title: Recommendation for COUNCIL REGULATION (EEC) concerning the conclusion of the Agreement in the form of an exchange of letters relating to Article 9 of Protocol 1 to the Agreement between the European Economic Community and the State of Israel and concerning the import into the Community of preserved fruit salads originating in Israel (1980)#Recommendation for COUNCIL REGULATION (EEC) on the conclusion of the Agreement in the form of an exchange of letters between the European Economic Community and the People's Democratic Republic of Algeria concerning the import into the Community of preserved fruit salads originating in Algeria (1980)#Recommendation for COUNCIL REGULATION (EEC) on the conclusion of the Agreement in the form of an exchange of letters between the European Economic Community and the Kingdom of Morocco concerning the import into the Community of preserved fruit salads originating in Morocco (1980)#Recommendation for COUNCIL REGULATION (EEC) on the conclusion of the Agreement in the form of an exchange of letters between the European Economic Community and the Republic of Tunisia concerning the import into the Community of preserved fruit salads originating in Tunisia (1980)#Recommendation for COUNCIL REGULATION (EEC) on the conclusion of the Agreement in the form of an exchange of letters between the European Economic Community and the People's Democratic Republic of Algeria on the importation into the Community of tomato concentrates originating in Algeria (1980) (submitted to the Council by the Commission) COM(79) 471 final

