17.2.92 OfficialJournaloftheEuropeanCommunitiesNoC40/31
OpinionontheCommissioncommunication onindustrialpolicyinanopenandcompetitive
environment
(92/C40/15)
On21December1990theECCommissiondecidedtoconsulttheEconomicandSocial
Committee,underArticle198oftheTreatyestablishingtheEuropeanEconomicCommunity ,
ontheabovementioned communication .
TheSectionforIndustry,Commerce,CraftsandServices,whichwasresponsibleforpreparing
theCommittee'sworkonthesubject,adopteditsOpinionon6November1991.The
RapporteurwasMrPetersen.
Atits291stplenarysession(meetingof27November1991),theCommitteeadoptedthe
followingOpinionbylargemajority(oneabstention).
1.Introduction tostrengthenindustryandincreaseemploymentinone
countrycouldunderminetheeconomy—andthus
employment—inothers.
Instancesofcountriesgoingitaloneinthesecond
halfoftheSeventiesweresufficientreasonforthe
CommissiontotakespecificmeasuresatCommunity
levelinindividualindustrialsectors,suchassteel,ship­
building,textiles,chemicalfibresandfootwear.In
almostallcasestheCommissioncouldarguethat—mo­
tivatedbydifficultstructuralproblemsandnoticeable
fallsinemployment—therewasastrongtendencyfor
someMemberStatestopreserveexistingstructuresby
measureswhichcausednewdistortionsofcompetition ,
triggeredprotectionistreactionsandwereultimately
capableofdisruptingthecommonmarket.Acommonindustrialpolicydoesnotfeatureinthe
TreatiesofRome.Elementsofsuchapolicyaretobe
foundonlyintheEuropeanCoalandSteelCommunity
(ECSC)Treaty.TheECCommissionmadeaninitial
attempttoframeacoherentindustrialpolicyinthe
mid-Sixties :in1970itpresentedacomprehensive mem­
orandumonCommunityindustrialpolicy(*),which
wasintendedtoserveasabasisforadetaileddiscussion
withotherCommunityinstitutionsandwiththebodies
representingtheCommunity'ssocioeconomic interest
groups.EconomicandsocialdifferencesintheMember
Statesandthereluctancetotacklestructuraladjustment
problemsjointlywithanadequateindustrialpolicy
thwartedtheCommission'sproposalsandcondemned
theindustrialpolicymemorandumtofailure.TheCom­
mission's1971proposaltocreateanindustrialpolicy
committeealsogotlostinthesands.Theactionpro­
grammeinthefieldofindustrialandtechnological
policy(2)whichtheCommissionsubmittedin1973
likewisefailedtoachieveanyresults.Anewattempttorevivethedebateonindustrialpolicy
strategywasmadebytheCommissionin1981whenit
presentedtheCouncilwithacommunication onthe
developmentofindustryinEurope:aCommunitystrat­
egy(4).Inthiscommunication ,theCommissioncalled
ontheMemberStatestomeetthechallengesfacing
economicandemploymentpolicyjointly,underthe
unifyingumbrellaoftheCommunity :'Theindustrial
strategyofthepublicauthorities,likethatofthemajor
companiesandindustrialcomplexes,mustnowbefor­
mulatedonascaleofcomplexity,abreadthofscope
andatime-spanwhichinEuropearefeasibleonlyat
Communitylevel.Theaimmustbetore-createacli­
mateofconfidencethatwillencourageinnovativeand
expansioninvestment,bothbythemajorindustrial
groupingsandbythesmallandmedium-sizedbusiness­
es,whosecontributiontothecreationofproductive
employment iscommonknowledge.'However,this
urgentappealalsometwithapoorresponse.TheTheEconomicandSocialCommitteeenteredtheindus­
trialpolicydebateattheendof1977withitsOpinion
onindustrialchangeandemployment—areviewofthe
Community'sindustrialpolicyandfutureprospects(3).
TheOpinionpointedoutquiterightlythat,inthe
absenceofaCommunityindustrialpolicy,Member
States'policieswoulddevelopalongpurelynational
linesand,becauseofthesenarrowerhorizons,could
evenconflictwitheachother.Structuralproblems
wouldbeexportedtoneighbouringcountriesunder
certaincircumstances .Measureswhichwereintended
(1)Doc.COM(70)100final.
(2)Doc.SEC(73)3824final.
(3)OJNoC292,3.12.1977. (4)Doc.COM(81)639final,p.2.

NoC40/32 OfficialJournaloftheEuropeanCommunities 17.2.92
breakthroughtoacomprehensive andfuture-oriented
industrialpolicyfailedonceagain.andtechnologicaldevelopment .Themainresponsi­
bilityforindustrialcompetitiveness lieswithindustry
itself.Thepublicauthoritiesactmainlyasacatalyst
andpavethewayforinnovation,withfirmsbeing
abletoexpectthemtoprovideaclearpredictable
environmentandprospects. Tobeprecise—andheretheCommitteeagreesunre­
servedlywiththeCommission—thedebateonindus­
trialpolicyintheEuropeanCommunityhasforyears
beenhamperedbythelackofan'appropriateconceptual
framework'.Ontopofthis,theideaofglobalcompeti­
tiveness,whichhasfrequentlybeenpinpointedasthe
aimofCommunityindustrialpolicy,isvagueand
ambiguous .TheCommitteethereforewelcomesthe
factthat,initsnewestcommunication onindustrial
policyinanopenandcompetitiveenvironment,the
Commissionismakinganattempttodevelopthecon­
ceptofamodernanddynamicindustrialpolicy.The
focalpointofthisconceptistheCommunityinterest.Thispositiveandopenapproach,whichiscommitted
totheprincipleofsubsidiarity,isbasedonrecent
experience.TheSeventiesandEighties,inparticular,
showedthatinterventionist policiesinindividual
sectorsofindustryarenotaneffectiveinstrumentfor
promotingstructuralchange.Thesepoliciesfailedto
makeindustrycompetitive .Theymayhelptempor­
arily,buttheyinevitablyriskdelayingstructural
adjustmentsandthuscausingjoblossesinthefuture;
theyalsotieupresourceswhichcouldbedeployed
moreproductivelyelsewhere.Theeconomyisgiven
therightsignalsbybeingfirmlyplacedwithinthe
internationaldivisionoflabourandbycompliance
withtheassociatedrules.Experiencehasshownthat
competitiononequaltermsisthebestguaranteeof
astrong,competitiveindustry. 2.GistoftheCommissionproposal
However,thesituationinindividualsectorsofthe
Europeaneconomyisnotstaticandfromtimetotime
problemspeculiartoindividualsectorsmustbead­
dressedandsolvedatCommunitylevelorbytheMem­
berStates.Itisvitalinthesecasestoo,however,forall
measurestakentobefullyconsistentwiththegeneral
principlesofCommunityindustrialpolicy.Europeanunificationisgainingmomentumbothpoliti­
callyandeconomically .Aninitialtarget—thecom­
pletionoftheinternalmarket—willbereachedbythe
endof1992.Theinternalmarket—accordingtothe
Commission—willbedecisiveinhelpingtoforcebusi­
nessestothinkandactstrategicallybeyondnational
frontiers.Globalcorporatestrategieswillincreasein
importance .Atthesametime,theenvironmentinwhich
Europe'seconomyoperatesisundergoingpermanent
change:internationalcompetitionisbecomingkeener,
technologicalknow-howisnecessitatinggreaterinvest­
ment,productioncyclesareconstantlybeingshortened
andthemacroeconomic conditionsformanufacturing
investmentaredeteriorating .Inthesecircumstancesthe
limitsofnationalpoliciesaresoonreachedandtheir
alignmentandcoordinationatEuropeanlevelbecomes
anurgentnecessity.Inthefieldsofbotheconomicand
industrialpolicyahighdegreeofconsensusisrequired
inEuropeinordertoconsolidateandbuildonwhat
theCommunityhasachieved.Whoeverchoosesto
ignorethisandinsistsoncontinuingtothinkandact
nationally,isturninghisbackongrowthopportunities ,
jobopeningsandgreaterprosperity .Structuraladjustmentandinternational competi­
tivenessarecloselylinked.AdynamicEuropeanindus­
trialpolicymustthereforefocusontheeffectiveand
coherentimplementation ofallthosepolicieswhich
makeindustrialrestructuringaneasier,moresecure
andspeedierprocess.Accordingly ,theCommission
thinksthatstructuraladjustmentmainlyinvolvesthree
stagesandthattheCommunity'sindustrialpolicyblue­
printmuststrikeanappropriatebalancebetweenthe
three:
i)Necessaryprerequisitesforstructuraladjustment
securingastableeconomicenvironmentinorder,
inparticular,tostrengthenfirms'abilitytoinvest,Itisgenerallybelievedthatonlyacompetitiveeconomy
willmeetthechallengesandenabletheCommunityto
secureandstrengthenitspositionintheworldeconomy.
TheCommunity'sindustrialpolicyblueprintisthere­
forepromptedbythewilltooptimizemarketefficiency.
