Opinion of the Economic and Social Committee on the 'Communication from the Commission to the Council, European Parliament, the Economic and Social Committee and the Committee of the Regions: Plan of action to increase the competitiveness of the European textile and clothing industry'
Date: 1998-04-29
Institutions: European Economic and Social Committee
Subjects: action programme, clothing industry, competitiveness, textile industry

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Official Journal of the European Communities

C 214/95

Opinion of the Economic and Social Committee on the ‘Communication from the Commission
to the Council, European Parliament, the Economic and Social Committee and the Committee
of the Regions: Plan of action to increase the competitiveness of the European textile and
clothing industry’

(98/C 214/26)

On 30 October 1997 the European Commission decided, under Article 198 of the Treaty
establishing the European Community, to consult the Economic and Social Committee on the
above-mentioned communication.

The Section for Industry, Commerce, Crafts and Services, which was responsible for preparing
the Committee’s work on the subject, adopted its opinion on 1 April 1998. The rapporteur
was Mr Malosse.

The Economic and Social Committee, at its plenary session of 29 and 30 April 1998 (meeting
of 29 April) adopted the following opinion by 85 votes to 5 with 13 abstentions.

1.

Introduction

1.1.
The textile and clothing sector, a traditional
activity catering for one of the essential needs of society,
has experienced major upheavals resulting from the
international trade trend which encourages the emer-
gence of new low-wage production areas (Northern
Africa, Asia, Eastern Europe, Latin America). The
development of new technology, the changes in the
tastes and behaviour of consumers, and the retail
revolution have accelerated this change. In the European
Union,
this transformation has unfortunately been
accompanied by the loss of many jobs — particularly
the least skilled jobs, often filled by women — and by a
disastrous situation in many areas of traditional activity
which have not managed to modernize or reconvert.

There is now clearly a widening gulf between
1.2.
a part of the textile/clothing sector which is very
competitive and enterprises which are still not competi-
tive and have not managed to adapt.

1.3.
It is, however, noteworthy that the sector has
succeeded in retaining a number of its strengths, mainly
thanks to the existence of a highly integrated processing
chain, a world class equipment industry, a highly
efficient manmade fibres industry, a very large number
of highly creative SMEs and artisans, and a generally
highly skilled labour force. Other strengths include
the dynamism conferred by European fashion design
(stylists, haute-couture, ready-to-wear) which domi-
nates the world market. Also worth stressing is the
positive role as a vehicle of European fashion played by
specialized retail outlets, both abroad and in the centres
of European cities where fashion shops are located.

1.4.
In 1996 intra-Community exports reached ECU
53,4 billion, while exports to third countries rose to
ECU 30,3 billion, making this sector one of the leading
sectors for European exports. There is, however, concern
about the future because of the financial crisis in Asia,
involving devaluations which could mean for Europe a
flood of imports at low prices and more difficult access
to Asian markets.

1.5.
Despite its strengths, the sector has suffered
many job losses in recent years — estimated at 600 000
between 1990 and 1996. Indeed, forecasts for the coming
years are equally alarmist, showing a trend of 100 000
jobs lost per year. It is therefore essential to adopt an
offensive strategy which seeks to slow down and indeed
stop this job shedding, following the example of the
very numerous successes of many enterprises in the
sector which have managed to maintain or create jobs.
In order to have a better idea of what is at stake, the
ESC, in consultation with the European Commission
and the European Parliament, took oral evidence from
the main interested parties on 23 January 1998.

2. General comments

2.1.
The Commission communication has the great
merit of having sparked off a wide-ranging debate about
the idea of a real strategy for the sector at European
level. It will be possible to regard it as an authentic plan
of action if it is accompanied by more specific proposals,
by a description of the financial and human resources
required, by a timetable for implementation and by
mechanisms for the inter-departmental follow-up and
coordination which are essential for effective appli-

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cation. The Economic and Social Committee therefore
calls on the Industry Council to give practical expression
to the good intentions contained in this communication,
in view of the urgency of the expectations expressed.