text:
ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (79) 471
Vol. 1979/0163
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. September 2003
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
der genannten Verordnung freigegeben.
 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                              COM(79 ) 471 final
                                              Brussels , 6 September 1979
                           Recommendation for
                        COUNCIL REGULATION ( EEC)
    concerning the conclusion of the Agreement in the form of an
     exchange of letters relating to Article 9 of Protocol 1 to
      the Agreement between the European Economic Community and
       the State of Israel and concerning the import into the
         Community of preserved fruit salads originating in
                              Israel ( 1980 )
                           Recommendation for
                        COUNCIL REGULATION ( EEC)
   on the conclusion of the Agreement in the form of an exchange
     of letters between the European Economic Community and the
       People 's Democratic Republic of Algeria concerning the
         import into the Community of preserved fruit salads
                      originating in Algeria ( 1980)
                           Recommendation for
                        COUNCIL REGULATION ( EEC)
  on the conclusion of the Agreement in the form of an exchange of
   letters between the European Economic Community and the Kingdom
  of Morocco concerning the import into the Community of preserved
               fruit salads originating in Morocco ( 1980 )
                           Recommendation for
                        COUNCIL REGULATION ( EEC )
  on the conclusion of the Agreement in the form of an exchange of
  letters between the European Economic Community and the Republic
    of Tunisia concerning the import into the Community of preserved
               fruit salads originating in Tunisia ( 1980 )
                           Recommendation for                r
                        COUNCIL REGULATION ( EEC),
                                                /•* "■           ''A
  on the conclusion of the Agreement in the' form of an exchange^ of
  letters between the European Economic Community and the People's
 Democratic Republic of Algeria on the importation into 'the - Community
        of tomato concentrates originating in Algeria ( 1980) ,'r I
                                              Ç        ...
             ( submitted to the Council by the' Commission)
  COM(79) 471 final                                       " T"
 ---pagebreak---                          Recommendations for
                     COUNCIL REGULATIONS ( EEC )
concluding the Agreement between the European Economic Community and the
State of Israel concerning the import into the Community of preserved
fruit salads originating in Israel ( 1980 )
concluding the Agreement between the European Economic Community and the
People 's Democratic Republic of Algeria concerning the import into the
Community of preserved fruit salads originating in Algeria ( 1980 )
concluding the Agreement between the European Economic Community and the
Kingdom of Morocco concerning the import into the Community of preserved
fruit salads originating in Morocco ( 1980 )
concluding the Agreement between the European Economic Community and the
Republic of Tunisia concerning the import into the Community of preserved
fruit salads originating in Tunisia ( 1980 )
concluding the Agreement between the European Economic Community and the
People 's Democratic Republic of Algeria concerning the import into the
Community of tomato concentrates originating in Algeria ( 1980 )
                              ( presented by the Commission to the Council )
 ---pagebreak---                   /
                /
                        EXFLAFATURT ÎTO-îQRAïfTOÏi
The agreement between the European Economic Cosimunity and the State of
    n t-r T-> ,
Israel and the Cooperation                            signed by the
Community and the Maghreb countries make provision for annual exchanges
of letters "to establish the details for implementation of the arrangement
agreed between the Community and the countries in question for the
importation of certain products originating in those countries .
The products concerned are i    ;          '
fruit salad from all the above-mentioned countries , and tomato concentrat
from Algeria .
                                   *
The Commission therefore recommends that the Council adopt the following
regulations concluding , for the year -1980-'V agreements in the form of
exchanges of letters concerning the importation into the Community of
fruit salad from Israel , Algeria,, Morocco and Tunisia , and tomato con
centrate from Algeria .                 '
These regulations must enter into foroe'by 1 January " 1980      ~    -
 ---pagebreak---                                                           I
                                        (Acts whose publication is obligatory)
                                  COUNCIL REGULATION ( EEC) No
              on the conclusion of the Agreement in the form of an exchange of letters
              between the European Economic Community and the People's Democratic
              Republic of Algeria concerning the import into the Community of preserved
                                     fruit salads originating in Algeria ( 19&7)
THE COUNCIL OF THE EUROPEAN
                                                              Peoples Democratic Republic of Algeria concerning
 COMMUNITIES,                                                 the import into the Community of preserved fruit
 Having regard to the Treaty establishing the European        salads originating in Algeria is hereby approved on
 Economic Community, and in particular Article 113            behalf of the Community.
 thereof,
 Having regard to the recommendation from the                 The text of the Agreement is annexed to this Regula
Commission ,                                                  tion .
Whereas the Cooperation Agreement           between the
 European Economic Community and            the People's
 Democratic Republic of Algeria (' ) was   signed on 26
April 1976 and entered into force on        1 November                               Article 2
 1978 ;
Whereas the Agreement in the form of an exchange
of letters between the European Economic Commu               The President of the Council is hereby authorized to
nity and the People's Democratic Republic of Algeria          designate the person empowered to sign the Agree
concerning the import into the Community of                   ment for the purpose of binding the Community.
preserved fruit salads originating in Algeria should be
approved.
HAS ADOPTED THIS REGULATION :                                                        Article 3
                        Article I
                                                              This Regulation shall enter into force on the day
The Agreement in the form of an exchange of letters           following its publication in the Official Journal of
between the European Economic Community and the               the European Communities.
             Thss Regulation shall be binding in its entirety and directly applicable in all Member
             States.
             Done at Brussels. .
                                                                         For the Council
                                                                           The President
(') Oj No L 263, 27. 9. 1978, p. 2.
 ---pagebreak---                                         AGREEMENT
■ in the form of an exchange of letters between the European Economic Commu
  nity and the People's Democratic Republic of Algeria concerning the import
         into the Community of preserved fruit salads originating in Algeria
  Sir,
                                                                                I
  With a view to implementing the 55 % reduction in the Common Customs Tariff duties
  provided for in Article 19 of the Cooperation Agreement concluded between the Euro
  pean Economic Community and the People's Democratic Republic of Algeria, and
  following the clarifications exchanged concerning the conditions governing imports into
  the Community of preserved fruit salads falling within subheadings 20.06 B II a) ex 9 and
  20.06 B II b) ex 9 of the Common Customs Tariff and originating in Algeria, I have the
  honour to inform you that the Algerian Government undertakes to take all necessary
  measures to ensure that the quantities supplied to the Community from 1 January to 31
  December 19SOdo not exceed 100 tonnes.
  To this end the Algerian Government declares that all exports to the Community of the
  said products will be effected exclusively by exporters whose operations are controlled by
  the 'Societe de gestion et de developpement des industries alimentaires' (SOGEDIA)
  (Society for the Administration and Development of the Foodstuffs Industries).
  The guarantees relating to quantities will be met in accordance with the procedures
  agreed between the 'Societe de gestion et de developpement des industries alimentaires'
  (SOGEDIA) and the Directorate-General for Agriculture of the Commission of the Euro
  pean Communities.
   I should be grateful if you would confirm the agreement of the Community with the fore
  going.
  Please accept, Sir, the assurance of my highest consideration.
                                                       For the Algerian Government
 ---pagebreak--- Sir.
I have the honour to acknowledge receipt of your letter of today worded as follows :
     'With a view to implementing the 55 % reduction in the Common Customs Tariff
     duties provided for in Article 19 of the Cooperation Agreement concluded between
     the European Economic Community and the People's Democratic Republic of
     Algeria, and following the clarifications exchanged concerning the conditions
     governing imports into the Community of preserved fruit salads falling within
     subheadings 20.06 B II a) ex 9 and 20.06 B II b) ex 9 of the Common Customs Tariff
     and originating in Algeria, I have the honour to inform you that the Algerian Govern
     ment undertakes to take all necessary measures to ensure that the quantities supplied
     to the Community from I January to 31 December 1950 do not exceed 100 tonnes.
   • To this end the Algerian Government declares that alL exports to the Community of
     the said products will be effected exclusively by exporters whose operations are
     controlled by the "Societe de gestion et de developpement des industries alimentaires"
     (SOGEDIA) (Society for the Administration and Development of the Foodstuffs Indus
     tries).
     The guarantees relating to quantities will be met in accordance with the procedures
     agreed between the "Societe de gestion et de developpement des industries alimen-
     taires" (SOGEDIA) and the Directorate-General for Agriculture of the Commission of
     the European Communities.
     I should be grateful if you would confirm the agreement of the Community with the
     foregoing.'                                . "
I am able to confirm the agreement of the Community with the foregoing and
consequently to state that the 55 % reduction in the Common Customs Tariff duties will
apply from 1 January to 31 December 19<50to the quantities of preserved fruit salads orig
inating in Algeria referred to in your letter.
Please accept, Sir, the assurance of my highest consideration.
                                                         On behalf of the Council
                                                      of the European Communities
 ---pagebreak---                                     COUNCIL REGULATION (EEC) No
              on the conclusion of the Agreement in the form of an exchange of letters
              between the European Economic Community and the People's Democratic
              Republic of Algeria on the importation into the Community of tomato concen
                                       trates originating in Algeria ( 1920)
THE COUNCIL OF THE EUROPEAN                                   Peoples Democratic Republic of Algeria on the
COMMUNITIES.                                                  importation into the Community of tomato concen
Having regard to the Treaty establishing the European         trates originating in Algeria is hereby approved on
Economic Community, and in particular Article 113
                                                              behalf of the Community.
thereof.
Having regard to the recommendation from the                  The text of the Agreement is annexed to this Regula
Commission,                                                   tion .
Whereas the Cooperation Agreement between the
European Economic Community and the People's
Democratic Republic of Algeria ( ' ) was signed on 26
April 1976 and entered into force on 1 November                                       Article 2
1978 ;
Whereas the Agreement in the form of an exchange
of letters between the European Economic Commu               The President of the Council is hereby authorized to
nity and the People's Democratic Republic of Algeria        • designate the person empowered to sign the Agree
on the importation into the Community of tomato               ment for the purpose of binding the Community.
concentrates originating in Algeria should be
approved,
HAS ADOPTED THIS REGULATION :                                                         Article 3
                          Article Î
                                                              This Regulation shall enter into force on the day
The Agreement in the form of an exchange of letters           following its publication in the Official Journal of
between the European Economic Community and the               the European Communities.
              This Regulation shall be binding in its entirety and directly applicable in all Member
              States.
              Done at Brussels. J