ThemainproblemaccordingtotheCommissionisto
createthe'appropriate'corporateclimatefor(a)an
optimumallocationofthefactorsofproductionby
marketforces,(b)swifterstructuraladjustment,(c)
greatereconomiccompetitiveness inEuropeand(d)the
establishment ofaplatformforlong-termindustrialmaintainingacompetitiveenvironmentbykeeping
acarefulwatchonlargemergersandacquisitions
andcontrollingstateaidrigorously,

17.2.92 OfficialJournaloftheEuropeanCommunities NoC40/33
—guaranteeingahighlevelofeducationalattainment
asthebasisforgeneratingandassimilatingnew
technologiesandorganizational methods,—ensuringtherequisiteconditionsforthedevelop­
mentofdynamicandcompetitivebusinessservices
(inparticularinthefieldoffinancialservices).
—promotingeconomicandsocialcohesionbetween
Communityregions,withemphasisbeingplacedon
theroleoftheStructuralFundsforareaswith
laggingeconomies :employeeinformation ,consul­
tationandparticipationwhencorporatedecisions
aboutstructuraladjustmentmeasuresaretaken,TheCommissionstressesthatitsindustrialpolicyblue­
printisbasedonaclearconsensusandnotonacompro­
misewhichrepresentsthesmallestcommondenomi­
natoracceptabletoall.Theblueprintrestsonthe
principleoffreetradeandcannotbemisunderstood
underanycircumstances asapolicyoflaisser-faire .It
shouldbeseenasbeingpartandparcelofapolicyfor
shapingrulesandregulationsdesignedtoensurethat
marketforcesandfreecompetitionareabletoflourish
intheindustrialsector,too.—achievingahighlevelofenvironmental protection
inordertosafeguardhumanhealthandthenatural
environmentandcreatenewmarketsasasourceof
competitionfor'clean'growth.
3.Comments
ii)Measuresforunderpinningstructuraladjustment
3.1.TheEuropeanCommunity'sindustrialpolicy
approach
—completionoftheinternalmarket,tobeachieved
inparticularbyimprovingEuropeanstandardsand
productquality,liberalizingpublicprocurement ,
abolishingnationalimportquotas(Art.115of
theEECTreaty)andestablishingacoherentlegal
frameworkandtrans-European networks,
—anopentradepolicyasanecessarycomplementto
theopeningoftheinternalmarket,withstrict
respectfortheinternationally agreedrulesbyall
worldtradepartners;thisincludesrefrainingfrom
unfairtradingpracticesandtheCommunitybeing
willingtotakeeffectiveactiontodefenditself.
iii)MeansofspeedingupstructuraladjustmentTheCommitteeagreeswiththeCommissionthat
greaterEuropeanintegrationimpliesthatindustrialpol­
icyproblemsshouldbesolvedatEuropeanleveland
thatstructuraladjustmentmeasuresshouldtakethe
Communitymarketintoaccount.Italsoendorsesthe
viewthatonlycompetitiveindustrycancontribute
towardsEurope'seconomicandsocialdevelopment .
TheCommitteeassumesinthisconnectionthatthe
term'Europeanindustry'—asusedbytheCommission
onseveraloccasions—isnotconfinedto'European­
ownedfirms'.
Themainideabehindtheindustrialpolicyblueprintis
thatanopenandcompetitiveenvironmentshouldbe
established,andthereisnoalternativetothiswhich
hasanychanceofsuccess.Withinthefieldofindustrial
policythisisatoppriorityobjective.TheEuropean
Communitywillnotmasterthechallengesithasset
itselfintheTreaties,andintendstosetonthepath
towardsPoliticalUnion,bybuildingawallaround
itsmarketandpursuingdefensivepoliciestopreserve
existingstructures.
However,theCommitteewouldcriticizethefailureof
theCommunityblueprinttogivesufficientconsider­
ationtoindustrialpolicy'sregionalandsocialdimen­
sion.ThestrengtheningofEuropeanindustry'scom­
petitivenesswillnotinitselfsufficetodevelopindustry
inlaggingregionsortocaterforsocialneeds.Therefore,
initsindustrialpolicyblueprint,theCommissionmust
giveevengreaterprominenceinparticulartothe
interestsoflaggingregionsandworktheseinterests
moreconvincinglyintoitspolicyinstruments .Thegen­
eralreferencetotheCommunity'sStructuralFunds
doesnotgofarenough.Theviewthatdialogueand
partnershipbetweenindustryandthepublicauthorities—developmentoffirms'technologicalcapabilitiesby
providingmorefavourableconditionsfortheplan­
ning,development ,diffusionanduseofadvanced
technologies ,
—adynamicpolicytowardssmallandmedium-sized
enterprises,designedtolimitredtape,increasecoop­
erationandimproveaccesstoCommunityand
worldmarkets,
—betteruseofhumanresourcesandeasierintroduc­
tionofnewtechnologiesandworkingmethodsas
aresultofworkertrainingandretraining,

NoC40/34 OfficialJournaloftheEuropeanCommunities 17.2.92
underlyingtheorganizationoftheeconomywillbe
undermined ,unlesstheseexceptionsbecometherule.
Aslongasthisisnotthecase,theexceptionscanbe
consideredtoprovetherole.alsohasa'vital'roletoplayinpromotingeconomic
andsocialcohesionisambiguousandthereforerequires
urgentclarification .
Inpracticalterms,theCommitteewouldurgethatapart
fromthehorizontalmeasuresforassistingstructural
changeandincreasingindustry'sadaptabilityaplace
mustberetainedforindustrialpolicymeasureswhich
(a)providesecondarysupportfortherequisite(regional
andsectoral)adjustmentprocessesinproblemareas
and(b)cushionthesocialimpactofstructuralchange
withtheaidofsuitableco-ordinated transitional
measures.Thispolicyshouldincludethefollowing
ingredients,whichoverlapandalsoinfluenceeachother
inpart:
—aregionalpolicywhichevensoutdiscrepancies ,for
strengtheninglaggingregions'potentialandability
todevelop,
—aregionalpolicywhichevensoutdiscrepancies ,for
regionswitheconomicrestructuringproblems,
—adjustmentassistanceforoffsettingsocialhardship
intimesofstructuralcrisisorwhenindustryisbeing
slimmeddown.Withregardtotheeconomicpolicyinstruments,the
Committeethinksthatinitiallythepackageofeconomic
policyobjectivesshouldbespecifiedandspeltoutin
thelightofEECTreatyArticle104.Thisstipulatesthat
eachMemberStateistopursuetheeconomicpolicy
neededtoensuretheequilibriumofitsoverallbalance
ofpaymentsandtomaintainconfidenceinitscurrency,
whiletakingcaretoensureahighlevelofemployment
andastablelevelofprices.Thiscatalogueofobjectives
isbynomeanscomplete.Aboveall,itdoesnotinclude
economicgrowth,whichisimportantforsuccessful
economicrestructuring .Thisgrowthshouldcontain
bothquantitativeandqualitativeelements,which
shouldinfluenceandcomplementeachotherinappro­
priatefashion.Protectionoftheenvironmentandcon­
servationofnaturalresourcesarevitalforlonger-term
quantitativegrowth.
3.2.Prerequisitesforstructuraladjustment
3.2.1.Macroeconomic conditions and
flexibilityItistheMemberStates'tasktoadoptthemeasures
whicharesuitableforachievingthemacroeconomic
objectives.Thesemeasuresshouldalsobeblendedin
suchawaythatcorporateinitiativeandadaptabilityis
encouragedandstrengthened ,notimpeded.Thereisa
constantdangerthattoomanyundulycomplicated
provisionswhichareguidedtoolittlebyeconomic
criteriawillrestrictfirms'abilitytoact,weakenthe
market'sself-regulatory forcesandthreatencorporate
flexibility,especiallyinthesmall/mediumbusinesssec­
tor.Theeconomicchallengesofthefutureandthe
keenercompetitionworldwiderequirefirmstoadapt
rapidlytostructuralchanges.Timelagsarenowtoler­
atedlessandlessbythemarket.TheCommitteeshares
theCommission'sviewsonthis,butwouldunderline
thattheflexibilitywhichfirmsneedtohaveshouldnot
callworkers'socialprotectionintoquestion.Asthe
Commissionpointsout,an'adequatelevelofsocial
protection...providesasafetynetwhichdiminishesthe
risksof(structural)changeand...promotesmobility'.TheCommissionhasrightlyhighlightedtheimportance
ofafavourableandreliable(macroeconomic )environ­
mentforcorporateactivity,andstressedthatCom­
munitypolicymustaccommodatethisrequirement .An
importantroleisalsoplayedbythegeneralpolitical
conditions .Moreoftenthannot,theeffectwhichthese
conditionshaveinshapingindustryisoverlooked .The
Committeewouldhavewelcomedaclearerreference
intheCommission documenttotheintricatelinks
betweenthepolitical,economicandsocialspheres.