The Committee regrets that this communication
2.2.
does not include a breakdown of the sector’s perfor-
mance by Member State, which would make it possible
to measure the best performances and analyse their
causes. It also regrets the absence of a more thorough
structural analysis of the sector. It is indeed essential,
even when discussing an integrated sector, to be able
to measure the diversity of trades and positions of
competitiveness effectively:

2.2.1.
and generally very efficient.

A textile machinery industry, very concentrated

A dynamic textile sector for non-garment
2.2.2.
purposes: upholstery and carpets, other industrial uses,
automobile industry.

2.2.3.
A labour-intensive ready-to-wear industry,
employing mainly women and located in sensitive
employment areas. It is dominated by small enterprises.

2.2.4.
Subcontracting, particularly in the ready-to-
wear industry, which according to the European Com-
mission’s figures employs more than 650 000 people in
the European Union, of whom 200 000 are craft workers,
some working at home; this is an essential employment
factor in certain employment areas. Made-to-measure
and sewing/repair workshops, with their specific charac-
teristics, also form part of the sector.

2.2.5.
Insufficient R&D in the European Union,
particularly where new fibres and materials, often linked
with safety and health requirements, are concerned.

2.2.6.
Fashion and haute-couture: fields where Euro-
pean designers and stylists play a leading role in the
world and contribute, through brands and design, an
added value which is often much higher than production
value alone.

Commerce is often the vehicle of fashion and
2.2.7.
European design inside and outside Europe (notably
specialized boutiques and up-market department stores
which in general give priority to quality and service),
while large-scale retailing relies more often on cheapness,
selling goods imported at very low prices which allow
for substantial mark ups.

2.3. However, the Committee is pleased to note that
the Commission acknowledges in the communication

that the textile and clothing sector is more than a
traditional activity — it is also a sunrise sector which
provides work in the European Union for 2 200 000
people, in 120 000 enterprises, many of which, regardless
of size, are very competitive and have strong growth
potential. Moreover, consideration should also be given
to distribution, which plays an essential role for this
sector, as for the footwear industry and for all fashion-
related activities and accessories. In its wider definition,
this sector thus represents about 5 million jobs in the
European Union. Even though these activities have their
own specific problems, the Committee advocates a
broader approach for the plan of action, which would
give it greater coherence and weight.

For the whole of the sector concerned, the
2.3.1.
creative and cultural content is a decisive factor for the
success of Community exports. The sale of a high-quality
garment means selling not just a fabric, but also a
content linked with ‘creativity’, knowhow, an image
and a lifestyle.

The Community must therefore contribute to promotion
measures which seek to make the most of the sector’s
cultural aspects. Creativity (patterns and designs) is a
trump card for European industry vis-à-vis international
competition.

Effective protection of this type of intellectual property
at national and international
levels is of enormous
importance for this industrial sector.

At present there is no uniform, harmonized protection
of intellectual property at Community level, applicable
to fashion patterns and designs. The Committee takes
the opportunity to stress the urgent need for a directive
on the matter, promised in the past but not yet adopted.

3. Promoting the legitimate interests of European

industry on world markets

3.1.
The subject of better access to third country
markets is insufficiently dealt with in the action plan,
and that of import controls is barely touched upon. Yet
this is an area where the Community has exclusive
powers. Whereas the European Commission, after con-
sulting the sector, recently opened up the EU more
to imports, in view of the fact that the Multifibre
Arrangement (MFA) expires in 2004, the Committee
calls for determined action on the basis of the instruments
which the European Union already has, and in accor-
dance with the rules of the WTO. Here the Committee
would stress the question of reciprocity. For example,

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European clothing products are currently subject to
22 % duties on entry to the American market, as against
only 12 % duties on the USA’s corresponding exports to
the European Union. In the field of public contracts, it
has been noted that a growing share is accounted for by
suppliers from non-member countries, whereas recipro-
city barely occurs, as a result of a very large number of
barriers or discriminatory practices which contravene
the Agreement on Government Procurement concluded
in the GATT framework.

