Verbatim report of proceedings

Tuesday, 4 July 2006 - Strasbourg

12. Towards a more integrated approach for industrial policy (debate)

  President. The next item is the report (A6-0206/2006) by Mr Calabuig Rull on behalf of the Committee on Industry, Research and Energy on a policy framework to strengthen EU manufacturing towards a more integrated approach for industrial policy (2006/2003(INI)).

  Joan Calabuig Rull (PSE), rapporteur. – (ES) Madam President, before I begin my speech, please allow me to make a brief reference to the serious accident that took place yesterday in Valencia and that cost the lives of 41 people.

As some Members know, I was born in and I live in the city of Valencia and I would therefore like to begin by expressing my sincere condolences and solidarity to all of the families of the victims of this tragic accident and wishing all of the injured a speedy recovery.

The fact is that a drama on this scale is incomprehensible in the present day, and I hope that the specific causes of this accident will be fully clarified so that no other family ever has to experience such a tragedy.

With regard to the report that we are debating today, I would like to begin by congratulating the Commission, in particular Commissioner Verheugen and his team, on the Communication that they have presented on the future of the manufacturing industry.

In view of the challenges we are facing, we cannot remain passive or take a defensive position, but we must also recognise that the invisible hand of the market is not going to provide a sufficient response. An initiative that puts industrial policy back on the table and promotes the conditions necessary to safeguard the European Union's manufacturing industry’s future is therefore an appropriate one.

Europe's aspiration must be to remain a great industrial power and it must not be content simply with developing the services sector, whose future is often intimately linked to the existence of a solid industrial base. The Member States and the regions must not therefore wait until times are critical, with the irreversible consequences for industry that that entails, before taking action.

We are not talking today about a policy of subsidies for great industrial dinosaurs; that model represented a bottomless pit for public resources and hindered the creation of new opportunities for creating stable jobs with futures.

The European manufacturing industry is facing several important challenges all at the same time, such as enlargement, globalisation and relocations. There is no question, however, that the Union’s greatest challenges are coming from the outside, in particular those resulting from globalisation and specifically the competition from the emerging Asian countries. These challenges mean that we must change mindsets and take advantage of new opportunities.

The present industrial structure of the European Union’s economy as a whole does not put us in the best position to confront the current process of globalisation. The European Union’s trade is still concentrated in medium and high technology and low or intermediate personal qualifications, which exposes the European Union to competition from producers from emerging economies.

Our competitive advantage must come from knowledge and quality, and not low prices. However, that often means sectoral adjustments with social consequences. Although responsibility ultimately lies with the private sector, these consequences must be dealt with through specific resources, such as the European Globalisation Adjustment Fund.

This Communication recognises that the use of the different industrial policy instruments needs to be adapted to the context and the specific characteristics of each individual sector.

The Commission also proposes seven new extremely important cross-sectoral policy initiatives: increasing the protection of intellectual property rights and combating counterfeiting, the creation of a high-level group on competitiveness, energy and the environment and support for access to new markets for our products in a fair and reciprocal fashion.

This new policy must be complementary to the work done in the Member States and, in this regard, we have advised that it will be necessary to do more work on the problems faced by the new Members.

This new approach must seek consensus, involving key agents, social interlocutors and Member States in the process of political decision-making at an early stage. The new industrial policy must promote investment in people’s qualifications and equipment so that people can adapt to change and take advantage of the new opportunities that it offers. Training and flexibility are precisely the Union’s most important resource and competition parameter.

We are talking about competition based on R+D, on innovation, quality and design, on infrastructures, on new ways of organising production and on investment in pioneering sectors. These measures are urgent, since European industry’s competitors are moving quickly in that direction.

I would like to end by stressing the need to increase the transfer of knowledge and the application of the results of research to new products and processes. Technological platforms are of particular importance for this objective, which are a model that has led to successes but that must find mechanisms to give SMEs access to the results of the technological platforms and to apply the latter’s innovations.

  Günter Verheugen, Vice-President of the Commission. (DE) Madam President, ladies and gentlemen, I am extremely grateful to the rapporteur, Mr Calabuig Rull, for his report, which accurately reflects the intentions of the Commission and also gives a fair and appropriate assessment of them.

