WRITTEN QUESTION P-3407/96 by Laura González Álvarez (GUE/NGL) to the Commission (22 November 1996)

Subject: Alternatives for reindustrialization in Asturias (Spain) in the wake of the economic and social depression created by the closure of the coalmines

The Spanish Government has recently announced its intention to go ahead with the permanent closure of the Hunosa mining concern, by the year 2002. Should there not be sufficient reindustrialization before then, central Asturias could become an industrial graveyard.

The coal-mining industry in Asturias has shrunk dramatically in recent years: in 1980 there were 27 000 workers and 24 mines, producing 4 m tonnes of coal, whereas now, in 1996, only 10 000 workers and 10 mines produce 2 m tonnes.

Is the Commission aware of the extremely grave economic and social consequences of the industrial decline of Asturias and the uncertain prospects for the future?

What is the Commission's assessment of the results of the plan for the restructuring of the coal-mining industry in Asturias for 1994-1997, in terms of employment and reindustrialization?

In the event of there being (as is likely) no improvement in, or a deterioration of, the dramatic economic and social conditions linked to the gradual running down of the Hunosa, Minas de Figaredo and La Camocha concerns, will it be possible to prolong public aid to the coal-mining industry in Asturias beyond the year 2002?

Is the Commission willing to cooperate with the authorities in Asturias with a view to proposing alternatives for reindustrialization and economic diversification in this EU region, with the direct participation of the sectors of society in Asturias most concerned and, in particular, trade unions, employers' organizations, chambers of commerce and the university?

Answer given by Mr Papoutsis on behalf of the Commission (20 December 1996)

The Commission is well aware of the difficulties facing the regions in Europe whose development is lagging behind (Objective 1), and those seriously affected by industrial decline (Objective 2). In the context of the economic and social cohesion policy, the Commission has implemented specific intervention programmes in the framework of the Structural Funds in these regions, in close collaboration with the Member States, in order to expedite the programmes established under various Community support frameworks and also to implement the various Community initiatives aimed at solving problems more specific to certain regions by means of additional financing from the Structural Funds to complement these programmes.

The Commission is currently involved in combating the specifically regional problems in Asturias - classified as Objective 1 - a region particularly affected by the restructuring of various sectors, on the basis of various Structural Fund schemes totalling around 86 000 million pesetas (ECU 565 million, at 1989 rates) for the period 1989-93.

With regard to the current programming period (1994-99), the Community support framework for the development and structural adaptation of Spanish Objective 1 regions (set up by the Commission in close collaboration with the Spanish Government and approved on 28 June 1994), provides for a contribution to Asturias from the Structural Funds and the Financial Instrument for Fisheries Guidance (FIFG) estimated at ECU 1 121 million (around 180 000 million pesetas), plus supplementary aid allocated under Community initiatives such as Rechar II (ECU 16.3 million), Resider II (ECU 27.6 million), Urban (ECU 10 million), Leader (ECU 13 million) and other initiatives which are not specifically regional in nature (Adapt, Employment, Pesca, small and medium-sized enterprises, Konver II).

With regard to the plan for restructuring the coal-mining industry in Asturias for 1994-97 in particular, the Commission's opinion is that part of the industry, mainly that situated in the western district, has made progress towards economic viability, given the price of coal on the international markets, by reducing both production costs and aid. The Commission has therefore approved the operating aid allocated to this area. In contrast, the companies Hunosa, Minas de Figaredo and La Camocha have no viable economic prospects in spite of the large sums of aid they have received. It should be noted that this aid, to the extent that it conforms with Commission Decision No 3632/93/ECSC ((OJ L 329, 30.12.1993, p. 12. )) establishing Community rules for State aid to the coal industry, is approved by the Commission on social and regional grounds in order to permit the implementation of the plans for the progressive and continual reduction of activities notified by Spain in 1994. Although the reductions in the labour force in these companies are in line with the activity-reduction plan for 1994-97, the Commission nevertheless notes with concern that the financial losses of these companies in 1994, 1995 and 1996 have remained considerably higher than those notified and authorized by the Commission.

The Commission is unable to comment on the results of the results of the plan for restructuring due to a lack of information in the modernization, rationalization, restructuring and activity-reduction plans notified in 1994.

With regard to State aid to the coal-mining industry in Asturias beyond the year 2002, and without considering the economic logic of such aid, the Commission can at present only refer to the provisions relating to State aid in Articles 92 and 93 of the EC Treaty. Commission Decision No 36/93/ECSC also states that companies in receipt of aid for the reduction of activity authorized on exceptional social and regional grounds which close after the year 2002 must have completed a significant reduction in capacity before that date.

In the light of the experience of restructuring acquired in certain coal-mining regions in the Community, the Commission is willing to participate in the development of alternatives for reindustrialization and economic diversification in this region, in the framework of the cooperation procedures established with Member States.