10-11 June General Affairs Council

Date: 13/06/1996

SLOVENIA has applied for membership of the Union. Slovenian Prime Minister Janez Drnovsek delivered his country's application on Monday when he signed a Europe accord that promises lucrative trade and economic incentives. The pact had been under threat from the UK's non-cooperation policy over beef, but London waived its veto. UK Foreign Secretary Malcom Rifkind said it had done so as a “gesture of goodwill” in response to the partial lifting of the beef ban, but diplomats suggested US pressure to reward Slovenia for staying out of the Yugoslav war was a factor. Slovenia is the tenth former Communist nation to sign an association accord with the EU.

THE UK blocked agreement on 16 'A-points' on the Council agenda as part of its continuing protest over beef, including a declaration on the gradual resumption of cooperation with Niger, a political dialogue with the Andean pact countries and a mandate for a trade agreement with Mexico. But in addition to the Slovenia accord, the UK also abandoned its blocking tactics on two other proposals: one to send 3 million ecu to support elections in Bosnia and another on the adoption of a negotiation mandate for a cooperation accord with Algeria.

SPAIN blocked the planned approval of a transatlantic pact between the Union and Canada, saying it did not guarantee Spanish fishing boats access to Canadian ports. Spanish trawlers fish heavily off Canada's east coast, a cause of conflict between the two which erupted into gunfire last year. Ministers instructed their ambassadors to go back and look at the pact's fisheries chapter. In the meantime, the EU and Canada still plan to go ahead with their scheduled 26 June summit in Rome to approve a “free trade agreement in all but name”.

MORE progress was made with South America. Foreign ministers of the four Mercosur nations - Argentina, Brazil, Paraguay and Uruguay - joined EU ministers for their first joint meeting since the Union and Mercosur signed a framework agreement last December. Argentine President Carlos Menem said the two blocs should eliminate all trade barriers between them by 2005. He called the pact a “qualitative leap for relations between Europe and Latin America”. Both Mercosur and the EU are on the verge of signing trade pacts with Chile.

COOPERATION with Damascus inched forward with the second ministerial meeting.

The Union offered financial contributions towards the modernisation of Syria's crumbling economy, in return for a clear answer from Damascus as to whether it was prepared to negotiate a partnership accord and join in on plans for a regional free trade zone between the Union and the Middle East.

MINISTERS approved guidelines for the Commission to negotiate an association agreement with Algeria covering political, financial, social and cultural cooperation. As for trade, the goal would be to bring Algeria into a planned Euro-Mediterranean free trade area by 2010. Spain is still concerned that Algerian citrus growers would compete with its own, and other ministers want a detailed schedule of which industrial goods would be affected by the gradual dismantling of tariffs. But the UK's non-cooperation policy prevented ministers adopting broad plans for the region.

GREECE continued to block funding for regional development in North Africa and the Middle East. Greece's deputy foreign minister said Athens would oppose the MEDA funding package, which contains money for Turkey, until its EU partners showed more solidarity over what it perceives as security threats from Ankara.

FARM trade must be reviewed this year, ministers agreed, approving a system which would create rules for opening Union agricultural markets to countries which do not already have contractual links to the EU. Member states will review a list of countries which benefit from the Union's Generalised System of Preferences (GSP) and report on each case before 1 January. Italian Foreign Minister Lamberto Dini said the republics of former Yugoslavia deserved urgent attention, and it was “very likely that the GSP would apply there”.

THE Union still disagrees with Washington's policy on Cuba, but will temper its criticism rather than risk spoiling relations with the US. Ministers said EU leaders would bring up the issue, but not make a big deal of it, at the EU-US summit on 11-12 June. The US legislation, which punishes foreign firms doing business in Cuba, has caused problems for some European companies, and the Union has complained to the World Trade Organisation.