TheCommittee'sconcernisthatthereshouldbeaclear
distinctionineconomicpolicybetween(a)thegeneral
organizationoftheeconomyand(b)economicpolicy
instruments .Theformerestablishesthegeneralframe­
workforeconomicactivity.ThereforetheCommission
shouldclearlyindicatethepurposeandshapeofthe
generaleconomicframework .Itshouldpinpointthe
principlesonwhichthisframeworkrests,andcallon
MemberStatestoobservetheseprincipleswhentaking
industrialpolicydecisions.Theorganizational frame­
workshouldalsobeable,withinlimits,totakeaccount
ofevolutionarychanges.Thisincludesthedeliberate
acceptanceoftemporaryexceptionswhentheseare
justified.ThereisnoreasontofearthattheprinciplesEconomicpolicymeasuresmustbecoordinatedmore
closelyatCommunitylevel.Ahigherdegreeofmacro­
economicconvergencecanonlybeachievedwiththe
aidofjoint,specially-targeted efforts.TheConvergence
Directivewasadoptedaslongagoas1974witha
viewtoimprovingandstreamliningtheprocedurefor
cooperationbetweenMemberStatesinthefieldof
economicpolicy.However,littlehasbeenachievedon
thegroundatCommunitylevel.Whatisthepoint—

17.2.92 OfficialJournaloftheEuropeanCommunities NoC40/35
theCommitteeasks—oftheEuropeanCounciland
othersmakinglengthydeclarationsonCommunity
economicpolicy,andoftheCommissionissuingnumer­
ousproposalsonglobaleconomicstrategies(themost
notableexamplebeingthe1985cooperativegrowth
strategyformoreemployment ,whichwasalsofirmly
supportedbythesocialpartnerswithintheframework
ofthesocialdialogue),ifeconomicpolicymakersinthe
MemberStatespaylittleornoattention.Inthefinal
analysistherehasalwaysbeenalackofpoliticalwill
toagreeoneconomicpolicyobjectives,tolaydown
theirorderofpriorityand,aboveall,tomakeagree­
mentsmorebinding.hasrepeatedlyreferredtothistrendandhascalledon
(nationalandCommunity )anti-trustbodiestoconsider
atleasttheEuropeandimensionwhenassessingperti­
nentmarkets.'Thecontinuedexistenceofnational
economicareasisananachronism whenitcomesto
achievingasufficientdegreeofrealcompetitiveness ',
theCommitteestressedinitsOpinionontheCom­
missions'15thcompetitionpolicyreport,addingthat
'thesmallestpossiblegeographicalyardstickisnowthe
Community ,andeventhentheworlddimensioncannot
bedisregarded (2).USandJapanesecompetitionpolicy
haslongbeentailoredtocross-frontier ,orevenworld
markets.
Initsrecent(Additional )OpiniononEconomicand
MonetaryUniontheEconomicandSocialCommittee
reiteratedtheneedtoagreeoncommoneconomicpol­
icyguidelinesandobjectives(l).TheCommission
shouldputforwardmultiannualeconomicpolicyguide­
linesbasedonanassessmentofeconomicperformance
intheMemberStatesandsubmitthemtotheCouncil
ofMinistersofEconomyandFinance(ECOFIN)and
theEuropeanCouncil,whichshouldactinaccordance
withtheprocedurestobelaiddownintheEECTreaty's
plannedArticle102C.Theseguidelinesshouldbe
adaptedeachyearandshouldreferinparticularto
financepolicy,labour-market policyandstructuralpol­
icy.Theeconomicreformprogrammesofthestructur­
allyweakerMemberStateswillneedtobegivensupport
andtakenintoconsideration intheCommunity'secon­
omicpolicyguidelinesiftheseMemberStatesareto
catchupandattainthedesiredlevelofeconomiccon­
vergence.Itwillalsobenecessarytostrengthenthe
multilateralsurveillance ,launchedin1990,ofallecon­
omicpolicyaspectsofimportancetotheCommunity
(priceandcosttrends;competitiveness ;employment ;
regionaldevelopment ;publicbudgets).TheCommittee
considersthattheCommunity'sindustrialpolicyblue­
printwillbedeprivedofoneofitsmainpillarsifthe
ECproposalonceagainfailtoscorearesounding
success .AtthesametimetheCommitteecalledforananti­
trustsystematCommunitylevelinordertomaintain
competitionandsecurethebestpossiblemixbetween
therequirementsofinternationalcompetitionandthe
maintenanceofbalancedconditionsofcompetitionin
theinternalmarket.TheDecember1989Regulationon
thecontrolofconcentrations betweenundertakingswas
welcomedinprinciplebytheCommittee,becauseit
alsohelpedtoremovelegaluncertainties .Thisapplied
especiallytothenatureandextentoftheCommission's
mergercontrolpowersandthedemarcationofEuro­
peanfromnationallaw.However,therearestilla
numberofdoubtsabouttheRegulation .Inparticular,
theECU5billionthresholdis(too)highandisnot
justifiedoneithereconomicorcompetitiongrounds.
'Havingthresholdsinaninitialphasewhicharetoo
highwillmakeitmoredifficult,ifnotimpossible,to
formulateauniformcompetitionpolicyforallMember
States—atanyrateinthekeyareas'(?).Withregardto
thesecondmainpointofcriticism—thesubstantive
criteriaforintervention—theCommitteeregrettedthat
importantyardsticks,suchasdegreeofdevelopment
andneedforrestructuringincertainareasoftheCom­
munity,wereonlytobefoundintheprotocolstate­
mentswhichhadnobindingforce.Industrialandsocial
policyconsiderations ,andespeciallytheneedtopre­
servejobsthreatenedbystructuralchange,madeit
imperativetoincludethesecriteriaintheRegulation .
3.2.2.Competition
TheCommitteeisnaturallyawarethatananti-trust
Regulationbasedoncompetitionpolicyconsiderations
cannotsolveallthemanyeconomicandsocialproblems
associatedwithmergersandacquisitions .Allthemore
urgenttherefore—accordingtotheCommitteeinits
OpinionontheBasicRegulation—is'theneedfor
coordinationofcompetitionpolicywithallother
policies,suchasregionalandsectoralstructuralTheglobalizationofmarketsandgrowingeconomic
interdependence ofECMemberStatesinevitablypro­
vokestructuralchange.Mergersandacquisitionsare
oneofthewaysofmeetingthechallengeatcompany
levelandadaptingEuropeanindustry.TheCommittee
(2)OJNoC333,29.12.1986,p.86.
OJNoC102,18.4.1991,p.24. (3)OJNoC208,8.8.1988.

17.2.92 NoC40/36 OfficialJournaloftheEuropeanCommunities
policy,researchanddevelopment(R&D)policyand
consumerpolicy'.
Furthermore ,competitionpolicymustleaveEuropean
firmswithenoughscopeforcooperationinorderto
meetthechallengesofworldwidecompetition .Inthis
connection,R&Dcooperation isparticularly
important .Cross-frontier technologicaltransferand
technologicalcooperationshouldnorbestifledby
undulyrigidrulesoncompetition .Animportantrole
isplayedbygroupexemptionsforresearchcooperation
which—inviewofthegrowingdemands—oughttobe
extended .TheCommission shouldalsobearinmind
thatthecross-frontiertransferoftechnologywillcon­
siderablyimprovetheCommunity'soverallcompeti­
tivenessinrelationtothirdcountriesandthatthe
transferofknow-howisvitalforincreasingthecom­
petitivestrengthsofsmallandmedium-sizedenterprises
inparticularandhelpstosafeguardandcreatejobs.betweenthepublicandtheprivatesector.Publicaid
shouldalsobelimitedintime,shouldbetaperedand
shouldbespentonthetargetsforwhichitisintended.
Communityaidshouldalsofulfilthesecriteria,which
aremoreorlesscommensurate withtheonesadopted
bytheCouncilofMinistersoftheOrganizationfor
EconomicCooperationandDevelopment (OECD)in
1978underitspositivestructuraladjustmentplan.