3.2.
The European Commission has set up a database
and an Internet site which are directly accessible for
economic operators and make it possible to list barriers
to European imports by third country markets (‘Market
Access’). This database has been very successful, but its
use should be further encouraged, particularly among
those working in the textile and clothing sector, who
frequently complain of the barriers affecting them.
However, this database is only one instrument available
to the European Commission for lifting these barriers
after identifying them. In view of the large number of
barriers identified by the ‘Market Access’ base (more
than 600 in less than a year) and the small number of
cases initiated under the regulation on trade barriers,
one can only urge the Commission to be even more
aggressive in the positive sense of the term — the
approach which European Commissioner Sir Leon
Brittan announced to the Economic and Social Com-
mittee in October 1997.

3.3.
The Committee draws attention to illicit prac-
tices injurious to international trade and suggests that
all the instruments available to the European Union be
used to combat them.

In the event of dumping the Council must
3.3.1.
assume its reponsibility for deciding whether or not to
confirm the provisional anti-dumping duties. By not
confirming provisional decisions taken in accordance
with a transparent procedure, the Council could serious-
ly damage European interests.

3.3.2.
Taking as a model the stringent checks carried
out by US customs, the EU must combat all fraudulent
practices (counterfeit documents, etc.) more effectively
on the basis of the case law of the European Court of
Justice (May 1996 judgement in the ‘Faroe Seafood’
case) and the EU’s Unit on Coordination of Fraud
Prevention (UCLAF).

mission will soon be issuing a Green Paper which must
in the Committee’s view raise awareness among the
general public of the damaging effects of such practices,
e.g. in terms of jobs.

Surveillance teams should be established in ‘high-risk’
countries, in cooperation with the local authorities.
Initial soundings at the recent ‘Asia-Europe Business
Forum’ in London were encouraging.

3.3.4.
The Community must not hesitate to use the
legal weapon of a modification to the generalized scheme
of preferences (GSP) to encourage developing countries
to combat fraud and counterfeiting.

3.3.5.
The Committee also calls upon the relevant
national and Community authorities, in consultation
with trade circles, to consider the establishment of
marking showing the place of manufacture, to combat
evasion of the rules and thus ensure transparency
and proper information for the consumer. Various
approaches can be considered, taking into account a
definition based on the place where clothes are made up
and retaining the image of prestigious national marks
such as ‘made in Italy’ or ‘made in France’.

3.4.
Going beyond the current instruments, the Com-
mittee urges the Union to pursue a more offensive
strategy within the WTO — concerted with the circles
concerned — with a view to more transparent, more
balanced and more humanly acceptable rules in the field
of international trade: restriction of GSP treatment
to countries which are really in difficulty, effective
application of the reciprocity principle, and promotion
of the ILO’s social conventions through both positive
measures
(strengthened preferences) and negative
measures in the event of flagrant non-compliance (forced
labour of prisoners and children). In this context the
Committee supports the development, in consultation
with the trade, of environmental or ‘social’ labels such
as the American ‘child labour free’, provided that they
are subject to rigorous checks and harmonization to
ensure that they are not diverted to purely commercial
ends. The Committee is pleased to note that labour and
management organizations of the textiles/clothing sector
at European level, EURATEX and the FSE/THC, signed
on 22 September 1997 a ‘code of conduct’ whereby
they actively encourage their members and therefore
European enterprises in particular to comply throughout
the world, directly or indirectly, with the minimal
ILO Conventions relating to ‘core labour standards’,
safeguarding the right of association and negotiation,
and prohibiting forced labour, child labour and discrimi-
nation in employment.

