INTERNATIONAL STUDENT CONFERENCE PRAGUE 2000

INTEGRATING EUROPE:

TRADITIONS, PROSPECTS, AND CHALLENGES

DECEMBER 1-3, 2000

EU ENLARGEMENT:

MAIN PECULIARITIES AND IMPACTS

Katia Fedoreaca

Academia Istropolitana NOVA

European Studies Programme

Enlargement has always been part of the EU’s historic mission. Since it’s foundation, the organization has more than doubled in size from 6 to 15 members. However the issues raised for the Union by the current enlargement are qualitatively different from those faced before.

In the past the enlargement process was more fragmented, and the focus was on the individual problems of applicant states. The collapse of the USSR has radically altered the environment for EU enlargement, not only with the creation of newly independent sovereign states on the EU’s frontiers but also the political, economic and strategic reorientation of these countries towards the West. It seems that despite the EU’s strict rules and procedures (not to mention the high cost of membership), it is still considered to be the “Best Club in Europe”, one worth making the effort to join. Although continually modified, the principles of integration and the EU’s capacity for change and flexibility are now being challenged more openly. It is questionable whether the dynamics and methods of enlargement, which had been used in the past, are still valid in the terms of the current enlargement.

The aim of this paper is to explore:

- the past experience of enlargements so as to assess what lessons may be drawn from them.

- the impact of the previous enlargements on the EU

- to draft possible features of future enlargement processes

In the previous four rounds of enlargement, the EU had to deal with a wide range of political and economic difficulties and candidate countries with different capabilities and levels of commitment to the integration process. The fact that the EU is engaging in a further enlargement suggests that the dynamics of the process bring benefits to both applicants and existing members.

Many of the dynamics of the process have deep roots in the origins of the EU and the basic objectives of the integration process. Since the Rome Treaty was signed, the Community was affected by the need to balance the demands of widening and deepening. In different periods of EU’s development, the accent has been either on widening or deepening. Progress towards integration has always depended on favorable economic conditions. For instance, during the boom years of the late 1950s and 1960s, the Community focused on deepening, concentrating on completion of the customs union, the creation of the Common Agricultural Policy and the establishment of its own budgetary resources. The post-1973 oil crisis decrease led to a long period of stagnation and the EC's commitment to further integration was diluted. Then the economic growth of the mid-1980s helped to the completion of the Internal Market in 1992.

Although the will to deepen has been fundamental to the process of integration, the expectation of widening has always existed. It was always recognized that integration process should not be isolated from other European countries. Article 237 of the Rome Treaty proves that:” Any European State may apply to become a Member of the Community”. (Christopher Preston “Enlargement and Integration in the European Union”, London, 1997, page 33). Though the requirements for acceptance into the EC have always been complex, this basic commitment to widening has opened the door to the process of expansion. Within 4 years of signing the Rome Treaty, six founding members were faced with applications for accession from the UK, Ireland, Denmark and Norway. Within several years the enlarged Community of nine met again new challenges of expansion, following the collapse of dictatorships in Greece, Spain and Portugal. The possibility of a 12-member in Community has led to active debates about the impact of widening on deepening. Therefore, the search for balance between widening and deepening has become a fundamental goal of the EC. Although widening has been recognized as one of the EC’s policies, the key EU actors, France and Germany, have always favored deepening as vital for further successful development of the EU. Enlargement has only proceeded when the risks of dilution have been minimized, in most of the cases, by demanding reassurances from potential members.

In order to analyze the past experience of enlargements it is necessary to know a method which enlargements have been based on – the classical method of Enlargement. Despite being hardly tested at each enlargement round, the classic method has endured. According to it new members are made to be responsible for adjustment, and, thus, this responsibility gives them a strong incentive to conclude negotiations quickly. Any outstanding disagreements are therefore left until the new member is accepted to the club. However, the classical method also has serious weaknesses. By putting responsibility for adjustment on the new members, lingering resentments can be created, which can disrupt the whole integration process. For example the failure to address the predictable budgetary problems arising from the UK’s trade structure led to renegotiations of entry terms in 1975, and “big” budget dispute that was not settled until 1984.

The narrow focus of enlargement negotiations also makes possible the thought that the EC is an exclusive organization more concerned with maximizing the benefits to its present members than fulfilling its wider responsibilities.

Though enlargement processes have affected the EC, the “rules of game” have become more entrenched. Many difficulties result from the applicant’s need to adapt their expectations of the EU, to reappraise their definition of national interest and to identify new points of influence within the EU framework.