InthisconnectiontheCommitteeurgestheCommission
tomakefulluseoftheinstrumentsavailableformoni­
toringaid(Art.93oftheEECTreaty).National
financialsupportshouldbestrictlyvetted,continuously
monitoredandmadesufficientlytransparent .Itwould
beanutterdisasterifcompetitionbetweenfirmswere
tobeincreasinglyreplacedbygovernmentsoutbidding
eachother.TheCommitteenoteswithconcernthat
accordingtotheCommunitysurveyonStateaids(1),
between1981and1986thefourlargestMemberStates
accountedonaverageforroughly88%ofallnational
aid.Theinitialstatisticsfor1986-1988donotindicate
anygreatchange.TheCommitteethereforecallsonthe
MemberStates,andespeciallythefourlargest,tosort
outthechaossurroundingsubsidiesatlonglastandto
makeappreciablecuts.TheCommissionhasrepeatedly
pointedoutthatnationalaidtoCommunityfirmsfar
exceedstheaiddisbursedbytheCommunity'sstructur­
alfunds.Inviewofthelevelofeconomicinterdepen­
dencenowattainedbyECMemberStates,theCom­
mitteethinksthatthefullestpossiblerecordshouldbe
madeofallaidandthatthisaidshouldbecoordinated
inliaisonwiththeECMemberStates.3.2.3.Stateaid
AstheCommissionquiterightlysays,'afirmaiddisci­
plineisaprerequisitetotheincreasedcompetition
withoutwhichverylittleoftheprojectedgainsfrom
theinternalmarketwillberealized'.Thisshouldbe
borneinmindbytheECMemberStates.However,
Europe'sfirmsarealsorequiredtostoptheirappealsto
theirgovernmentsandstopdemandingStateguarantees
fortheirsurvival.Thesocialmarketeconomymust
onceagainbeconceivedasaprincipleunderpinning
lifeinsociety—itmustnotbewatereddowntoan
emptyformula.TheCommitteeexpresslywelcomestheCommission's
remarksonaidpolicy.Articles92and93oftheEEC
TreatyenabletheCommissiontoprotectcompetition
fromdistortionscausedbyStateaidandtocounterthe
artificialpreservationofstructures .However,thereis
noquestionofabolishingaidcompletely .Aidisfully
compatiblewiththeCommonMarketinthecases
referredtoinArticle92(2)and(3)and,tothisextent,
isalegitimateindustrialpolicyinstrument .However,
infutureitshouldpavethewayforstructuraladjust­
mentandsupporttheestablishmentofnewindustrial
structuresandshouldnotbedisbursedtopreserve
existingstructures .Thereisaneedforthedirect(prob­
lem-oriented )grantingofaidtotackledeficiencieswith
regardtoinfrastructure ,training,industrialsites,recla­
mationofdumpsandbasicresearch.Inaddition,a
regionally-oriented systemofaidisclearlysuperiorto
onewhichfocusesonindividualindustries .Aidisless
dirigisteandhaslessofanunwantedtendencytopre­
servestructuresifitgoestoregionsratherthanailing
industries .Thisdoesnotexcludethegrantingofaidto
individualindustriesinspecialcasesinordertosupport
anorderlychangeovertothenewstructures.3.2.4.Education
Oneofthekeystosuccessfulstructuraladjustment,
accordingtotheCommittee,isabetterCommunity­
widestandardofeducation.Lifelonglearning
TheCommitteeagreeswiththeCommissionthatself­
helpincentivesmustbepreservedandstrengthenedby
publicaid,thatdistortionsofcompetitionshouldbe
minimizedandthatpublicaidshouldnotdiscriminate(')SecondSurveyonStateAidsintheEuropeanCommunityin
themanufacturing andcertainothersectors(Commission ,
1990).

NoC40/37 17.2.92 OfficialJournaloftheEuropeanCommunities
Community'svariousregionsandthebackwardness of
theleastfavouredregionsaretobereduced.Thereis
littletraceofthisconcernintheindustrialpolicypaper.andaboveallpermanentreadinesstoadaptone'sper­
sonalcapabilitiesandknowledgetonewdemandsare
vitalformaintainingandimprovingthequalityof
humancapital.Thespreadofdataandinformation
technologiesintoallbranchesoftheeconomyand
societymakestheproperhandlingofnewtechnology
animportantpartofmoreandmorepeople'slivesand
plans.However,italsomeansthateducationwillhave
newtaskstofaceintheNinetiesinallECMember
States.Firstly,itwillhavetotakeintoaccountthenew,
mostlyhigherskillsneededtocopewithtechnological
changeandhelptoensurethatbasicinstructionin
informationtechnologyisprovidedatschool.Andsec­
ondly,itwillhavetolaythefoundationwhichwill
enableindividualstomasterthischangeintellectually .
Thenewinformationtechnologiesdisseminateknow­
ledgeatanunprecedented speedandonanunpre­
cedentedscale.Hencethegrowingimportanceofbeing
abletoorderandarrangefacts.Evennow,numerous
occupationsareheavilyaffectedbytechnological
change.Bythemid-Nineties—accordingtotheesti­
matesofvariousresearchinstitutes—morethan50%
oftheworkforcewillhavetohaveagroundingin
dataprocessing .Hencetheabsolutenecessityofskills
offensivewiththetwinobjectiveof:InconnectionwiththeCommission'sremarkson
regionalpolicytheCommitteewonders,forexample,
whysolittleattentionwaspaidtotheCommission's
ownstudiesontheinternalmarketandthepanorama
ofECindustry.Aboveall,thereportpublishedbythe
Commissionontheimpactoftheinternalmarketby
industrialsector:thechallengefortheMemberStates(')
containsfindingswhicharehighlyrelevantforthe
developmentofacommonindustrialpolicystrategy.
Thestudy—whichoffersacarefulanalysisandis
empiricallybased—providescompellingproofthat,as
farasthemosthighlyindustrializedMemberStatesare
concerned,thechallengesoftheinternalmarketare
broadlynotofasectoralnature.Fortheless-developed
MemberStates,however,twoscenariosarepresented
andthesectoralchangeswhichthesewillcausemaybe
far-reaching .Thefirstinvolvesgreaterspecialization in
thetraditionalindustriesinwhichthesecountrieshave
competitiveadvantages,whilstthesecondcentres
aroundthedevelopmentofnewhigh-techsectors.In
thefirst(inter-industry )scenarioitispresumedthat
therewillbeagreaterconcentration onbranchesof
industryinwhichtheexpectedriseindemandiscalcu­
latedtoberatherlow.Inthesecond(intra-industry )
scenariothesouthernMemberStateswouldexpandin
branchesofindustrywhichofferbettergrowthpros­
pectsand—atleastinthemediumterm—wouldenable
theseMemberStatestocatchupwiththerestmore
quickly.Economicrealityis,however,suchthatitwill
notbeaquestionofeitheronescenarioortheother,
andthecompletionoftheinternalmarketisnotlikely
toresultinfundamentalshiftsbetweengeographical
zonesinthepatternofindustrialdistribution .Nonethe­
less,theCommitteethinksthatbothscenariosmustbe
takenintoaccountintheCommission'sindustrialpol­
icyblueprintandanalyzedindepthandthattheright
economicpolicyinstrumentsmustbechoseninliaison
withtheMemberStates.Thiswouldappearallthemore
urgentsince—accordingtotheECCommission—the
probabilityofeachscenariohappeningwillbeinflu­
encedbythepolicypursuedatCommunitylevel.In
anotherpropheticremarkitisstatedthattheroleof
thestructuralfundsmayalsodifferinoneortheother
case.—equippingindividualswhohavepooremployment
prospectswithaskill,
—cateringonawidescaleforthenew,morestringent
demandsoftechnicalchange.
TheCommitteecallsonallthoseresponsibleforedu­
cationpolicyatCommunitylevelandintheMember
Statestoincreasetheireffortsandhelptocorrectexist­
ingskillsshortagesinthecomingyears.Itwillnotbe
possibletoreducetensionsandadversedevelopments
onthelabourmarketuntileducationandemployment
arebettercoordinated .TheCommitteealsowarns
againstunduespecialization byworkers,forthiscould
limittheirabilitytoadapttostructuralchangeand
causeconsiderablesocialproblems.
3.2.5.Economic andsocialcohesionTheCommission'sremarksonsocialcohesioninfirms
arealsounsatisfactory .Statementssuchas'agood
balancebetweentheneedsofthevariouspartiescon­
cernedwillplayanimportantconstructiveroleinsuch
TheCommission'sremarksonpromotingeconomic
andsocialcohesionfallwellshortoftheCommittee's
expectations .Article130AoftheEECTreatyclearly
statesthatinordertopromoteitsoverallharmonious
development ,theCommunityistodevelopandpursue
apolicyforstrengthening itseconomicandsocial
cohesion.Inparticular,thedisparitiesbetweenthe(')'Theimpactoftheinternalmarketbyindustrialsector:the
challengefortheMemberStates'(EuropeanEconomy,Special
edition1990).

NoC40/38 OfficialJournaloftheEuropeanCommunities 17.2.92
processes'aretoovagueanddonotgetusanywhere.
ThesocialgroupingsrepresentedontheCommittee
haverepeatedlymadepracticalremarksonthesubject
ofsocialcohesion.TheCommitteehasrepeatedly
endorsedsuchcohesioninprinciple,mainlywithaview
totherepresentation ofworkers'interestswithinfirms
andtheirinvolvementincertaincorporatedecisions,
emphasizingthatworkerparticipation isanimportant
prerequisiteforthedevelopmentofademocratic
society.Neglectingstaffconsiderations inafirmmeans
ignoringeconomic,social,historicalandlegalreality.
Co-determination atcompanylevelshouldtakethe
formofanopendialogue.However,thisdialoguealso
presupposesthatentrepreneurstakeaclearstanceand
heedtheeffectwhichcorporateactivityhasonsociety.
ThesameappliestotheCommission ,whichshould
reviewandamplifytherelevantpassagesinitsblue­
print.marketsismadeeasierifenvironmental policytargets
aresetbutindustryislefttochoosethebestpath.This
istheonlywaytodevelopaninnovatoryclimatewhich
encouragestechnicalprogress,growthandemployment
incentives.Amajorroleherehastobeplayedbythe
CommunityandtheMemberStates,which—actingin
liaisonwithallsocialgroupings—mustdecidehowfar
theywishtogowithenvironmental protection .Not
untilthishasbeendonecanthemeasuresforachieving
environmental targetsbeintroduced .