It is particularly urgent to step up the fight
3.3.3.
against the circulation of counterfeit goods. The Com-

Special attention must be given, on the basis of
3.5.
these principles, to renewal of the Lomé Convention, to

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the prospect of a free trade area with South Africa and
to the probable accession of Russia and China to the
WTO. It is important to associate very closely with
these initiatives the European parties concerned, namely
industrialists, trade unionists, traders and consumers,
to ensure that European interests are not constantly
neglected in those negotiations. The Committee wishes
here to stress respect for the principles of reciprocity
and fair competition, and intends to make sure that
the European Union does not, by opening markets
unconditionally, encourage the development of activities
contrary to the essential values on which the European
Union is based, namely human rights, social rights,
children’s rights and environmental conservation. The
Committee is also pleased to note the initiative proposed
by the European textile and clothing industry for
a ‘magna carta’ to be signed by industrialists and
trade-unionists of the countries belonging to the WTO on
the principles of trade reciprocity, fairness, monitoring
measures, preventing the counterfeiting of goods, and
compliance with ILO social Conventions.

3.6.
The Committee also wishes to see tackled the
basic question of counterfeiting and ways of effectively
combating this problem, which mainly affects designers
and brands of the European clothing and accessories
industries (scarves, perfume,
footwear and jewels)
because of their worldwide reputation. The Committee
asks the European Commission to make wider use of
its prerogatives to strengthen the fight against these
practices, particularly by ensuring more effective coordi-
nation among national customs services. In the ‘sensitive’
countries, joint Commission and Member State anti-
fraud units attached to delegations and embassies would
have the task of identifying the main sources of illegal
production and of taking action with the authorities
concerned, through legal channels, to put an end to
these practices. This monitoring and enforcement action
must also concern the European Union itself, particularly
in the ‘third pillar’ context, since these practices are also
increasingly found in the EU.

3.7.
Even though public measures to promote exports
are still the sole responsibility of the national authorities,
industrialists and artisans in general wish the European
Union to support collective action on third country
markets: trade missions, exhibition centres, partici-
pation in trade fairs, logistical centres. Such activities
would in the Committee’s view be particularly appropri-
ate for SMEs and the craft trades. The abolition of
Exprom credits comes as a serious blow to the sector in
this context.

4. Subcontracting, an essential link in the chain

4.1.
As the Committee pointed out in its opinion on
‘The competitiveness of subcontracting in the European
Union’s textile and clothing sector’ (1), subcontracting
link in the chain, because it makes
is an essential
for flexibility and provides alternative to wholesale
relocation of jobs outside the European Union. The fact
that high-quality European subcontracting is on hand
boosts the competitiveness of the sector in that it enables
the sector to react very quickly to changes in the tastes
of consumers who follow the vagaries of fashion.
Subcontracting is also a factor for innovation and
creativeness thanks to the flexibility of the thousands of
craft firms and SMEs involved. For many regions it is
also a key source of employment, particularly for
women. It is therefore important at European level to
stimulate just-in-time and quality projects and good
practice. In this respect the Committee endorses the
initiatives launched by the European association EURA-
TEX with the support of the European Commission,
to facilitate rapid response research and technology
transfer. The Committee stresses the interest of broaden-
ing this initiative and of involving fashion designers and
craft firms in this upstream, and specialized retail outlets
downstream, so that this new dynamic flexibility extends
throughout the whole sector.

4.2. Outward processing traffic (OPT) and subcon-
tracting in third countries are worth analysing more
deeply. Particularly through the exchange of good
practice (benchmarking) among enterprises, it would be
possible to identify OPT which has positive effects on
local employment. The track record of the North
American NAFTA would be worth analysing in detail.
Within NAFTA, enlarged to include the Caribbean
States, a global strategy for the textile and clothing
sector has been implemented. The Committee proposes
that the European Union work out a similar strategy
with eastern and central Europe, the Mediterranean
third countries and the ACP countries which have signed
the Lomé Convention. Together with the principle of
reciprocal opening of frontiers and joint rules of origin,
a European strategy must also involve commitments to
respect basic social and environmental rules. This
strategy must also involve instruments for facilitating
inter-enterprise cooperation agreements in the large

(1) ESC opinion in OJ C 66, 3.3.1997.

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Euro-Mediterranean area: inter-enterprise cooperation
centres, joint programmes on training and new skills,
investment assistance of the JOP or ECIP type (1),
measures on health and safety at work, etc. The
Committee recommends that the likely advantages of
such a strategy be researched.

