Bulgaria, Romania to join EU on January 1

Bulgaria and Romania received the go-ahead to join the European Union on January 1, winning billions of euros in subsidies and expanding the world's largest trading bloc to 27 countries. The European Commission said yesterday Bulgaria and Romania upgraded regulatory standards enough to avert a one-year entry delay. With a combined population of 30 million, the two Balkan nations are counting on membership to help raise per-capita wealth from a third of the EU average. „The accession of Bulgaria and Romania will mark an historic achievement,” Commission President Jose Barroso told the European Parliament in Strasbourg, France. The commission, the 25-nation EU's executive branch, reiterated the possibility of curbing some membership benefits because food, aviation and judicial norms still fall short. The entry of Bulgaria and Romania will mark the EU's second expansion into the former Soviet bloc to establish market-based rules for industries ranging from energy and transport to telecommunications and banking. Ten countries, including Poland and seven other nations in formerly communist eastern Europe, joined in May 2004 and swelled the bloc's population to about 460 million. EU integration and funds for Bulgaria and Romania „will boost economic activity, support the macroeconomic outlook and improve the credit ratings of both countries,” said Ivailo Vesselinov, a senior economist at Dresdner Kleinwort in London. „We see medium-term gains, especially in the case of Romania.”
The January expansion will extend the EU's borders to the Black Sea, revive a push to streamline European decision-making and put the spotlight on the membership bids of other Balkan countries including Croatia, Turkey and Macedonia. The entry goals of these nations are threatened by growing public opposition in the EU to further enlargement. „Enlarging the union, if carefully managed, produces a win-win situation for both the existing and the acceding member states,” Barroso said. „Enlargement stimulates economic growth and social cohesion and reinforces the role and influence of the European Union in the world.”

The prospect of EU membership has bolstered the Bulgarian and Romanian economies. Last year, Romania's economy grew 4.1% to about $100 billion, its sixth straight year of expansion, and the Bulgarian economy grew 5.5% to about $24 billion in its eighth consecutive year of expansion. „After the accession date, there will be new investment opportunities for Romanians and foreigners alike,” Romanian Prime Minister Calin Tariceanu said in Bucharest. The two countries completed entry negotiations in 2004 and signed EU accession treaties last year. Membership is slated to include EU subsidies totaling €32 billion ($41 billion) for Romania and €11 billion for Bulgaria through 2013. „For Bulgaria this will be the final fall of the Berlin Wall,” Bulgarian Prime Minister Sergei Stanishev said in Sofia. „This will justify all the hardship of transition undergone by Bulgarians and the work of all Bulgarian institutions to meet accession commitments.” Because Bulgaria and Romania hadn't fully met European standards when the accession treaties were signed, the EU reserved the right to delay entry by 12 months and deny both nations some membership benefits.

Sticking to the 2007 entry timetable „is the best way of supporting Bulgaria and Romania,” said Hans-Gert Poettering, German head of the European Parliament's Christian Democrats, the assembly's biggest faction. The EU may yet impose membership curbs because of lingering concerns about judicial, food and financial standards in Bulgaria and Romania and aviation norms in Bulgaria. Such restrictions could block some aid and market access. The commission threatened to take „remedial measures, where necessary, to ensure the functioning of EU policies.” Bulgaria's aviation standards have „serious deficiencies,” according to the commission, which said it may „restrict access to the internal aviation market” unless Bulgaria „takes the necessary corrective actions.”

The enlargement concerns grew after French and Dutch voters last year rejected a European constitution meant to help the bloc function better with more members. Other aspiring members may be prevented from joining until the EU rescues its new rule book, a process due to last at least until 2009. Turkey and Croatia began accession talks last year, Macedonia wants the go-ahead to start them and nations including Serbia and Montenegro are seeking EU trade agreements that would be a stepping stone to membership. Rehn said the threatened curbs against Bulgaria and Romania send a signal to these nations and he highlighted problems of corruption in Croatia and human rights in Turkey. „It's very important that Croatia gets the right message,” according to Rehn, who also said he was „rather tired” of pressing Turkey to meet EU standards on media and religious freedoms. Germany, France, Belgium and Denmark still need to ratify the accession treaties with Bulgaria and Romania to remove the final obstacles to their entry, according to the commission. Barroso predicted a speedy end to the ratification process after today's commission reports, which Rehn said national parliaments in the EU were consulted on during the preparations. „It will go smoothly,” Barroso said. (Bloomberg)