The enlargement of EU by acceeding new countries

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The enlargement of EU by
acceeding new countries.
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International Economic Relations

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Marta Fernandes :: Vítor Santos

University of Oradea
Erasmus Students from Portugal
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2

THE ENLARGEMENT OF EU BY ACCEEDING NEW COUNTRIES
TABLE OF CONTECTS

Introduction .................................................................................................................. 3
History of the European Union and its enlargement ................................................... 4
Founding countries: ............................................................................................... 4
1st Enlargement: ................................................................................................... 5
2nd Enlargement: ................................................................................................. 6
3rd Enlargement: .................................................................................................. 6
Fall of Berlin Wall ................................................................................................. 7
5th Enlargement: .................................................................................................. 8
6th Enlargement: .................................................................................................. 9
7th Enlargement: ................................................................................................ 10
Benefits ...................................................................................................................... 11
Impact of enlargement for Portugal .......................................................................... 12
Advantages ......................................................................................................... 12
Difficulties ........................................................................................................... 12
Action needed .................................................................................................... 12
Impact of enlargement for Romania and Bulgaria ..................................................... 13
Membership Criteria .................................................................................................. 14
Conclusion .................................................................................................................. 15
Bibliography ............................................................................................................... 16

International Economic Relations  University of Oradea

3

INTRODUCTION

This work was carried out for the course of
International Economic Relations taught by Mr.
Prof.Dr. Mihai Berinde at the University of Oradea.
At the end of WWII, Europe was completely
devastated. Western Europe, who until the second war
had taken the role as the main center of power and
decision of the world had lost him in favor of two
powers that emerged now, the U.S. and the USSR.
For the reconstruction of Western Europe was
essential to American economic aid, known as the
Marshall Plan. To administer the pool money
allocated by America, was created OEEC -
Organization for European Economic Cooperation.
The Treaty of Paris established the European Coal
and Steel Community (ECSC). The idea of putting
two basic benefits to the restoration of Western
Europe on a common management had as main aim to
liberalize trade in these two products among signatory
countries.
The merit of the ECSC is twofold: on the political,
encouraged the reconciliation and cooperation
Franco-German and opened the way for the European
community, in economic terms, contributed to the
recovery of Europe to liberate the production and
trade of raw materials essential to industry.


HISTORY OF THE EUROPEAN UNION AND ITS
4

ENLARGEMENT
In 1949, created the Council of Europe, by the nations of Eastern Europe, and this is
the first step towards cooperation that these six founders wished to deepen. Such
cooperation is a consequence of World War II and was intended to ensure that such
carnage and destruction will not happen again.
The May 9, 1950 (Europe Day), Robert Schuman presented a plan for further
cooperation. The April 18, 1951, and based on the plan presented by Robert Schuman,
six countries (Belgium, France, Italy, Luxembourg, the Netherlands) signed a treaty that
aimed to put their heavy industries of coal and steel under a common authority (ECSC).
From this date no member country can produce weapons of war to turn against each
other, as in the past.

FOUNDING COUNTRIES

Germany, Belgium, France, Italy, Luxemburg, Netherlands

EU-27 Member States (2007)

Having regard to the success of the treated coal and steel, the six countries have
continued their cooperation in extending this to other economic sectors, by signing the
Treaty of Rome (March 25, 1957), thus creating the European Economic Community
(EEC) or "common market", whose aim is the free movement of persons, goods and
services between Member States.


In August 1961, the communist authorities in East Germany build a wall in Berlin to
5

keep the population flee to West in search of freedom. Some manage to escape, but
others are killed trying to flee.
The July 30, 1962, it launched the Common Agricultural Policy (CAP), which gives
Member States the common control of food production and agricultural prices are
uniform in the Community.
The EEC signed the July 20, 1963 his first major international agreement for
assistance to former African colonies, since leading the efforts of development
assistance to the poorest countries.
The July 1, 1968 there is the abolition of tariffs between the six member states, thus
creating conditions for free trade exists.
In 1970, in order to create monetary stability, the EEC decided to limit the margin of
fluctuation between their currencies, creating a single currency (the euro) would be
released years later.
The January 1, 1973, the six countries join three (Denmark, Ireland, United
Kingdom), thus giving the first enlargement.