TheCommitteewouldreferinthisconnectiontoits
Opiniononenvironmental policyandthesingleEuro­
peanmarket,whichfocusedontheuseofmarket
economyinstrumentsandincentivesforenvironmen­
tally—friendlyconsumption (2).
Inaddition,theCommunityshouldmakefulluseofits
powerstoenactenvironmental standards,coordinate
therequisitemeasureswithnationalenvironmental
activitiesandseektheharmonization ofdivergent
environmental provisionsandrulesintheMember
States.Inparticular,cross-frontierpollutionmustbe
reducedandthedistortionsofcompetitioncausedby
environmental policieseliminated.TheCommunity
shouldnotbeguidedbythesmallestcommondenomi­
nator;itmustachievewhatisecologicallynecessary.
Thisincludestakingsuitableadministrativeandlegal
actiontoensurethatoncemeasureshavebeendecided,
theirimplementation ispushedthrougheverywhere
intheCommunity .Thewilltotakeenvironmental
protectionseriouslyisoftenstilllacking.3.2.6.Environment
TheCommitteeagreeswiththeCommissionthat
environmental protectionisanimportantpartofindus­
trialpolicy.Environmental protectionisacross-frontier
challengewhichnationscannotsolveinisolation.
Environmental policymustthereforebeseenasatask
fortheCommunity ;itmustbeapolicyofprevention
basedoncooperation ,andmustbecarefullycoordi­
natedwithotherpolicyareas(e.g.regionalpolicy,
R&Dpolicy).The'prudentandrationalutilization'of
environmental resourcesiscalledfor.Environmental
risksmustbeproperlyidentifiedatanearlystageand
suspectedcausalchainsmustbebroughttothepublic
notice.Thisimpliescloseandloyalcooperation
betweentheworldsofpolitics,businessandscience.
Consideration shouldalsobegiventoconsumerbehav­
iour,whichisshapedinmanywaysbyenvironmental
measures .Environmentpolicy,sotheCommitteesays,
mayhavea'majorinfluenceontheconsumer (prices,
taxes,diversityofchoice,healthandsafety);consumer
policymayalso,throughtheconsumerchoicesittrig­
gers,influencetheenvironmentforthegoodorfor
thebad(!).Increasingattentionshouldbepaidtothe
interfacebetweenconsumerpolicyandenvironmental
policy.3.3.Measuresforunderpinningstructuraladjustment
3.3.1.Internalmarket
TheCommitteeagreeswholeheartedly withtheCom­
missionthattheprogrammeforcompletingtheinternal
marketwillcreatea'homemarket'ofconsiderablesize
andqualityandmustthereforebeconsideredasan
'industrialpolicymeasureparexcellence'.TheCom­
mitteewouldreferinthisconnectiontoitsvarious
positiveOpinionsonthemovestowardstheinternal
marketandwouldreiteratetheexpectationthatthe
internalmarkerwillbenefiteverybody—workers,firms,
consumersandinvestors.Economicdevelopment isaprerequisiteforeffective
environmental protection,foritistheonlywaytomeet
thecostofenvironmental activities.Atthesametime
environmental activitiescreatenewmarketswitha
broadandvariedrangeofproductsandservicesfor
protectingtheenvironment .ThedevelopmentofnewTheinternalmarketprogramme'spracticaleconomic
andsocialrepercussionswillhingeonwhetherandto
(')Doc.ESC1115/91. (2)OJNoC322,31.12.1990,p.107.

17.2.92 OfficialJournaloftheEuropeanCommunities NoC40/39
toimprovecoordinationandcoherence,proposepri­
oritiesandencourageparticipationandtransparencyin
thefieldofEuropeanstandardization ,includingthe
nationallevel(2).whatextenttheinternalmarketinitiativesareputinto
actionintheMemberStates.Therearestillshort­
comingsandnumerousdeficitsinthisarea.Eventhough
theCommissionnotesinitssixthreportconcerningthe
implementation oftheWhitePaperonthecompletion
oftheinternalmarket(')thatthepercentageof
measurestransposedintonationallegislationrosefrom
69%inDecember1990tomorethan73%inMay
1991,someMemberStatesstilllagalongwaybehind.
TheCommitteethereforenotonlycallsontheCom­
missiontomakeanevengreaterefforttoensurethat
infringementproceedingsareinstituedrapidly;itwould
alsoasktheMemberStatestomakeaneffectivecontri­
butiontothecompletionoftheinternalmarketby
speedingspeedinguptheirtranspositionofCommunity
laws.TheCommitteealsorequeststheCommissionto
actearlytoensurethatthenon-transposition oflaws
inindividualMemberStatesdoesnotjeopardizeestab­
lishmentofthebarrier-freeinternalmarketin1993.3.3.1.2.Publicprocurement
TheCommitteeagreeswiththeCommissionthatthe
liberalizationofpublicprocurementinallareasiscen­
traltotheinternalmarketprogrammeandisofgreat
significanceinindustrialpolicyterms.Europeanindus­
trywillnotmoveclosertogetherunlessthecontinuing
tendencytofavour'nationalchampions'whenaward­
ingpubliccontractsisabandonedatlastonceandfor
all.'Thiscontinuedpartitioningofindividualnational
markets',astheCommissionsaidalreadyinitsJune
1985WhitePaper,'isoneofthemostevidentbarriers
totheachievementofrealinternalmarket'(3).
3.3.1.1.Standardsandproductquality
EuropeanstandardsareakeyfactorinCommunity­
widemarketintegrationandareextremelyimportant
forindustrialcompetitiveness .Theyremovetechnical
barrierstotradeandhaveaderegulatingeffect,thereby
makingcross-frontierindustrialcooperationeasierand
enablingfirmstobenefitfromeconomiesofscale.When
thebasicrequirementstobemetbyproductsarelaid
down,theCommissionshouldensurethatthehighest
possiblelevelofprotectionisprovided.Thisapplies
bothtotheprotectionofhealthandsafety(especiallyat
work)andtoenvironmental andconsumerprotection.ThedirectivesadoptedsofarontheCommunity-wide
liberalizationofpublicprocurementmarkaconsider­
ablestepforward.However,thefactthatsmalland
medium-sizedenterprisesstillhavenoadequateaccess
topubliccontractsisviewedwithconcernbytheCom­
mittee.Improvements areespeciallynecessaryinthe
fieldofsubcontracting ,whereupperlimitsshouldbe
imposedinindividualcases.TheCommunityshould
alsopressmoreinfuturefortheworldwideliberaliza­
tionofpublicprocurement ,inkeepingwiththeprin­
cipleofreciprocalaccesstomarkets.
Smallandmedium-sizedenterprises'accesstopublic
contractsinothercountriescouldbefurtherimproved
iftheTEDdatabankweretobebrokendownby
sector.TheGermanpilotprojectPOINT(PublicOrders
InformationNetwork)isinprogressatthemoment
inthisfield.ThepurposeofPOINTistoprovidea
technicallyperfectedserviceforsmallandmedium­
sizedenterprisesinneedofreliableinformationabout
publicprocurementproceduresintheCommunity .The
Commissionshouldlenditssupporttothisprojectand
furtheritswidercross-frontieruseafteritscompletion.DespitetheundisputedadvantagesofEuropeanstan­
dards,Communitystandardization workpresentsafar
fromsatisfactorypicture.Thereisstillaplethoraof
nationalstandardswhichactasdefactomarketbarriers
intheCommunity .Asaresultsmallandmedium-sized
enterprisesinparticularhavedifficultyingainingaccess
topubliccontractsinotherMemberStates.Although
thenumberofnewEuropeanstandards,accordingto
theCommission ,increasedsharplyfrom19in1985to
150in1989,thisfallsalongwayshortoftherequire­
mentsoftheinternalmarketprogramme .TheCom­
mitteecallsontheCommission toincreaseitsefforts
toharmonizestandardsandalsotouseitsinfluenceto
stepuptheestablishment ofeffectiveproceduresfor
theapplicationofstandardsintheCommunity .Inthis
connectiontheCommitteewouldreiteratetheidea
ofestablishinganorganizationsuchastheEuropean
Standardization CouncilproposedbytheCommission ,3.3.1.3.Abolitionofnationalprotectivemeasures
Withthecompletionoftheinternalmarket,thecases
whereEECTreatyArticle115canbeappliedwill
probablybecomefewerandfewer.Nationalprotective
measuresarenotcompatiblewiththeprinciplesofan
open,competitiveindustrialpolicy.TheCommittee
thereforesupportstheCommission'seffortstoabolish
thesemeasuresinordertoexposenationalmarketsto
agreaterdegreeofintra-Community andworldwide
(2)OJNoC120,6.5.1991,p.28.
(3)Doc.COM(85)310final. (MDoc.COM(91)237final.