We are, then, united in our opinion that Europe must and will remain a strong location for industry. Industry still remains a decisive economic factor for Europe, although it is no longer the only one. Manufacturing industries directly employ 34 million people in Europe and produce three-quarters of all the goods exported by the European Union; more than 80% of all expenditure on research and development by the private sector in the EU comes from industry, and of course a large proportion of all services depends upon it being strong and competitive.

Indeed, we in Europe have no reason to feel ashamed. The competitiveness of European industry is outstanding in many areas, and it is not as if we had fallen behind in this sector. There are some areas in which competition has become harder and where we are having difficulties, but in an astonishing number of areas Europe is a world leader and also a leader in terms of technology.

When we tabled our proposal on industrial policy for the 21st century, we agreed that we must not fall back into times of state control, bureaucracy and interventionism, but that we need to enhance the conditions for industrial activity in Europe to such an extent that Europe remains, or becomes, an attractive location for industry. This implies a definite renunciation of protectionism and state intervention, but also a firm offer of help in promoting and developing more competitiveness.

The different horizontal and sectoral initiatives that the rapporteur has already mentioned bring us closer to this objective. I would in particular like to point out that some of the horizontal initiatives that the Commission proposed last year have in the meantime become very important topics, for example, increasing capacity for innovation, defending intellectual property rights or also access to third markets a major topic that is currently being discussed in the Doha round.

I would in particular like to draw your attention to the importance of better lawmaking for modern industrial policy. If any sector of the European economy complains about too much bureaucracy and too many long-winded regulations, then it is this one. As you know, we have taken up this cause with great care. I should also like to reiterate that the purpose of the current review of Community law is not to reduce any standards, for example, less environmental protection or less consumer protection; instead, it is intended to make the rules as effective and as modern as possible, in order to reinforce the competitiveness of our businesses.

I fully share the rapporteur’s opinion on the problem of qualifications, and I am very grateful that he has highlighted this so clearly. For the future of the manufacturing industry in Europe it will be more and more important to have sufficiently qualified workers at our disposal. In some Member States we already have a qualification problem, and part of the unemployment in Europe is due to the fact that certain qualifications are not available where they are actually needed. On this issue, too, further coordinated activities will most certainly be necessary on the part of the European Union and the Member States as well.

  Ilda Figueiredo (GUE/NGL), draftsman of the opinion of the Committee on Employment and Social Affairs. – (PT) Commissioner, I hope this debate will make the Commission pay greater attention to the importance of the various industrial sectors in the EU, and to its vital contribution to the creation of wealth and jobs. Consequently, investment must be made in strengthening existing companies. Importance must be attached to the most vulnerable industrial sectors and to the consequences of the liberalisation of world trade, which are already being felt.

There can be no continuation of a policy of negotiations within the World Trade Organisation that overlooks the various industrial sectors, jobs with rights, regional development and economic and social cohesion.

The Committee on Employment and Social Affairs sought to warn about these issues in the opinion that I am presenting and that the majority in the Committee on Industry, Research and Energy took into account. I wish to emphasise the need to protect the workers whenever manufacturing companies are restructured, including ensuring that the workers are kept fully informed and given a decisive influence throughout the process.

  Werner Langen, on behalf of the PPE-DE Group. – (DE) Madam President, I would first of all like to thank Mr Calabuig Rull for his fine and result-oriented cooperation, and would also like to thank the Commission, in particular Commissioner Verheugen, as the proposal submitted by the Commission is most serviceable, indicating a new direction for industrial policy.

Our group supports the draft resolution of the Committee on Industry, Research and Energy; we helped to produce it and it reflects our own opinions. On the other hand, we will be requesting split votes for some of the amendments, where the powers of the Member States are encroached on. This is a danger we will not countenance. The Commission does not have sole responsibility: the Member States themselves are also responsible for many areas, and they must discharge these responsibilities.

