Speech by

H.E. David Daly, Ambassador and Head of Delegation of the European Union to Australia and to New Zealand

Monash University , Melbourne, 25 September 2009

  "EU Enlargement -A success, but not just a question of Time"

Excellencies, ladies and gentlemen,

I am delighted to be back in Melbourne to have the opportunity to speak at this excellent conference. I would like to thank and pay tribute to the organisers.

The general theme of this conference - EU foreign policy - and the particular theme of my own few words - EU Enlargement - are of particular interest to me. Before coming to Canberra, I had spent the past 18 years in the European commission working on Enlargement issues one way or another - from trade liberalisation for the countries of central and Eastern Europe in the 1990s, to helping Hungary prepare for its accession, to helping stabilise the countries of the Western Balkans and leading the accession negotiations with Croatia.

I would like to share with you some insights into the Enlargement process, distilled from experiences.

For as long as I have been dealing with enlargement issues, one question more than any other has been put to me: "When will country x join the EU?" It is always put simply as a question of Time.

I will offer an alternative and better question to ask.

However, before going any further I would like to just remind ourselves that the recent enlargement of the EU has been a major success - for the EU and for the countries themselves.

Patten on "the collapse of Russia 's Communist empire in Europe" says " We now had to cope with the results of the ending of Europe 's division. We found a policy to support the emergence of open markets and democracy in central and eastern Europe - the enlargement of the EU. This has been the most successful foreign policy pursued by Europe ." ["Not quite the diplomat", p 152].

Politically successful

Politically, the area of peace and prosperity was expanded in Europe through the Enlargement. The reforms needed to join the EU helped the democratic transition in the candidate countries themselves - Human rights, a free media, equality legislation, institution building, regulatory convergence, the fight against corruption and against organised crime. These important issues, important in their own right, were able to be addressed with the support of the EU which provided models which could be used by the candidate countries.

To put it another way, joining the EU meant that further political instability in central and eastern Europe in a fast changing and uncertain world was avoided.

Economically successful

The Enlargement has been an economic success as well; the Single Market increased to almost 500m consumers - 30% of world's GDP and 17% of world trade (not including intra-EU trade).

The new Member States' have become wealthier through joining the EU; accession added 1.75% points to their growth, already relatively healthy (+3.5% (1999-2003) to 5.5% (2004-08)); their average income increased from 40% (1999) of EU15 wealth per capita to 52% (2008).

Intra-EU12/EU15 trade tripled (1999-2007), from 175bn euros to 500bn euros

EU15 growth gained an extra +0.5%pts from accession over same period, employment +1% p.a.

Investments from Cohesion funds helped competitiveness of EU12, and of EU as a whole; also EU12 allowed a different division of labour within Europe thereby increasing competitiveness - important for facing the Globalisation challenge.

Applying the EU Acquis has created more open, transparent and competitive economies in the new Member States; EU12 have now 5.75% of GDP through openly announced public procurement (2007) (EU 3.25% GDP).

Transition, enlargement preparations during a difficult decade - 1990s

Very soon we will celebrate the 20 th anniversary of the fall of the Berlin Wall. This reminds us that the 1990s was in fact a very difficult decade for Europe and the world.

The USSR dissolved.

Yugoslavia disintegrated into a tragic war.

There was the Gulf War.

At the same time the EU had a busy internal agenda too, with new Treaties and policies -the Euro, Common foreign and Security Policy (1992), the European Security and Defence Policy (1999) as well as the new area of Justice and Home Affairs; and yes, we also had the accession of Austria, Finland and Sweden (1995).

And this was also the period when the EU came to terms with the new opportunity to embrace the countries of central and Eastern Europe and help guide them into the EU through its Enlargement policy. The foundations were laid during the 1990s.

"When will country x join?" and "What does country x still have to do?"

There is a natural tension between Candidate Countries and the EU in the accession process.

Candidates say they are ready to join already now while the EU says no you're not, you still have to complete the following reforms to meet the membership criteria.

The Candidate countries them say that it would be easier to get the domestic political support for the often difficult reforms if they had a clear sight of the finishing line - give us a date by which we will join.

Hence the most frequently asked question, "When will country x join the EU?"

However, the answer to this question is itself directly related to the far more important one: "What does country x still have to do in order to be ready to join the EU?" ; the question I have been asked much less frequently.

To understand the accession negotiation process it is important to reflect on how the EU functions in some basic terms.

EU Member States are presumed to be able to implement EU law and, if ever they do not implement it properly then the European Commission takes the Member state to court - the European Court of Justice then decides. This presumption is based on the knowledge that EU law is properly translated into domestic law in the Member States, where appropriate, and also that the Member state has the administrative capacity and the political will to implement and enforce the law.

This is a heavy burden and demands a sophisticated public administration in the Member state.