4.3.
This research will also need to cover the negative
effects of uncontrolled subcontracting which eludes any
economic or social rules: large-scale relocation to avoid
employment in the European Union, and exploitation
of local labour under conditions which violate human
dignity and flout the ILO’s Conventions.

4.4.
The use of clandestine labour in Europe continues
to plague the sector. The Committee calls for a Green
Paper assessing this phenomenon, which affects all the
countries of the Union: its scale should be estimated and
solutions proposed, and this will no doubt require closer
cooperation between Member States.

5.

Improvement of general economic conditions

5.1.
The communication deals too briefly with the
high cost of labour in Europe resulting from fiscal and
other costs. Yet this is a major problem for Europe. As
a large-scale employer, particularly of women, the textile
and clothing sector can only benefit from an easing of
charges and taxes on labour, particularly as regards less
skilled jobs. This would be an excellent way of combating
clandestine work, just as in principle reduced VAT for
labour-intensive services could encourage such activity
to develop in the sector. The Committee regrets that the
European Employment Summit did not take up the
proposals of the European Parliament to amend the
Sixth VAT Directive in order to launch pilot projects to
reduce VAT on labour-intensive services.

5.2.
The communication rightly deals with the funda-
mental role of the social dialogue in the sector, particu-
larly with a view to reduction/re-organization of work-
ing time, training and job retention/creation. The
Committee urges the social partners to concert their
efforts on the subject. It would be useful for the
Commission to survey the best practice followed in the
Member States, and particularly agreements between

the social partners aiming at flexibility of working hours
associated with the retention or the creation of jobs.
The Committee stresses that adapting working hours
would be made all the easier if accompanied by measures
to reduce labour costs, extended to all sectors so as not
to distort competition. To be effective, the social
dialogue must involve all representatives of the retail
sector, craft industry and SMEs. It is therefore important
for the Commission to ensure that the organizations
representing these groups are well represented in any
negotiation, both in general and in sectoral terms.

6. Training and skills

6.1.
The paradox of the sector is that, while there are
still low-skilled job losses, there is a shortage of skilled
labour particularly in certain regions of the Union:
skilled workers are not often attracted by an activity
whose brand image is unflattering and where the wages
are generally below the average.

6.2.
The Committee therefore stresses the importance
of an authentic training and skills policy, which would
form part of a regional strategy involving the European
Union and its neighbours (CEEC and Mediterranean
countries). As well as bringing skills and wages up to a
reasonable level, the trade must seek to make itself more
attractive to young people.

6.3.
The European Union has a role to play here. The
Committee would recommend better access to use of
the Leonardo and Adapt programmes, which have been
disappointing for many operators in the sector because
of excessive administrative constraints and inadequate
funds. In the context of the pilot actions of the European
Union, the Committee recommends that a European
network of training institutes be set up in order to
foster exchanges of experience and encourage joint
programmes. If this action is to be effective, it must also
involve the professional associations and trade unions
of the sector, including SMEs, craft industries and the
retail trade, in order to align the supply of training with
the needs of the sector.

7. Regional policy and framework for public support

(1) JOP: Joint-Venture Programme; ECIP: European Com-

munity International Investment Partners.

7.1.
The legitimacy of a Community regional policy
cannot be disputed provided that it does not lead to
create
intolerable distortions of

competition or

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production over-capacity, which would penalize the
most efficient enterprises while failing to provide real
prospects for sectors in difficulty which are simply
assisted to ensure their survival. It is in that spirit that
one must question whether the current Community
regional policy is really consistent with a policy of
organizing support on a multi-sectoral basis. It would
be healthier now to have a greater transparency on the
subject, with simple rules and more rigorous application
of them. It would be preferable to assist disadvantaged
regions by encouraging integrated measures to promote
the local textile and clothing sector: training measures,
quality control measures, technical centres, acquisition
of new technology, agreements with the specialized
retail sector. Measures for exchange of best practice
could be taken at the European level, following successful
examples.