NoC40/40 OfficialJournaloftheEuropeanCommunities 17.2.92
competitionandsopreparethembetterforglobalchal­
lenges.However,inmanycasesitistobeassumedthat
accompanying structuralmeasureswillbenecessaryso
thatunavoidablestructuraladjustmentscanbemade
relativelysmoothly .global,integrated,multi-modeapproach,providinga
referenceframework .Investmentriskswillthusbe
reduced,Community ,nationalandregionalmeasures
willbemoreeffectiveanddueaccountcanbetakenof
long-termneeds(3).
3.3.2.Opentradepolicy
Therehavebeenconsiderablechangesintheinter­
nationaldivisionoflabourinrecentdecades:industries
havebeenrelocatedandneweconomiccentresand
areashavesprungup—themostobviousonebeingthe
Pacificarea,whichincludestheUSWestCoast,Japan
andthecountriesofSouthEastAsiaandSouthAmer­
ica.'Old'industrialregionshaveupgradedbychanging
theirstructures,reorganizingandswitchingtonew
technology .Thisworldwidechangehasnotbeenwith­
outfriction.Therisksanddangersinvolvedpresent
governmentsandcentralbanks—butalsofirmsand
socialgroups—withtheintricatetaskofhavingto
weighupandsettleconflicts.3.3.1.4.Coherentlegalframework
ComparablelegalconditionsintheMemberStatesare
ofvitalimportanceforEuropeanfirmsiftheyareto
operateunhinderedthroughouttheCommunity .Atthe
momentidenticaldefactosituationsstilldifferdejure.
AlthoughtheCommunityhasmadevisibleprogressin
recentyearsintheapproximation oflegislation,awhole
seriesoffurthermeasuresareneeded—notleastinthe
fieldofcompanylaw.Viewsdifferonthelevelof
harmonization requiredinthisfield,butthereisprob­
ablyagreementthatthecommonmarketrequires
nationalcompanylawstobealignedtoacertainextent.
Inaddition,thereshouldbemoresupernational legal
vehicles—suchastheEuropeanEconomicInterest
Grouping—basedonEuropeanlaw.
TheCommitteehasinvariousOpinionscalledonthe
CouncilandtheCommissionto'stepupandproperly
organizetheiroverdueaction'withregardtothe
approximation oflegislation (1).Thisincludesfurther
improvingtheprotectionofintellectualandindustrial
property.Europeanfirmsneedareliableframework
foractionandmorescopeforreorganizingthemselves
iftheyaretostrengthentheircompetitiveness ,finda
flexibleresponsetothegrowingpressuresfrominter­
nationalfirmsbasedousidetheCommunityandcreate
andpermanentlysafeguardjobs.TheEuropeanCommunity,becauseofitseconomic
importance,hasalotofresponsibilitytobearinthe
fieldofworldtrade.Article110oftheEECTreaty
expresslyrequirestheCommunityto'contribute,inthe
commoninterest,totheharmoniousdevelopmentof
worldtrade,theprogressiveabolitionofrestrictions
oninternationaltradeandtheloweringofcustoms
barriers'.HencetheCommitteewelcomestheCom­
mission'sremarkthatanopentradepolicyisrequired
asanecessarycomplementtothesinglemarket.The
liberalization ofdomesticmarketsmustbe
accompaniedbyaliberalexternaltradepolicy.Itwould
beabsolutelydisastrousiftheCommunityweretobe
thecauseofinternationaltradetensionsandupheavals.3.3.1.5.Trans-European networks
TheCommissionrightlystressesthattrans-European
networksarevitalforthecompletionoftheinternal
marketandanimportantprerequisitefortheinte­
grationoftheCommunity'smarkets.Theyclosegaps
inexistingnetworksandpromotethedevelopmentof
theCommunity'speripheralregions,whilealsofacilit­
atingtheconstructionoftheEuropeanEconomicArea
andsupportingtheeconomicdevelopmentofCentral
andEasternEurope.
ItiswiththisinmindthattheCommitteehasrepeatedly
emphasizedthenecessitytoestablishanddeveloptrans­
Europeannetworks—especialyinthetransport,energy,
telecommunications andvocationaltrainingsectors.In
itsOpinionontheCommission'sactionprogrammefor
trans-European networks(2)theCommitteecallsforaThisbeingso,theenormousgapbetweenthetrade
policyguidelinesoutlinedbytheCommissioninits
paperandtheinternationalrealityisamatterforcon­
cern.Administrative tradebarriers,subsidieswhich
distortcompetitionandstrategieswhichrestrictcompe­
tition—includingtheingloriouspracticeknownas
'laserbeaming'—aretheorderofthedayandaregener­
atingconsiderable disturbances inworldtrade.
Regionalcooperation isalsoincreasingfurther.
Countrieswiththesameorsimilareconomicobjectives
0)OJNoC124,21.5.1990,p.34.
(2)Towardstrans-European networks—foraCommunityaction
programme [doc.COM(90)585final]. (3)Doc.ESC1282/91.

17.2.92 OfficialJournaloftheEuropeanCommunities NoC40/41
No1ruleisinternationalcooperationbasedontrust.
Thereisnoplaceanymorefornationsgoingitalone.
Theworld'stradingpartnerswilleitherhavetowork
togethermoreinfutureortheywillhavetofollowthe
leadsetbyothersandundergothepainfulprocessof
restructuring .havejoinedforcesnotonlyinEuropebutalsoelsewhere
intheworld.Whatwasconsideredanexceptionatthe
timeoftheestablishmentoftheGeneralAgreementon
TariffsandTrade(GATT)hasnowbecometherule.
Themultilateralprincipleofworldtradeisthusbecom­
ingmoreandmoreofafarce.Theinternationaldivision
oflabourisbeingdominatedmoreandmorebyecon­
omicgiantsandespeciallythetriadformedbyEurope,
theUSAandJapan.Thistriadencompassesthemain
marketsandthisiswherecompetitioniskeenest.
3.4.Meansofspeedingupstructuraladjustment
TheCommissionstressesthatthecapacitytorestruc­
turemustbeacceleratedbyaccompanying measures.
Specialemphasisisplacedonresearchandtechnology
policyandamoredynamicpolicytowardssmalland
medium-sizedenterprises .Hencethegrowingimportance—andheretheCom­
mitteeagreeswiththeCommission—ofrequiringthat
'therulesofthegameberespectedbyalltradingpart­
nerssincetheCommunity'seconomywillbecomemore
sensitivetosuchpracticesinlinewithitsevengreater
openness'.Inviewofthecontinualviolationofthese
rulesitishardlysurprisingthatthecallfor'reciprocity'
isbecominglouderandlouder.Reciprocityalone—ac­
cordingtoitsadvocates—'canensurethatthemarkets
ofJapan,SouthKorea,TaiwanandotherAsian
countriesarealsopartof...thetraid's(overallmarket),
andarenotfencedhomebasesfromwhichJapanese
andEastAsian...(firms)conquerthemarketsofAmer­
icaandEurope'(*).3.4.1.Technological strength
TheCommitteeagreesinprinciplethatthetechnologi­
calcompetitiveness ofEuropeanindustryplaysakey
roleanddetermineswhetherEuropeanfirmscanhold
theirownontheworldmarkets.Itwouldemphasize
evenmoreclearlythantheCommission ,however,that
measuresforenhancingcompetitiveness shouldnotbe
confinedtoafewhigh-techsectorsbutmustalso
addressbroadlybasedtechnologies .Inaddition,there
isnoguaranteethatEuropeanindustrywilldevelop
harmoniously unlessthesetechnologiescanalsobe
appliedbyfirmsinlaggingregions.MemberStates
haveimportanttaskstoperformhere.Supportfor
theCommunity'stechnologicalcapabilitiesremainsan
absolutemust,especiallywherepre-competitive
researchandthetransferoftechnologytosmalland
medium-sizedenterprisesandlessdevelopedregions
areinvolved.However,theCommitteewouldpointout
thattheprincipleofsubsidiaritymustberetainedin
thefieldofresearchpolicy,too.Communitysupport
forresearchshouldbechannelledintoareaswhere
nationalfundsdonotsufficeortheCommunitycan
reapclearbenefits.Inaddition,prioritymustcontinue
tobegiventocorporateresponsibilityforR&D.Firms
areinabetterpositionthantheStatetodecidewhere
researchisworthwhileandtowhatextentitcanbe
seenthroughanddevelopedintomarketableproducts.Againstabackgroundoflatentdangersfortheinter­
nationaldivisionoflabour,theCommitteeurgesthe
EuropeanCommunitytocontinuetomakeanallout
efforttoconvinceworldtradingpartnersoftheadvan­
tagesoffreemarketsunderconditionsoffaircompe­
titionandtoensurethattheGATTUruguayRound
isbroughttoasuccessfulconclusion .Theincreasing
globalizationofcorporateactivities—eveninthesmall/
mediumbusinesssector—demandsrulesfortheinter­
nationaldivisionoflabourinwhichwecantrust.Above
all,morecredibilityanddisciplineareneededinworld
trade.Solemncommitments bywesterntradingpart­
ners,reiteratedatlengthagainandagainattheOECD
orat'worldeconomicsummits',arenolongerenough.
