,

-2-
Whereasitisadvisablethatdirectivesshouldbegivenonthestandto
beadoptedbytheCommunityattheinternational negotiations onthe
amendmentofcertainprovisionsoftheArrangement onguidelinesfor
officiallysupportedexportcredits,
HASDECIDEDASFOLLOWS:
Soleartieie
Attheinternational negotiations ontheamendmentofcertainprovisions
oftheArrangement onguidelinesforofficiallysupportedexportcredits
theCommissionshallstatetheCommunity'sstandinapplication ofthe
annexeddirectives .
Itshallactinconsultation withthespecialCommitteeprovidedforin
Article113oftheTreaty,whichshallassistitinitstask.
>•A
Doneat
FortheCouncil
ThePresident

ANNEX
I.Arrangement towhichthepresentdirectivesrelate
Α
ThesedirectivesrelatetotheArrangement onguidelinesfor
officially supportedexportcredits.
II..Negotiating brief
TheCommissionshallurgethatthefollowing amendments bemade
totheArrangement :
(a)Listofcountries :
ThelistbasedontheWorldBankstatistics for1975willhave
tobereviewedinthelightoftheBank'sstatisticsfor1977.
Thecurrentsubdivision onthebasisofGNPsof£1000and
&3000perheadistoberetained.Adjustmentswillthere­
foreconsistsolelyoftransferring countriesfromoneof
theexistingcategoriestoanotheronthebasisoftheWorld
Bank'smorerecentstatistics .
(b)Minimuminterestrates:
.repaymenttermsofbetweentwoandfiveyears:richcountries,
9.25%;intermediate countries,7.75%;poorcountries,7.50%.
.repaymenttermsofoverfiveyears:intermediate countries,8.25%;
poorcountries,7.50%.
(c)Minimumrepaymentterm:
Themaximumrepaymenttermforanofficially supportedexport
creditgrantedexceptionally toarichcountryshallinnocase
exceedfiveyears.If,inexceptional circumstances ,aparty
totheArrangement proposestogiveitssupporttoanoperation
ofthiskind,itshallgivepriornotification thereofin
accordance withtheprocedureprovidedforinparagraph 9(a)
oftheArrangement .Therepaymenttermscurrentlyapplicableto
theintermediate andpoorcountries'shallremain-unchanged.