Local view for "http://purl.org/linkedpolitics/eu/plenary/1999-10-05-Speech-2-084"
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"en.19991005.5.2-084"2
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"Mr President, ladies and gentlemen, the three draft reports we have before us concerning further financial assistance to Bulgaria, Romania and Macedonia cover much the same ground in terms of content and political perspective so I should like to explain them together. What are they about? The Commission proposes granting loans to help the balance of payments in the context of a macro-economic stabilisation programme drawn up by the International Monetary Fund. It is intended to grant a sum of EUR 100 million to Bulgaria and a sum of EUR 200 million to Romania, in each case as a long-term loan. In the case of Macedonia, a contribution of no more than EUR 30 million in addition to the euro loan of EUR 50 million has been proposed because the country’s financial position has been particularly exacerbated by the conflict in Kosovo.
I therefore recommend approval of the Commission’s proposals for financial assistance, including the amendments included in the report. My amendments to the Commission’s document are a reminder of the goal of macro-economic stabilisation. What, however, we must be concerned with, above all, is securing long-term employment and improving the conditions of people’s lives in the countries affected. In this context, the IMF’s policy of economic restructuring is often cause for fierce and necessary criticism. In the end, programmes in South-East Asia and particularly in Indonesia were to the detriment of poor strata of the population when, for example, subsidies for basic foodstuffs were cancelled.
In the case of the economic reforms which are on the agenda in the former socialist States, a situation must therefore be prevented in which the burdens of change again affect those in society who are least able to defend themselves. It is true that the IMF has improved in many respects, but there is still a great deal of work to be done. Accordingly, we are also arguing for having representatives of the programmes join us here in Parliament, or at least in the Committees.
With my changes, I should also like, however, to go on emphasising that the Commission and the relevant States are obliged to comply with the rules for budget supervision and efficient administration. It must go without saying that the European Parliament will be informed appropriately and in good time about any payments made and about the ways in which these are used. Finally, steps must be taken to ensure that the macro-economic financial assistance is not misappropriated, as we have seen happen in a dramatic way in Russia.
The Council has requested urgent procedure in connection with the financial aid to these three countries. This means that we must approve them this week here in Strasbourg. In commenting upon this, the Committee on Budgets pointed out the basic interinstitutional problems and problems relating to budget policy which would arise if we were to comply with the Council’s request for urgent procedure in the case of financial assistance for Macedonia, since in this case, the Commission’s proposal contains a subsidy component.
Granting up to EUR 30 million in subsidies to Macedonia throws up budgetary problems of a technical nature. The funds specified in Category 4, “External Actions”, of the Financial Perspective have already been exhausted by the funds assigned in the draft EU budget. The European Parliament must therefore insist upon a corresponding review of the Financial Perspective as a prior condition for granting the subsidy. Overall, there ought, however, to be agreement about the fact that aid is quickly needed for Bulgaria, Romania and Macedonia.
In the case of all the countries, the financial assistance is to be provided in two tranches with the second tranche only being released once economic development and reforms have been satisfactorily resumed.
The amounts I have mentioned for the various States are proportionate, on the one hand, to the estimated deficits in the balance of payments of the individual countries and, on the other hand, to the multilaterally agreed share which the EU has to contribute to these forms of macro-economic financial assistance. We are therefore concerned here with comparatively modest amounts. Just to support the balance of payments of the six States bordering Kosovo, the World Bank and the International Monetary Fund have estimated that USD 1.5 billion in financing is required.
Let me briefly go into details about the three countries which we are now dealing with here. For Macedonia, an external financial shortfall to the tune of USD 372 million is expected in 1999. Financial assistance is therefore an urgent matter in view of the vital interests which Europe has in stability in the Balkans. The dramatic reports may have disappeared from the television screens, but there are still thousands of Kosovan refugees in Macedonia.
With the economic development since the change of government in 1997, Bulgaria has made some remarkable progress. Economic growth has been stimulated again. The rate of inflation has fallen. Exports have increased and direct foreign investments have been noted. However, the balance of payments deteriorated in 1998, with the crisis in Russia being partly responsible for this.
In Bulgaria’s balance of payments for 1999, a financial shortfall of approximately USD 500 million is anticipated. Without the balance of payments loan of a maximum of EUR 100 million proposed by the Commission, the Bulgarian reform programme might be placed in jeopardy. Aid from the EU might also make it easier for Bulgaria to make some progress with safety at its nuclear power plants. This is also a matter of some concern for my home country, Austria.
Because of the conflict in Kosovo, foreign trade has further deteriorated in Romania. An additional balance of payments deficit amounting to USD 190 million is in the offing. Here too, the laborious process of economic reform must be continued with and supported.
In order to make further progress, Bulgaria, Romania and Macedonia need our help. The planned financial aid which, in the first place, is really a technical process, is also politically significant in connection with the discussion about enlargement of the European Union and, above all, against the background of the destabilisation of South-East Europe because of the Kosovo conflict. My own homeland, Austria, borders on four countries which want to join the European Union. It, therefore, has a particular interest in the economic and also political stabilisation of Central and South-East Europe. Such stabilisation cannot be achieved unless the region makes its own contribution. How much would growing uncertainty in Central and Eastern Europe cost in terms of political and financial capital? In the end, how much would it cost us to look on and do nothing? We must therefore commit ourselves, and not only financially but also politically.
The Group of the Party of European Socialists last week lent its support in Skopje to the idea of a Stability Pact in South-East Europe and, above all, took up the themes of democracy, human rights and a civilian society. Strengthening civilian society is undoubtedly an important concern but is inconceivable without stable framework conditions for the various national economies."@en1
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