For us, modern industrial policy is a means to ensure that Europe remains an attractive location, and to safeguard competitive conditions in the context of globalisation. Competitive industry is indispensable if the services sector is to be reinforced, as Mr Calabuig Rull has pointed out. Industrial policy therefore forms the basis of, rather than a hindrance to, efforts towards opening up new markets in the services sector. Industry, characterised by high quality standards and technological advances, was and still is the motor of economic development in Europe, and all measures concerning the environment and climate protection must be judged in terms of energy policy, to see whether they contribute to improving the framework conditions.

Of course, when we say that the Member States bear the responsibility for many measures, then we must consider whether we do not go too far in certain respects. Better coordination: yes, European responsibility: no, sectoral groups of experts: yes, competence and strategy plans for enterprises and regions: no, employee participation: yes, but general veto rights for works committees: no. I am convinced that if we follow these examples we can further improve Mr Calabuig Rull’s report, and, all told, that together with the Commission we can work out a serviceable instruction manual for future industrial policy in its relation to other policy areas.

  Reino Paasilinna, on behalf of the PSE Group. – (FI) Madam President, Commissioner, ladies and gentlemen, thanks go to the rapporteur for an excellent report, which we support.

Do we really want to become the leading knowledge-based economy in Europe and indeed the world, or do we prefer to try and get by by staying with the old ways, with the help of subsidies? That is the question. Even the old industrial sectors can thrive and be competitive if there is financial support for their modernisation. For example, training and innovation can help procure a good workforce for the future.

Nokia is a good example. Did you know that many years ago Nokia was a well-known manufacturer of shoes and boots? It is a long way from shoes and boots to the mobile phone.

In the accelerating and ever more fiercely competitive global economy, European competitiveness can only be maintained by investing in research, development and innovation. We are all agreed on that, but it just is not happening.

However, competitiveness has also been sustained through untenable means, such as mass layoffs and sudden moves in production. It is as if we had come to a lake and fished it empty and then moved on to another lake and fished that one empty as well. This sort of European overfishing cannot be thought of as a wise move. Employees in companies are flexible, and in many countries very flexible indeed, but the lack of any protection in non-manual work acts as a brake in an innovative society.

Job satisfaction and employees’ ability to cope are important, and they can help to ensure that we have an effective and lasting workforce. According to the latest report by Eurofound, the European Foundation for the Improvement of Living and Working Conditions, job-related stress has increased, and it has done so continuously in recent years. The result is absenteeism though illness, a drop in work efficiency and even people allowing themselves to be excluded from the job market. Especially worrying is the fact that the demands of work have grown, especially in the female-dominated sectors. If the Chinese work themselves to death, we should at least work with a smile.

  Patrizia Toia, on behalf of the ALDE Group. – (IT) Thank you Madam President, ladies and gentlemen, it is a widely-held belief that the future of European development largely depends on the ability of society and the knowledge-based economy to deliver results, but we often sadly underestimate the fact that, as part of this ambitious outlook, we need to draft, relaunch and enhance an entire policy relating to the sectors, including the traditional sectors, of our production and of the European productive system as a whole, from agriculture to services, and from the core businesses of the manufacturing sector to construction. There cannot in fact be an economy based solely on intangible networks, information and software without a solid foundation of manufacturing, producing primary goods, ranging from finished products to machinery, and from essential goods to luxury goods.

An economic system is solid if it enables all of its production sectors to grow economically and if it is able to provide these sectors, including traditional production sectors, with ever stronger and more robust injections of technological innovation in processes and products; if it is able to introduce huge amounts of research, diversification and the ability to keep up with new developments, thus maintaining our position in the world market and defending the size of Europe's balance of trade.

As you said, Commissioner, the support given by the Commission and the Member States to their strategic sectors is not dirigisme or public interventionism, policies that have been superseded in the integrated market and in the European and global free markets, but it is the ability to promote industrial policies that can cope with, anticipate or manage changes, that can create an attractive environment for international investments and that, in short, can manage the many crises in the European productive system and cope with future challenges.