1ST ENLARGEMENT:

Denmark, Ireland, UK

The fall of the Salazar regime in Portugal in 1974 and the death of General Franco in
Spain in 1975 put an end to the latest right-wing dictatorships in Europe. The two
countries are committed to the establishment of democratic governments, which is an
important step towards membership.


The January 1, 1981, the number of community members is 10, with the accession of
6

Greece, who could join after the collapse of his military regime and the restoration of
democracy in 1974.

2ND ENLARGEMENT:

Greece

The January 1, 1986, Spain and Portugal join the EEC, which increases to 12 the
number of its members.

3RD ENLARGEMENT:

Spain, Portugal


Despite the abolition of customs duties in 1968, there remain obstacles to free trade
7

within the Community. These are mainly from differences between national laws, the
Single European Act signed in 1986, provides for eliminating. The Single Act also
increases the influence of Parliament and strengthen the powers of the EEC on the
environment.
The fall of the Berlin Wall in 1989 symbolized the collapse of communism in
Central and Eastern Europe, which began in Poland and Hungary. It is the reunification
of Germany after more than 40 years of separation and eastern part of the EEC in
October 1990.

FALL OF BERLIN WALL
4TH EXTENSION

The February 7, 1992 is signed the Treaty on European Union at Maastricht. The
EEC exceeds a major step by establishing clear rules for the future single currency,
foreign policy and security and cooperation in justice and home affairs. The "European
Community" is formally replaced by "European Union".

JANUARY 1, 1993

Creating a single market and its four freedoms becomes a reality from January 1,
1993, where they move freely to the goods, services, people and capital.


Austria, Finland and Sweden join the EU on 1 January 1995. The 15 Member States
8

now cover almost all of Western Europe.

5TH ENLARGEMENT:

Austria, Finland, Sweden

The Schengen Agreement came into force on 26 March 1995, seven Member States:
Belgium, France, Luxembourg, the Netherlands and Portugal. Travelers of all
nationalities, can travel to these countries without identity checks at borders. Other
countries later joined the Schengen area.
The signing of the Treaty of Amsterdam (June 17, 1997) is based on achievement of
the Maastricht Treaty. Includes provisions to reform the European institutions to give
more weight to Europe in the world and devote more resources to employment and the
rights of citizens.
EU leaders agree to start accession negotiations with 10 countries of Central and
Eastern Europe: Bulgaria, Slovakia, Slovenia, Estonia, Hungary, Latvia, Lithuania,
Poland, Czech Republic and Romania. Addition to these countries, the Mediterranean
islands of Cyprus and Malta. In 2000, the Treaty of Nice opened the way for
enlargement, to overhaul the EU rules on voting.
The January 1, 1999, eleven countries (that Greece would join in 2001) adopting the
euro only for their commercial and financial transactions. The coins and banknotes will
be introduced later. The eurozone countries are: Austria, Belgium, Finland, France,
Greece, Ireland, Italy, Luxembourg, the Netherlands and Portugal.


The introduction of euro notes and coins takes place at 1 January 2002, whose
9

printing, minting and distribution involved a major logistical operation. More than 80
billion coins and banknotes are put into circulation. The notes are the same in all
countries, but coins have one common face with an indication of value, and a face with
a national symbol.
May 1, 2004, eight countries in Central and Eastern Europe (Estonia, Slovakia,
Slovenia, Hungary, Latvia, Lithuania, Poland and Slovenia) join the EU, as well as
Cyprus and Malta.

6TH ENLARGEMENT:

Cyprus, Slovakia, Slovenia, Estonia, Hungary,
Latvia, Lithuania, Malta, Poland, Czech
Republic

The 25 Member States sign a treaty on 29 October 2004 establishing a Constitution
for Europe in order to simplify the decision process and functioning of a democratic
Europe with 25 members and more. The Treaty, which includes a new post of European
Minister of Foreign Affairs, will only enter into force if ratified by all 25 Member
States.
Enter into force in February 2005, the Kyoto Protocol, an international treaty to limit
global warming and reduce emissions of greenhouse gases.
The January 1, 2007, two more Eastern European countries, Bulgaria and Romania
join the EU, bringing the number of Member States to 27


10

7TH ENLARGEMENT:

Bulgaria and Romania

The 27 EU Member States signed the Treaty of Lisbon on 13 December 2007,
amending previous treaties. Its aim is to increase the democracy, effectiveness and
transparency of the EU and thus make it capable of facing global challenges such as
climate change, security and sustainable development. Before its entry into force, the
Treaty of Lisbon should be ratified by each of the 27 Member States.

