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Coming of Age: The European Community and The Economic Summit

Susan Hainsworth

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1987: VENICE (8-10 June)

The Venice Summit was characterised by a reaffirmation of existing policies by the summit leaders, with little innovation. The Belgian Prime Minister, Wilfried Martens held the Presidency of the European Council. Jacques Delors attended again as the President of the Commission.

The macroeconomic discussions centred around the endorsement and approval of the co-ordinating efforts being executed under the auspices of the Group of Seven Finance Ministers -- particularly their recent agreements at the Louvre and in Washington -- in which the Commission had no role.

With regard to trade issues, the leaders strongly endorsed the work underway in the Uruguay Round of MTN and stressed the tight correlation between trade, growth and development. They also endorsed an agreement which had been attained at the OECD Ministerial Conference one month prior to the summit to make agriculture more responsive to market signals. The summiteers also undertook not to introduce any new measures which could exacerbate the market imbalances or the trading environment for agricultural goods. For the Europeans, this meant that a modification in the structural and guidance policies of the CAP was a potential requirement; indeed, the CAP had already undergone reforms throughout the 1980's (and particularly since the Fontainebleau European Council decision of 1984 to place a strict limitation upon the amount of Community budgetary expenditure which could be allotted to agriculture).

In addition, structural reform policies were not embellished,but were merely a reaffirmation of the policy targets which had been established the previous year at Bonn. No specific mention was given to the European Community's bold 1992 initiative for the achievement of a barrier-free internal market, which by then was well underway; indeed, the EC's 1992 aspiration had been legally enshrined in the first ever revision to the 1957 Rome Treaty, entitled the Single European Act (SEA) which was fully implemented on January 1 1987. The SEA expanded Community competence in a number of key areas, including the addition of a monetary dimension into the treaty, the environment, social and structural policies, and research and technology.

Obviously, this expansion of Community competence and legal authority provided a firm foundation for enhanced Community involvement and influence in the summit preparations and deliberations. This was particularly evident in economic discussions at Venice, in which the summiteers devoted a large chunk of their time to the problems of developing countries. In preparation for the Venice summit, the Commission had, for the first time, drawn up a paper on the international economic situation as well as a detailed working paper dealing with the problem of sub-Saharan African debt which analysed the specific circumstances of the most heavily indebted countries in this region, and proposed special measures to remedy their situation. The Commission is quick to admit that this working document was an autonomous Commission initiative, and that it therefore did not establish a common Community position on these issues in a strict sense. 80

However, the working paper on sub-Saharan debt did establish the basis for summit discussions, as well as guaranteeing a high and influential Commission presence at the table. Individual European member states taking part at the summit generally adhered to the guidelines delineated by the Commission. On the basis of the Commission's initiative, the Community and its member states announced at the Summit that they were prepared to participate with their OECD partners in examining the various solutions which had been proposed. 81 Indeed, Commission assertiveness and initiative at Venice aided in reaching an agreement among the summit nations to triple the Structural Adjustment Facility of the IMF, and to write off completely the debt of some of the poorest LDCs.82

After the Venice Summit, the President of the European Council,Mr. Wilfried Martens and Jacques Delors the European Commission President held a joint press conference where they discussed the tangible results of the summit gathering. Delors expressed his satisfaction with the summit, declaring that the Community had spoken with one voice in most of the summit discussions and emphasising that headway at Venice had been made in the four issue areas where the Commission had concentrated its efforts: trade and exchange rates, agriculture, economic policies and relations with developing countries.83

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