Two new developments have been highlighted by the rapporteur and by the other speakers, which I too would point out: finally, after years in which it seemed that the sectoral approach had been largely surpassed, we are beginning to realise once again that we need to understand what is really taking place in the strategic sectors in our Europe. As regards the other aspect, an industrial policy is understood to mean an integrated policy, which requires integrated, practical measures, but this policy must also be designed – and this is where we call on the Commission to make an extra effort – by bearing in mind all of the various aspects: purely industrial aspects, research aspects, energy aspects and commercial aspects.

We are well aware that, in order to tackle the global market, we must equip ourselves with more and more resources and give impetus to the Commission's work, too, as we have seen done for the textile sector and other sectors. Yet, all of my fellow Members from the various countries of Europe know that what struck the textile sector, that is to say, that kind of whirlwind of extremely low-cost production originating from certain parts of the world, may strike yet other production sectors that are important for Europe. We therefore call for an effort to be made along these lines; we call for the Globalisation Adjustment Fund, too, to take account of this aspect relating to sectoral restructuring, to the ability to help workers retrain for new jobs and to the professional skills that are of use to an integrated system that is able to innovate, as my fellow Members have also said.

Next, I should like to refer to small and medium-sized enterprises: we all know that Europe's production structure is based on the reality of these businesses, which is not only a reality in terms of production but a reality that revitalises the regions and gives impetus to regional policies.

I want to say to you, Commissioner, that this Commission is the one that we value, one that is not passive in the face of Europe’s problems and changes, but able to perform a strong coordinating role.

  Rebecca Harms, on behalf of the Verts/ALE Group. – (DE) Madam President, ladies and gentlemen, the weaknesses in the Commission's draft cannot be laid at Mr Calabuig Rull's door: in our view, the real weakness is the fact that this framework does not yet have a strategic outlook. In our opinion, and in this I agree with the previous speaker, a successful strategy would need to be based on clarifying the interaction between industrial, regional, competition, trade and, last but not least, environmental policies.

In connection with our complaints about these analytical weaknesses, we are concerned by the fact that industrial policy is determined by high level groups that have recently been springing like weeds from the soil of Brussels but that are dominated by a few large industrial companies. We see one problem with this as being that democratic controls are being weakened in this field, and another as the virtual lack of any say whatever in these high level groups for small and medium-sized enterprises, which employ 50% of all workers in the processing industry.

Where industrial businesses in Europe have failed in recent years because they were unable to innovate, that was certainly not always due to poor policies, but down to the fact that certain business leaders have completely failed to recognise their workers’ potential for innovation, or the need to innovate at all.

  Lydia Schenardi (NI). – (FR) Madam President, on the face of it, this report contains a number of sensible ideas: it talks about the crucial role of industry in a modern economy, even though, for years, the myth of a post-industrial society focused entirely on services has prevailed. It calls for the negotiations conducted within the WTO to take into account the specific characteristics of each sector, or the specific problems of each Member State, which is something of a cultural revolution but which will never be applied by the Commission, for which the European Union represents a single entity. The report demonstrates confidence in the bilateral agreements when it comes to settling the problems of market access encountered by your manufacturers, particularly in emerging countries, and the application of the principle of reciprocity in respect of international trade. This runs counter to the belief in multilateralism that has been reaffirmed on numerous occasions in this House. The report is very sparing in its criticism of unfair competition and counterfeiting, against which Brussels fights so half-heartedly. This is indeed all true but, in essence, it is just meaningless talk, and nothing has changed.

The European Parliament’s report, like the Commission’s communication, still proposes the same timeworn and disastrous formulas. The standard policy of competition and liberalisation, for example of the energy market, efforts to mitigate the effects of globalisation, which is regarded as inescapable and, in essence, beneficial to shareholders, the modernisation of intellectual property law, the symbol of which is the software patent – which was rejected by users and SMEs in the sector - and the simplification of legislation, such as the REACH Directive - that 1 200-page convoluted text that is jeopardising the European chemical industry.

This is the usual litany of policies that have been conducted for years, with the aim of making people believe that what is required is a European industrial policy that is not provided for by the Treaties and, above all, with the aim of preventing the Member States, when faced with the resulting de-industrialisation and social disintegration, from taking matters into their own hands.

  President. The debate on this report is suspended. The remaining speakers will have the opportunity to take the floor this evening.