Candidate: Former Yugoslav Republic of Macedonia, Croatia, Turkey

Potential countries: Albania, Bosnia and Herzegovina, Kosovo, under United Nations auspices
in accordance with Resolution 1244 the Security Council, Montenegro, Serbia, Iceland


A policy of gradual and carefully managed enlargement is of fundamental interest to
11

the EU. Future enlargements will concern the countries of Southeast Europe. These
countries are at different stages on their road towards the EU.
Croatia and Turkey are candidate countries which have started accession negotiations
on 3 October 2005. In December 2005 the European Council granted the former
Yugoslav Republic of Macedonia the candidate status, the accession negotiations have
not started.
All other Western Balkan countries are potential candidate countries: Albania,
Bosnia and Herzegovina, Serbia and Montenegro including Kosovo under Resolution
1244 Security Council of the United Nations. The EU has repeatedly reaffirmed at the
highest level its commitment for eventual EU accession of Western Balkan countries,
provided they meet the membership criteria.
Iceland submitted a request in the July 23, 2009.

BENEFITS

The benefits of EU enlargement have political, economic and cultural contexts;
 The enlargement of the zone of peace, prosperity and stability in Europe will
provide better security to the population.
 The increase for the European market of over 100 million people in fast growing
economies, boost economic growth and employment and the current Member
States or candidate countries.
 Is there a better quality of life for the citizens of Europe, as candidate countries
to adopt European standards of environmental protection and the fight against
crime, drugs and illegal immigration.
 The new member states will enrich the EU for increased cultural diversity,
exchange of ideas and improve knowledge and understanding between peoples.
 The enlargement will strengthen the EU position in world affairs, as regards
foreign policy, security, trade etc..
Source: Iapmei


IMPACT OF ENLARGEMENT FOR PORTUGAL
12

ADVANTAGES

 New opportunities for business and for economic and financial groups;
 Export and investment opportunities in new markets;
 The fact that these countries were emerging economies will enhance the
attractive conditions for Portuguese investment in these countries;
 Free movement of workers - flows;
 Prospects for a major increase in trade in products and services.
 Low wages are our main competitive factor with the disadvantage that in
Portugal the manpower is not as high educational qualifications;
 Allowed the strengthening of democracy and political stability and society in
general.

DIFFICULTIES
 Migratory movements;
 Increased competition in the economy domestic and foreign markets,
including competition with labor-national work;
 Relocation of enterprises and investment (including foreign direct
investment);
 Loss of power and political influence in the European Union;
 Worsening of the position;
 Increase in commercial competition;
 Divert investment flows;
 Reduction in the intensity of Community grants;
 Potential effects on competitiveness and competition between companies;
 Fears about a transfer of existing EU financial aid to other countries and
regions;
 Movement of foreign direct investment and multinational enterprises.

ACTION NEEDED
 Entrepreneurs with initiative and support the internationalization
 Taking all the benefits of the enlargement of the market
 Maintaining the connection with a major investment in the candidate countries,
notably in infrastructure (environment and transport as priority areas) and
technical assistance;
 Enjoy the whole experience that Portugal is in services (banking, insurance) are
important for these countries
 Modernize and improve the competitiveness of productive sectors, increasing
the export capacity.

