EU Expansion: Lessons of the Past and features of the Present
Paper delivered at the conference
Competition Law and the Right to Compete. Lithuania and the European Union
Vilnius, October 30, 1998
Mark Gray, White & Case
Introduction
I am very grateful for the opportunity to speak at an institute that is quickly gaining a renowned reputation not just in the Baltic Region, but throughout the continent of Europe.
Before the conference concentrates in detail on the area of competition policy, I have the opportunity this morning to say a few words on the broader challenges and issues facing Europe. I will particularly focus on the present enlargement process, which presents the greatest challenge to the Union since its creation in the 1950's. Our aim must be a Union, enlarged and deepened, which allows the Union to play its role as the anchor of stability in the new Europe.
Before turning to the present day, I have been asked to draw some conclusions from the previous experiences of expansion of the European Union.
Lessons of the Past
- The European Union has admitted new members on four occasions. Denmark, Ireland and the United Kingdom (1973); Greece (1981); Portugal and Spain (1986) and Austria, Finland and Sweden (1995).
- It is tempting to look at previous expansion of the European Union and attempt to draw lessons from the past. The issues raised are often similar (economic stability, security questions) and the negotiation process is governed by a tried and trusted procedure (Article O of the treaties). First a Commission Opinion, then a Council decision to proceed, followed by a two phase negotiation, involving in the first instance an intensive screening aimed at identifying problem issues and once that has been done, the negotiations proper.
- But it is important to guard against drawing too many parallels. Each enlargement process is unique. Never before has the Union attempted to virtually double its size. Shifting from 15 member states to 25-30 is an immense challenge for the European Union.
That said, I would make two points:
- The Copenhagen Summit in 1993 was historic because for the first time in its history, the Union promised future membership to countries - even before they officially applied for it. Not even in the last round of enlargement in 1995, were such promises made. For no other countries has the Union created this situation where the question is not whether they will join, but how and when.
- One issue that is important to underline is that from previous experience, the implementation of the accession agreements are as crucial as the negotiations themselves. Applicant states must be aware of the implications of taking on board the European Union acquis and the consequences if they are not met.
The current situation
In a few moments I will look at the current situation in relation to enlargement, but before doing so, I would like to place the debate in a broader framework.
A number of major trends, both internal and external, will inevitably affect the way the Union in general develops.
The external factors include:
- globalisation, which is increasing both the volume and speed of trade with the rest of the world. The Union is itself promoting greater openness at the same time as helping to formulate a co-ordinated response to globalisation. The trend has provoked anxiety and introversion, which could have negative implications for the Community method;
- enlargement, which will expand the Union's membership to over twenty countries, further increasing its diversity. Policies and the institutions' procedures will have to be reviewed;
- scientific and technological changes, opening up new horizons, requiring permanent adjustment and forcing us to reassess our management methods.
Then there are the trends directly connected to the now well advanced process of European unification:
- successive reforms of the Treaty have given the Union a role of one sort or another in virtually all areas of public policy. Subsequent reforms will therefore be less concerned with the scope of the Union's powers than with its use of them;
- the public has high expectations in some of the Union's new areas of responsibility (common foreign and security policy, justice and home affairs, and employment for instance).
- once the vast legislative programmes such as the single market and EMU have been completed, the quantity of new primary legislation will decline. At the same time, greater importance will be attached to how the legislation is implemented in practice and how it is monitored.
Lastly, as society changes so do people's attitudes, including the way they view the Union:
- as the pressure for budget discipline increases and is further augmented by the approach of the single currency, the period of steadily increasing Community budgets will come to an end. Restrictions on financial and human resources will force the Union to set clearer priorities and manage its policies more effectively;
- Changes in the relationship between government and the governed will produce an increasing demand for openness, consultation and monitoring. This is likely to lead to a debate on governance in general.
Turning now to the enlargement process in particular. May I remind you on how the enlargement process is being dealt with.