                                                                          For the Council
                                                                          . The President
( ' ) OJ No L 263, 27. 9. 1978, p. 2.
 ---pagebreak---                                       AGREEMENT
in the form of an exchange of letters between the European Economic Commu
nity and the People's Democratic Republic of Algeria on the importation into
          the Community of tomato concentrates originating in Algeria
                                • A. Letter from Algeria
Sir.
With a view to implementing the 30 % reduction in the Common Customs Tariff duties
provided for in Article 19 of the Cooperation Agreement concluded between the Euro
pean Economic Community and the People's Democratic Republic of Algeria, and
following the clarifications exchanged concerning the conditions governing imports into
the Community of tomato concentrates prepared or preserved otherwise than by vinegar
or acetic acid and falling within subheading 20.02 ex C of the Common Customs Tariff
and originating in Algeria, I have the honour to inform you that the Algerian Govern
ment undertakes to take all necessary measures in order that the quantities supplied to
the Community from I January to 31 December 1980 shall not exceed 100 tonnes.
To this end the Algerian Government declares that all exports to the Community of the
said products will be effected exclusively by exporters whose operations are controlled by
the 'Societe de gestion et de developpement des industries alimentaires' (SOGEDIA)
(Society for the Administration and Development of the Foodstuffs Industries).
The guarantees relating to quantities will be met in accordance with the procedures
agreed between SOGEDIA and the Directorate-General for Agriculture of the Commis
sion of the European Communities.
I should be grateful if you would confirm the agreement of the Community with the fore
going-
Please accept, Sir, the assurance of my highest consideration.
                                                     For the A heruin Govtrnmcnt
 ---pagebreak---                                 B. Letter from the Community
Sir,
1 have the honour to acknowledge receipt of your letter of today worded as follows :
     'With a view to implementing the 30 % reduction in the Common Customs Tariff
     duties provided for in Article 19 of the Cooperation Agreement concluded between
     the European Economic Community and the People's Democratic Republic of
     Algeria, and following the clarification exchanged concerning the conditions
     governing imports into the Community of tomato concentrates prepared or preserved
     otherwise than by vinegar or acetic acid and falling within subheading 20.02 ex C of
     the Common Customs Tariff and originating in Algeria, 1 have the honour to inform
     you that the Algerian Government undertakes to take all necessary measures in order
     that the quantities supplied to the Community from 1 January to 31 December 1 986
   • shall not exceed 100 tonnes.
     To this end the Algerian Government declares that all exports to the Community of
     the said products will be effected exclusively by exporters whose operations are
     controlled by the "Societe de gestion et de developpement des industries alimentaires"
     (SOGED1A) (Society for the Administration and Development of the Foodstuffs Indus
      tries).
     The guarantees relating to quantities will be met in accordance with the procedures
      agreed between SOGEDIA and the Directorate-General for Agriculture of the
      Commission of the European Communities.
      I should be grateful if you would confirm the agreement of the Community with the
      foregoing.'
 I am able to confirm the agreement of the Community with the foregoing and that
consequently the 30 % reduction in the Common Customs Tariff duties will apply to the
quantities of tomato concentrates originating in Algeria referred to in your letter from 1
January to 31 December 1 980. .                                              .
Please accept, Sir, the assurance of my highest consideration.
                                                        On behalf of the Council
                                                      of the European Communities
 ---pagebreak---                                     COUNCIL REGULATION ( EEC) No
               on the conclusion of the Agreement in the form of an exchange of letters
               between the European Economic Community and the Kingdom of Morocco
               concerning the import into the Community of preserved fruit salads originating
                                                in Morocco ( 1930)
THE COUNCIL OF THE EUROPEAN                                  Kingdom of Morocco concerning the import into the
COMMUNITIES.                                                 Community of preserved fruit salads originating in
                                                             Morocco is hereby approved on behalf of the Commu
 Having regard to the Treaty establishing the European       nity.
 Economic Community, and in particular Article 113
thereof.
                                                             The text of the Agreement is annexed to this Regula
 Having regard to the recommendation from the                tion .
Commission ,
Whereas the Cooperation Agreement between the
European Economic Community and the Kingdom of
Morocco ( ' ) was signed on 27 April 1976 and entered                               Article 2
into force on I November 1978 ;
Whereas the Agreement in the form of an exchange             The. President of the Council is hereby authorized to
of letters between the European Economic Commu              designate the person empowered to sign the Agree
nity and the Kingdom of Morocco concerning the               ment for the purpose of binding the Community.
import into the Community of preserved fruit salads
originating in Morocco should be approved.
HAS ADOPTED THIS REGULATION :                                                       Artich' J
                          Artnie I
                                                             This Regulation shall enter into force on the day
The Agreement in the form of an exchange of letters          following its publication in the Official Journal of
between the European Economic Community and the              the European Communities.
              This Regulation shall be binding in its entirety and directly applicable in all Member
              States.
              Done at Brussels,
                                                                        For the Council
                                                                          TJje President
( ' ) OJ No L 264, 27. 9. 1978, p. 2.
 ---pagebreak---                                        AGREEMENT
in the form of an exchange of letters between the European Economic Commu
nity and the Kingdom of Morocco concerning the import into the Community
                    of preserved fruit salads originating in Morocco
Sir.
With a view to implementing the 55 % reduction in the Common Customs Tariff duties
provided for in Article 20 of the Cooperation Agreement concluded between the Euro
pean Economic Community and^the Kingdom of Morocco, and following the clarifica
tions exchanged concerning the conditions governing imports into the Community of
preserved fruit salads falling with subheadings 20.06 B II a) ex 9 and 20.06 I) II b) ex 9 of
the Common Customs Tariff and originating in Morocco, I have the honour to inform
you that the Moroccan Government undertakes to take all necessary measures to ensure
that the quantities supplied to the Community from I January to 31 December 1980 do
not exceed 100 tonnes.
To this end the Moroccan Government declares that all exports to the Community of the
saul products will be effected exclusively by the 'Office de commercialisation ct d'exporta-
tion (OCE)' (Marketing and Exports Office).
The guarantees relating to quantities will be met in accordance with the procedures
agreed between the Marketing and Exports Office and the Directorate-General for Agricul
ture of the Commission of the European Communities.
1 should be grateful if you would confirm the agreement of the Community with the fore
going.            ;       "                                                   "' n
Please accept, Sir, the assurance of my highest consideration.
                                                      For the Moroccan Government
 ---pagebreak--- β
                                     COUNCIL REGULATION (EEC) No
                 on the conclusion of the Agreement in the form of an exchange of letters
                 between the European Economic Community and the Kingdom of Morocco
                concerning the import into the Community of preserved fruit salads originating
                                                 in Morocco ( 1930)
  THE COUNCIL OF THE EUROPEAN                                  Kingdom of Morocco concerning the import into the
  COMMUNITIES,                                                 Community of preserved fruit salads originating in
                                                               Morocco is hereby approved on behalf of the Commu
  Having regard to the Treaty establishing the European        nity. '
   Economic Community, and in particular Article 113
  thereof.
   Having regard to the recommendation from the                The text of the Agreement is annexed to this Regula
                                                               tion .
  Commission ,
  Whereas the Cooperation Agreement between the
   European Economic Community and the Kingdom of
  Morocco ( ' ) was signed or. 27 April 1976 and entered                                 A rticle 2
  into force on I November 1978 ;
  Whereas the Agreement in the form of an exchange              l he , President of the Council is hereby authorized to
  of letters between the European Economic Commu              designate the person empowered to sign the Agree
  nity and the Kingdom of Morocco concerning the               ment for the purpose of binding the Community .
  import into the Community of preserved fruit sntads
  originating in Morocco should be approved,
  HAS ADOPTED THIS REGULATION :                                                          Artide 3
                           Art ich /
                                                               This Regulation shall enter into force on the day
  The Agreement in the form of an exchange of letters          following its publication in the Officio! Journal of
  between the European Economic Community and the              the European Communities.
                This Regulation shall be binding in its entirety and directly applicable in all Member
                States.
                 Done at Brussels,
                                                                             For the Council
                                                                              77JC President
  (' ) OJ No L 264, 27. 9. 1978, p. 2.
 ---pagebreak--- Sir.
1 have the honour to acknowledge receipt of your letter of today worded as follows :
     'With a view to implementing the 55 % reduction in the Common Customs Tariff
     duties provided for in Article 20 of the Cooperation Agreement concluded between
     the European Economic Co_mmunity and the Kingdom of Morocco, and following the
     clarifications exchanged concerning the conditions governing imports into the
     Community of preserved fruit salads falling within subheadings 20.06 B II a) ex 9 and
     20.06 B II b) ex 9 of the Common Customs Tariff and originating in Morocco, I have
     the honour to inform you that the Moroccan Government undertakes to take all neces
     sary measures to ensure that the quantities supplied to the Community from 1
     January to 31 December 1980 do not exceed 100 tonnes.
     To this end the Moroccan Government declares that all exports to the Community of
     the said products will be effected exclusively by the "Office de commercialisation et
     d'exportation (OCE)" (Marketing and Exports Office).
     The guarantees relating to quantities will be met in accordance with the procedures
      agreed between the Marketing and Exports Office and the Directorate-General for
      Agriculture of the Commission of the European Communities.
      I should be grateful if you would confirm the agreement of the Community with the
      foregoing.'
I am able to confirm the agreement of the Community with the foregoing and
consequently to state that the 55 % reduction in'the Common Customs Tariff duties will
apply from i January to 31 December 1950 to the quantities of preserved fruit salads orig
inating in Morocco referred to in your letter.
Please accept, Sir, the assurance of my highest consideration.
                                                        On behalf of the Council
                                                      of the European Communities
 ---pagebreak---                                                                                a
                                       COUNCIL REGULATION ( EEC) No
                 on the conclusion of the Agreement in the form of an exchange of letters
                 between the European Economic Community and the Republic of Tunisia
                 concerning the import into the Community of preserved fruit salads originating
                                                  in Tunisia ( 1980)
  THE COUNCIL OF THE EUROPEAN                                   Republic of Tunisia concerning the import into the
  COMMUNITIES,                                                  Community of preserved fruit salads originating in
                                                                Tunisia is hereby approved on behalf of the Commu
  Having regard to the Treaty establishing the European         nity.
  Economic Community, and in particular Article 113
  thereof.
  Having regard to the recommendation from the                  The text of the Agreement is annexed to this Regula
                                                                tion .
