Statement by the Minister for Foreign Affairs Brian Cowen TD to Dáil Éireann 23 October, 2003

Together with the Taoiseach, I attended the European Council meeting in Brussels on 16-17 October, 2003. We were accompanied by the Minister for Finance, Charlie McCreevy, and the Minister for European Affairs, Dick Roche.

The Conclusions of the European Council have been laid before the Houses of the Oireachtas.

Our meeting last week allowed the Heads of State or Government of the European Union to:

- take stock of developments in the Intergovernmental Conference,

- review trends in the European economy and appoint a new Governor of the European Central Bank,

- take steps to ensure that our borders are not exploited by traffickers, and

- review a range of external relations issues.

The meeting, under the Italian Presidency, was a success. I am happy to say that the groundwork being laid by the Presidency will enable us to further advance the agenda of the European Union. And I want to thank the Italian Presidency for that.

A meeting of the Intergovernmental Conference preceded the European Council meeting proper and I will deal with that issue first.

The Intergovernmental Conference flows from the work of the European Convention.

This House has already had the opportunity of having a first debate on 15 October on the draft Constitutional Treaty produced by the European Convention. I do not propose, therefore, going over all that ground again on this occasion.

I welcome the opportunity to bring Deputies up to date on what is happening in the IGC. And I want to underline the commitment of the Government to keeping this House and the general public informed of developments in the IGC.

We are at a relatively early stage in the IGC deliberations. Last week's meeting at the level of Heads of State or Government was the first at that level since the opening of the IGC on 4 October. In addition, there have been two meetings of the IGC at Foreign Minister level.

It remains the Italian Presidency's ambition to complete negotiations by the end of the year. I fully support them in that. At the same time, we will of course be prepared to take over and advance any work that may fall to us from January.

The discussion last week focussed on institutional issues. The topics covered included the Commission, the European Council, the Presidency, Qualified Majority Voting and the European Parliament. By and large member states set out known positions on these issues. There was also an informal discussion by Heads of State and Government on the defence provisions of the draft Constitutional Treaty.

The future composition of the Commission was a major topic of discussion. It is clear that there is a range of views on this matter. Ireland, and a number of other countries, indicated general satisfaction with the European Convention outcome - subject to some clarification. At the same time, we would of course welcome a move to one Commissioner per Member State, if this can be achieved on the basis of strict equality. Several participants, in particular the accession countries, supported one Commissioner per Member State. Five of the larger Member States and the Benelux countries indicated support for the Convention outcome. For us, and for several other smaller states, retention of guaranteed equality in the appointment of the Commission remains of fundamental importance.

It is now generally accepted that a post of European Council President will be created. The issue now is how the role will be defined and how the individual appointed to the post will make it work in practice. We believe that the current text is broadly balanced. There is also more work to be done on how a Presidency will be organised in the future in the various Council formations, with significant support for team Presidencies.

The definition of QMV remains a difficult issue. At the IGC the known positions of those seeking to change the Convention outcome were reiterated. From Ireland's point of view we would be happy to stick to the arrangements agreed at Nice, but we can support also the Convention outcome.

The minimum number seats allocated in the European Parliament is an issue of particular concern to the smallest members of the IGC. We are, of course, sympathetic to their concern.

It is generally accepted, at this stage, that there will be a European Union “double-hatted” Foreign Minister who will be a member of the Council and of the Commission. The details remain to be worked out.

We did not expect an outcome last week that would resolve differences on these institutional issues. Institutional arrangements tend to be, understandably, the most intractable part of IGC negotiations with agreement often emerging only towards the end. The session was, however, useful in further clarifying positions.

Consensus in favour of continuing to legislate in the Council's sectoral formats rather than in a single legislative Council, as proposed by the Convention, has been reached.

The Presidency has signalled its intention to conduct consultations across a range of issues with participants before the next meeting of the IGC at Heads of State or Government level. In this regard, an additional meeting of the IGC at this level has not been ruled out for November. At that stage the possible lines for agreement may be starting to emerge. And, of course, further meetings at Foreign Minister level are scheduled.

Perhaps of most significance from our meeting last week was the outcome of the informal discussions among Heads of State and Government on security and defence issues. This is, of course, an area of particular sensitivity for everyone.

Together with a number of Partners, we made clear our view that the proposals on security and defence in the draft Treaty required further consideration by the IGC and this was generally accepted.

As I have said before in the House, we wish to see the Union equipped to make an effective contribution on the international stage whilst respecting the values and traditions of the Member States. Existing arrangements in the ESDP are based on openness, inclusivity and accountability to all Member States. We firmly believe that this should be the case for any new arrangements in the security and defence area.

A large number of Member States share these concerns as was clear from the discussions in Brussels last week.

As regards common defence, our position is very clear: we cannot participate in an EU common defence unless the people decide so in a referendum.

The IGC will return to these important issues in detail next month, and the Presidency has undertaken to redraft the defence articles in the draft Constitutional Treaty in light of the points made at the dinner discussion on 16 October.

The European Council meeting which followed the IGC concentrated on three areas: the European economy, justice and home affairs and external relations.

