Croatia jumps at EU opportunity

Few governments have been awaiting the outcome of this week’s (18-19 October) EU summit in Lisbon more anxiously than that of Croatia. It is just two years since Croatia’s negotiations for membership of the Union began, after Chief Prosecutor Carla Del Ponte had declared that Croatia was collaborating fully with the International Criminal Tribunal on the former Yugoslavia.

Since then, it has been fairly plain sailing. Yet failure by the EU member states to agree at this week’s meeting of EU leaders in Lisbon on the terms of the reform treaty could - at best - seriously delay Croatia’s entry into the EU beyond 2009. That has been the Croats’ unofficial target-date for becoming the Union’s 28th member, even though there has been no commitment from the EU side.

As a result of its experience with earlier enlargement negotiations, particularly with Romania and Bulgaria, the EU has made more difficult the obstacle-race facing potential entrants, though the formal requirements remain unchanged. Whereas negotiations with earlier applicants were confined to 31 chapters, this time there are 35, because of the sub-division of the chapters on agriculture and the judiciary, which will enable some of the most contentious issues to be examined in closer detail.

More significantly, verifiable ‘benchmarks’ have been set for Croatia to match, either before a chapter may be opened or closed. Vladimir Drobnjak, Croatia’s chief EU-negotiator, told a European Policy Centre (EPC) event in Brussels earlier this month that these were welcomed by the Croats, as they gave Croatia "useful, clearly defined targets".

So far, two chapters - on science and research and education and culture - have been provisionally closed, while ten others have been opened. According to Drobnjak, work is well advanced on seven further chapters, while two more will be opened "within days".

It is clear, however, that while steady progress has been made since 2005, the most difficult part of the negotiation is only now beginning. Christian Danielsson, the Commission’s acting director for Croatia, Macedonia and Turkey in the enlargement directorate-general, spelled out at the EPC conference the steps which Croatia must now take so that quick progress may be made in the most controversial fields.

‘Horizontal’ reforms are now needed, he said, across such areas as the public sector and the judiciary, so that the body of EU law, the acquis communautaire, can be fully implemented. Stamping out corruption and establishing public trust in the law, and environmental reforms, such as ratifying the Kyoto Protocol on climate change were also vital.

Other issues to be addressed included agriculture, public procurement, competition and state aid, and the need to restructure industries such as shipbuilding. Reforms were needed, he said, to justice, freedom and security matters, such as establishing clear borders so that Croatia can join the Schengen border-free travel zone. He had no doubt that all this could be achieved, but it would require substantial effort and the investment of political capital.

Recent economic developments have contributed to a climate of optimism about Croatia’s EU prospects. Foreign direct investment has doubled since 2005, and reached a record €1.2 billion in the first quarter of 2007. Gross domestic product (GDP) has grown annually by 4.8% and GDP per person stood at €7,700 in 2006, substantially higher than in Romania and Bulgaria. At the same time, unemployment has decreased to what Drobnjak claims is a ‘record low" of 11.2%, though this is still high for the Balkan region.

Negotiations with Croatia were begun on the same day as those with Turkey, but have proceeded far more smoothly. This is largely because, in contrast to Turkey, none of the 27 member states are opposed in principle to Croatia’s admission and there is virtual consensus on the EU side that it is a question only of ‘when’ not ‘if’. Nor is there any likely threat of existing member states claiming the right to hold a referendum before ratifying the entry terms.

There is one possible exception to this - the neighbouring state of Slovenia, which is involved in a long-standing dispute with Croatia over sovereignty of the waters in the Bay of Piran, a 20 square kilometre inlet into the narrow coastal border between the two states. This has led to confrontations over fishing rights and offshore drilling for oil.

Croatia has said that it will accept international mediation of the dispute, and it is now up to the EU to take the initiative in bringing this about.

• Dick Leonard is the author of The Economist Guide to the European Union.

Few governments have been awaiting the outcome of this week’s (18-19 October) EU summit in Lisbon more anxiously than that of Croatia. It is just two years since Croatia’s negotiations for membership of the Union began, after Chief Prosecutor Carla Del Ponte had declared that Croatia was collaborating fully with the International Criminal Tribunal on the former Yugoslavia.