"This is yet another very good example of why we established the Fund", said Employment Commissioner Vladimír Špidla. "Globalised trade and production can bring benefits to many, but we must help those who feel a less positive impact. These workers fall into the latter category, and I am pleased that we are able to recommend this application to the Parliament and to the Council".
The Spanish application concerns 1,521 dismissals at the Delphi factory and 68 dismissals at their suppliers. In February 2007 the American multinational decided to close down its factory in Puerto Real (Cádiz) on 31 July 2007 and transfer production to its existing plant in Tangiers. The region of Tangiers offers lower labour costs, tax benefits and the proximity of raw materials. This is a clear example of a trend in the European automotive industry to relocate to third countries with lower production costs, with the corresponding increase in imports to the EU and a reduction of employment in the sector.
Spain will receive the funding in a single instalment once agreement is reached by the Budgetary Authority, i.e. the European Parliament and the Council, to mobilise the European Globalisation adjustment Fund in response to this application.
The EGF may give a financial contribution in cases where more than 1,000 workers in an enterprise or a regional sector are made redundant due to major structural changes in world trade patterns leading to substantially increased imports into the EU or a rapid decline in EU market shares.
The EGF was established by the European Commission, the European Parliament and the Council at the end of 2006 to provide help for people who have lost their jobs due to the impact of globalisation. Commission President José Manuel Barroso proposed the idea in 2005 to create an instrument of solidarity to help workers affected by redundancies resulting from changes in world trade patterns find their way back into work.
There have been 12 applications to the EGF so far. The Delphi application is the seventh approved by the Commission for presentation to the European Parliament and Council, the other six having already been paid in full (€ 21.71 million in total helping 6,910 workers). It is the fourth application concerning the motor vehicles sector. A further five applications from Italy and Lithuania are currently being assessed by the Commission.