Critical Reflections on EU Enlargement

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Critical Reflections on EU Enlargement - Dorthee Heisenberg


In Copenhagen on June 22, 1993 the European Union (EU)2 made a momentous decision, the importance of which seems to have been unappreciated at the time. By formally committing themselves to allowing up to thirteen new Central and East European countries (CEEC's) to become members of the union eventually, the EU had taken a dramatic step in irreversibly changing the institu­tional structures and character of the EU itself. Surprisingly, this monumental change of policy was hardly discussed in the two-day European Council meeting, was not highlighted by the media covering the summit, and did not even merit the first item on the communiqué of the summit. Instead, buried near the bottom of the communiqué was the paragraph that:

The European Council today agreed that the associated countries in central and eastern Europe that so desire shall become mem­bers of the European Union. Accession will take place as soon as an associated country is able to assume the obligations of mem­bership by satisfying the economic and political conditions re­quired.3

Although the acceptance was conditional on political and economic fac­tors, the fact remains that after the Copenhagen Summit in 1993, the discussion of enlargement became a question of how and when, and not if.

Since the Copenhagen Summit, the EU developed an organizing frame­work detailing the order in which to admit the countries (Agenda 2000, the Lux­embourg Summit declarations in December 1997, and the Helsinki Summit decla­rations in December 1999), the framework to rationalize the financial structure of the EU's programs (Agenda 2000 and the Essen and Cologne Summits in March and June 1999) and an intergovernmental conference (IGC) and treaty revision to change the EU's institutional structures (Amsterdam Treaty and the current IGC). However, despite these many attempts to facilitate admission, little substantive progress has been made to achieve that promise to date.

There is little doubt that a significant portion of the lack of progress on the EU's part may be attributed to changes in Member States' preferences regarding the ultimate desirability of this enlargement. Although the Member States justify the lack of progress in arguments about the inadequate preparation of the CEEC's at this time, there is primarily a reluctance to change the institutions of the EU in such a radical way as would be necessitated by the addition of 13 or more new states. The current state of the enlargement question is that three elements need to be achieved before the actual enlargement is completed: 1) the CEEC's must reform their domestic institutions and economies to conform to the acquis communautaire, 2) the EU must reform its institutions, and 3) the EU must ra­tionalize the financing of the EU and its major aid programs. Most of the EU's focus has been on the insufficient progress made on the first element by the CEEC's; however, the Member States have a record of failing to reach an agreement on the second and third points, and in the long run, these may be the more important elements of discussion.

This article addresses that question of the EU' s institutional reform and structural integrity. Specifically, it reflects critically on the commitment to admit an indeterminate number of new members at Copenhagen. At issue is the risk that enlargement, no matter how morally justified, will undermine the forty-five year old structural stability of the EU. Should the Member States renege on their promise of membership for the CEEC' sin order to preserve the EU?

The EU is a unique set of institutions cobbled together without a plan for future development or coherent institutional design. The path of institutional de­velopment has been incremental evolution rather than conscious design, and the conflicts between existing EU Member States often reflect this development. Changing the structures in a fundamental way, and adding thirteen new members (irrespective of their economic level of development) poses the risk of a complete breakdown of the whole institutional framework. This essay addresses some of the risks for the EU.

A Brief History of Enlargement

The Treaty of Rome incorporated an open door policy towards other countries at the signing of the European Union documents in 1957. The primary motivation at the time was to give Britain a chance to change its mind and join the EU later. There was limited discussion of which countries would or would not be in the union, and the inclusive stance taken by the Member States reflects an international context of other states (most importantly Britain) declining entry rather than clamoring for entry. Moreover, the limits of what was "Europe" were well established within the Cold War context, and there were thus a limited number of potential candidates.

The first enlargement (Britain, Ireland, Denmark and Norway in 1973) reinforced this perception of the EU: Norway negotiated accession but failed to join after the required referendum failed, and Britain essentially renegotiated entry after it had been accepted in 1973. This enlargement showed that economic motivations to join the EU predominated political ones. The EU had been more successful than EFTA, and the exclusion from a successful regime was difficult. By 1973, the EU had already acquired a critical mass that made it economically attractive.

The second enlargement (Greece in 1981, Spain and Portugal in 1986) demonstrated that the EU had become a stamp of approval for post-dictatorship regimes. EU accession stood for political motivation to modernize, to eschew market protectionism, to remain democratic and to join European, indeed interna­tional, society. From the EU' s perspective, the admission of these countries repre­sented a lowering of the admissions standards set by the existing Member States. Political reasons to join trumped economic fitness, setting the precedent for the current accession talks. Moreover, the Mediterranean enlargement changed the character of the EU voting, to make bloc voting (core-periphery, rich-poor, and northern-southern) more prevalent on various issues.