Source: IAPMEI


IMPACT OF ENLARGEMENT FOR ROMANIA AND BULGARIA
13

The European Union gives welcome to new members, Bulgaria and Romania, which
will become official members of the European Union on January 1, 2007. The accession
of these two countries is another phase of the enlargement process initiated in the year
1990, when twelve countries, mainly from Central and Eastern Europe, have applied for
EU membership.
Since its founding over 50 years, the EU has exerted a strong power of attraction,
having been enlarged constantly seeking new members. The accession of ten new
Member States in May 2004 was the biggest ever enlargement of the European Union.
The inclusion of Bulgaria and Romania will supplement the integration process,
rewarding the efforts of the European Union to promote peace, democracy and
prosperity across Europe.
As with previous enlargements, to meet all the criteria required for accession,
Bulgaria and Romania had to perform a process of significant reform and
modernization. In congratulating the people and the leaders of both countries for their
historic achievement, the European Commission President Jose Manuel Barroso
announced that measures will be taken of special monitoring following the accession of
Bulgaria and Romania. These measures will exert some supervision in certain areas it
was found that some efforts are still needed. Measures will be taken to control,
particularly in the areas of judiciary reform, fight against corruption and organized
crime, expenditure on agriculture and food safety.
In response to questions and concerns of European citizens posed by present and
future enlargements, the Commission adopted on 8 November 2006, a strategy for the
policy of EU enlargement. The studies of effective impact of benchmarking activities
and other concrete measures allow the EU to better assess the impact of adhesions. The
Commission also recognized the need to listen more carefully to citizens and to assist
Member States with regard to communication and dialogue with civil society.


MEMBERSHIP CRITERIA
14

Any European country which respects the principles of liberty, democracy, respect
for human rights and fundamental freedoms and the rule of law of the European Union
can apply to join the European Union. The Treaty on European Union concerning their
conditions (Article 6, Article 49).
The application for EU membership is the beginning of a long and rigorous process.
The official starting point is the request by a country, usually as a result of strong
bilateral relations between that country and the European Union. A valid application
triggers a sequence of evaluation procedures by the European Union which may
ultimately result in the presentation of an invitation to the country to become a member.
The pace with which each country moves depends solely on its own progress in
achieving common objectives.
The country presented its application for accession to the Council. The European
Commission gives its formal opinion on the candidate and the Council decides whether
to accept the application. After the unanimous adoption of a negotiating mandate by the
Council, may be given official start to the negotiations between the candidate and all
Member States. But this is not an automatic step. Before the start of negotiations, the
candidate must meet a set of criteria.
So-called 'Copenhagen criteria', established in December 1993 by the European
Council in Copenhagen, require that the country has:
 stable institutions guaranteeing democracy, the rule of law and respect for
human rights and respect for minority rights and protection thereof;
 a fully functioning market economy and capacity to cope with competitive
pressure and market forces within the Union;
 ability to assume the obligations of the status of a Member State of the European
Union, including adherence to the aims of political, economic and monetary
union.
In 1995 the Madrid European Council still needed that the candidate should be in a
situation that allows it to enforce regulations and procedures of the European Union.
Membership also requires the prior creation by the candidate with the conditions for its
integration through the adjustment of their administrative structures. Although the
transposition of EU law into national law is important, its effective implementation
through appropriate administrative and judicial structures is even more important. This
is a prerequisite for establishing a climate of mutual trust essential to the process of EU
accession.
Furthermore, the European Union must integrate its new members, needing to ensure
that its institutions and decision processes continue to function effectively and
responsibly; to be in a position, as it grows, continue to develop and implementing
common policies in all areas, and can continue to finance its policies in a sustainable
manner.


15

CONCLUSION

Since its establishment under the Treaty of
Rome (1957), the EU enlargement is certainly the
greatest challenges facing Europe, as it benefits the
political, economic and social concerns represent
this process and some costs.
Indeed, Portugal is likely to be countries that
will see more negative impacts of enlargement. It
is however important to take into account the
benefits which result. For this, you must be aware
of stress and adaptation needed in order to have an
early response by the national stakeholders in order
to carry out the changes necessary to adapt the
country.


16

BIBLIOGRAPHY

 http://www.dre.pt/ue/ue_desc.html

 http://europa.eu/abc/history/animated_map/index_pt.htm

 http://ec.europa.eu/enlargement/countries/index_pt.htm

 http://www.iapmei.pt/iapmei-art-03.php?id=1000

 http://ec.europa.eu/agenda2000/overview/pt/agenda.htm

 www.ugt.pt/ue/estudo2.doc


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