The first enlargement (UK, Ireland, Denmark)

Many of the principles underlying the classical enlargement method have their origins in the 1940s and 1950s. In the early postwar period the need to reconstruct war-destroyed economies and political institutions led to the first endeavors on European cooperation and integration. But different experiences of three significant European nations – France, Germany, Great Britain – have led to suggestion of different models of integration. For France and Germany the main priority was to avoid war, and, thus, they emphasized the control of the raw materials, coal and steel, which are necessary to make war. Britain, whose economic development had been based on the maintenance of maritime trade, gave priority to creating open trade arrangements. That is why Britain has been always skeptical about the idea of a more economically integrated Europe. Nevertheless, in 1952, France, Germany, Italy and the Benelux countries established the European Coal and Steel Community, which underpinned the later Rome Treaty of creating the EC. This and other issues (decolonisation process, which rejected Britain’s role as a world power, the US support for the development of the EC, fears about Britain’s relative economic decline in integrated Europe) have influence Britain to reconsider its foreign policy options. But enlargement’s negotiations in the UK’s case were the most problematic. The situation was complicated both by uncertainty about joining the EC of British politicians and of existing EC members. It is widely known de Gaulle veto, which expressed doubts about Britain’s ability to make necessary adaptations in order to be accepted to the EC. This veto was also a powerful reminder to all applicants that full membership demands not only technical and policy adjustment to the Treaties, but also a more profound reorientation of political attitudes.

For Ireland, Denmark and Norway’s policies towards European integration were strongly determined be their relations with the UK. For these three countries EC membership was a way of retaining trade links with the UK but within a larger group that would reduce their historical dependence on the UK. From the moment of submitting application for accession Irish government sought maximum coordination with the British of its strategy toward EC accession. The main aim of this coordination was to avoid any new economic barriers appeared between Ireland and Britain as a part of transition process. The classical method posed few problems for Ireland. This was proved by a referendum on membership, which resulted in approval of accession by 83,1 per cent. (Christopher Preston “Enlargement and Integration in the European Union”, London, 1997, page 41)

As one of Europe’s largest food exporters Denmark was driven by rational economic calculations of national interests when announcing its intention of applying for membership. After the failure to create Nordic Customs Union in 1968 the Danes were sure that there was no realistic alternative to full EC membership. Referendum, where two-thirds of the participating 90 per cent voted in favour of membership, was followed by Denmark’s joining the EC on 1 January 1973.

The Norwegian negotiations were complicated by domestic political concerns about sovereignty, combined with concerns about agriculture and fisheries. As a result rejection of the entry terms by 53,5 per cent to 46,5 per cent. Norway’s demands directly challenged and tested the EC’s classical method. The Norwegian example demonstrated that accession is not inevitable and may depend on a very fragile domestic consensus.

The second enlargement (Greece)

Within 3 years of completing its first enlargement, the Community was faced with a new set of challenges in the Mediterranean region. Southern enlargement involved a much poorer group of states than the first enlargement. Both the capacity of the applicants to implement the acquis (the main principle of accession, which consists in the following: “accession implies full acceptance by your countries of the actual and potential rights and obligations attaching to the Community system and its institutional framework, known as the acquis communitaire. This includes also the content, the principles and political objectives of the Treaties, including those of the Maastricht Treaty ”, Christopher Preston “Enlargement and Integration in the European Union”, London, 1997, page 18 ), and the sensitivity of the EC’s domestic interests affected by enlargement put the classical method under severe terms. These pressures appeared first in the case of Greece. Its accession negotiations lasted 34 months, longer than the first enlargement negotiations. For Greeks EC membership meant economic development, especially for agriculture as the crucial sector in Greece’s economic structure. That is why they used every diplomatic lever to ensure a speedy acceptation to the EC. The Community itself had a more complex set of opinions concerning Greece. No member state was really enthusiastic about Greek membership, though Germany considered that Greece was vital to the development of a Mediterranean security policy. Britain had a contrast point of view, considering that Greek membership might threaten the delicate Greek-Turkish balance over Cyprus.

The Greek negotiations show that the classical Community method of enlargement with its stress on adaptation to the acquis through transition arrangements could be achieved. However, this isolation of the accession negotiations from the wider debates within the EC costed a lot. Greeks were afraid that taking a strong position would risk the successful admission. For the Community, the sterss on the classical method risked internalising Greece’s economic problems before the Community had developed adequate instruments to solve them. The capacity of the Greek economic and political system to impelement the acquis remained questionable. The demand for compensatory payments through the Integrated Mediterranean Programs shows how quickly the Greeks learnt to use their economic weakness to theis advantage in Community bargaining.