The third enlargement (Sweden, Finland, Austria and Norway in 1995) was a recognition of two trends: the end of the Cold War, which permitted previ­ously neutral states to join the decidedly political EU, and the economic non-viability of EFTA in its remnant configuration. Again, Norway's accession failed in the referendum phase, but the other states joined after conforming their legislation to the extensive EU framework.

Two points regarding these accessions are notable: first, the populations of the existing Member States in the early enlargements were not asked to ratify the increase in the union membership; all of the decision-making on enlarging the EU was done by the government elites. Although indirect democracy is legitimate practice and the preferred decision-making method in Europe, it has also served as a lightning rod for criticisms of the EU bureaucracy's democratic deficit. The increasing divisions between mass public and elite opinion on the issue of enlarge­ment would indicate that perhaps these types of sensitive issues should be handled in a more democratically participatory fashion. As the EU has become more and more federal and interdependent over time, it may be appropriate to have Mem­ber State citizens make the decision of which other states should have the rights and responsibilities of EU membership.

Second, there is an ad hoc quality to the decision-making process re­garding which states should join the union that increasingly is out of synch with the stature of the EU internationally. Specifically, there has not been an organized effort to define "Europe" and its boundaries4. Without knowing what "not Eu­rope5" is, it is difficult to define "Europe" and "European values." This is evident in the identity search now being conducted by the existing Member States6. As the EU became an irresistible attraction in Europe, there was more demand for accession; however, the EU continued to behave institutionally as though it were a small customs union, indifferent to the size of the union.

The Proposed Enlargement

The proposed enlargement to include the CEEC's reflects the history of admitting any countries that want to join. A chronology (see Table 1) of the mile­stone EU decisions concerning the CEEC's shows that there was never a serious discussion of whether these countries should be offered admission. Instead, the EU Members acted on the basis of assumptions that were deemed obvious or politically correct. The desirability of the CEEC's ultimately joining the EU was considered self-evident, and the EU bureaucracy operated on the basis of that assumption. Moreover, during the critical first three years (November 1989-June 1993), the EU Members were distracted by the negotiation and ratification of the Maastricht Treaty, the beginnings of the Yugoslav wars, and the EMS crises, and thus enlargement did not receive the attention it required7.


Soon after the fall of the Berlin Wall, the EU acted to approve financial aid to Poland and Hungary (PHARE) which was later expanded to twelve other CEEC' s. Two years later, in December 1991, the first Association (Europe) Agreements were signed with Czechoslovakia, Hungary and Poland. The Asso­ciation Agreements are trade agreements that state that the associated CEEC will, over a ten year period following the signing of the Association Agreement, liberal­ize trade with the EU. Essentially, the Europe Agreements were to lay the founda­tion for a free trade zone between the CEEC's and the EU. In this period, the associated CEEC would forego giving state aids and liberalize competition in its market. In return, the EU would grant access to the European market.

There were three significant exceptions to the free trade area that was being created, all advantaging the EU: textiles, steel and agricultural goods. Thus, three sectors in which the CEEC's had a comparative advantage were deliber­ately excluded from the agreements. It isn't hard to understand why they contin­ued to lobby for full membership.

Six months later, the Commission presented its report, "The Challenge of Enlargement," to the Lisbon European Council, in which it strongly recommended that the CEEC' s be admitted into the EU.

What is striking about the various accounts of this period is the extent to which the Member States acted as though enlargement were a foregone conclu­sion that could not be debated. The uncertainty of the post-Cold War transition period forced the EU to act uncharacteristically quickly on such a question of monumental importance to the EU itself. Moreover, the lack of Treaty guidance as to what countries could legitimately be excluded, combined with the guilt of Western Europeans for seeming, in the words of Lech Walesa8, to put a "silver curtain" in place of the "iron curtain," made a frank debate over enlargement impossible. The critical June 1993 decision at the Copenhagen European Council to formally offer accession seems to have been made without any real discussion of the long-term implications for the EU:

The most important proposal was ... that 'the European Council should confirm in a clear political message, its commitment to membership of the Union for Europe Agreement signatories when they are able to satisfy the conditions required.' This was the great achievement of Copenhagen. Interestingly, it was hardly discussed by the Member States and certainly not disputed in the many hours of discussion and negotiation leading up to the Sum­mit. The explanation of this show of unanimity is difficult, given that probably a majority of countries were not totally in favor of accession, at least in the near term.9

Once the Copenhagen Summit had finally offered admission, the die was cast, and the terms of the debate about accession moved to the question of how best to incorporate the CEEC's into the union. It is unclear, however, if this response is still the most appropriate for the circumstances ten years after the end of the Cold War. The CEEC's are politically stabilized, and their economies are, to different degrees, stabilizing around a market-oriented system. The urgency to admit the CEEC's to shore up their democratic credentials is gone, and the toll on the EU' s institutions of admitting so many states is becoming more apparent. Is it possible to change strategic direction at this date?