TheCommitteeexpectstheGATTnegotiationstopro­
ducenotonlyconcreteassurancesfromallGATTmem­
bersthattheywillobserveexistingGATTrules,but
alsoanoticeableimprovement intherulesincritical
areas(e.g.subsidies,escapeclause)andtheinclusion
ofnewareasinGATT(e.g.services,protectionof
intellectualproperty).
Theremustbeagreatergeneralrealizationthat—given
present-dayeconomicandpoliticalconstraintsinthe
world—itwillnotbepossibletosolvethetasksfacing
usandavoidnewtensionsinworldtradeunlessthe
3.4.2.Smallandmedium-sized enter­
prises
SupportforR&Dinsmallandmedium-sizedenterpri­
ses—especiallythroughbetterinformationandadvice
innewareasoftechnologyandimprovements inthe
transferofknow-howandtechnology—isanimportant(')K.Seitz,Diejapanisch-amerikanische Herausforderung :
Deutschlands Hochtechnologie-Industrien kämpfenums
Überleben ,2.Auflage,München :BonnAktuell,1991.

NoC40/42 OfficialJournaloftheEuropeanCommunities17.2.92
concern.Smallerbusinessesmustbeinvolvedmore
closelyinexisting(nationalandCommunity-wide )
researchprogrammesandtheproceduresforthegrant
ofsupportmustbesimplified.Notuntilthishasbeen
donewillitbepossibleforsmallerbusinessestofulfil
theircentralroleintheprocessofindustrialadjustment .
Inanageinwhichthereisagreaterspecialization
withinsectors,Europeanindustryreliesmorethanever
onaflexibleandinnovatorysmallandmedium-sized
enterprisessector.However,supportprogrammesare
nosubstituteforapolicyaimedatimprovingthegen­
eralenvironment (e.g.withregardtotaxation)andthe
reductionofred-tape.
TheCommissionrightlyplacestheemphasisonthe
importanceoftraininginthisconnection .TheCom­
mitteeagreeswiththeCommissionthatinthefaceof
theimpendingskillshortagesandamuchfasterrate
ofinnovation,theadaptabilityandqualityofhuman
capitalhasbecomethekeydeterminantofindustrial
competitiveness andtheoneonwhichdevelopedecon­
omiesmustplacegreatestrelianceinfuture.Inthis
connectionthedistinctionbetween'high-tech'and
'low-tech'industriesislosingitsimportance .There
mustbebroadly-basedR&Dandtraininginallsectors
andregions.identifysomecyclicalcauses,interactingstructural
weaknessesarefarmoresignificant :
—thehighdegreeoffragmentationoftheCommunity
market,
—unequalcompetitionconditionsinthevarious
regionsoftheworldmarket,
—disadvantages linkedtofinancing,
—lackofhighlyqualifiedstaff,
—weakpointsinthestructureofproduction,
—inadequatecorporatestrategies.
IntheCommission'sviewmeasuresneededtocorrect
structuralweaknessesandimprovecompetitiveness
shouldprimarilybelefttothefirmsthemselves .The
joboftheCommunityandtheMemberStatesis,subject
totheprincipleofsubsidiarity,tocreateafavourable
environmentforfirmsandinsodoingtotakeaccount
ofthepotentialofITandelectronicstechnologyfor
theCommunity .Againstthebackgroundofthisanaly­
sistheCommissionhasdrawnupafive-pointaction
programmetocomplementandreinforceinitiativesby
firms.Theproposedmeasurescoverdemand,tech­
nology,training,externalrelationsandthebusiness
environment .
InitsOpinion(2)theCommitteewelcomestheCom­
mission'sindustrialpolicyinitiativeandjudgesthe
actionprogrammetobeasuitablebasisforcreating—in
partnershipwithfirms—competitivestructuresand
goodjobprospectsofferinggoodworkingconditions
intheEuropeanITandelectronicsindustry.Recent
unfavourabledevelopments suchaslossesofmarket
shareinconsumerelectronicstoEastAsiancompetition
andcurrentmarketproblemsinsemiconductors and
thecomputerindustryhaveclearlyshownhowurgent
Communityactionhasbecome.TheCommitteefeels
thatthestrategicallyimportantconditionsaretobe
foundinresearchandtechnology,infrastructure ,pro­
ductioncapacity,trainingandskills.Intheseareasthe
Committeeproposesabroadspectrumofmeasuresto
complementtheCommission'sproposedpackage;these
shouldbetakenupbytheCommunityandtheMember
Statesandusedtoconstructaframeworkfortheactivi­
tiesoffirms.
TheCouncilResolutionof18November1991onelec­
tronicsinformation andcommunication technol­
ogies(3)hasbeennotedbytheCommitteewith
approval.Basically,thisResolutiontallieswithwhat
theCommitteesaysinthisOpinion,andalsofitsin
withtheCommittee'sOpinionontheEuropeanelec­
tronicsandinformationtechnologyindustry.4.Applicationoftheindustrialpolicyblueprintto
sectors
TheCommissionhasrecentlybeguntoapplytheopen,
horizontalandoffensiveindustrialpolicyapproachto
individualsectors.Thesectorsconcernedaresectors
which'canplayakeyroleforthedevelopmentof
Europeanindustry',suchastheinformationtechnology
(IT)andelectronicsindustryandbiotechnology .The
Commission isalsointerestedinareaswhoseworldwide
environmental andeconomicimportanceisincreasing
(e.g.deep-seamining).InadditionCommunityblue­
printsaretobedevelopedforsectors—suchasthe
textileandclothingindustry—whichoccupyan
importantplaceinthestructureoftheCommunity's
economybutwhicharelikelytohaveto'cometoterms
withstructuralchange,whichinsomecaseswillbe
radical'.
4.1.TheEuropeanITandelectronicsindustry(r)is
poorlyrepresentedinkeyareassuchassemiconductors ,
peripheralsandconsumerelectronics,andintheIT
sectorthesituationcanonlybedescribedasdifficult.
WhilsttheCommission'sanalysisofweaknessesdoes
(2)Doc.ESC1392/91.
(3)No9298/91(Presse208)of18November1991. (MDoc.SEC(91)565final.

17.2.92 OfficialJournaloftheEuropeanCommunities NoC40/43
4.2.Biotechnology isofstrategicimportanceindeal­
ingwiththemajorchallengesfacingbothindustrialized
anddevelopingcountriesinthefieldsofnutrition,
health,environmental protectionandpopulation
growth.Itshouldbeunderstoodasaninterdisciplinary
fieldstradlingchemistry,biologyandprocessengineer­
ingandusingthebiochemicalsynthesisoflivingcells
toobtainormodifysubstancesaspartofindustrial
productionprocesses.Biotechnology offersgreat
opportunitiesformanysectorsoftheeconomy,from
powergeneration,metalextraction,refusedisposaland
chemicalstobioelectronics .Itistruethatthistech­
nologyhasabadpublicimage.Reservationsareaimed
mainlyatthepossibleconsequencesofimproperuse
forhumanandanimalhealthandsafety.
Inviewofthegrowingimportanceofbiotechnology—
notleastfortheEC'seconomicfuture—theCom­
missionhasdrawnupapaperonbiotechnology and
proposednumerousinitiativesacrossthewholespec­
trum(1).Theiraimistoimprovethecompetitiveness
offirmsinvolvedinbiotechnology ,toadaptthelegal
framework,toestablishbiotechnology standards,to
providefortheprotectionofintellectualpropertyand
tohelpwithR&Dfinancing.Atthesametime,the
Commissionsays,ethicalissuesraisedbybiotechnology
mustbetakenupbytheMemberStatesandatCom­
munitylevelanddiscussedatlengthintheframework
ofanopendialogue.
TheCommissionidentifiesthefollowingpriorities:
—theestablishment ofabiotechnology information
infrastructure viaresearchprogrammes ,infor­
mationpolicyandinternationalcooperation ,
—thephasedintroductionofsupportforbiotechno­
logyR&D(possiblyextendingbeyondthepre-com­
petitivephase),
—thedrawingupofaclearandprecisemandatefor
activitiesoftheEuropeanCommitteeforStandard­
ization(CEN)inthefieldofbiotechnology ,
—theadoptionofCommunityrulesprotectingintel­
lectualpropertyandtheincorporation ofCom­
munitylawinnationallaw,
—theestablishmentofbiotechnology statistics(indus­
tryandproductstatistics),
—theintensification ofbilateralandmultilateralcon­
tacts.Thesettingupofworkingparties[GATT,
OECD,theEuropeanFreeTradeAssociation
(EFTA)]toformulateobjectivesforhealthand
environmental protection,—thesettingupofasuitableCommunityadvisory
bodyonethicalissuesrelatedtobiotechnology ,e.g.
questionsconcerninglifeandhumanidentity.
Tocomplementitspolicyinitiativesandbiotechnology
researchprogrammes ,theComissionwillcontinueto
assesssocial,economicandtechnologicalconsequences .