7.2.
The European internal market is still operating
inadequately. For example, as regards public contracts
in the sector, there is very little opening up to enterprises
from other Member States. It is even extremely common
for national public buyers to drift away from European
directives: inequality of treatment based on discrimina-
tory criteria, selection based only on the lowest price,
regulatory constraints. In this context the Committee
draws attention to the recommendations in its opinion
on the Green Paper on public procurement, for the
replacement over time of badly transposed directives
with regulations, for preference to be given to the best
bid, for preferential quotas for SMEs and for the creation
of independent authorities. In the field of technical
standardization, there is a need for either harmonization
or application of the equivalence principle, in order to
put an end to national provisions — e.g. on the
environment — which can be discriminatory.

Taxation is a central factor in competitiveness
7.3.
and a major source of distortions of competition. This
matter is insufficiently covered in the Commission
communication. A proper assessment of the European
Union’s taxation systems is more necessary than ever,
particularly before the advent of the euro which will
make it easier to compare conditions of competitiveness
and competition.

7.4.
The European Commission has just quite rightly
published an explanatory communication on compe-
tition, covering trade fairs and exhibitions. This subject
is particularly sensitive in the textile and clothing sector,
where many European enterprises, particularly SMEs
and designers, complain that they are refused access to
events without being given legitimate reasons. The
Committee therefore asks the European Commission to

organize a Round Table involving the organizers of
trade fairs in the European Union and the professional
associations, in order to introduce greater transparency
in the rules for admission to these events. The Committee
also expects the Commission to take a more active role
by intervening — partly under the Regulation on trade
barriers — to defend the interests of European producers
excluded from events in third countries. This is the
traditional role of a public authority, and is preferable
to the idea of maintaining representation bureaux for
the sector abroad — an activity which obviously depends
more on private or national initiative.

8. Making the most of competitive enterprises

Despite its image as a sector in crisis, the
8.1.
European textile and clothing industry has undoubted
strong points, with many leading firms on a world scale.
In view of that, the Committee expects a plan of action
to take a more dynamic overview of the prospects for
enterprise and job creation in the sector.

8.2.
The research sector for textiles and clothing is
insufficiently developed in Europe, particularly with
regard to new materials and fibres. Many European
designers, craftsmen and enterprises are turning to
centres based in third countries. The Committee suggests
that, under the heading of measures on new materials,
the sector be directly associated with the ‘advisory
groups’ which define the priorities for action. Better
complementarity with national RTD measures should
be ensured.

8.3.
There is considerable innovation potential in the
sector, particularly with the SMEs. This potential is
insufficiently utilized, for lack of the necessary financial
and human resources. In view of this, one can envisage
a decisive contribution by the European Union to
dismantling barriers between innovation support net-
works and technical centres, developing cooperative
research procedures such as Craft and supporting
demonstration projects linked with the introduction of
new technologies. The demonstration projects could
take the form of an ‘innovation Eureka’, combining
public and private funds, European programmes and
national measures, as the Committee suggested in its
Own-initiative Opinion on ‘The impact on SMEs of the

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steady, widespread reduction in funds allocated to
research and technological development in the EU (at
Community and national level)’ (1). When applied to the
textile and clothing sector, such an initiative must
include fashion and design as forms of innovation.

8.4. One of the sector’s structural weaknesses is a
lack of financial attractiveness resulting from the low
return on the net capital invested, which puts investors
off. In the context of the growth and employment
initiatives adopted at the European Employment Summit
in Luxembourg, financial incentives were introduced to
encourage enterprise creation and investment in the
form of risk capital and guarantees. The Committee
suggests that trade organizations, in partnership with
financial intermediaries, be asked to identify projects
which could benefit from these incentives, for both
creation and relaunching of enterprises,
in view of
the high number of SMEs in the sector which are
disappearing through lack of entrepreneurs willing to
run them.

8.5.
The question of intellectual property is basic to
the development of what is a very ‘personalized’ sector.
Thus urgent adoption of the proposal for a European
directive for protection of designs and models, and of
the proposal for an authentic Community patent, must
be among the priorities of the action plan. In addition,
these legal instruments must be effective for combating
internationally the scourge which counterfeiting consti-
tutes for the sector.

