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Strengthening Euro-Mediterranean industrial cooperation

Photo: All rights reserved © Flavio Vallenari - iStockphoto.com

The EU will support the Southern Mediterranean people’s democratic aspirations by creating a Euro-Med area of shared prosperity with a special focus on entrepreneurship and small business. To this end, industry ministers have agreed upon a series of practical actions during the latest Euro-Med meeting held in Malta.

Starting in Tunisia, a veritable ‘youthquake’ has swept across North Africa and the Middle East and has led to the dawning of what is being widely referred to as the ‘Arab Spring’.

What does this mean for the EU?

The thirst for greater democracy and freedom, as well as for jobs and a better future, are major driving forces behind the current wave. Given that these principles are integral to the European model, the EU has come down politically on the side of the people.

At the same time, the geographic proximity of the uprisings makes them of concern to Europe. For instance, the instability in North Africa has caused a wave of illegal migration, particularly from Tunisia and Libya, into Europe. In addition, the southern Mediterranean represents some 10% of the EU’s external trade, and so continued disruption could have serious economic repercussions not only for the countries concerned but for the Union too.

Working for peace and prosperity

In fact, the European Union has been working to create a Euro-Med region of “peace, security and shared prosperity” since 1995, when the so-called ‘Barcelona Process’ was launched. This evolved to become, in 2008, the Union for the Mediterranean between the EU and 16 Med partner countries. The current of change gripping the region however has led to a recognition that the EU needs to adjust its involvement and step up its support. Towards that end, the European Commission proposed, in March 2011, a new strategy entitled ‘A partnership for democracy and shared prosperity with the Southern Mediterraneanpdf Choose translations of the previous link ’.

Mutual benefit

The EU is the southern Mediterranean’s main trading partner, with a relationship worth some €224 billion a year. It enjoys considerable leverage to help deliver the jobs, growth and prosperity needed through deeper cooperation. European businesses which have expanded to the Med countries have the capacity to build EU-MED value chains to help them compete in the broader world.

This new partnership seeks to promote inclusive economic development in the southern Mediterranean, much as the Europe 2020 strategy already does in the EU. SMEs – long recognised as Europe’s economic engine through the Small Business Act (SBA) and the ‘Think small first’ principle – take centre stage in these plans to stimulate economic growth and job creation.

"The EU needs to give a clear signal that a strong industrial cooperation and the creation of a favourable environment for SMEs is of mutual benefit for Mediterranean neighbours and the EU,” reiterated European Commission Vice-President Antonio Tajani, who is responsible for industry and entrepreneurship, at a Union for the Mediterranean conference of industry ministers which took place in Malta in May 2011. “Further economic development and job creation is essential for political stability in the region, as well as help to manage migration.”

At the gathering, Vice-President Tajani unveiled a number of far-reaching proposals for the progressive economic integration between the EU and the Mediterranean, with the eventual aim of creating a single Euro-Med market.

The ministers at the conference agreed to a number of actions at national, regional and intra-regional level: to  develop the current Euro-Med Charter for Enterprise into a Small Business Act for the Med region, to stimulate European and diaspora investment in the Mediterranean, to facilitate trade in industrial products through the conclusion of agreements on conformity assessment (ACAA), to build innovation capacity, to promote sustainable enterprise development and energy efficiency, and more.

As a first major step towards turning these ambitious goals into realities, the European Commission released a work programme for the 2011-2012 periodpdf Choose translations of the previous link  which mirrors closely the priorities identified by the ministers. Its implementation has already started in  cooperation with a large number of  public and private stakeholders from the North and the South.

Facts and figures

  • The EU enjoys a longstanding and extensive trading relationship with the southern Mediterranean. In 2009, this was worth €224 billion (€119 billion in exports and €105 billion in imports).
  • Despite inequalities, GDP and private consumption growth have been growing steadily in the southern Mediterranean. Although this growth will slow in the coming years, it is set to continue.
  • Despite the economic crisis, the EU remains the main foreign investor in the region. Fuelled by growing domestic demand and low-cost local production, the number of EU foreign direct investment (FDI) projects in the southern Mediterranean shot up by more than 50% in 2010, to reach 826.

Entrepreneurs, a key to the future

The young at the forefront of the movements for reform in North Africa and the Middle East have exhibited tremendous creativity, flare and resourcefulness in their drive for change. “The dynamism of SMEs is crucial for creating employment and offering concrete opportunities to the younger generations,” notes Vice-President Tajani.

Numerous entrepreneurs in the EU and the southern Mediterranean have, in recent years, been demonstrating the benefits of cross-border entrepreneurship. Take Energie del Sole, a Tunisian company established with Italian capital, which is seeking to transform the country’s abundant supply of sunshine into sustainable, clean energy for the future. Not only has the company performed well in Tunisia, where the government supports and subsidises the spread of the technology, but it is now also investing back in Italy with plans to develop in the photovoltaic and biomass sectors.

And Energie del Sole is not alone. Although most people are aware that Europe exports a lot of technology to the Med region, a reverse flow has been growing in recent years. For instance, the Egyptian company Electrometer El Sewedy, which is one of the largest manufacturers of electricity meters in Africa and the Middle East and the fifth largest globally, has used the Czech Republic as its launch pad into the EU marketplace, following successfully entering several African, Latin American and Asian markets.

Similar success stories can be found at:
http://ec.europa.eu/enterprise/policies/international/files/success-stories_en.pdf
pdf
Choose translations of the previous link 

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