MEPs count the cost of enlargement

Date: 28/11/1996

By Rory Watson

THE European Parliament will be asked next month to endorse a strategy ruling out any early rush into the Union by applicant countries in central and eastern Europe.

The approach advocated by New Democracy MEP Efthymios Christodoulou, a former governor of Greece's central bank, is in stark contrast to that called for by those who argue on security grounds for accelerated EU expansion eastwards.

In a report approved virtually unanimously by the Parliament's budget committee, the Greek MEP warns that the tactic of swift membership followed by lengthy derogations from central EU policies would create difficulties for the Union's finances, internal market and the application of EU law.

“There is nothing worse than to confuse NATO and the Union. What on earth would countries be joining if they had derogations from the agricultural and structural policies and from the free movement of people.

It would also make things considerably more complex,” he insisted.

Critics of the report fear that its intention is to reduce expectations about the pace of enlargement even further.

While optimists believe some countries could join by 2000 and many consider 2002 to be a viable target, there is a growing view that 2004 is now a more realistic objective.

German Socialist MEP Klaus Rehder, whose own proposals for far-reaching reforms to ease the integration of eastern European farm policies into those of the Union were rejected by his colleagues on the Parliament's agriculture committee, is one such critic.

“Of course we must reform structural and agricultural policies. But the Conservative majority on the committee did not want any reform of the Common Agricultural Policy (CAP). What I criticise Christodoulou for is that all the calculations he gives are from the negative point of view of transferring existing measures to the applicants,” he said.

Rehder has unsuccessfully argued for a radical overhaul of agricultural policy with greater emphasis on sustainable husbandry, regional implementation and ecologically-sound practices. He insists that such reforms are necessary to end the present situation in which 80&percent; of EU subsidies go to just 20&percent; of farmers.

Christodoulou rejects charges of foot-dragging, insisting that his proposals are not intended to make accession more difficult, but are designed to determine the real financial and budgetary implications of enlargement.

“The reasoning behind my approach is that it seems to be alright to make political declarations if they do not need to be backed up with financial means. My fear is very much that when the scale of these means is known, the declarations may be retracted,” he explained.

Christodoulou accepts that the direct financial implications of enlargement could be significant. But he stresses that these would not be so heavy if they were spread over time in an effective pre-accession strategy leading to negotiation and membership.

Calculations to date vary enormously on the cost to the EU budget of including the ten central and eastern European applicants with their 106 million inhabitants and an aggregate gross domestic product less than 4&percent; of the Union's own.

Estimates of the annual cost to the CAP alone range from 12 to 50 billion ecu, while regional and social spending could rise by 14 billion ecu a year.

European Commission data contained in the report indicates that it would be reasonable on current trends to expect spending of 37 billion ecu in existing and new member countries on regional, social and agricultural policies between 2000 and 2006 - a 9-billion-ecu increase on the funding between 1991 and 1999.

Christodoulou criticises such estimates for painting a static picture of events and for failing to take account of expected developments in the applicant countries and in the Union's own policies.

If the full Parliament follows his advice when it votes on the report at its mid-December plenary, the Commission will be asked to draw up a detailed assessment within the next year of the most likely financial impact of enlargement on various EU policies, including the cost of adding several more official languages to the current 11.

While it treats existing financial forecasts with a large degree of scepticism, the report nevertheless injects a new set of figures into the current debate.

Assuming no change in existing EU policies, it estimates that the cost to the Union of adding one Baltic country (Estonia), one Balkan (Bulgaria) and two Visegrads (Poland and the Czech Republic) to the EU's ranks would total about 12 billion ecu - equivalent to a 12.5&percent; increase in the annual Union budget.