9.

Industrial cooperation among enterprises in the
European Union

9.1.
In its opinion on subcontracting the Committee
had already stressed the need to ‘encourage cooperation
among SMEs, including small traders, so as to promote
liaison between the conduits of European fashion and,
where appropriate, through a policy of offering high-
quality products at competitive prices, enable SMEs to
compete more effectively with imports and defend their
interests vis-à-vis major retail chains’.

9.2. More generally, it is necessary to question wheth-
er the current instruments for supporting cooperation
(BC-NET, Interprise, Europartenariat) are really adapt-
ed to the sector’s needs. Greater sectoral specialization
in their operation is a way of identifying potential
partners more rapidly; also helpful would be information
and assistance activities on the part of the chambers
of commerce, chambers of trades and professional
organizations.

The current

9.3.
instruments for intra-European
cooperation often cease to apply after the initial contact.
In its opinion on subcontracting, the Committee had
therefore called for ‘a proper financial instrument ... for
promoting partnership between small and medium-sized
enterprises within the EU’. It is pleasing to note that
this proposal has been followed up by proposing an
instrument known as ‘JEV’ (2), corresponding to this
objective; the proposal, included in the ‘Growth and
Employment’ initiative, is welcomed and supported by
the Committee.

9.4.
Special attention could be given to instruments
for partnership (JOP, ECIP) with neighbouring third
countries, particularly in Eastern Europe and the Medit-
erranean basin. Indeed, controlled industrial cooper-
ation, which maintains the essential part of the value
added in the European Union, can encourage the
integration of these countries’ industry into the EU and
facilitate access to emerging local markets. In this
connection, the existence of industrial cooperation
centres promoted by the EU in these countries is a way
of following up these industrial cooperation projects so
as to ensure that they are approached in a spirit of
cooperation and not merely as cases of relocation. It is
also desirable to extend to Asia and South America the
partnership instruments available for promoting the
activities of European textile and clothing enterprises in
these countries.

10. Commerce and consumers

10.1.
The Committee would point out that retail is
an indispensable link in the chain, particularly where
large department stores or small
specialized retail,
retailers are concerned. In this context, it is important
for traders to be associated with all the projects,
particularly those involving training or cooperation. In
this context the Committee would draw attention to its
proposal for pilot projects for cooperation between
SMEs with the aim of creating common structures for
design, production and distribution so as to increase the
added value of each element in the chain, including
through a pricing policy, in order to compete better with
large-scale retail (3).

10.2.
The Committee would also stress the fact that
consumers are often ill-informed or uninformed about
the origin and production conditions of the products
available to them, which would warrant carrying out
a study on the introduction of origin-marking. The
Committee would stress the importance of pilot projects
which would associate producers, distributors and

(1) ESC Opinion in OJ C 355, 21.11.1997.

(2) JEV: Joint European Venture.
(3) ESC Opinion in OJ C 66, 3.3.1997.

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consumers, particularly to combat counterfeiting. The
development of social or environmental
like
marking of the place of manufacture, is also a way of
making retailers and consumers more responsible in
their choices.

labels,

10.3.
There are differing national laws with the aims
of protecting the health of consumers and protecting
the environment, particularly with regard to certain
chemicals used in the processing of textile and clothing
products. Effective operation of the internal market
requires harmonization at Community level, and the
Committee calls for a Commission initiative to ban
certain substances, particularly PCPs and azo colouring
agents, and restrict the use of formaldehyde and heavy
metals.

10.3.1.
In these fields, a special research and develop-
ment effort should be made under the fifth Community
framework programme, particularly on new substances
with properties which are beneficial to safety or health
(e.g. allergy prevention). The potential effects of new
substances just discovered must also be ascertained, and
there must be strict monitoring of imported products
which often do not conform with Community require-
ments.

