CHALLENGES 2007-2008: Still Outsiders After a Year in EU

By Claudia Ciobanu Reprint | | Print |

Claudia Ciobanu

BUCHAREST, Dec 26 2007 (IPS) - Bulgaria and Romania joined the European Union (EU) Jan. 1 2007 under the toughest conditions ever imposed on new member states. Although the two countries barely met the criteria for membership, their strategic location, between the Western Balkans and the Black Sea, as well as their relatively trouble-free domestic politics, made them an asset for the stability of EU’s eastern front.

“Retrospectively, these countries’ entry to the EU did look like a political decision,” Jean Crombois, professor of European studies at the American University in Bulgaria told IPS. “In this context, the stakes for the EU are quite high, especially if the countries do not make substantial progress in the sensitive areas.”

Signalling that the Balkan duo was not fully ready to enter the union, the European Commission (EC), the executive arm of the EU, reserved the right to invoke “safeguard clauses” if the two countries do not continue to implement pro-European reforms after entry. “Safeguard clauses” allow the EU to withhold funds or impose limitations on basic freedoms in cases of serious shortcomings in the fulfilment of commitments by member states.

Reform of the justice system and the fight against corruption are being particularly monitored, under the threat that unless progress is made, rulings passed by judges in Bulgaria and Romania might not be recognised by courts in other European states.

Although the EC has decided not to penalise any of the two countries yet, reform of the judiciary has been slowing down after EU entry. This may be due to “a kind of fatigue in terms of reforms,” Crombois told IPS, partly caused by conflicts among major domestic political forces.

In Bulgaria, although contract killings take place often on the streets of capital Sofia, no big figure has been to date convicted for corruption or links with organised crime.

In Romania, justice minister Monica Macovei, widely credited with implementing the anti-corruption reforms which allowed the country to join the EU, was removed from her position in April 2007. As she told IPS in an interview this summer, she was brought down by politicians who “felt threatened by investigations opened against them or their business partners.”

According to the Corruption Perception Index published by Transparency International Sep. 27 this year, both countries are still confronted with high levels of corruption. Bulgaria occupies 64th place and Romania 69th among 180 states.

Other areas that are strictly monitored by the EC are the functioning of agencies dealing with the distribution of European funds, and safety standards for food products and air travel.

The EU itself is not all ready to let these countries in. Only Finland and Sweden have completely opened their labour markets to workers from the two Eastern European countries. The other old EU members have chosen to maintain restrictions at least until 2009, arguing that they are still incorporating the influx of workers from the countries that joined the union in 2004.

According to a joint study by the publications Business Standard from Romania and Dnevnik from Bulgaria in September 2007, Romanians and Bulgarians are the poorest in Europe. They have the least purchasing power and income levels are around an eighth of the EU average. This makes many people in the two countries keen to work in Western Europe.

EU membership has certainly encouraged foreign investment into the two countries. But this is usually concentrated in the capitals and largest cities. High economic growth rates, which in 2007 reached 5 percent in Bulgaria and 6 percent in Romania, at most correspond to realities in major urban centres, while inequalities between the dynamic and the neglected regions of the countries are increasing.

EU membership comes with subsidies for development of the poorest regions, and support for agriculture. But absorption rates for such funds have been remarkably low in 2007 for both countries, because of the inefficiency of distribution agencies and insufficient awareness among people about the means to access such money. Romania barely escaped losing over 400 million euro in agriculture subsidies by quickly revamping its payment agencies.

Even participation in the common European market has not been entirely beneficial. Because of large disparities between the economic development of Bulgaria and Romania as compared with most Western European countries, joining the internal market has actually led to an increase in the new members’ trade deficits.

“The opening of markets, called for by EU membership, is clearly beneficial to the partners of the club, but the same does not hold true for the newest competitors,” economic analyst Ilie Serbanescu wrote in the Romanian weekly ’22’.

Still, even though integration has not immediately brought increased welfare in the two countries, Bulgarians and especially Romanians maintain their optimism about their countries’ prospects in the union. According to a Eurobarometer report released Dec. 18, 52 percent of Bulgarians and 71 percent of Romanians approve of EU membership.