  Commission ,
  Whereas the Cooperation Agreement between the
   European Economic Community and the Republic of
  Tunisia ( ' ) was signed on 25 April 1976 and entered                                Article 2
  into force on I November 1978 ;
  Whereas the Agreement in the form of an exchange              The President of the Council is hereby authorized to
  of letters between the European Economic Commu               designate the person empowered to sign the Agree
  nity and the Republic of Tunisia concerning the               ment for the purpose of binding the Community.
  import into the Community of preserved fruit salads
  originating in Tunisia should be approved,
  HAS ADOPTED THIS REGULATION :                                                        Article 3
                             Article /
                                                                This Regulation shall enter into force on the day
  The Agreement in the form of an exchange of letters           following its publication in the Official Journal of
  between the European Economic Community and the                the European Communities.
                 This Regulation shall be binding in its entirety and directly applicable in all Member
                 States.
                 Done at Brussels,
                                                                          . For the Council
                                                                             Tl>e President
i ( ' ) OJ No L 26.5, 27. 9. 1978, p. 2.
 ---pagebreak---                                        AGREEMENT
in the form of an exchange of letters between the European Economic Commu
nity and the Republic of Tunisia concerning the import into the Community of
                     preserved fruit salads originating in Tunisia
Sir,
With a view to implementing the 55 % reduction in the Common Customs Tariff duties
provided for in Article 19 of the Cooperation Agreement concluded between the Euro
pean Economic Community and the Republic of Tunisia, and following the clarifications
exchanged concerning the conditions governing imports into the Community of
preserved fruit salads falling within subheadings 20.06 B II a) ex 9 and 20.06 B II b) ex 9
of the Common Customs Tariff and originating in Tunisia, I have the honour to inform
you that the Tunisian Government undertakes to take all necessary measures to ensure
that the quantities supplied to the Community from I January to 31 December 1580 do
not exceed 100 tonnes.
To this end the Tunisian Government declares that all exports to the Community of the
said products will be effected exclusively by exporters whose operations are controlled by
the 'Office de Commerce de Tunisie' (Tunisian Board of Trade).
The guarantees relating to quantities will be met in accordance with the procedures
agreed between the Tunisian Board of Trade and the Directorate-General for Agriculture
of the Commission of the European Communities.
 I should be grateful if you would confirm the agreement of the Community with the fore
going.
 Please accept. Sir, the assurance of my highest consideration.
                                                     For the TunisLnt Gotxrnmcnt
 ---pagebreak--- Sir,
I have the honour to acknowledge receipt of your letter of today worded as follows :
     'With a view to implementing the 55 % reduction in the Common Customs Tariff
     duties provided for in Article 19 of the Cooperation Agreement concluded between
     the European Economic Community and the Republic of Tunisia, and following the
     clarifications exchanged - concerning the conditions governing imports into the
     Community of preserved fruit salads falling within subheadings 20.06 B 11 a) ex 9 and
     20.06 B 11 b) ex 9 of the Common Customs Tariff and originating in Tunisia, I have
     the honour to inform you that the Tunisian Government undertakes to take all neces
     sary measures to ensure that the quantities supplied to the Community from I
     January to 31 December I9J0 do not exceed 100 tonnes.
     To this end the Tunisian Government declares that all exports to the Community of
     the said products will be effected exclusively by exporters whose operations arc
     controlled by the "Office de Commerce de Tunisie" (Tunisian Board of Trade).
     The guarantees relating to quantities wil! be met in accordance with the procedures
     agreed between the Tunisian Board of Trade and the Directorate-General for Agricul
      ture of the Commission of the European Communities.
      I should be grateful if you would confirm the agreement of the Community with the
      foregoing."
I am able to confirm the agreement of the Community with the foregoing and
consequently to state liiat the 55 % reduction in the Common Customs Tariff duties will
apply from ! January to 31 December IVffOto the quantities of preserved fruit salads orig
inating in Tunisia referred 16 in your letter.
Please accept. Sir, the assurance of my highest consideration .
                                                        On behalf of the Council
                                                     of the Europetin Communities
 ---pagebreak---                                                             I
                                         (Acts whose pttbliaition is obligator)-)
                                   COUNCIL REGULATION (EEC) No
               concerning the conclusion of the Agreement in the form of an exchange of
               letters relating to Article 9 of Protocol 1 to the Agreement between the Euro
               pean Economic Community and the State of Israel and concerning the import
                   into the Community of preserved fruit salads originating in Israel ( 1930)
Till : COUNCIL OF THE EUROPEAN                                  between the European Economic Community and the
COMMUNITIES,                                                    State of Israel and concerning the import into the
Having regard to the Treaty establishing the European           Community of preserved fruit salads originating in
                                                                Israel ( 1980J is hereby approved on behalf of the
Economic Community, and in particular Article 113
thereof,
                                                                Community.
Having regard to the recommendation from the                    Th'e text of the Agreement is annexed to this Regula
Commission ,                                                    tion .
Whereas the Agreement between the European
Economic Community and the State of Israel ( ') was
signed on 11 May 1975 ;                                                                 Article 2
Whereas the Agreement in the form of an exchange
of letters relating to Article 9 of Protocol I to the said      The President of the Council is hereby authorized to
Agreement and concerning the import into the                    designate the person empowered to sign the Agree
Community of preserved fruit salads originating in              ment in order to bind the Community.
Israel should be approved,
HAS ADOPTED THIS REGULATION :                                                           Article J
                         Article I
                                                                This Regulation shall enter into force on the day
The Agreement in the form of an exchange of letters             following its publication in the Official Journal of
relating to Article 9 of Protocol I to the Agreement            the European Communities.
               This Regulation shall be binding tn its entirety and directly applicable in all Member
               States.
               Done at Brussels.
                                                                            For the Council
                                                                              The President
(') OI No L 136, 28. 5. 197S, p. 3.
 ---pagebreak---                                        AGREEMENT
in the form of an exchange of letters relating to Article 9 of Protocol 1 to the
Agreement between the European Economic Community and the State of Israel
and concerning the import into the Community of preserved fruit salads origi
                                   nating in Israel ( 19ft?)
                                         Letter No 1
Sir,
In pursuance of Article 9 of Protocol 1 to the Agreement concluded between the Euro
pean Economic Community and the State of Israel and following the clarifications
exchanged concerning the conditions governing imports into the Community of
preserved fruit salads, falling within subheadings 20.06 B II a) ex 9 and 20.06 B II b) ex 9
of the Common Customs Tariff and originating in Israel, I have the honour to inform
you that Israel undertakes to take all necessary measures in order that the quantities
supplied to the Community from 1 January to 31 December 1990 will not exceed 220
tonnes .
To this end the Government cf the State of Israel declares that all exports to the Commu
nity of the products concerned will be effected exclusively by exporters whose operations
are controlled by the Israeli Ministry cf Commerce, Industry and Tourism.
The guarantees relating tc the qusntitics ~;;1! be met in accordance with the procedures
agreed between that Ministry and the Directorate -Genera! for Agriculture of the Commis
sion of the European Communities.
 I should be grateful if you weu'iJ '.Indly confirm the agreement of the Community with
the foregoing.
 Please accept. Sir, the as:urance of my highest consideration.
                                                          For the Government of
                                                             the State of Israel
 ---pagebreak---                                          Letter No 2
Sir,
I have the honour to acknowledge receipt of your letter of today worded as follows :
     'In pursuance of Article 9 of Protocol 1 to the Agreement concluded between the
     European Economic Community and the State of Israel and following the clarifica
     tions exchanged concerning the conditions governing imports into the Community
     of preserved fruit salads, falling within subheadings 20.06 B II a) ex 9 and 20.06 B II
     b) ex 9 of the Common Customs Tariff and originating in Israel, I have the honour
     to inform you that Israel undertakes to take all necessary measures in order that the
     quantities supplied to the Community from 1 January to 31 December 192towill not
     exceed 220 tonnes.
     To this end the Government of the State of Israel declares that all exports to the
     Community of the products concerned will be effected exclusively by exporters
     whose operations are controlled by the Israeli Ministry of Commerce, Industry and
     Tourism .
     The guarantees relating to the quantities will be met in accordance with the proce
     dures agreed between that Ministry and the Directorate-General for Agriculture of
     the Commission of the European Communities.
     I should be grateful if you would kindly confirm the agreement of the Community
     with the foregoing.'
I am able to confirm the agreement of the Community with the foregoing.
Please accept, Your Excellency, the assurance of my highest consideration.
                                                        On behalf of the Council of
                                                   the European Economic Communities
 ---pagebreak---                  FlftSA^CSAL               STATEJV5SWT
                                                                                Date : 23-7 - 1979
1 . BUDGET HEADING : 12 ( receipts )                                              APPROBATIONS s     4,7455 MUCE
2. TITLE : Draft Council regulations on the conclusion of agreements "between the EEC
     and Algeria , Morocco , Tunisia and. Israel concerning the import into the Community
     of preserved fruit salads from these countries and of tomato concentrate originat                                       ng
3 . LEGAL BASIS : Article 1 1 3 of the Treaty
4 . AIMS OF PROJECT : Re–e ractement of the reduction of 55^ of the CCT ( 30% for the tomato
     concentrate ) on importation of these products into the Community for the year
     1980 .
 5 . FINANCIAL IMPLICATIONS                  PERIOD OF 12 MONTHS    CURRENT FINANCIAL YEAR   FOLLOWING FINANCIAL TEAR
                                                                           (         I             (         I
 5.0 EXPENDITURE
      - CHARGED TO THE EC BUDGET
        ( RE FUNDS / INTERVENTIONS )
      » NATIONAL ADMINISTRATION
      - OTHER
 5.1 RECEIPTS
      - OWN RESOURCES OF THE EC
        CUSXSS / CUSTOMS DUTIES )        1    !{!cl3C î 45«000 UCB                         [ma*. 45 .OOO UCE
      - NATIONAL
 5.0.1 ESTIMATED EXPENDITURE
 5.1.1 ESTIMATED RECEIPTS
 5.2 METHOD OF CALCULATION           Fruit salad
                                     Israel                    220 t x 77 ECU - 16.940 ECU
                                     Algeria                   100 t X 77 ECU =          7.700 ECU
                                     Morocco                   100 t x 77 ECU -          7.700 ECU
                                     Tunisie                   100 t X 77 ECU =          7.700 ECU
                                     Tomato Concentrate
                                     Algeria                   100 t x 43 ECU ». 4 . 300 ECU
                                                                      max.              44.340 ECU
 6.0 XMSCJH&BSeXKXMfcxaSMaGttOUBCat^KaafflUeEiOiasaaaOH^^                                                                  2
                                                                                YBGXBD    I
 6.1 sôîioaÊxaEa3©cxîetxMît^6<BxJcscjc3fflsx5§sjeyËâat^!!fâ£)diaitx3Éxî^^
 6.2 XXX2CXK3lXK5£SC3<B!tXl3CQU]E050B£E&S£K@EXX
                                                                                3Ê&tîfâc
 6.3 WILL FUTURE BUDGET APPROBIATIONS BE NECESSARY ?
                                                                                YES / SOC
 OBSERVATIONS :
                        Non-levying of oustoms duties .


