The Copenhagen deal for enlargement

The briefing note analyses the outcome of the Copenhagen European Council and considers the challenges ahead for the EU-15, as well as the accession candidates, prior to enlargement on 1 May 2004.

The paper concludes that the Copenhagen deal was as good as the candidate countries could have hoped for in light of the economic slowdown in the eurozone economies and the constraints the Stability and Growth Pact has been putting on national budgets. Instead of the 42 billion euro enlargement budget agreed at the Berlin European Council in 1999, the total package of financial aid under the current budget will amount to a maximum of 40.8 billion. The bargaining at Copenhagen was about shifting money around from one part of the budget to another, rather than bringing forward new financial resources.

Poland can claim the most success in the enlargement negotiations, as it will alone receive about half of the total money allocated to the new members. The deal, however, favours farming communities that make up a quarter of Poland's population, while the Polish taxpayer may be left thinking that the funds could have been spent on other priorities.

The accession candidates, besides receiving, will also contribute some 15 billion euros to the EU budget over the same period. Moreover, they may not be able to use all the money that has been allocated to them by 2006. Therefore, according to Commission estimates, the net cost of enlargement will be just 10.3 billion euros for the ten countries over three years, representing less than one-thousandth of the EU's GDP.

The author thus comes to the conclusion that achieving ratification of the Accession Treaty by EU parliaments should not be too difficult. In Central and Eastern Europe, however, next year's referendum campaigns could see the emergence of openly anti-EU forces, although the only country facing a serious danger of public rejection of accession is Malta.