Years of isolation end as Spain enters EC. Access to European markets likely to benefit Spanish industries

Seven hundred years of Moorish presence, 100 years as a supreme world power, 400 years of darkness and isolation, and now it can be said: Europe. That is how many Spaniards see the main landmarks of their history.

Spain's entry into the European Community, sealed at the EC summit in Brussels which ended Saturday, marks the end of a long, difficult road of opening up toward Europe and the start of a new era in the club of European nations.

The Socialist government of Prime Minister Felipe Gonz'alez, all the political parties, the press, and it seems most of those Spaniards who have been abroad have hailed the event as an ineluctable step in Spain's development.

However, expectations raised by the golden myth of Europe -- tales of high salaries and sudden wealth, propagated by Spanish workers who immigrated to Europe and by the tourist boom in the '60s -- have receded brutally in the last year. The intricacies and difficulties of the last phase of the negotiations, brought home daily to the public, have had a sobering effect.

Many Spaniards, for whom Europe is a hazy concept anyway, are beginning to wonder what the benefits of membership are going to be. The first point that seems to have made an impact is the down-to-earth fact that prices will go up owing to the EC's system of value-added tax.

``Our small businesses are already sinking. What's going to happen when that tax is added? I'm not thrilled. I'm plain worried,'' says Jose Cepero, who runs a small household goods store in Madrid.

``I trust the government knows what it got us into. They didn't tell us what it's all about, and the people simply don't know,'' he adds. For the most part, the daily press barrage of technicalities in the negotiations has failed to contribute a clearer picture of Europe.

However, the effects of accession are expected to be subtle and long term. Basically a commercial deal, the accession treaty cannot afford to provoke sudden positive or negative results for either partner: hence the transitional periods that allow Europe and its new members to adjust gradually. (Spain officially becomes a member after all EC countries have ratified the treaty.)

``Changes will not be as exaggerated as people think. There will be no miracle or collapse for the Spanish economy,'' says Xavier Prats, a Community spokesman in Madrid.

Most likely to benefit from accession will be Spain's agriculture, although profits may be marginal as Spain already exports 50 percent of its fruits and vegetables to Europe. On the negative side, the small dairy farmers of the poor northwest will have to adjust painfully to Europe's mighty dairy production.

Spain's fishermen got a better deal than expected with a substantial increase in their quota for catches in EC waters.

Accession will be felt most by Spain's industry. Whereas EC markets were already opened to Spain under a 1970 preferential trade agreement, the reverse was not true. Now Spain will have to lower its barriers, introduce a value-added tax, and modernize production. Before Spain is able to increase its exports substantially, it may feel the adverse effects of imports and higher prices, analysts here say.

Accession will mean the moment of truth for the small- and medium-sized enterprises that dominate the Spanish economy and that now either dread or eagerly await their entry into the fray.

``With Spain's protectionist system, firms weren't forced to be competitive until now,'' says Mr. Prats.

The changes, though now within the framework of the EC, will be the making of the Spanish government rather than the Community.

In an address to the nation, Prime Minister Gonz'alez gave the Spanish a sober message about the challenge they face to modernize the country and make the economy competitive.

Changes in life style will be gradual. There will be more consumer choice as imports from the EC are allowed to rise. Ironically, because of the Community's farm-subsidy system, housewives will be paying more for some items Spain produces in abundance: olive oil and fruit.

Consumer protection will improve vastly to comply with Europe's higher standards in food, health, and transport regulations. European law will prevail over national law, giving Spaniards the right, for instance, to go to a European court in a case of job discrimination.

Certain professions will be directly affected, as EC specifications are imposed; in time there should be more and better dentists, for instance. A quarter million Spaniards working in other EC countries stand to gain from better health and retirement benefits. On another level, the free movement of workers throughout Europe will give Spanish society a new perspective.

Manuel Marin, Spain's secretary of state for European affairs, says: ``Spaniards will be able to go all over Europe. . . . Our society, which has long been isolated . . . will gain.''

Although the Spanish political class agrees that Spain's entry transcends the role played by any one party in the long negotiating process, the breakthrough strengthens the position of the socialist government and makes easier its task to persuade Spain to remain in NATO when a promised referendum comes up next year. The public balked at sharing defense costs in the alliance, which Spain joined in 1982, while not yet an EC member. Along with the formidable task of getting Spain's economy ready for Europe, the NATO referendum is the next hurdle.

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