Objections to the Enlargement

The most commonly heard objections to the impending enlargement of the EU are that the CEEC' s are considerably poorer and more agrarian than even the poorest of the EU' s current members, placing a significant strain on the existing aid programs of the EU. This critique implies that if the EU waits sufficiently long for these countries to achieve EU minimum standards, there will be few problems with the admissions process. Much of the formal EU debate has, in fact, revolved around the issue of timing the accessions to ensure the CEEC's meet the set con­ditions. Economic conditionality has become the most significant factor slowing the accession for the individual countries.

A less benign version of the same criterion arises at the mass public level. Right wing populist movements like the Freedom Party in Austria have capitalized on the fear that the impoverished nature of the CEEC's threatens the current EU population's living standards, and therefore should be opposed on those grounds. These "GDP per capita" concerns, although important, miss critical aspects of the debate about the EU polity. The decision to admit significantly more members may undermine the fundamental stability of the EU that the world has come to take for granted. Moreover, raising questions about the financial condition of the CEEC's that are to be allowed into the EU risks "personalizing" a debate about the EU that should go forward even if these countries had no interest in admission. Funda­mental questions about the future path of the EU have been avoided because of their political divisiveness. Yet the enlargement process simply begs for a consen­sus on these questions. The EU historically has avoided these questions by "backing into" many decisions and then presenting its citizens with a de facto decision.

In order to strip away the arguments having to do with the economic status of these countries, and to focus attention on the EU institutional debate, let us assume that the EU is considering admitting fifteen Norways into the Union, meaning small, rich, EU budget net-contributing countries that share a common conception of the welfare state and ecological policy. Would this pose a problem for the EU, or would it be as uncomplicated10 as the last enlargement in 1995?

The sheer number of candidates ensures that any accession agreement must include EU Treaty reform that rationalizes the number of institutional voters on policy. Essentially, the exercise now before the current Intergovernmental Con­ference (IGC) involves reducing the number of veto points in the decision-making process in order to prevent gridlock in EU institutions. There are several ways11 to do this but essentially this would be achieved through two means: either by enlarging the scope of qualified majority voting (QMV) to areas that are now covered by unanimity voting, or by reducing, and in some cases, eliminating, the number of votes that each country has in the various EU institutions. The EU Member States have wrestled with these alternatives for several years now and for perhaps obvious reasons, have not reached a consensus on the appropriate solution. The 1996 IGC had as its primary goal to make the institutions of the EU compatible with enlargement, a task it fell sadly short of, necessitating another IGC to accomplish. The new IGC12 has as its mandate, "[to] examine the size and composition of the Commission, the weighting of votes in the Council and the possible extension of qualified majority voting in the Council..."13

There are democratic, structural and historical reasons why these solu­tions are problematic. The democratic objections to the proposals can be sum­marized by saying that they change the existing character of the EU without popu­lar assent. Although there is considerable dispute about how to characterize the present EU institutional framework with its quirky anomalies, the most widely held conception is one of confederalism rather than centralized federalism. Thus, de­spite an increase in QMV over time and even issue areas, the Member States continue to hold a veto over almost all non-economic decisions made by the EU (primarily those in the second and third pillars of the Maastricht Treaty). It is this fundamental retention of sovereignty that the new institutional arrangements are likely to change, and with it, the character of the EU itself. Many Member States are hesitant to take such a dramatic step.

A further democratic critique of these solutions is that they fundamentally change the dynamic between large and small countries. One of the essential characteristics of EU voting is that the smaller countries are over-represented in EU institutions on the measure of votes per capita (see Table 2). Moreover, the blocking minority of 26 out of 87 votes in the Council at present can be a coalition of 5 small states, comprising as little as 12% of the EU population. While this over­represention of small state voter power may seem unjust (and is thus the target of Commission reform proposals), it serves to mitigate a large state bias that exists de facto in the EU due to the inherent intergovernmental nature. Most of the EU initiatives are large-country sponsored, or at the very least approved by the large countries14, and the Council voting over-representation of the small countries may in fact be a useful antidote to the ''tyranny of the majority" problem in Europe. By changing the composition of the EU from "5 large and 10 small" to ''7 large and 21 small" and changing the voting structures to either represent accurately (or not represent at all) the voting populations in the small countries, the EU risks alienat­ing the small country citizen that to date has been able to make his preferences heard. It is perhaps this historical compromise that has made the EU so politically stable.