- At the Luxembourg European Council in December 1997, the Heads of State and Government agreed that there should be an inclusive process with;
- an enlargement process. The centrepiece of the enlargement process is the multilateral framework of a European Conference bringing together all the existing EU member states, plus those European states which actively pursue their candidacy and which share the goals of the Union. In the first instance this invitation has been extended to the ten candidate countries of central and Eastern Europe plus Cyprus and turkey. The conference deals with CFSP, JHA and other issues of common interest, particularly economic and regional co-operation.
- an accession process with eleven candidates - Cyprus and the ten central and eastern Europeans.
- a negotiating process involving bi-lateral intergovernmental conferences with Cyprus, Hungary, Poland, Estonia, the Czech Republic and Slovenia. At the present time an analytical examination of the acquis (screening process) is being undertaken. In parallel the preparations for negotiations with Romania, Slovakia, Latvia, Bulgaria and Lithuania is being accelerated through a similar screening process.
- Although negotiations are due to start with Cyprus, Poland, Hungary, Czech Republic, Slovenia and Estonia, the Commission will produce an assessment of the other five countries each year. The first progress report on whether countries will move up to the first group will be announced next week (4 November 1998)
A reinforced pre-accession strategy also applies to the ten central and eastern European candidates. The Accession Partnership's are the key element of the process of integration of Lithuania, with short and medium term priorities to enable accession. The Phare programme now comes under the framework of the Accession Partnerships with a focus on the priorities for membership. The Commission has set up a special fund of 100 MECU for the period 1998 - 1999 for those countries not yet at the negotiating table. This catch-up facility makes available additional financial resources to support a number of specifically targeted priority areas including the completion of privatisation of the banking sector and of large state owned enterprises, the promotion of foreign direct investment and the fight against fraud and corruption.
- This is not just a one way process. Although applicant countries have significant work to undertake, the existing fifteen members must also make a substantial commitment to enlargement through reform of its policies, financing and institutional framework(Agenda 2000).
- Lithuania is making considerable progress. The screening process of 31 chapters shows that much still needs to be done, but the present government has positively taken on board the work outlined in the Commission opinion.
- The accession process is rather like a long motorway journey. Those who wish to arrive safely and in good time at their destination, should ensure that their car is well prepared and serviced for the journey. They should be prepared for all eventualities, including the possibility of being overtaken on the outside lane, traffic jams and breakdowns. Those awaiting the arrival must also be prepared, on time and welcoming. For the countries in the accession negotiations, there is now a clear departure time but no one can guarantee a definite arrival time.
Shaping the future architecture of Europe
- The European Union acquis is not static, it is constantly evolving. Between 1998 and the accession of Lithuania, the architecture of Europe will change.
- The European Union is moving towards a more flexible, dynamic entity. A single currency, a new institutional framework and amended security arrangements are three examples of this evolution.
- As Lithuania prepares for membership of the European Union, it will need to take a number of strategic decisions. What future Union do you wish to see? Which circles of activity must you be part of? What priorities do you have? Which alliances would you hope to form?
Conclusion
- Progress has been made, but Europe together must develop a strategy to preserve the achievements of the last forty years and continue to pursue its two key objectives, namely, peace and mutual understanding and continued economic growth.
- An enlarged Union, with a population near to 500 million, and an economic product one third higher than that of the USA, must expect to be a major provider of economic assistance and political stability. It will need to handle the unfinished business of creating order and peace in the Balkan Peninsula and establish a working relationship with Russia, the Ukraine and the Newly Independent States. In addition, we must encourage regional co-operation in the areas such as the Black Sea and the Baltic where the interests of member states and of non-members are inseparably involved. Regional forums will become more important, not less important, as the union expends.
- The plethora of new commercial, political, institutional, cultural and social ties which have been built up between the EU ands Central and Eastern Europe since the fall of the Berlin Wall is a demonstration of the energy which has gone into bridging the gap that existed for so long. The final entry of the candidate countries into the EU will be the culmination of this process as much as a beginning of a new relationship. At that point, we will not be debating enlargement versus deepening but the re-unification of a continent.
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