Miguel
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Third meeting of the Association Council EU-Israel
Luxembourg, 21 October 2002
The meeting was chaired by Mr Per Stig MØLLER, Minister for Foreign Affairs of the Kingdom of Denmark and President of the Council.
Mr Shimon PERES, Minister for Foreign Affairs of Israel, led the Israeli Delegation.
Mr Javier SOLANA, Secretary General and High Representative for the CFSP, and Mr Anastasios GIANNITSIS, Deputy Minister for Foreign Affairs of Greece, for the incoming Greek Presidency also attended the meeting.
The European Commission was represented by Mr Christopher PATTEN, Member.
Declaration of the European Union
1. We welcome the holding of the third meeting of the Association Council between the EU and Israel. It comes only two weeks after the last meeting of the Association Committee in Jerusalem which provided an excellent opportunity to review the whole of our relationship and to take note of progress on many points in our common interest, be it cooperation in educational and cultural matters, transport and telecommunication or scientific and technological co-operation.
2. The Association Agreement has established a regular political dialogue on all issues of common interest. This dialogue between us is more important than ever. Accordingly, the Association Committee devoted time to discussing a number of political issues in addition to its other work. Among these were the fight against terrorism, non-proliferation, disarmament and arms control as well as the Euro-Mediterranean Partnership.
3. The Association Agreement provides the framework of the bilateral relations between us and sets the agenda of our cooperation. We have stressed, time and again, including during the last meeting of the Association Council on 20 November 2001, the great importance we attach to the correct application of the association agreement, in particular the territorial scope of the agreement. We regret that since our last Association Council meeting no progress has been made towards a solution to the issue of rules of origin in accordance with the Association Agreement, as acknowledged by the Association Committee at its 8 October meeting. However, the EU welcomes Israeli readiness stated at the meeting to identify concrete bases for a mutually acceptable technical solution and to resume technical talks. These talks should start without further delay. During its meeting the Association Council will take stock of the situation and assess the perspectives for a solution. However, if the Association Council cannot find a solution, the EU will review its position in accordance with the provisions of the Association Agreement.
4. Our bilateral association is based on shared respect for democratic principles and human rights, an essential element of our association agreement as set out in Article 2. The EU upholds the universality, interdependence and indivisibility of human rights. The promotion and protection of human rights including rights of persons belonging to minorities as well as fundamental freedoms constitute a major objective of the EU's foreign policy.
The EU firmly believes in Israel’s right to live in peace and security. It recognises the tragic impact of suicide attacks and the fear and anger they cause. The EU has clearly and publicly condemned suicide bombings and pressed the Palestinian Authority to take determined steps to stop them.
Israel’s security concerns are legitimate, but they must be addressed with full respect for human rights and within the framework of the rule of law. The EU urges Israel to put an immediate end to activities that are inconsistent with international humanitarian law and human rights, such as extra-judicial killings, to abstain from all acts of collective punishment such as demolition of Palestinian homes, to lift closures and curfews and to abstain from deportations of family members. The EU firmly believes that there can be no justification for military actions directed indiscriminately against civilian neighbourhoods. Such actions fuel mistrust and hatred and further hamper efforts to seek a political solution. They damage Israel’s reputation as a democracy based on the rule of law. All settlement activities, including those in and around East Jerusalem, must stop immediately. There is no connection between settlement activities and Israel's security needs.
5. The EU is seriously preoccupied with the worsening humanitarian situation and the fact that many projects, including humanitarian projects and projects aiming at enhancing the quality of life in the Palestinian territories, cannot be implemented as Israeli authorities impede access of personnel necessary for these projects. The EU noted the terrible consequences of the situation as set out in the Bertini report. We call on Israel to ensure full, safe and unfettered access for international and humanitarian personnel.
6. The EU is gravely preoccupied with the deliberate destruction of Palestinian infrastructure, including those financed by the EU and other donors, which hampers the economic, social and humanitarian development of Palestinians. Such destruction hinders the reform for which Israel itself has called. The EU urges Israel to put an end to this practice. We refer in this context to the letter that Minister Piqué, in his capacity as Council President, sent to Minister Peres on 29 January 2002 in which the EU reserves the right of giving an appropriate follow-up to this question.
