PURPOSE: to propose the withdrawal of the European
Union from the International Rubber Study Group.
PROPOSED ACT: Council Decision.
ROLE OF THE EUROPEAN PARLIAMENT: Council may adopt the
act only if Parliament has given its consent to the act.
BACKGROUND: the International Rubber Study Group
(IRSG) is an intergovernmental organisation established in 1944 and
composed of rubber producing and consuming stakeholders. It
provides a forum for the discussion on supply and demand issues for
both natural and synthetic rubber.
By Council Decision 2002/651/EC, the European
Community became a member of the IRSG. The accession of the EU as a
single member dates back to 1 July 2011.
During the preparation of the amended IRSG
constitution in 2011, the Commission has repeatedly stressed its
concern on the limited and declining relevance of IRSG
following the withdrawal in 2010-2011 of important member countries
(USA, Thailand, Malaysia).
IRSG's current membership is representative of only
about 10% of the world production and 25% of the world consumption
of natural rubber, respectively.
In its resolution
approving Council Decision 2012/283/EU on 2011 constitution, the
European Parliament asked the Commission to work on the expansion
of the membership of the International Rubber Study
Group.
Therefore, the Commission called upon IRSG and its
other members as well as industry to encourage non-member
governments to join IRSG. However, despite repeated efforts by the
IRSG Secretariat in the last four years, none of the potential new
members that have been approached gave any reliable indication that
they would be prepared to join the Group. There are no reasonable
perspectives of this situation being reversed.
During a period marked by significant increases in
natural rubber prices (mid-2008 to mid-2011), the IRSG was
considered by industry as a tool to control excessive volatility in
commodity prices. This argument is no longer valid given that the
largest producers are no longer represented in the IRSG and that
natural rubber prices have fallen to less than half the record
level reached six years ago.
The Commission questions whether membership in IRSG
remains a priority in the context of increasing budget restrictions
and new challenges. This concern is reinforced by increasing
membership fees, which are the consequence of the reduced number of
member governments. For the financial year 2016/17, the EU
contribution to the IRSGs budget was EUR 132 000 and will
increase to EUR 135 000 for the next financial year
(2017-2018).
For these reasons, the Commission considers that the
EU should withdraw from the International Rubber Study
Group.
CONTENT: the Commission proposes that the European
Union withdraws from the International Rubber Study Group.
It considers that the withdrawal of the EU is necessary in order to
put an end to annual budgetary expenses that bring limited
benefits, lower than those expected at the time when the European
Community joined the IRSG.
BUDGETARY IMPLICATIONS: by withdrawing from the IRSG,
the Union could save over EUR 150 000 in annual
contributions, as well as the human and logistical resources
needed to manage membership.