11. Recommendations

Number 1

The Committee notes that the textile and clothing sector,
which directly employs 2 200 000 people in the European
Union — nearly 5 million if one includes accessories
and footwear — is a promising one with real growth
and employment potential for Europe. In particular, the
Committee would stress the positive role played by
SMEs and craft workers who ensure that the sector is
creative and flexible. In this context the Committee
would welcome a European blueprint for improving
competitiveness, provided that it contains a precise
timetable, properly identified resources and a mechanism
for follow-up and monitoring.

Number 2

The Committee takes the view that this plan of action
should concentrate primarily on the fields where the
European Union is directly competent, namely:

— An external trade policy based on reciprocity, in
which the priority must be to ensure wider access to
third country markets for European products.

— Collective promotion measures on third-country
markets through the relaunching of the Exprom
programme.

— A completed internal market, particularly in terms
of standards and the opening up of public markets.

— Encouragement and protection at Community and
international levels of European fashion design and
brands, particularly through the Community patent,
arrangements to protect designs and models, and
active measures against counterfeiting and fraud.

— Strengthened monitoring to prevent dumping and
illicit trade practices, and promotion of a charter for
fair trade at the international level.

— An active link between liberalization of trade for the
benefit of developing countries and respect for basic
social rights as defined in the ILO Conventions.

Number 3

The Committee, after submissions from the main inter-
ested parties, makes the following recommendations for
practical measures:

— Making it easier to use the European Union’s
existing financial resources (European Structural
Funds, Leonardo programme)
for measures to
improve skills and speed up the dissemination of
new technology, especially towards SMEs, craft
industries and subcontracting in general.

— Reorientating a significant share of the future frame-
work programme for R&D towards support for
innovation, creative design and the use of infor-
mation technologies (Craft and Eureka innovation
procedures). The textile and clothing sector must
also have a chance to benefit from the new ‘Growth
and Employment’ financial engineering measures
decided at the Luxembourg Summit, to cover inter-
enterprise cooperation, launching of enterprises and
their relaunching under new management, and intro-
duction of new technologies.

— Providing the plan of action with significant
resources (pilot projects, benchmarking) for encour-
aging cooperation between firms: collective pro-
motion measures aimed at third countries, use of
EDI to set up rapid-response systems involving
SMEs, craft industry, subcontractors and the special-
ized retail sector, strengthening of the JEV instrument
for firms, and finally the networking of specialized
training institutes, in association with the operators.

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C 214/103

— Commissioning a study of the effects of Asian
monetary, stock-market and structural disturbances
on the activities in the sector which are among those
most affected.

Number 4

The Committee, aware of the social stakes in a sector
which is still very largely labour-intensive, and in
view of a worrying and unacceptable contraction of
employment, advocates:

— an intensified sectoral social dialogue to achieve
progress in reorganization of working hours, upskill-
ing and employment, particularly by identifying the
most innovative agreements;

the code of conduct signed by the European social
partners;

— combating illegal work at European Union level
through coordinated action by the Member States;
— a regional strategy to develop a priority area of
commercial and industrial cooperation with eastern
European, Mediterranean, Asian and South Amer-
ican countries. This area of complementary activities
(sub-contracting, franchises, etc.) can guarantee new
outlets and increased competitiveness for the EU
textiles sector. It can also help to raise the standard
of living and the employment level in these countries,
and be accompanied by effective monitoring of
protection of, in particular, social and environmental
conditions. The Committee urges the Commission
to undertake a study of this matter in consultation
with the industry.

— effective measures at national level to ease the payroll

Number 5

taxes affecting unskilled labour;

— anticipation of

changes
through a high-level group composed of qualified
representatives of the various parties concerned;

foreseeable

industrial

— a more determined policy on the part of the European
Union to promote the basic ILO Conventions and

Brussels, 29 April 1998.

Aware of the fact that this communication must be
regarded as a starting point, the Committee recommends
the drawing-up of a precise timetable for implementing
the plan of action. Through an assessment published
annually, it would be possible for the parties concerned,
including the Economic and Social Committee, to watch
over its effective implementation.

The President

of the Economic and Social Committee

Tom JENKINS