The structural arguments against EU enlargement come from international relations research on empires of the past. At issue is the absolute size of the EU, and whether it is politically feasible to create a stable union of that size. Table 3 shows the existing population of the EU-15 in relation to the ten most populous countries of the world, as well as where the EU-28 population would fit in. A suitable analogy to EU expansion might be blowing up a balloon: it is a mathematical certainty that the balloon will burst if air is continually added, but no one knows exactly at what moment it will burst. The EU is attempting to create a political system for more than half a billion people; the only other two examples of this are China and India. Does this indicate that the EU can only enlarge by becoming less democratic and more centralized or by accepting political chaos and gridlock? Is it empirically possible for a democratic union of this size be stable?

Paul Kennedy's The Rise and Fall of the Great Powers presents the cycle of empire-building and empire-disintegration that hinges on the empire over-extending its reach, engendering both nationalist opposition and increasing economic costs that weaken the core. Is this an apt characterization of the EU? On the one hand, the pressure for extending the EU comes from the outside rather than from the EU itself, and thus one would expect less nationalist resistance. On the other hand, nationalist pressures can arise both from the elite-mass divergence in the accession countries, as well as from the disenfranchised populations within the EU that had to give up their veto rights in order to make accession possible. Thus a nationalist, in this case anti-EU, protest could be mobilized from the newly democratic and independent populations that do not want to relinquish their newly regained sovereignty. A divergence between political elites and mass opinion on the desirability of joining the EU has already formed in several of the CEEC's.16

Alternatively, there could be organized resistance from the EU population which objects to the changing structure of the EU. The primary legitimization of the EU' s plans will be through the European Parliament's assent procedure and through parliamentary ratification by most of the Member States. Given a grow­ing divergence between mass and elite opinions about enlargement in the EU, popular opposition to enlargement may not be reflected in the parliamentary proc­ess. At present there are no mainstream political parties that are taking an anti­enlargement position in any of the EU Member States17. However, this could change in the years before the accession preparations are finalized.

From an economic point of view, the enlargement requires the EU to fundamentally change several of the programs that have evolved as significant federalizing measures, like the Common Agricultural Policy and the Structural Funds. These programs have served as identity anchors for the EU since the 1960s (in the case of the CAP), and the EU faces the choice of dramatically cutting or eliminating them, or overextending itself financially to accommodate the CEEC's. Obviously, there are several Member States that would welcome these cuts, but it would be a mistake to underestimate the degree of support for these programs within the Member States.

A final point about structural stability concerns the European Central Bank and its monetary policy making. At present there are already concerns that the number of votes in the governing council (11) could outweigh those of the execu­tive council (6) and therefore add a regional bias to the monetary policy of the

EU18. The addition of up to seventeen additional members of the Governing Council would exacerbate this tendency, and potentially destroy coherent mon­etary policymaking in the ECB. Structural changes to the ECB institutional frame­work are not even contemplated at this date, given that the EU accession must necessarily precede negotiations of EMU membership19. However, structural revisions would require unanimity voting on new treaty amendments, which would be extremely difficult with twenty-eight members. Financial market uncertainty about institutional changes at the ECB could lead to financial crises before the EU could act coherently.

The above discussion of the absolute size of the EU highlights the critical question that few EU bureaucrats seem to be asking: can an EU-28 be as politi­cally stable as the EU-15 has been? It is imperative to keep the stability criterion as the most important one, overriding considerations off fairness, mutual economic gain, and political advantage. The current political climate in Brussels is that it is too late to exclude the CEEC's from full membership, and thus the only objective is to find the proper method for incorporating them. However, if the institutional reforms increase the instability of the EU, or cause the institutions to fail, it will be difficult if not impossible to salvage the existing benefits of European cooperation. Would it not be better to find alternative solutions?

Creative Alternatives to Membership?