7. The EU expresses grave concern about the current situation in the Middle East. We unreservedly condemn violence and terrorism and those responsible. The EU welcomes the adoption of UN Security Council Resolution 1435 and urges both parties to comply fully with it. More than ever, Israelis and Palestinians must return to the negotiating table in order to offer a political perspective.
The Middle East Quartet meeting on 17 September in New York set out elements for a "road map", including the holding of an international conference, leading towards a final, just and comprehensive settlement in accordance with international law including all relevant Security Council Resolution with two States living side by side in peace and security by 2005. We appeal to both sides to support the Quartet efforts and the outcome of the 17 September meeting. The road map should be based on parallel and reciprocal steps by the parties on political, security and economic issues and contain definite timelines. Implementation by the parties should be monitored and assessed by the Quartet. The Palestinians must push ahead with the reform efforts and in particular cooperate in security matters with Israel, the US, the EU and regional partners with the aim of putting an end to terrorism in all its form. Steps must be taken by Israel as well as the Palestinians themselves to ensure a satisfactory holding of free and fair Palestinian elections early in 2003.
Israel must facilitate the reform efforts by lifting curfews and closures, withdrawing to its positions held prior to 28 September 2000, by resuming transfer of Palestinian VAT and customs revenues and stopping settlement activities in the occupied territories. It is in Israel's own interest to alleviate the deepening economic and humanitarian crises and to assure the functioning of the Palestinian economy. The EU considers it crucial that economic and institutional collapse in the Palestinian territories be avoided. The EU has engaged itself for budgetary support to the PA and has spearheaded an international donor effort to that end.
The EU reaffirms its conviction that the creation of a viable, democratic and peaceful sovereign Palestinian state would be the best guarantee of Israel's security and its acceptance as an equal partner in the region.
It is recalled that the 4th Geneva Convention is applicable to the occupied territories including East Jerusalem where the status quo must be respected until a permanent status is agreed by the parties.
8. The EU supports the reform process in Iran, and in this context it has decided to strengthen EU-Iran relations. The Council has given a mandate to the European Commission to negotiate a Trade and Cooperation Agreement with Iran and a mandate to the Presidency to lead negotiations with Iran on arrangements for EU-Iran political dialogue and on cooperation against terrorism. For the EU, all of this constitutes a single package. The different elements are indissociable when it comes to entry into force, application and denunciation, and parallelism will be applied between all these elements. Negotiations will start soon. The EU expects the deepening of economic and commercial relations to be matched by similar progress in all other aspects of the EU's relations with Iran.
The EU wishes to see an intensified political dialogue with Iran, leading to a better understanding, as well as to significant positive developments in the EU areas of concern: human rights, non-proliferation, terrorism and the Middle East. With regard to the Middle East, the EU has encouraged Iran to exercise its influence in order to hamper and prevent any action that might jeopardise the chances of returning to a political process. The EU has also encouraged Iran to join, without reservation, the international consensus on the necessary existence of two States, Palestine and Israel, living peacefully side by side with recognised borders.
On human rights, the EU and Iran have agreed on 10 September, at their "Comprehensive Political Dialogue" meeting in Teheran, to explore possibilities on the setting up of a human rights dialogue without any condition. Experts from Iran and the EU have met at the end of September to discuss modalities. The EU Council will examine this issue further at its 21 October meeting. The EU considers that the open invitation by the Iranian authorities to the UN thematic rapporteurs on human rights to visit their country is a positive gesture.
9. Iraq's failure to comply with UN Security Council Resolutions, in particular with regard to weapons of mass destruction, remains a source of major concern. We note Iraq’s announcement to allow the return of UN inspectors without conditions and welcome in this context the efforts of the executive chairman of UNMOVIC, Dr. Blix, and the General Director of IAEA, Dr. Elbaradei, concerning the practical arrangements for the early resumption of inspections. Iraq must fulfil its obligations under the relevant United Nations Security Council Resolutions without delay and must grant unconditional and unimpeded access for the weapons inspectors.