title: Recommendation for a Council opinion in accordance with the third paragraph of Article 5 of Council Regulation (EC) No 1466/97 of 7 July 1997 on the updated stability programme of Greece, 2006-2009

text:
Important legal notice

|

52007SC0187

Recommendation for a Council opinion in accordance with the third paragraph of Article 5 of Council Regulation (EC) No 1466/97 of 7 July 1997 On the updated stability programme of Greece, 2006-2009  /* SEC/2007/0187 final */

	[pic] | COMMISSION OF THE EUROPEAN COMMUNITIES |Brussels, 13.2.2007SEC(2007) 187 finalRecommendation for aCOUNCIL OPINIONin accordance with the third paragraph of Article 5 of Council Regulation (EC) No 1466/97 of 7 July 1997 On the updated stability programme of Greece, 2006-2009(presented by the Commission)EXPLANATORY MEMORANDUM1. GENERAL BACKGROUNDThe Stability and Growth Pact, which entered into force on 1 July 1998, is based on the objective of sound government finances as a means of strengthening the conditions for price stability and for strong sustainable growth conducive to employment creation. The 2005 reform of the Pact acknowledged its usefulness in anchoring fiscal discipline but sought to strengthen its effectiveness and economic underpinnings as well as to safeguard the sustainability of the public finances in the long run.Council Regulation (EC) No 1466/97 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies[1], which is part of the Stability and Growth Pact, stipulates that Member States have to submit, to the Council and the Commission, stability or convergence programmes and annual updates thereof (Member States that have already adopted the single currency submit (updated) stability programmes and Member States that have not yet adopted it submit (updated) convergence programmes). The first stability programme of Greece was submitted in June 2000. In accordance with the Regulation, the Council delivered an opinion on it on 12 February 2001 on the basis of a recommendation from the Commission and after having consulted the Economic and Financial Committee. In accordance with the same procedure, updated stability and convergence programmes are assessed by the Commission and examined by the Committee mentioned above, while the Council may examine them.2. BACKGROUND FOR THE ASSESSMENT OF THE UPDATED PROGRAMMEThe Commission has examined the most recent update of the stability programme of Greece, submitted on 18 December 2006, and has adopted a recommendation for a Council opinion on it (see box for the main points covered by the assessment).In order to set the scene against which the budgetary strategy in the updated stability programme is assessed, the following paragraphs summarise:1.  the economic and budgetary performance over the last ten years2.  the country’s position under the corrective arm of the Stability and Growth Pact (excessive deficit procedure)3.  the most recent assessment of the country’s position under the preventive arm of the Stability and Growth Pact (summary of the Council opinion on the previous update of the stability programme); and4.  the Commission’s assessment of the October 2006 national reform programme.2.1. Recent economic and budgetary performanceGreece has experienced high economic growth and is closing the gap with the EU-25 in terms of living standards[2]. It faces high inflation originating from a mixture of high potential growth and structural problems (product market rigidities). Despite labour shortages in specific sectors, labour market rigidities hinder the reallocation of labour and thus, unemployment remains high, which points to possible mismatches between skills and firm's needs, while participation is low by EU standards, especially of women. Although labour productivity growth is healthy, unit labour costs are increasing faster and in excess of Greece's main trade partners in the euro-area, thus worsening the competitive position of the country. Consequently, Greece records high trade deficits, only partly compensated by surpluses in services. Behind the external deficit largely lies the deficit of the public sector. Greece has traditionally recorded deficits above 3% of GDP. Greece is a high debt country that also faces the risks of the growing cost of the public health system and other current expenditures. This public expenditure pattern is worrying not only because external borrowing is not channelled to productive investments, but also because the external borrowing is dependent on the credibility and sustainability of public finances.2.2. The excessive deficit procedure for GreeceOn 5 July 2004 the Council adopted a decision stating that Greece had an excessive deficit in accordance with Article 104(6). At the same time, the Council addressed a recommendation under Article 104(7) specifying that the excessive deficit had to be corrected by 2006.On 18 January 2005, the Council decided in accordance to Article 104(8) that Greece had not taken effective action in response to this recommendation and, in accordance with Article 104(9), on 17 February 2005, the Council decided to give notice to Greece to take measures for the deficit reduction judged necessary to remedy the situation. According to this notice, the excessive deficit still has to be corrected by 2006. On 6 April 2005, the Commission adopted a communication to the Council on the action taken by the Greek authorities in response to the Council notice, taking account of the March 2005 update of the stability programme submitted as part of the follow-up to the Council notice. The communication concluded that, on then available information, the Greek government had taken decisions consistent with the Council notice so that no further steps under the EDP were needed at that stage. In its meeting of 12 April 2005, the Council concurred with this assessment.2.3. The assessment in the Council opinion on the previous programmeOn 14 March 2006, the Council adopted its opinion on the previous update of the stability programme, covering the period 2005-2008. The Council “welcome[d] the efforts undertaken so far and the priority given by the government to a permanent reduction of the deficit”. The Council noted that “overall, the programme is consistent with the correction of the excessive deficit by 2006, subject to a full implementation of the envisaged adjustment and conditional on the effects on the planned deficits of possible further statistical revisions of budgetary data”. In the light of the recommendations made by the Council under Article 104(9) of 17 February 2005, the Council invited Greece to:“(i) implement the necessary permanent measures leading to the correction of the excessive deficit by 2006 at the latest;(ii) further pursue the reduction of the deficit in structural terms towards the MTO set in the programme, taking advantage of good economic times to reduce primary spending;(iii) enhance the efforts to identify and control factors other than net borrowing that contribute to the change in the debt levels, in order to ensure that the debt ratio is sufficiently diminishing and approaching the reference value at a satisfactory pace;(iv) control public pension expenditure, resolutely implement the approved pension reforms and carry out additional structural reform to ensure the long term sustainability of the public finances;(v) further improve the collection and processing of the general government data, notably by enhancing the mechanisms that ensure a prompt and correct supply of budgetary data, in particular on social security”.2.4. The Commission assessment of the October 2006 national reform programmeThe implementation report of the national reform programme of Greece, provided in the context of the renewed Lisbon strategy for growth and jobs, was submitted on October 2006. Greece's national reform programme identifies as key challenges: fiscal consolidation; R&D and innovation; modernising public administration; active labour market policies and the reforms of education and training.The Commission’s assessment of this programme (adopted as part of its December 2006 Annual Progress Report[3]) showed that Greece is making limited progress in the implementation of its national reform programme. Greece is moving ahead relatively strongly in the macro-economic area, whereas progress with micro-economic and employment reforms is still insufficient. Regarding governance, better coordination and stronger ownership among administrative levels is needed.Box: Main points covered by the assessment As required by Article 5(1) (for stability programmes) and Article 9(1) (for convergence programmes) of Council Regulation (EC) No 1466/97, the assessment covers the following points: whether the economic assumptions on which the programme is based are plausible; the medium-term budgetary objective (MTO) presented by the Member State and whether the adjustment path towards it is appropriate; whether measures being taken and/or proposed to respect that adjustment path are sufficient to achieve the MTO over the cycle; when assessing the adjustment path towards the MTO, whether a higher adjustment effort is made in economic good times, whereas the effort may be more limited in economic bad times, and, for euro-area and ERM II Member States, whether the Member State pursues an annual improvement of the cyclically-adjusted balance, net of one-off and other temporary measures, of 0.5% of GDP as a benchmark to meet its MTO; when defining the adjustment path to the MTO (for Member States that have not yet reached it) or allowing a temporary deviation from the MTO (for Member States that have), the implementation of major structural reforms which have direct long-term cost-saving effects (including by raising potential growth) and therefore a verifiable impact on the long-term sustainability of public finances (subject to the condition that an appropriate safety margin with respect to the 3% of GDP reference value is preserved and that the budgetary position is expected to return to the MTO within the programme period), with special attention for pension reforms introducing a multi-pillar system that includes a mandatory, fully-funded pillar; whether the economic policies of the Member State are consistent with the broad economic policy guidelines. The plausibility of the programme’s macroeconomic assumptions is assessed by reference to the Commission services’ autumn 2006 forecast, using also the commonly agreed methodology for the estimation of potential output and cyclically-adjusted balances. The assessment of consistency with the broad economic policy guidelines is made against the broad economic policy guidelines in the area of public finances as included in the integrated guidelines for the period 2005-2008. The assessment also examines: the evolution of the debt ratio and the outlook for the long-term sustainability of the public finances, which should be given “sufficient attention in the surveillance of budgetary positions” according to the Council report of 20 March 2005 on “Improving the implementation of the Stability and Growth Pact”. A Commission Communication of 12 October 2006 sets out the approach to the assessment of long-term sustainability[4]; the degree of integration with the national reform programme, submitted by Member States in the context of the Lisbon strategy for growth and jobs. In its cover note of 7 June 2005 to the European Council on the broad economic policy guidelines for the period 2005-2008, the ECOFIN Council stated that the national reform programmes should be consistent with the stability and convergence programmes; compliance with the code of conduct[5], which inter alia prescribes a common structure and set of data tables for the stability and convergence programmes. |-  Recommendation for aCOUNCIL OPINIONin accordance with the third paragraph of Article 5 of Council Regulation (EC) No 1466/97 of 7 July 1997 On the updated stability programme of Greece, 2006-2009THE COUNCIL OF THE EUROPEAN UNION,Having regard to the Treaty establishing the European Community,Having regard to Council Regulation (EC) No 1466/97 of 7 July 1997 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies[6], and in particular Article 5(3) thereof,Having regard to the recommendation of the Commission,After consulting the Economic and Financial Committee,HAS DELIVERED THIS OPINION:5.  On [27 February 2007] the Council examined the updated stability programme of Greece, which covers the period 2006 to 2009[7].6.  The macroeconomic scenario underlying the programme envisages that real GDP growth will be broadly stable at around 4% per year. Assessed against currently available information, this scenario appears to be based on plausible growth assumption for 2006 and 2007 but on favourable ones thereafter when the projected evolution of growth appears to be on the high side. The programme’s projections for inflation appear to be on the low side in the outer years of the programme period.7.  