The third enlargement (Spain and Portugal)

During the third enlargement the need for policy adaptation within the EC, as well as extensive political and economic reform within the applicant states has become more pressing because the degree of diversity within the enlarged Community became clear. By opening to the South, the Community proved its intention to safe the balance of power and to help to establish Europe’s new democracies on its southern periphery. The third enlargement also became a test of the ability of the Community to adapt its acquis to accommodate diversity and to develop appropriate new policy instruments.

The Iberian accession negotiations have been the most protracted, with the possible exception of the British negotiations. Yet, unlike the British case, accession quickly led to the active involvement of Spain and Portugal in the development of European integration.

Though the Spanish economy had some “crisis sectors” (e.g. steel) and some major adjustment problems (for instance in fisheries), generally the Spanish economy had enough means to make the necessary adaptations. Spanish public opinion saw Community membership as vital to their national development. From the side of Community despite the overall consensus that enlargement was a “good thing”, there was no agreement concerning new potential members. This fact also postponed the accession negotiations. There was also another difficulty: Spain approached the negotiations with a strong belief that it has an evident right to be treated as an equal by the Community. But Spanish optimism was soon disabused after having faced with the reality of Community negotiations with its ignoring of domestic interest groups. This made the Spanish to focus more on issues which could more facilitate their entry to the EC. Yet a key lesson of the Iberian enlargement negotiations was that EC policy reform needs to be confronted before enlargement can proceed.

The fourth enlargement (Austria, Sweden and Finland)

The fourth enlargement of the Community, accepting Austria, Sweden and Finland in January 1995 was also, after ratification of the Treaty on European Union, the first enlargement of the EU. This enlargement was the last classical enlargement. As a homogeneous group of small, wealthy, open trading nations with long traditions of democracy, the countries of European Free Trade Area (1960, Stockholm Convention) were well able to adopt the acquis. However, this did not mean that the enlargement negotiations proceeded easy. All applicants had sensitive domestic political interests, which in several cases, were incompatible with EU membership.

In general, the fourth enlargement negotiations were conducted more speedily and more effectively than the last enlargement negotiations. The average duration of the forth accession negotiations was the shortest in the EC’s history – 13 months. This can be explained by several reasons. First, the EFTA countries had closer ties with the Community than previous applicants. About 60 per cent of the acquis had already been adopted by the applicants as part of the EEA process.(European Economic Area). The actual negotiations, therefore, focused on the confined areas where applicants had important national interests.

The EU has also showed more flexibility in the interpretation of the acquis than it was in previous rounds. The acceptance of EFTA’s environmental standards, the continuation of Austria’s control on heavy lorries in transit and the continuation of the retail monopoly on sales of alcohol were not so common for EU policy towards the applicants. However, this flexibility was mostly due to the fact that none of these compromises affected any major existing EU interests. The forth enlargement was, therefore, the last to use the pure classical method of enlargement.

With the exception of Iceland, Liechtenstein, Norway and Switzerland, who have chosen for domestic political reasons to stay outside the EU, all the former members of EFTA have been accepted into the EU. To the East lies a group of potential applicants that poses more fundamental challenges to the EU and the classical method of enlargement.

The impact of the previous enlargements on the EU

The political and economic adaptations made by new members also require adaptations by the Community itself. It becomes necessary to develop new policy instruments or reform existing ones. Enlargement therefore changes the relationship between the national and EU policy domains and leads to the complex processes by which these policies are expected to develop.

It can be seen that the major deepening initiatives are usually connected with enlargements. This was the case with the establishment of the European Regional Development Fund at the first enlargement and with the Structural Fund reforms in 1984 at the third enlargement. Yet, the relationship between deepening and widening also creates tensions. The Commission’s search for an economically rational policy domain is rarely accepted uncritically by all the member states. They may accept the extension of EU policy competencies while still retaining significant control over implementation. Regional policy is a clear example of this trend. Whilst enlargement has positively affected the EU’s cohesion policies, national governments still consider them as part of intergovernmental bargain. Nevertheless, as the enlargement process has developed so the links between policy areas, in particular cohesion policy, the Single European market and Economic and Monetary Union, have been strengthened.