At the heart of the EU is the Single market; this operates on the basis of mutual confidence in the legal structure and administrative capacities between the Member states. If consumers in one Member state do not have confidence in the authorities of another Member state then the Single Market could unravel because barriers to the free movement of goods, workers and capital would be created e.g. consumers would reject the products of the Member State in which they had no confidence.

Therefore mutual confidence is the lifeblood of the Single Market.

Accession negotiations are all about the Candidate Country convincing the European Commission and the EU member Sates that it does have the necessary legal framework in place, that it does have the administrative capacity and political will to implement and enforce EU law. This has to be proven; the EU does not presume that these conditions are met by the Candidate Country.

This begs two questions; firstly, how does the Candidate Country know what it has to do to be ready? Secondly, how does the Candidate Country convince the EU MS and the Commission that it is ready for membership.

The EU adopted a set of criteria in 1993 - Copenhagen Criteria - which outline the general principles to be respected:

Political: a functioning democracy, respect for Human Rights including rights of people in minorities.

Economic:

• a functioning market economy with the
• Ability to withstand the competitive pressures of the EU Single Market

Ability to apply EU Law

• Legal structure - Law harmonisation
• Administrative capacity to implement, control and enforce EU law.

The EU also needs to be ready and able to integrate the new MS.

These criteria need to be broken down into more detailed operational level guidance for the Candidate Country - for practical purposes. This happens in two ways:

• firstly, the Commission does an annual review of progress by all Candidate Countries and Potential Candidate Countries and this contains detailed recommendations under each of the Copenhagen criteria;
• secondly, when accession negotiations start the EU sets very detailed benchmarks which have to be met in each individual chapter of the Acquis - the corpus of EU Law (the Acquis communautaire) is broken down into digestible portions called chapters of which there are 35.

Examples of such benchmarks would be

• That State Aid law be correctly applied in industrial sectors undergoing restructuring e.g. steel or shipbuilding
• That basic freedoms be respected under law and in practice - access to courts, free media, respect for human rights.
• That a reasonable strategy be put in place for budgeting for the infrastructural investments needed to comply with EU environmental law.

As to the second question, "How does the Candidate Country prove that it is really ready for membership, that it has actually met the conditions?"

This starts even before the start of accession negotiations with the implementation of the Association Agreement negotiated between the EU and the candidate Country - the Europe Agreement for the countries of the Central and Eastern Europe , the Stabilisation and Association Agreement with the countries of the Western Balkans. Meeting the obligations of the Association Agreements is like a training ground for EU membership - these obligations are sometimes tough but they ease the accession negotiation process later on.

During the negotiations the European Commission and the EU MS conduct a very close dialogue with the Candidate Country in each and every area of the Acquis. Through this we become aware of the various plans and strategies being adopted by the Candidate Country as well as their implementation and/or track record of achievements.

At certain stages in the process the Commission and the MS conduct "Peer Reviews" with practitioners from the EU working alongside their peers from the Candidate Countries to check progress.

Where appropriate, national and international NGOs also make inputs into this process.

Over time a very accurate picture emerges and is published each year in the Commission's annual Progress Report on the country.

Among the most difficult areas in the accession negotiations traditionally have included Agriculture, Competition and State Aids, Environment, Free Movement of Workers and of Capital, Justice, Freedom and Security.

Accession to the EU is not an instant remedy for all problems in a Candidate Country; for the Candidate Country its accession is as the coming of the dawn -light gradually spreads out; it is not like switching on a light in a dark room - everything immediately visible.

For the countries of Central and Eastern Europe , many of the benefits of EU membership come through the accession process and not just upon accession itself:

• FDI reacted long before 2004, throughout the 1990s;
• Trade grew before accession and also became more sophisticated;
• Knowledge transfers came with the FDI
• Competitiveness improved
• Productivity improved

Naturally, these advantages continue over time, way beyond the date of accession, accelerated by the benefits of full access to EU policies.

Fundamentally the success of the recent EU enlargement can be found in terms of more European countries being now covered by EU policies:

• More countries now operating a much more liberal trade policy - the EU as the world's largest importer and exporter, especially of agricultural policies from the developing world:
• More countries covered by the EU Climate change policy with its ambitious targets for GHG emissions reductions (-20% anyway, -30% if an international agreement at Copenhagen ), its ETS, its 20% energy efficiency and 20% renewables targets for 2020:
• More countries contributing to the EU's policy to help developing countries - with the EU and its MS already giving some 60% of all ODA given globally:
• More countries able in time to benefit from the monetary shelter of the Euro - especially important in these days of the GFC:
• More countries contributing to new EU security operations around the world:
• More countries contributing to EU discussions on how to handle EU bilateral relations with the EU's new next door neighbours that have been created through the enlargement process:

For all these reasons we can agree with Lord Patten's assessment that enlargement "has been the most successful foreign policy pursued by Europe."

This page updated November 18, 2009