No pity on strikers as Europe's fuel storm lashes

No pity on strikers as Europe's fuel storm lashes

2nd June 2008, Comments 0 comments

Protestors may have to face the fact that high fuel prices are here to stay and there is little the governments can do.

BRUSSELS - "If the government gets up your nose, picket."

It is a pun which dates back at least to the days of Margaret Thatcher and the coal-miners' strikes of the 1980s.

And it remained as true as ever in Europe on Friday, as protesters from Belgium to Bulgaria gathered in their respective capitals to demand government help in the face of soaring fuel prices.

"The government has to do something!" Belgian fishermen's union representative Ivan Victor declared simply as he picketed the European Commission's headquarters in Brussels.

But just as the miners' strikes succumbed to the merciless economic fact that the mines were losing money, Friday's protesters looked unlikely to get what they wanted as officials argued that the only way to deal with the problem would be to accept the fact that high prices are here to stay.

"Operating aid or fuel subsidies (are) not an appropriate or permissible response to high fuel prices," because the fishing industry's main problems are "fleet overcapacity and fuel-inefficient equipment and practices," the EU executive said bluntly on Thursday.

In the last week, fuel protests have swept across Europe. Beginning with French fishermen, the protests have spread to their colleagues in Belgium, Ireland, Portugal, Spain and Ireland, truckers in Britain and Bulgaria and bus drivers in Ireland.

They have made their point by lighting 10,000-candlepower distress flares, handing out free fish, blockading ports or simply bringing traffic to a standstill.

And while their methods have been as varied as the EU itself, they have all made the same point: fuel prices are going up too fast, and the authorities should do something about it.

Unfortunately, there is little that Europe's governments can do.

Recent protests have in general made three demands: that the government lower excise duty on fuel products, that it lower VAT on their sales, and that it pay out subsidies until prices drop again.

But the EU's strict laws say that governments can only drop VAT rates if the European Commission proposes such a change and all 27 member states approve it - a process which can take years.

Moreover, any tax cuts "would send a bad signal to oil producers that we will pay to cover your price rises. That could encourage them to raise prices," a commission spokesman pointed out on Friday.

And EU laws on state aid mean that governments can only bail out ailing industries if they then move to make them economically sustainable - usually by imposing major cutbacks.

Even as the protests gathered pace, EU officials were insisting that the best way for fishing fleets to deal with rising fuel prices would be to become more efficient.

And on Friday a spokesman for the commission's energy unit said that high fuel taxes could even be seen as a good thing, since "they have contributed to making Europe's cars more efficient."  

Indeed, as long ago as 2006 the commission urged member states to move forward on energy efficiency, in a paper provocatively entitled "Doing more with less."

It pointed out that the EU already relies on foreign sources for 50 per cent of its energy, a figure which is predicted to rise to 70 per cent within a few decades.

That means that the bloc is increasingly having to bid for its oil against existing powers such as the United States and rising powers such as China and India - pushing prices ever higher.

And with global demand showing every sign of continuing its rise, the only choice European consumers are likely to face over the next few years is whether they should spend more money - or use less fuel.

It is not a forecast which is likely to cheer the EU's picketers.

But as the price rises, and the protests, continue, it looks set to be one they will hear more and more often in the next few months.

2 June 2008

Text by dpa / Expatica
Photos by Flickr contributors Lee Jordan, theowl84 and Ruth L

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