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EU: Industrialists Group Influenced Growth

  • Tony Wesolowsky

For the past 17 years, the European Roundtable of Industrialists has quietly -- and effectively -- lobbied the halls of power at European Union headquarters in Brussels. In a two-part series, RFE/RL correspondent Tuck Wesolowsky profiles the roundtable, one of the most powerful lobbies at the EU, and its current efforts to influence EU expansion eastward. The first part looks at the group's formation and past record.

Prague, 30 March 2000 (RFE/RL) -- What the European Roundtable of Industrialists lacks in publicity, it more than makes up for with access to key policymakers at the European Union in Brussels.

It's not hard to see why. The group, known as the ERT, is a veritable who's-who of Europe's corporate powerhouses, representing 45 of its biggest companies, including British Petroleum, Siemens, DaimlerChrysler, Fiat, and Royal Dutch Shell. Firms represented at the roundtable do more than $800 billion worth of business annually and employ 4 million people worldwide.

The ERT's stated goal is to "strengthen the competitiveness of the European economy on the world stage." Ever since it was founded in 1983 -- by Pehr Gyllenhammar of Sweden's Volvo automobile company -- it has worked closely with the European Commission, the EU's chief executive body. Constitutionally, the commission has the right both to initiate new EU legislation and to oversee the implementation of legislation that has been approved by the EU Council of Ministers, which represents member-states.

Oliver Hoedeman is an analyst with the Amsterdam-based Corporate Europe Observatory, one of the few organizations monitoring corporate lobbying in the EU. Hoedeman says that in the 1970s there was little contact between EU-based multinational companies and the European Commission. That, he says, all changed with the establishment of the industrialists roundtable:

"In the beginning of the '80s, there was a situation in which European unification was in kind of a crisis, [or at least] was perceived as that. Also, the European economies were seen as being in a crisis, there was low growth, there was high unemployment, and, internationally, Europe was described as the 'sick old lady' [when compared] to Japan and the U.S. Then you had this group of industrial leaders who were inspired by similar groups in the U.S. -- particularly the U.S. Business Roundtable -- they got together and they set out on this mission to get European unification revitalized, but at the same time, trying to promote an economic project about liberalizing the economies and achieving a whole set of policies, generally described as neo-liberal [that is, pro-free market]."

Such policies were in line with the general free-market economic thinking of the time, promoted most prominently by U.S. President Ronald Reagan and British Prime Minister Margaret Thatcher. Hoedeman says that in the mid-1980s, then European Commission President Jacques Delors -- a French socialist -- found common cause with the ERT. According to Hoedeman, Delors believed that an integrated market without internal trade barriers would be a step toward the eventual creation of a social-democratic EU.

Hoedeman argues that, under Delors, the European Commission -- in its early years quite critical of the potential abuses of corporate power -- began now seeking cooperation from multinational companies. One of the lobbying groups the commission turned to often was the European Roundtable of Industrialists.

Perhaps the most noteworthy joint effort of the European Commission and the ERT came in 1993, when Delors released his landmark "White Paper on Growth, Competitiveness and Employment." Hoedeman says that the document, endorsed by heads of state and government at an EU summit that year, owed a great deal to the industrialists' roundtable. Drafts of the document were exchanged by Delors's office and the ERT.

And when Delors released the paper to the public in November, he publicly thanked the industrialists for their help.

Just a week earlier, Hoedeman adds, the ERT had released its own report on "Beating the Crisis." Its conclusions on many key points, the analyst says, mirrored those in the white paper. Both reports strongly advocated deregulation in the EU, more flexible labor markets and large investments in transport infrastructure.

Today, both Delors and the roundtable can take some satisfaction in their work: The single market among the 15 EU members states is effectively in place, as is monetary union with its new single currency, the euro. The ERT has since turned its attention to another vast EU project -- its coming expansion to Central and Eastern Europe. We'll explore that in the second part of this series.