For 2006, the general government deficit is estimated at 2.6% of GDP in the Commission services’ autumn 2006 forecast and in the new update, fully in line with the target set in the previous update of the stability programme. Total expenditures achieved the target set in the 2006 budget. While the main categories of expenditure broadly achieved the targets, a reduction in social transfers other than in kind fully compensated a ½% of GDP overrun in public investment. Total revenues were marginally higher than expected. One-off measures were partly substituted by permanent measures implemented in the middle of the year, namely increases of the excise tax on fuel and cigarettes, and a tax increase on mobile connection bills. Revenues from these permanent measures compensated for the reduction in one-off revenues from 0.6% of GDP set in the 2006 budget to 0.4% of GDP.8.  The budgetary strategy in the programme aims at correcting the excessive deficit in 2006. Thereafter, the government deficit is planned to continue narrowing steadily over the programme period, to 1.2% of GDP in 2009. The deficit reduction by 1½ percentage point of GDP between 2006 and 2009 is spread almost equally between revenue increase and expenditure reduction. On the revenue side, total revenue is expected to increase by ¾ p.p. of GDP, mainly driven by indirect taxes and social contributions. On the expenditure side, total expenditure is projected to fall by around ¾ p.p. of GDP over the same period, of which ½ p.p., corresponds to lower interest payments. As a result, reductions in primary expenditure are projected to be limited to just ¼ p.p.. Social transfers are projected to increase by ½ p.p., which would be more than compensated by reductions amounting ¾ p.p. in other expenditure categories, mainly collective consumption. The primary surplus would improve by around 1 percentage point over the programme period, to close to 3% of GDP by 2009. Although, compared with the previous programme, the targets for 2006-2008 are broadly unchanged with the same macroeconomic scenario, the current adjustment in 2006 is more significant since the deficit outcome for 2005 (5.2% of GDP) is higher than projected in the update of December 2005 (4.3% of GDP).9.  The structural balance (i.e. the cyclically-adjusted balance net of one-off and other temporary measures) calculated according to the commonly agreed methodology is planned to improve from a deficit of around 3½% of GDP in 2006 to 1¾% at the end of the programme period (2009). As in the previous update of the stability programme, the medium-term objective (MTO) for the budgetary position presented in the programme is balanced or in surplus in structural terms, which the programme does not aim to achieve within the programme period. As the MTO is more demanding than the minimum benchmark (estimated at a structural deficit of around 1½% of GDP), achieving it should fulfil the aim of providing a safety margin against the occurrence of an excessive deficit. The MTO lies within the range indicated for euro-area and ERM II Member States in the Stability and Growth Pact and the code of conduct and adequately reflects the debt ratio and average potential output growth in the long term.10.  The risks to the budgetary projections in the programme appear broadly balanced until 2007 but the budgetary outcomes could be worse than projected in the programme thereafter. In particular, for 2008 and 2009, the programme does not provide sufficient information on measures envisaged and is based on a favourable macroeconomic scenario. Based on past experience, and although no slippages have been recorded for the last two years, risks of expenditure overruns over the programme period can not be excluded, while revenue shortfalls may materialise if the announced measures to fight tax evasion would turn out ineffective.11.  In view of this risk assessment, the budgetary stance in the programme is consistent with a correction of the excessive deficit by 2006 as recommended by the Council. However, it does not seem to provide a sufficient safety margin against breaching the 3% of GDP deficit threshold with normal macroeconomic fluctuations within the programme's horizon. In the years following the correction of the excessive deficit, Greece is expected to continue to experience good times. In view of this assessment, the pace of the adjustment towards the MTO implied by the programme should be strengthened, especially after 2007, to be in line with the Stability and Growth Pact, which specifies that, for euro-area and ERM II Member States, the annual improvement in the structural balance should be 0.5% of GDP as a benchmark and that the adjustment should be higher in good economic times and could be lower in bad economic times.12.  Government gross debt is estimated to have reached 104% of GDP in 2006, far above the 60% of GDP Treaty reference value. The programme projects the debt ratio to gradually decline by almost 13 percentage points of GDP over the programme period, while stock-flow adjustments are very small starting from 2007. The evolution of the debt ratio after 2007 is likely to be less favourable than projected in the programme given the favourable growth projections and the risks to the deficit targets mentioned above. Nevertheless, in view of this risk assessment, the debt ratio seems to be sufficiently diminishing towards the reference value over the programme period.13.  The long-term budgetary impact of ageing in Greece is uncertain as long-term projections of pension expenditure are not available; however, it is very likely to be well above the EU average; according to the latest available information from the 2002 updated Greek stability programme, a significant increase in pension expenditure as a share of GDP is projected over the long term. The initial budgetary position, albeit improved compared with 2005, constitutes a significant risk to sustainable public finances even before considering the long-term budgetary impact of an ageing population. Moreover, the current level of gross debt is well above the Treaty reference value and reducing it requires achieving high primary surpluses for a long period of time. Consolidating the public finances as planned, together with urgent reform measures aimed at containing the likely significant increase in age-related expenditures, would contribute to reducing risks to the long-term sustainability of public finances. Overall, Greece appears to be at high risk with regard to the sustainability of public finances. The availability of long-term projections of pension expenditure would improve the assessment of long term budgetary sustainability.14.  The stability programme does not contain a qualitative assessment of the overall impact of the October 2006 implementation report of the national reform programme within the medium-term fiscal strategy. In addition, it provides no systematic information on the direct budgetary costs or savings of the main reforms envisaged in the national reform programme and, excluding 2007, its budgetary projections do not explicitly take into account the public finance implications of the actions outlined in the national reform programme. Nevertheless, the measures in the area of public finances envisaged in the stability programme seem consistent with those foreseen in the national reform programme. In particular, the majority of the measures and actions planned for 2007 in the implementation report of the national reform programme seem to have been included in the 2007 Budget Law, even if the lack of detailed description of the measures and their implementation raises doubts over the budgetary implications.15.  The budgetary strategy in the programme is broadly consistent with the broad economic policy guidelines included in the integrated guidelines for the period 2005-2008.16.  As regards the data requirements specified in the code of conduct for stability and convergence programmes, the programme provides all required and most of the optional data[8].The overall conclusion is that, following a significant fiscal consolidation and in a context of strong growth prospects, the programme is consistent with the correction of the excessive deficit by 2006 and it envisages progress towards the MTO, which however would not be attained within the programme period. The consolidation, which also relies on a significant decline in the interest burden, is subject to risks as specific measures are not fully spelled out after 2007.In view of the above assessment, Greece is invited to:(i) taking into account the good times, strengthen, after the excessive deficit has been corrected, the adjustment towards the MTO and ensure that the debt-to-GDP ratio is reduced accordingly;(ii) continue improving the budgetary process by increasing its transparency, spelling out the budgetary strategy within a longer time perspective and effectively implementing mechanisms to monitor and control primary expenditure;(iii) in view of the very high level of debt and the projected increase in age-related expenditure, improve the long-term sustainability of public finances by achieving the MTO, controlling public pension and healthcare expenditures and resolutely implementing the enacted reforms; and produce as soon as possible long-term projections for age-related expenditure.Comparison of key macroeconomic and budgetary projections2005 | 2006 | 2007 | 2008 | 2009 |Real GDP (% change) | SP Dec 2006 | 3.7 | 4.0 | 3.9 | 4.0 | 4.1 |COM Nov 2006 | 3.7 | 3.8 | 3.7 | 3.7 | n.a. |SP Dec 2005 | 3.6 | 3.8 | 3.8 | 4.0 | n.a. |HICP inflation (%) | SP Dec 2006 | 3.5 | 3.3 | 3.3 | 2.8 | 2.6 |COM Nov 2006 | 3.5 | 3.3 | 3.3 | 3.3 | n.a. |SP Dec 2005 | 3.5 | 3.2 | 3.0 | 2.7 | n.a. |Output gap (% of potential GDP) | SP Dec 20061 | 0.9 | 1.0 | 0.9 | 1.1 | 1.5 |COM Nov 20065 | 1.5 | 1.5 | 1.5 | 1.8 | n.a. |SP Dec 20051 | 1.1 | 1.1 | 1.1 | 1.5 | n.a. |General government balance (% of GDP) | SP Dec 2006 | -5.2 | -2.6 | -2.4 | -1.8 | -1.2 |COM Nov 2006 | -5.2 | -2.6 | -2.6 | -2.4 | n.a. |SP Dec 2005 | -4.3 | -2.6 | -2.3 | -1.7 | n.a. |Primary balance (% of GDP) | SP Dec 2006 | -0.4 | 2.0 | 2.0 | 2.4 | 2.9 |COM Nov 2006 | -0.4 | 2.0 | 1.8 | 1.7 | n.a. |SP Dec 2005 | 0.9 | 2.3 | 2.4 | 2.8 | n.a. |Cyclically-adjusted balance (% of GDP) | SP Dec 20061 | -5.6 | -3.0 | -2.8 | -2.3 | -1.8 |COM Nov 2006 | -5.9 | -3.3 | -3.3 | -3.1 | n.a. |SP Dec 20051 | -4.8 | -3.1 | -2.8 | -2.4 | n.a. |Structural balance2 (% of GDP) | SP Dec 20063 | -5.6 | -3.4 | -2.8 | -2.3 | -1.8 |COM Nov 20064 | -5.9 | -3.7 | -3.3 | -3.1 | n.a. |SP Dec 2005 | -4.8 | -3.7 | -2.8 | -2.4 | n.a. |Government gross debt (% of GDP) | SP Dec 2006 | 107.5 | 104.1 | 100.1 | 95.9 | 91.3 |COM Nov 2006 | 107.5 | 104.8 | 101.0 | 96.4 | n.a. |SP Dec 2005 | 107.9 | 104.8 | 101.1 | 96.8 | n.a. |Notes: 1 Commission services calculations on the basis of the information in the programme. 2 Cyclically-adjusted balance (as in the previous rows) excluding one-off and other temporary measures. 3 One-off and other temporary measures taken from the programme (0.4% of GDP in 2006). 4 One-off and other temporary measures taken from the Commission services’ autumn 2006 forecast (0.4% of GDP in 2006). 5 Based on estimated potential growth of 3.7%, 3.8%, 3.6% and 3.5% respectively in the period 2005-2008. Source: Stability programme (SP); Commission services’ autumn 2006 economic forecasts (COM); Commission services’ calculations. |[1] OJ L 209, 2.8.1997, p. 1. Regulation as amended by Regulation (EC) No 1055/2005 (OJ L 174, 7.7.2005, p. 1). All the documents referred to in this text can be found at the following website:http://europa.eu.int/comm/economy_finance/about/activities/sgp/main_en.htm[2] On 22 September, the Greek authorities transmitted to Eurostat new GDP data for the period 1995–2005, showing a sharp revision of GDP levels. This revision was carried out within the regular assessment process of compliance with Eurostat's statistical practices. However, the update of the stability programme (and the 2007 Budget Law) does not take into consideration the revised GDP figures. Given the magnitude and complexity of the revision, which is still undergoing complete verification by Eurostat, the Commission in its assessment of the updated programme has used the series of GDP data preceding such revision.[3] Communication from the Commission to the Spring European Council, “Implementing the renewed Lisbon strategy for growth and jobs - A year of delivery” - COM(2006) 816, 12.12.2006.[4] Communication from the Commission to the Council and the European Parliament, “The long-term sustainability of public finances in the EU” - COM(2006) 574, 12.10.2006 - and European Commission, Directorate-General for Economic and Financial Affairs (2006), “The long-term sustainability of public finances in the European Union”, European Economy No 4/2006.[5] “Specifications on the implementation of the Stability and Growth Pact and guidelines on the format and content of stability and convergence programmes”, endorsed by the ECOFIN Council of 11 October 2005.[6] OJ L 209, 2.8.1997, p. 1. Regulation as amended by Regulation (EC) No 1055/2005 (OJ L 174, 7.7.2005, p. 1). The documents referred to in this text can be found at the following website:http://europa.eu.int/comm/economy_finance/about/activities/sgp/main_en.htm[7] The update was submitted 2 weeks beyond the 1 December deadline set in the code of conduct.[8] In particular, data on general government expenditure by function, long-term sustainability and contributions to potential GDP growth are missing.