The EU is determined to support further efforts of the United Nations to that end. This matter should urgently be dealt with by the Security Council. The EU agrees with the UN Secretary General that if Iraq’s defiance continues, the Security Council must face its responsibilities.
As far as the humanitarian situation is concerned, the EU welcomed the Security Council's adoption of Resolution 1409 of 14 May 2002, which significantly eases the United Nations sanctions regime on Iraq. The EU has finished the necessary work to implement the Resolution in the EU. This will help improve the humanitarian situation and above all benefit the Iraqi people.
10. The EU notes that growth in the Israeli economy remains subdued after contracting by 0.6% in real terms in 2001, which may mainly be attributed to the continuation of political and security tensions and slower than expected global economic recovery. It also takes note of the recent deterioration of the exchange rate, inflation and fiscal position, and of the measures taken by the authorities to stabilise the economy again. A number of areas of vulnerability remain, including the budget, the large stock of public debt (over 100% of GDP), the deteriorating external position and increasing unemployment (10.3%).
The EU is confident that the authorities will continue to address these issues in order to maintain an appropriate macroeconomic framework. The EU also encourages Israel to enhance efforts in the area of structural reforms, particularly in the labour market.
In line with the economic chapter of the Association Agreement an informative Economic Dialogue took place in Brussels on October 17th 2002, where issues related to macroeconomic developments and policies, as well as structural reform and regional policies in both the EU and Israel were discussed.
11. Total trade between the EU and Israel has almost doubled in the last five years, and has reached € 24 billion in 2001. The EU is Israel’s major trading partner. It occupies rank number 1 in Israel's imports and rank number 2 in its exports. Israel is the EU’s 18th largest export market, and occupies rank number 25 in the EU's imports.
In 2001, there was however negative growth in bilateral trade, with Israel's exports to the EU going down 4.3 %, and EU exports to Israel decreasing by 8.8 %. This is in sharp contrast to earlier years, when trade flows increased considerably, in both directions. For Israel exports to the EU, those figures were +19.3 % in 1997; + 10.3 % in 1998; + 10.5 in 1999 and + 30.2 % in 2000. This is due in a large part to a restructuring in diamond trade which represents around 20% of EU-Israel Trade and to a dramatic reduction in trade in high tech products especially machinery for line telephony and automatic data processing. Without taking into account diamond trade, Israel exports to the EU have contracted by 1.4% and EU exports to Israel by 3.4% between 2000 and 2001. These downward trends have continued in the first semester of 2002.
12. EU FDI inflows from Israel in 2000 amounted to € 201 million (0.1% of EU total inward investment) and the outflow amounted to € 787 million (0.2% of EU total). Inward stocks amounted to € 1394 million (0.2 % share of EU total) and outward stocks to € 1698 million (0.1 % share of EU total).
13. Agricultural products account for a significant proportion (8.6%) of the Community’s total imports from Israel, and 2.6% of its total exports there. In 2001, the Community imported agricultural products from Israel for a value of over € 770 million and exported € 342 million worth of agricultural goods.
Under the Euro-Mediterranean Agreement, which entered into force in 2000, the two sides granted each other significant trade concessions for certain agricultural products, consisting of tariff reductions or elimination, either within quotas (and/or subject to calendars), or for unlimited quantities.
Article 14 of the Agreement provides for ongoing discussions with a view to the further reciprocal liberalisation of agricultural trade. Negotiations for a package of new concessions have been hampered by certain technical problems, but these have now been resolved and the EU side is carrying out the necessary evaluation of the state of play before negotiations can resume and be concluded.
As regard the smooth operation of agricultural trade under the current arrangements, Community operators have encountered difficulties as a result of certain phytosanitary measures taken by Israel. We would welcome discussions under Protocol 3 of the Agreement aimed at resolving these problems.