On the economy, the European Council noted that, after a period of some uncertainty, there are some positive signals emerging in Europe. An improvement in the international economic environment, low levels of inflation, stabilised oil prices and better conditions in the financial markets have been key factors behind a pick-up in economic activity. However, the situation remains fragile and, in this context, economic polices should continue to be aimed at job-creation and sustainable growth and at enhancing economic and social cohesion.

The European Council focused in particular on ways of stimulating growth by increasing investment in transport, energy and telecommunications networks and by underlining the need for further structural reform. I welcome the European Council's focus on relaunching the European economy, believing that action to boost growth will create more job opportunities and bring greater prosperity to the people of Europe. I also welcome, in this regard, the European Council's endorsement of the principles of the Growth Initiative which seeks to increase investment by improving the mechanisms for financing growth-related projects. This initiative aims to exploit the resources of the European Investment Bank more effectively, both to increase the funding available for growth-related projects and to leverage greater private funding of infrastructure.

The European Council recognised that building modern, efficient transport infrastructures would be critical in boosting growth and in maximising the potential of the internal market. It recommended, in this regard, that particular attention should be given to proposals on priority projects for Trans-European Transport Networks. The European Council suggested, in this regard, that the possibility of a higher rate of Community co-financing of such networks might be explored.

The European Council also considered that the completion of an integrated market for electricity and gas in an enlarged Europe, with the aim of securing security of supply and promoting competitiveness, would give a vital impetus to growth. Equally, it viewed the development of telecommunications networks as of key importance in promoting growth and, in this regard, considered the availability and promotion of a broadband network to be particularly necessary for the European knowledge-based economy. Viewing innovation, research and development and investment in human capital as crucial to Europe's growth potential, it re-affirmed the importance of action to mobilise investment and put the right regulatory conditions in place.

The European Council's focus on growth was complemented by its corresponding recognition of the importance of building a more competitive European economy. It reiterated the need to eliminate remaining barriers to the completion of the internal market, particularly in the area of services, which now account for 70% of the growth in the EU economy and in job opportunities. Completion of the internal market for services will also be an important issue for our Presidency. It was recognised also that further action to enhance environmental protection and sustainability will also contribute to growth.

The European Council reiterated that action to stimulate growth and boost competitiveness needed to be accompanied by effective social policies and a continuing focus on job creation. The European Council made particular reference, in this regard, to the demographic challenge currently faced by the European Union and the need to secure the long-term sustainability of pension systems. While the formulation of policy on pensions remains the responsibility of Member States, the European Council considered that certain benefits could accrue from reinforcing open coordination in this area.

The issue of growth will be reviewed and concrete proposals advanced within the context of the annual review of the Lisbon strategy at the Spring European Council during our Presidency next March.

The Lisbon strategy aims to make the European Union the most competitive economy in the world by 2010. The current challenge is to maintain the pace of sometimes deep-rooted reform across a wide-ranging agenda encompassing economic, social and environmental renewal.

The Irish Presidency will have the task of bringing greater coherence to this broad based set of issues at the Spring European Council and of ensuring the smooth integration of the new Member States into this process.

Our key priority will be to develop an economic climate conducive to sustainable growth and to the creation of high-quality employment in the interests of promoting greater social cohesion throughout Europe. We believe that successful implementation of key aspects of the Lisbon strategy will bring concrete benefits to the people of Europe in terms of better services, more prosperity and greater opportunities for business expansion. We are conscious that the decisions that we will take over the next year will be fundamentally important to Europe's economic future.

The European Council in Brussels last week also addressed the need to manage effectively the European Union's common borders, with a view to enhancing the fight against illegal migration and the trafficking of human beings. At the same time, the European Union is of course committed to the reception and integration of legal immigrants.

In this regard, the European Council noted proposals for the creation of a Border Management Agency and the development of a readmission policy. In addition, the Commission has initiated a study on the relationship between legal and illegal immigration and member states were invited to cooperate fully with this study.

In the external relations area the European Council addressed a broad range of issues including Iraq, the Middle East and the WTO.

On Iraq, the European Council welcomed the unanimous adoption of the United Nations Resolution 1511 on 16 October. The Conclusions set out the ingredients for a successful outcome in Iraq, which are:

• An adequate security environment;

• A strong and vital role for the United Nations;

• A realistic schedule for handing over political responsibility to the Iraqi people, and

• The setting up of a transparent multilateral donor fund to channel support for the international community.

The High Representative, Javier Solana, and the Commission have been asked to elaborate a medium-term strategy for the European Union's relations with Iraq. They will report by next March and, as Presidency, we will have the role of advancing work in this area.

On the Middle East the European Council reiterated its commitment to the Road Map. The European Council strongly condemned suicide and terrorist attacks and called on Israel to abstain from punitive measures including extra-judicial killings.

The European Council regretted the unsuccessful outcome of the World Trade Organisation talks in Cancun. However, it stressed the European Union's continuing commitment to multilateralism and its commitment to an early resumption of the Doha Development talks.

Following the European Council meeting, I accompanied the Taoiseach to a bilateral meeting with the Prime Minister of Luxembourg, Jean Claude Juncker. Discussions covered a range of issues on the European Union agenda including Ireland's Presidency priorities.

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