title: Council Recommendation of 12 July 2011 on the National Reform Programme 2011 of France and delivering a Council opinion on the updated Stability Programme of France, 2011-2014

text:
               20.7.2011

               EN

               Official Journal of the European Union

               C 213/8

         COUNCIL RECOMMENDATION
   of 12 July 2011
   on the National Reform Programme 2011 of France and delivering a Council opinion on the updated Stability Programme of France, 2011-2014
   2011/C 213/03
   THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union, and in particular Articles 121(2) and 148(4) thereof,
   Having regard to Council Regulation (EC) No 1466/97 of 7 July 1997 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies (1), and in particular Article 5(3) thereof,
   Having regard to the recommendation of the European Commission,
   Having regard to the conclusions of the European Council,
   Having regard to the opinion of the Employment Committee,
   After consulting the Economic and Financial Committee,
   Whereas:

               (1)

               On 26 March 2010, the European Council agreed to the Commission’s proposal to launch a new strategy for jobs and growth, Europe 2020, based on enhanced coordination of economic policies, which will focus on the key areas where action is needed to boost Europe’s potential for sustainable growth and competitiveness.

               (2)

               On 13 July 2010, the Council adopted a recommendation on the broad guidelines for the economic policies of the Member States and the Union (2010 to 2014) and, on 21 October 2010, adopted a decision on guidelines for the employment policies of the Member States (2), which together form the ‘integrated guidelines’. Member States were invited to take the integrated guidelines into account in their national economic and employment policies.

               (3)

               On 12 January 2011, the Commission adopted the first Annual Growth Survey, marking the start of a new cycle of economic governance in the EU and the first European semester of ex-ante and integrated policy coordination, which is anchored in the Europe 2020 strategy.

               (4)

               On 25 March 2011, the European Council endorsed the priorities for fiscal consolidation and structural reform (in line with the Council’s conclusions of 15 February and 7 March 2011 and further to the Commission’s Annual Growth Survey). It underscored the need to give priority to restoring sound budgets and fiscal sustainability, reducing unemployment through labour market reforms and making new efforts to enhance growth. It requested Member States to translate these priorities into concrete measures to be included in their stability or convergence programmes and national reform programmes.

               (5)

               On 25 March 2011, the European Council also invited the Member States participating in the Euro Plus Pact to present their commitments in time to be included in their stability or convergence programmes and their national reform programmes.

               (6)

               On 3 May 2011, France submitted its 2011 stability programme update covering the period 2011-2014 and its 2011 national reform programme. In order to take account of the interlinkages, the two programmes have been assessed at the same time.

               (7)

               France was relatively less affected than other Member States by the economic and financial crisis, with a decline of 2,7 % in GDP in 2009, partly due to sizeable economic stabilisers and the resilience of household consumption. The banking sector also proved to be resilient. In 2010, the economy recovered and, overall, GDP growth came out at 1,5 %. However, the economic crisis has substantially impacted France's public finances. Due to the automatic stabilisers and discretionary fiscal stimulus, the general governement deficit rose from 3,3 % of GDP in 2008 to 7,5 % in 2009. Similarly, the crisis has exacerbated the insufficient utilisation of labour and the structural weaknesses of the French labour market, where there was a relatively high level of unemployment of 9,7 % in 2010. In addition, the trade balance of goods has gradually deteriorated during the last decade, highlighting the challenges of French companies in terms of cost and non-price competitiveness.

               (8)

               Based on the assessment of the updated stability programme pursuant to Regulation (EC) No 1466/97, the Council is of the opinion that the macroeconomic scenario underpinning the budgetary projections is favourable, especially as expected growth levels remain well above the potential growth in later years. After a better-than-expected deficit of 7 % of GDP in 2010, the stability programme plans to bring it down to 3 % of GDP in 2013, which is the deadline set by the Council for correcting the situation of excessive deficit, and to continue consolidation thereafter. Starting from a debt of 82 % of GDP in 2010, the debt ratio is set to increase until 2012 (86 %), after which it will decline slightly. The deficit and debt adjustment paths are subject to risks, which include the possibility of a macroeconomic scenario that could turn out to be less favourable, the fact that the measures are not sufficiently specified to reach the targets from 2012 onwards, and the fact that targets have often been missed in the past, notwithstanding the better-than-expected outcome in 2010. Therefore, it cannot be ensured that the excessive deficit will be corrected by 2013 unless further measures will be taken as needed. The medium-term objective of a balanced budget in structural terms will not be reached within the stability programme period. The average annual fiscal effort over the 2010-2013 period as recalculated by the Commission services according to the commonly agreed methodology is slightly below what was included in the Council Recommendation of 2 December 2009 (‘above 1 % of GDP’).

               (9)

               Implementation of fiscal consolidation remains a major challenge. Avoiding expenditure slippages by means of a strengthened fiscal effort based on fully specified measures is vital to re-establishing a sustainable fiscal position, especially since the 2013 target does not provide any safety margin below the 3 % of GDP threshold. Moreover, as specified in the 2011-2014 Multiyear Public Finance Planning Act voted in December 2010 it would be appropriate to use all windfall revenues to accelerate the deficit and debt reduction. According to the Commission's latest assessment, the risks with regards to long-term sustainability of public finances appear to be medium. To improve the long-term sustainability of public finances, France adopted a new pension reform in 2010. The planned measures, including the gradual increase in the minimum retirement age from 60 to 62 and in the statutory retirement age from 65 to 67, as well as the phasing out of early retirement schemes, should have an impact on the low employment rate of older workers. Moreover, the pension system is expected to be in balance by 2018. A deficit is likely to appear thereafter unless further measures are taken. The latest pension reform has also created a new public body, the ‘Comité de pilotage des régimes de retraite’, which is in charge of presenting annual assessments of the budgetary situation of pension accounts and, if there is any likelihood of a deterioration, of proposing corrective measures.

