coming into force of the Schuman Plan on July 25, 1952, an historic experiment in functional integration began. Of even greater potential importance are the plans for the formation of a European Defense Community (EDC), which gives real promise of leading toward federation among these six countries. On May 27, 1952, the treaty providing for the establishment of the Defense Community was signed. Article 38 of this treaty provides that within 6 months after the EDC treaty goes into effect the assembly of the Defense Community shall make recommendations regarding the formation of an organization of federal or confederal character. Within 3 months following these recommendations the governments are to convene a conference to examine these proposals. Later the same May the Council of Europe assembly proposed that this process be speeded by giving this task to either the Schuman Plan assembly or the Council of Europe assembly, sitting in a membership restricted to those willing to participate in a political authority. The French Government adopted the proposal to have the Schuman Plan assembly undertake this task and jointly with the Italians presented this plan to the Foreign Ministers of the six countries. The Foreign Ministers agreed to this. An ad hoc assembly, made up of the members of the Schuman Plan assembly, additional members of the Coal and Steel Community (Csc) countries, plus 13 observers from those Council of Europe countries not members of CSC, began work drafting a treaty for the European Political Authority in September 1952 and presented the draft treaty to the Council of Ministers in March 1953 for action by the member governments. Thus, in the organizations with a broad geographic base, such as OEEC and NATO, a wide variety of problems formerly considered matters of purely domestic concern are being regularly examined and international solutions worked out. Among a more limited number of countries, real progress is being made toward full integration. Although neither political unification nor economic integration has yet been achieved in Europe, the progress achieved in this brief period is particularly remarkable in view of the obstacles which had to be overcome-strong national traditions, the pressure of vested interests, and a host of technical problems. In keeping with its basic policy of supporting all measures which strengthen the free world, the United States favors European integration. The U.S. Government recognizes that the strength of free Europe is vital to America's own security and well-being and is convinced that Europe's strength can be substantially increased by closer political, economic, and military unity among the European nations. Therefore, the United States has encouraged and, where appropriate, has given financial aid to European organizations and arrangements which show promise of bringing about a strong and united Europe. THE Benelux Economic Union Origin and Purpose HE IMPETUS OF the creation of an economic union of Belgium, Luxembourg, and the Netherlands was primarily the desire of the Netherland and Belgian Governments-in-exile during World War II to create an economic unit sufficiently large, in terms of its foreign trade, to compete successfully in the postwar world market. The first step toward the formation of such a union was taken in 1944 when a Customs Union agreement was signed by the Governments-in-exile in London. This agreement called for the elimination of existing tariffs between the participants and the levying of common tariffs on imports from outside the Union. Inasmuch as economic unity had existed between Belgium and Luxembourg since 1921, the Benelux Customs Union was designed to unite two, rather than three, economic units-the Belgian-Luxembourg Economie Union (BLEU) and the Netherlands. Implementation of the Customs Union agreement was delayed, but by 1947 the Benelux Union tariff schedule was completed, and the Customs Union went into effect on January 1, 1948. Although the agreement eliminated tariffs between BLEU and the Netherlands, it did not prohibit other types of trade restrictions, such as trade quotas and currency controls. It was recognized that in order to free trade within the Benelux area without disrupting the economies of the member countries it would be necessary to coordinate the economic policies of the members. In 1947, accordingly, an agreement was signed providing for the transformation of the Customs Union into a full Economic Union of Belgium, Luxembourg, and the Netherlands. This Union, if achieved, will provide for (1) free circulation of persons, goods, and capital within the area; (2) coordination of economic, financial, and social policies of the participating countries; and (3) conduct of all foreign relations involving economic, financial, and social matters by the Benelux Union rather than by the member states. Full economic union is to be reached through a step-by-step process of eliminating barriers and coordinating policies. An accord signed in October 1949 established the stage for pre-Union during which the steps necessary for full union would be worked out. A number of these steps have been taken, and further measures necessary to full economic union are under consideration. Progress toward full union, however, has been slower than originally hoped for by the member countries. By the spring of 1950 over 90 percent of the trade between the two areas had been freed. Early in 1951 both Belgium and the Netherlands enacted legislation adopting uniform excise and transit charges for the area. At the end of 1950 a protocol was agreed upon, providing for the gradual liberalization of agricultural trade between the two countries. The protocol went into effect in January 1951. This is one of the matters on which it was particularly difficult to reach agreement because of differences in Netherland, Belgian, and Luxembourg agriculture and agricultural policy. Recently the Netherlands' trade deficit with Belgium has limited further progress toward economic union and resulted in the temporary reimposition of restrictions on intra-Benelux trade. However, the Netherlands and Belgium have taken steps internally, aimed at correcting the imbalance in trade. Organization and Operation The Benelux organization undertakes to negotiate agreements on steps leading toward economic union and to put into effect those already accepted. The Prime Ministers of the three countries reach executive agreements in their Benelux conferences, which have occurred irregularly although ordinarily scheduled on a quarterly basis. A Permanent Benelux Commission handles problems arising between meetings of the Prime Ministers. Other major bodies are the Councils for Economic Union, Commercial Agreements, and Customs Administration. The latter body is assisted by a Customs Arbitration Commission, which gives final rulings on appeals from decisions made by the competent government authorities in the Netherlands and BLEU regarding the provisions of the tariff agreements. All major steps toward economic union must be in the form of treaties requiring parliamentary ratification. The Economic Commission for Origin and Purpose FTER WORLD WAR II the chief immediate problem confronting Europe was the reconstruction of areas devastated by the war. The U.N. Economic and Social Council, established in 1946, reviewed the European situation and concluded that a special regional intergovernmental organization should be established to assist the European countries in solving their postwar economic problems. In December 1946 the U.N. General Assembly recommended to the U.N. Economic and Social Council that an Economic Commission for Europe (ECE) be established. The Commission was set up on March 28, 1947. It assumed the functions of the Emergency Economic Committee for Europe, the European Coal Organization, and the European Central Inland Transport Organization and later took on additional functions. The terms of reference of ECE provide that it shall facilitate concerted action for the reconstruction of Europe, raise the level of European economic activity, and maintain and strengthen the economic relations of the European countries both among themselves and with other countries of the world. The Commission was instructed in its early stages to give special attention to the needs of the member countries suffering war devastation. Organization The members of ECE are the European members of the United Nations and the United States. Other European states are regularly invited to participate, and do participate in varying degrees, in the meetings of the Commission in a consultative capacity and in its committees, where they have recently acquired voting rights. The work of the Commission is carried on primarily through its committees, which meet regularly between Commission sessions, and through its secretariat, which is an integral part of the United Nations Secretariat. Meetings of the Commission as a whole are held once a year. The |