In the EU it has been difficult to think creatively about the future of the institutions because many ideas are immediately discarded as fragmenting the un­ion, or disadvantaging new or existing members. Among the ideas that have peri­odically been floated by various groups are "two speed Europe," "hard-core Eu­rope," ''variable geometry" and "Europe a la carte." These discussions have been motivated not by the demands of enlarging the union, but to accommodate the differing preferences of the existing Member States toward further federalization. These proposals have in common a desire to differentiate Member States on the basis of their preferences toward further integration, evidence that even within the existing Member States there are those that would want more economic than political union.

A common criticism of these plans is that any movement toward these alternative conceptions of the EU (not all countries in every program) opens Pandora's box, making the EU ungovernable and fiscally infeasible. Aside from the fact that this box has already been opened, with the EMU opt-outs for Britain and Denmark and the Schengen acquis, it is unclear that it would be more destabilizing (in light of the increasing membership) to have different "grades" of EU membership than to insist on incorporating the CEEC's into an institutional framework built for six members. Essentially, the EU would redefine the very concept of "membership."

Would prospective members consider joining a revised EU which does not contain the existing benefits for every member? This is exactly the scenario being negotiated at the moment. It is clear that from the CAP to the Structural Funds, the financial benefits of joining the EU will be significantly modified or eliminated before the CEEC's can join. Although the changes to the EU's fi­nances were supposed to be completed at the Cologne Summit in June 1999, the lack of consensus on this contentious issue delayed the inevitable reforms. How­ever, before the CEEC's join, it is certain that many of the financial arrangements that would have benefited them will be altered or eliminated.

There is virtual unanimity among observers that CEEC enthusiasm for EU membership is motivated by political and identity questions rather than economic cost/benefit calculations. This is partly due to the fact that some of the economic benefits of accession have already been obtained by virtue of the European Agree­ments. More importantly, however, is the fact that the economic calculus of the benefits of membership is indeterminate. There are significant costs as well as benefits, and it is virtually impossible to make a definitive judgment as to what the net cost or benefit will be for each country20. Moreover, as stated above, it is impossible to calculate the financial benefits of the CAP or structural funds, since these programs are likely to be radically changed before accession.

Some of the economic benefits have already accrued to the CEEC' s by virtue of the Accession Agreements. The CEEC' shave been forced to conform their domestic institutions to be compatible with the EU's acquis communautaire, thereby increasing transparency, accountability and competition in these econo­mies. It is a fact that the CEEC' shave been disadvantaged economically by the exceptions the EU imposed on the free trade certain sectors, but the remedy for this cost is rather simple (if politically difficult for the EU). As an interim step, the protection of certain EU markets should be eliminated in order for the CEEC's to get a more accurate picture of the benefits and costs of membership.

Security concerns are also unlikely to be the chief motivation to join the EU. After more than ten years of political stability in most CEEC's , the security and political stability concerns which prompted the initial rush to admit them into the EU no longer seem as pressing as they did in 1993. Moreover, the ongoing NATO enlargement negotiations would seem to be a better forum to discuss se­curity concerns than within the EU.

By default, therefore, the elite consensus that exists in the CEEC's that EU membership is desirable is based on political and identity factors. These factors are hardly insignificant motivators, but they do allow the opportunity to change the entire structure of the EU in ways that allow "membership" to be more broadly defined. If new members comprised the sole constituents in this new association, there would be a danger of class differences. Therefore, there should also be the opportunity for existing members of the EU to change their status as well. This would be highly complicated, and the entire process of institutional redesign and financing would necessarily need to be extremely transparent in or­der to avoid the suggestion that the EU was trying to cheat the CEEC's out of a previously made bargain. However, these types of difficult decisions need to be made sooner rather than later in order to preserve the stability of the EU as a whole.

Enlargement of the EU to the CEEC's is a project fraught with serious difficulties. Contrary to conventional wisdom, it is the EU institutional issues that are more problematic than the economic issues that are often offered as proof that the enlargement process should slow down. EU institutional and financial issues have been discussed for more than seven years in various Commission and inter­governmental forums, but they remain extremely divisive. This apparent disagree­ment reflects fundamentally different conceptions of the EU's purpose and char­acter among existing member states. These differences are unlikely to be papered over in the coming years despite the pressure of the impending enlargement. Thus there are two paths the EU could take: one is to renege on its commitment to membership for the CEEC's, or at least to stall as long as possible and hope that the internal political preferences of the individual CEEC's change to reject full membership. This appears to be the de facto strategy of the Member States at the moment. The second, and perhaps more honest, path would be to spend two years completely redesigning the EU to make it compatible with different federal­ist preferences and enlargement. It is perhaps a utopian view that agreement for such a radical change could be won from the Member States, the Commission and the Parliament, but it is a debate that will be necessary at some point in the near future.