14. As to the trade chapter of the Euro-Med Association Agreement a limited number of specific issues matters of interest both for the EU and for Israel such as market access questions raised by the respective industries are currently being dealt with, pragmatically and on a case by case basis, either directly between the respective officials or within the institutional framework foreseen by the Euro-Med Agreement. In this respect it has been agreed to set up an informal consultation mechanism between the Commission and Israeli relevant services which will allow, on an ad hoc basis, a more specific exchange of views on trade matters and to explore ways of developing trade between the parties. This will also allow to tackle trade irritants at an early stage, helping to prevent their escalation into disputes by seeking mutually acceptable solutions.
15. The EU's policy towards the Mediterranean region including Israel is governed by the Euro-Mediterranean Partnership launched at the 1995 Barcelona Conference. The EU welcomes Israel's attachment to this Partnership. The bilateral relations with each Mediterranean partner including Israel are indeed seen in the context of the objective, in the common interest, to foster mutual trade and the increasing network of Euro-Mediterranean Association Agreements, allowing for a free trade area across the Mediterranean.
16 In this regional context, the EU is convinced that co-operation and economic integration in the region will bring great benefit to all concerned. This was indeed a reason for the launch of the Barcelona process, the aim of which is to create, by 2010, a free trade area covering the entire region, thereby contributing to creating progress towards peace, stability and economic prosperity. Within the Euro-Mediterranean framework, the EU is indeed seeking to actively promote co-operation not only bilaterally between the EU and the partner countries concerned, but also amongst the partners in the region.
17. In May 2001, the first Euro-Med Trade Ministerial took place, which created working groups on rules of origin and on services. Especially as regards the rules of origin, the Euro-Med Trade Ministerial of March 2002 agreed to the principle of the participation of the Mediterranean countries to the system of pan-European cumulation of origin, linking the EU with Central and Eastern European Countries, the Baltic States, EFTA and Turkey Such system could be functional already in the short term for those partners having signed FTAs containing identical rules of origin. The EU notes Israel's support for this proposal. A report on the state of play of the implementation of the system of pan-Euro-Mediterranean cumulation will be presented to the next trade Ministers meeting. In the field of services, Euromed Trade Ministers have asked experts to exchange experiences in certain key sectors in order to prepare for the liberalisation foreseen in the various association agreements. They have also particularly insisted on the need to develop South South trade and adopted an action plan on trade an investment facilitation, with the improvement of customs procedure as a first priority.
18. In the field of Scientific Co-operation, Israeli research entities are fully associated to the 5th Framework Programme of EC, enjoying a status equivalent to that of Member State of the Community. 498 co-operative R&D projects have been registered by June 2002 covering the whole spectrum of FP5 Specific Programmes. 131 projects are co-ordinated by Israeli entities. More than 1.500 European Union entities collaborate with Israeli entities within FP5. Israeli partners in FP5 cover the whole spectrum of the Israeli society: 47% universities, 37% Industries, 16% other entities (hospitals, public regional bodies, etc.). Most successes in FP5 so far are in the Information Society Technologies (IST), Quality of Life and the Growth Specific Programmes.
Israel has officially requested to the Commission its association to the 6th Framework Programme for RTD activities (2002-2006) on March 2002. Following the adoption of the Sixth Framework Programme for RTD activities, it is important to ensure that the renewed Agreement enter into force on a provisional basis to enable early Israeli participation in the 6th Framework Programme. The Council is now examining the Commission’s recommendation for a Council decision authorising the Commission to negotiate the renewal of the agreement for scientific and technical cooperation between the European Community and the State of Israel. The Association Committee encouraged the parties to accelerate the negotiations on the Israeli participation to the Programme as soon as a formal EU mandate is available, in order to ensure the participation of Israeli entities from the outset in the 6th Framework Programme.
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Romans 9:11-24
Our Eschatology may vary even our Ecclesiology may be disputed among us but our Soteriology most assume a singularity and exclusivity which in biblical term is known as Quote; "The Narrow Way" and Quote!
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