Vol. 420 No. 3
15 Mr. S. Barrett asked the Minister for Foreign Affairs if he will give details of the Agreement on the European Economic Area which was signed recently by the European Community and the EFTA countries; and if he will give details of the fund being established by the EFTA countries to assist regions within the EC over the next five years.
The European Economic Area Agreement, (EEA), between the EC and EFTA was signed in Porto, Portugal on 2 May 1992. The agreement, once it has been ratified by each of the 19 states involved, will result in the creation, on 1 January 1993, of the largest single unified market in the world, consisting of 380 million consumers and accounting for 43 per cent of the world's trade. This will add to the economic growth already expected to be generated in the Community by the completion of the Internal Market and Ireland will be in a position to benefit from this increased economic activity.
The EEA Agreement provides for free movement of goods, persons, services and capital within the 19 EC and EFTA states. It includes common rules on competition and state aids as well as arrangement concerning procurement and intellectual property. Institutional arrangements, including provision for an EEA Council at Ministerial level, form part of the Agreement. Enhanced co-operation in social policy, consumer protection, the environment, research and development and education, is also provided for by the agreement.
This agreement will provide a comprehensive framework for strengthening relations between the EC and its close neighbours in EFTA with whom it shares much in the political, economic, cultural and social spheres. The agreement is a balanced one, providing benefits for all participants.
Ireland enjoys excellent relations with the EFTA member states and welcomes the EEA Agreement as an appropriately strong framework for EC-EFTA co-operation. We are well placed to benefit from easier access to this larger market in goods and services, having had in 1991 a trade surplus of some IR£150 million with the EFTA countries.
In the course of the negotiations concern was nevertheless expressed by several member states, including Ireland, that the benefits of market integration would not be spread evenly throughout the EEA. Together with Spain, Portugal and Greece, we therefore sought inclusion in the Agreement of appropriate provisions to promote economic and social cohesion. A cohesion fund to be set up by the EFTA States is among the instruments to be used in this area. The fund will consist of 500 million ECU (£400 million) in grants and 1,500 million ECU (£1,200 million) in loans which will attract a 3 per cent interest rate subsidy. These sums, which will be divided between the island of Ireland, Greece, Portugal and the most disadvantaged regions of Spain, are to be committed over a five year period beginning in 1993. Priority will be given to projects which place particular emphasis on the environment, on transport including infrastructure, education and training. Discussion has not yet taken place on the shareout of this assistance between the eligible countries.
There is one point that interests me. Can the Minister say whether consideration has been given to the situation that will arise when a number of the EFTA countries join the Community? The Minister confirmed that nearly all EFTA countries are considering joining the Community — a number have applied — and he talked about a Cohesion Fund which is to run up to 1998. What is the likely situation which will emerge when two or three of these countries at least will have become full members of the Community long before 1998? Who will pay the money into the Cohesion Fund and what arrangements have been made to cover that eventuality?
That is too far ahead.
The Deputy will be aware that the process of accession to the Community is complicated and slow. The completion of this agreement should speed up the accession applications of Norway and Finland if they propose to advance them. I advise the Deputy that individual applications will be dealt with in the normal way adopted by the Community; they are examined by the Commission and we have an opportunity to express our views on those applications. The view is that the new agreement would certainly speed up accession if individual EFTA member states wish to apply for membership of the Community.