               (10)

               The current employment protection legislation is still too strict: the conditions for economic dismissals are subject to legal uncertainty. This is leading to labour market outcomes where workers on indefinite labour contracts (the majority of the labour ‘stock’) benefit from a relative degree of security and workers on temporary labour contracts (the majority of the inflow into the labour market) are exposed to uncertainties. Hence, the share of temporary contracts is significantly higher for young workers, and there are few transitions from temporary contracts to permanent contracts. This segmentation also applies to access to vocational training. There is consequently a high turnover and a limited accumulation of human capital in these workers. Young workers and the low-skilled are therefore exposed to disproportionate risks in the labour market. The aim of the Renewal of Social Dialogue Act and of the 2008 Labour Market Modernisation Act was to modernise social dialogue and to address the issue of labour market dualism. The latter Act notably introduced a new procedure for terminating permanent contracts by mutual agreement (rupture conventionnelle) which is now increasingly used.

               (11)

               The French unemployment rate was slightly above the EU average in 2010 and long-term unemployment is on the rise (3,9 % in 2010 versus 2,9 % in 2008). In this context, public employment services should play an important role in supporting the unemployed in their search for a job. In France, the new one-stop shop public employment service Pôle Emploi has so far shown mixed results. In 2009-2010, in the context of the crisis and of a significant increase in the number of job seekers, its main objective was mainly focused on the merger of the two pre-existing administrative entities. Outsourcing of placement services has so far yielded mixed results in achieving the return to work targets set by Pôle Emploi. At the same time, Pôle Emploi resources dedicated to individualised support of job seekers remain underdeveloped (71 full-time equivalents per 10 000 unemployed, which is significantly below the levels recorded in some peer countries).

               (12)

               The French current account deficit has gradually deteriorated during the last decade, reflecting the decline in the trade balance of goods, partly due to a decrease in labour cost competitiveness after the single minimum wage was reintroduced in the 2003-2005 period (the previous reform of the 35 hours working week had resulted in five different minimum levels). Some improvements have been made to the indexation procedure (creation of an advisory commission of independent experts, elimination of discretionary hikes) leading to a moderation of the increase in the minimum wage. As a result, the proportion of employees that are paid the minimum wage has decreased substantially, enabling better wage differentiation. The French minimum wage is still among the highest in the EU when compared to the median salary even if the tax-wedge is much lower than for the average salary due to cuts in employers’ social security contributions.

               (13)

               France has one of the highest tax and social security burdens on labour in the EU, while the tax on consumption remains relatively low. Moreover, environmental tax revenues as a share of GDP are also below the EU average. Rebalancing the tax system, including for example by switching taxation from labour towards consumption and the environment, is likely to have a beneficial effect on jobs as well as on environmental objectives.

               (14)

               Tax and social security exemptions (including niches fiscales) in France are very high. In addition, understanding and exploiting the benefits of the system requires firms and households to invest in extensive expertise. While tax expenditures are used to implement a given economic policy, there has not been so far a systematic assessment whether they have managed to fulfil the objectives pursued although a review is planned to be carried out in 2011 according the 2009-2012 Multiyear Public Finance Planning Act. In the past, their substitutability with public expenditures has allowed the French authorities to formally meet existing spending rules, although further shifts are no longer possible as stated in Article 9 of the 2011-2014 Multiyear Public Finance Planning Act. A discretionary increase in tax revenue (mainly through the reduction of tax expenditures) by around 0,75 % of GDP over the period 2011-2013 is foreseen by the French authorities. The precise tax expenditures to be abolished have only been partly identified as from 2012.

               (15)

               Competition in the retail sector is still hampered by administrative restrictions on the opening of large retail outlets, and a ban on resale below cost. In the services sector, there are still barriers to competition for several regulated professions, which could be tackled either by reviewing the entry conditions, or by gradually doing away with certain quotas (numerus clausus) and the exclusive rights that these professions hold.

               (16)

               France has made a number of commitments under the Euro Plus Pact. On the fiscal side, France has undertaken to swiftly implement the 2010 pension reform. With a view to strengthening fiscal sustainability, France will also change its constitution to introduce binding multiannual budget planning. To increase labour participation, various measures are being considered to increase active labour market policies (e.g. apprenticeship to ease the school-to-work transition of younger workers, additional childcare facilities by 2012 to improve female employment prospects, strengthening of the public employment services for jobseekers). The competitiveness measures focus on improving the higher education system and promoting research and development (R&D) and innovation (investissements d'avenir), as well as reducing the administrative burden by implementing a comprehensive programme of administrative simplification. These commitments refer to three of the four areas of the Pact, leaving out the financial sector. Although they are taken in those areas where the main challenges lie, many of them (particularly those concerning fiscal governance or support to higher education and R&D) are confirmations of existing public policies/reforms. The reform agenda does not seem fully consistent with the extent of the macroeconomic challenges faced in the labour market or the business environment. In addition, the envisaged constitutional reform is subject to political uncertainty. These Euro Plus Pact commitments have been assessed and taken into account in the recommendations.

               (17)

               The Commission has assessed the stability programme and national reform programme, including Euro Plus Pact commitments for France. It has taken into account not only their relevance to sustainable fiscal and socio-economic policy in France but also their conformity with EU rules and guidance, given the need to reinforce the overall economic governance of the EU by providing EU-level input into future national decisions. In this light, the Commission considers that the fiscal consolidation strategy needs to be made more specific, for 2012 and beyond, in order to ensure that the excessive deficit is corrected by 2013 and the debt is brought onto a downward path. Any windfall revenues should be used to accelerate the deficit and debt reduction, as specified in Article 11 of the 2011-2014 Multiyear Public Finance Planning Act. A shift from labour towards environmental and consumption taxes, and a streamlining of tax expenditure, would bolster fiscal and environmental objectives and improve the business environment. Further steps in 2011-2012 should focus on adapting the employment protection legislation to reducing the dualism of the labour market, and on strengthening public employment services in order to provide comprehensive support to jobseekers. Existing policy on minimum wage moderation should be pursued. Competition should be fostered in regulated professions and retail trade.

               (18)

               In light of this assessment, also taking into account the Council Recommendation under Article 126(7) of the Treaty on the Functioning of the European Union of 2 December 2009, the Council has examined the 2011 update of the stability programme of France and its opinion (3) is reflected in particular in its recommendation 1 below. Taking into account the European Council conclusions of 25 March 2011, the Council has examined the national reform programme of France,

         HEREBY RECOMMENDS that France take action within the period 2011-2012 to:

               1.

               Ensure the recommended average annual fiscal effort of more than 1 % of GDP over the period 2010-2013 and implement the correction of the excessive deficit by 2013, in line with the Council recommendations under the EDP, thus bringing the high public debt ratio on a downward path, and ensure adequate progress to the medium-term objective thereafter; specify the necessary corresponding measures for 2012 onwards, take additional measures if needed and use any windfall revenues to accelerate the deficit and debt reduction as planned; continue to review the sustainability of the pension system and take additional measures if needed.

               2.

               Undertake renewed efforts, in accordance with national practices of consultation with the social partners, to combat labour market segmentation by reviewing selected aspects of employment protection legislation while improving human capital and upward transitions; ensure that any development in the minimum wage is supportive of job creation.

               3.

               Encourage access to lifelong learning in order to help maintain older workers in employment and enhance measures to support return to employment. Step up active labour market policies and introduce measures to improve the organisation, decision-making, and procedures of the public employment service to strengthen services and individualised support provided to those at risk of long-term unemployment.

               4.

               Increase the efficiency of the tax system, including for example through a move away from labour towards environmental and consumption taxes, and implementation of the planned reduction in the number and cost of tax and social security exemptions (including ‘niches fiscales’).

               5.

               Take further steps to remove unjustified restrictions on regulated trades and professions, in particular in services and the retail sector.

      Done at Brussels, 12 July 2011.

            For the Council

            The President

         J. VINCENT-ROSTOWSKI

      (1)  OJ L 209, 2.8.1997, p. 1.

      (2)  Maintained for 2011 by Council Decision 2011/308/EU of 19 May 2011 on guidelines for the employment policies of the Member States (OJ L 138, 26.5.2011, p. 56).

      (3)  Foreseen in Article 5(3) of Regulation (EC) No 1466/97.