EC Leaders Adopt Package to Stem Unemployment

European Community leaders Tuesday adopted a modest package of measures to stem Europe’s rising tide of unemployment but fell short of reconciling differences that have blocked completion of an international treaty to liberalize world trade.

Two issues--Europe’s sagging economies and Bosnia-Herzegovina’s civil war--dominated the two-day summit that ended Tuesday. The EC leaders agreed to send more troops to protect Muslims in six so-called safe areas of Bosnia, but they rebuffed German Chancellor Helmut Kohl’s 11th-hour appeal to lift the international arms embargo that has hampered the Muslims’ attempts to defend themselves from the country’s ethnic Serbs and Croats.

On other issues, the leaders of the 12 EC nations also:

* Agreed to drop some of their barriers to imports from six Eastern European nations--Poland, the Czech Republic, Slovakia, Hungary, Romania and Bulgaria--and reassured the six that they were in line to become full EC members.

* Urged the quick conclusion of a partnership and cooperation agreement with Russia.

* Declared that four Western European nations now negotiating their entry into the EC (Norway, Sweden, Finland and Austria) should be ready to join as of Jan. 1, 1995.

The adoption of a package of economic stimulus measures papered over a dispute among Britain and many of the EC’s other members over the causes of EC’s 11% unemployment rate.

British Prime Minister John Major laid much of the blame on the EC countries’ generous pension and family benefits, unemployment compensation and other social programs. To finance these programs, employer-paid taxes in many EC countries are so high that they discourage companies from adding employees, Major said.

He singled out a proposed EC law setting maximum work weeks and minimum time off the job as “muddle-headed meddling” by EC bureaucrats into issues that should be nationally decided.

“If we go on piling cost upon cost upon cost (on employers), there can be only one outcome,” Major warned. “We will export our jobs, not our goods.”

But the EC summit’s final statement made no mention of the issue, and some heads of government said there was no question of cutting social benefits to create jobs.

Nor did the leaders directly take on the issue of high German interest rates, which are widely blamed for depressing economic growth not only in Germany but throughout Western Europe.

The EC leaders pledged expanded public works investment. They called on the EC’s European Investment Bank to increase by $3.5 billion its special $5.8-billion lending facility for telecommunications and transportation projects and small- and medium-sized businesses.

For the longer term, they asked the European Commission, the EC’s executive body, to develop a package of stimulus efforts by the end of this year.

In their concluding statement, the leaders issued a familiar call for a speedy conclusion to the international trade negotiations that have been deadlocked since 1990.