Italsointendstomonitorregularlytheprogressans
competitiveness oftheCommunity'sbiotechnology
industries,inordertoensurethattheagreedconcept
performsitsfunction.TheCommissionremainscon­
vincedthatfuturemarketsuccesseswilldependtoa
greatextentonthestrategiesdevelopedandfollowed
byfirms.
TheEconomicandSocialCommitteereservestheright
toissueaseparateOpinionontheCommission's
biotechnologypaper.
4.3.Maritimeissueshavebecomeincreasingly
importantonaninternationallevelinecological,econ­
omicandpoliticalterms.InitsCommunication on
maritimeindustries(2)theCommissionsaysthatthe
ECshouldactivelyreacttothis.Inthelightoftheir
interdependence ,shipping,shipbuilding ,theuseofthe
resourcesofthesea,andtheneedtokeepthese
resourcesandtheseasthemselvesfreeofpollution,have
tobeseenandtreatedaspartofasinglemaritime
dimension .TheCommission'sCommunication there­
forecoversthiswholeareainordertopavetheway
forbetteruseofpresentandfuturesynergiesbetween
maritimeactivities.
Onlyefficientmaritimeindustriescanguaranteethat
theCommunitywillbeinapositiontoparticipate
adequatelyandsuccessfullyininternationaltradeand
benefitfromtheexploitationoftheoceans.Inthepast
theCommissionhasundertakenandproposedarange
ofdifferentinitiatives,butuntilnowtherehasbeenno
comprehensive viewofallmaritimeissues.Anewand
effectiveglobalapproachisthereforeneeded.This
doesnot,however,meansubstitutingforeffortsby
companiesthemselves .TheCommission'sobjectiveis,
rather,toimprovethecompetitiveness ofthemaritime
industriesviaappropriatehorizontalmeasures :
—improvedconditions (eliminationoftradebarriers),
—improvedmaritimesafety(navigationalsafety,
safetyonboard,safetyatwork),
—drawingupofanintegratedCommunityapproach
tomaritimeR&D,
—developmentofacombinedtransportnetworkand
extensionoftransportinfrastructure ,
(i)Doc.SEC(91)629. (2)Doc.COM(91)335final.

17.2.92 NoC40/44 OfficialJournaloftheEuropeanCommunities
—improvedbasicandfurthertraningofemployees,
—developmentofcommonmaritimeenvironmental
strategies,
—convergentconditionsofcompetitionbetweenthe
MemberStates.
Theimplementation oftheproposedhorizontal
measuresoffersfirmsinthemaritimesectortheoppor­
tunitytokeeppacewiththemostrecentdevelopments
andexploitfullytheadvantagesoftheinternalmarket,
Preconditions forthishoweveraremoreefficient
internalcoordinationofpolicyandabetterunderstand­
ingbetweenfirmsineachsector,theindividualecon­
omicsectors,theMemberStatesandtheCommission .
TheCommissionthereforeproposesadiscussionforum
consistingofrepresentatives ofthevariousindustries
andreserachinstitutes,themaritimeandeconomic
authoritiesoftheMemberStatesandtheCommission .
Theforum'sjobwouldbe:
—todefineingreaterdetailthescopeoftheglobal
andhorizontalapproach,
—toidentifyareasandmeasureswhichcouldimprove
thecompetitiveness ofthemaritieindustries,
—todevelopappropriatemethodsfortheimplemen­
tationofthenecessarymeasures.
TheforumshouldpresentareporttotheCommission
withinninemonthsofadoptionoftheCommission
proposal.TheCommissionwillthendecidewhatcon­
cretemeasuresareneededandshouldbeproposedin
thecommoninterestofthemaritimeindustries .
TheEconomicandSocialCommittee—oneofthe
recipientsoftheCommunication —willbesubmitting
aseparateOpinionontheEuropeanCommunity's
maritimesector.severalMemberstatestoconsiderorframetheirown
(national)plansofaction.Thedangerhere—according
totheCommission—isthat'failuretoestablishclear
guidelines (will)produceresultswhichwillcauseprob­
lemsatCommunitylevel'.Forthisreason,butalso
toemphasizetheimportancewhichtheCommunity
attachestothetextileandclothingindustry'seconomic
andsocialdifficulties,theCommissionhasputtogether
apackageofmeasuresforeffectivelyhelpingtheindus­
trytomodernizeandstrengthenitscompetitive­
ness(!).Itshouldbeborneinmindinthisconnection
thateveninthoseareaswheretheindustryhasbeen
extensivelyrestructuredandmodernized ,thetaskof
safeguardingandstrengtheningfirms'competitiveness
willbeanextremelydifficultone.
AstheCommissionseesmatters,therequisiteCom­
munitymeasuresmustsatisfytwoconditions :theymust
beintunewiththeoverallframeworkofCommunity
industrialpolicyandtheymustdojusticetothedis­
tinguishingfeaturesofeachregion.Thiswillrequirea
balancedpolicy-mix,withthefirmsthemselvesbearing
responsibility ,asever,forthestructuraladjustments .
ThenumerousCommunitysupportmeasureswillfocus
on:
—promotingandimprovingcommunications and
information ,
—improvingthetransparencyandcoherenceofState
aid,
—improvingbasicandfurthertrainingforworkers,
—steppingupresearchanddevelopment ,
—structuralfundassistancefortheregionsaffected.
TheCommunity'stextileandclothingindustryis
'extremelyinternational',andindustrialpolicy
measuresbytheCommunitymustthereforealsotake
developmentsontheworldmarketsintoconsideration .
ToppriorityshouldbegiventoreinforcingtheCom­
munity'soutward-looking approach,whileabalance
mustalsobeestablishedbetweentherightsandobli­
gationsarisingfromtheapplicationofcompetitionand
traderules.Thefollowingspecificmeasuresarelisted
intheCommissionCommunication 'schapteroncom­
mercialpolicy:
—openingupthemarketsofnon-Community
countries,
—exportpromotion,
—makingcorporatestrategiesinternational ,
—measuresagainstdumpingandsubsidies,4.4.Thetextileandclothingindustryplaysan
importantroleintheCommunity'sstructuralmake-up,
notonlyintermsofsales,productionandjobsbut
alsobecauseofthecreativityaspectandthewealthof
experienceamassed.Inthecomingyearsthisindustry
isonceagainlikelytobeunderconsiderablepressure
toadapt.Thechallengesfacingtheindustry—andin
particulartheintegrationofMediterranean andEast
Europeancountries—areforcingittospeedupthe
restructuringprocessbutalsorequiretheEuropean
Communitytodemonstrateitssolidarity.Thefactthat
thetextileandclothingindustryisofvitalimportance
forsomeoftheCommunity'slessdevelopedregions
(especiallyinPortugal,SpainandGreece)heightensthe
needforsolidarity.
TheCommissionhasbecomeincreasinglyawarein
recenttimesthatthecurrentproblemswiththeirposs­
iblestructuralandsocialrepercussionshaveprompted (MDoc.COM(91)399final.

17.2.92 NoC40/45 OfficialJournaloftheEuropeanCommunities
theCommitteewelcomesthefactthatthecouncilhas
lentitsapprovaltoaCommunityindustrialpolicy
whichtakesintoaccount'thecomplexitiesofthesitu­
ationbothinternalandexternaltotheCommunity'
andallows'amorebalanceddevelopmentandagreater
economicandsocialcohesionwithintheCom­
munity'(1).
TheCommitteethinksthatitwouldmakesenseto
includekeyobjectivesandelementsofaCommunity
industrialpolicyintheTreaty,therebyprovidingfirms
intheMemberstateswiththerightconditionsfor
exploitingtothefullthebenefitsofthesinglemarket,
EconomicandMonetaryUnionandthecommon
researchandtechnologypolicy.Provisionshouldalso
bemadeforcoordinatingnationalindustrialpolicy
decisionswithcorresponding measurestakenatCom­
munitylevelandinvolvingtheEconomicandSocial
Committeeinthis.—cooperationbetweencustomsauthoritiesinthe
Community ,
—protectionoflabels,designsandmodels,
—applicationofcommercialpolicyinstruments .
TheCommissionappealstotheMemberStatesto
ensurethatjointcomplementary actionistaken.Itis
alsotheCommission 'sfirmintentiontoco-ordinatethe
useofitsintrumentsandpolicymeasuressoasto
givelastingsupporttothestructuraladjustmentofthe
textileandclothingindustryandspeedupeconomic
diversification intheaffectedregions.
TheEconomicandSocialCommitteereservestheright
todeliveraseparateOpiniononthisCommunication ,
too.
5.Conclusions
TheconclusionsadoptedbytheCouncilofMinisters
ontheCommission'sindustrialpolicyblueprintare
notedbytheCommitteewithsatisfaction .Inparticular,(')ConclusionsoftheCouncilof26November1990onindus­
trialpolicyinanopenandcompetitiveenvironment ,docu­
ment10159/90(Presse198-G).
DoneatBrussels,27November1991.
TheChairman
oftheEconomicandSocialCommittee
FrancoisSTAEDELIN