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The European Commission announced its regular monitoring report on Bulgarian preparation for membership
submited on 27.10.2005 in category Political stability | Macroeconomic developments
submited on 27.10.2005 in category Political stability | Macroeconomic developments
The critical findings in the Commission report were an expected step towards tougher positions for Bulgaria and Romania. The worsened European political climate which culminated with the rejection of the EU constitutional treaty logically produced tougher line from Brussels. The aggravation of the general political climate in the EU, which high point was the EU-constitution project’s rejection, logically brought to less lenient attitude. Until some time ago the EU method of approach towards both countries was based mainly on formal and legal grounds. This is the reason why the bigger part of the negotiations was successful for Bulgaria. The country staked on demonstrating political will for reforms and implementing more or less concrete harmonized norms. But on European level, in the newly generated situation, EU requires more and more concrete steps and results in the subjectively evaluative fields. The eventual decision for postponing the Bulgarian membership and the imposing of the so called “safeguard” clause depends on two factors. First on the ability of the Bulgarian institutions of showing advancement in the criticized areas, and second – which is even with higher importance – the needed change in the EU-political climate. For the first time since the beginning of the whole negotiation process Bulgaria is in the situation where its own forces and progress are not the main factor. In that kind of complicated political situation on both European and local level, any forecast would be quite risky. In spite of this, we could make a few assumptions:
• The Bulgarian and Romanian’s membership delay still appear relatively little probable. In case of delay, there are certain disadvantageous consequences for the political credibility of the Union compared to minor positive short-tem effects.
• It is much more likely that in the next few months the emphasis on the application of the postponement clause is shifted to imposing more disadvantageous finance conditions and accession delaying as a result of a slow ratify process.
• We could express the economic effect upon Bulgaria in result of the aggravated European situation with further decrease in the structural aid funds, an eventual decrease of the speculative investor’s interest, in areas like the real estate market, and last but not least with significant postponement of the free labor force movement. The latter could give reflection on the financial transfers towards the country. The macroeconomic effects could be more significant only under the conditions of growing political instability and strong destabilization of the public finance system that seems unlikely.
• The Bulgarian and Romanian’s membership delay still appear relatively little probable. In case of delay, there are certain disadvantageous consequences for the political credibility of the Union compared to minor positive short-tem effects.
• It is much more likely that in the next few months the emphasis on the application of the postponement clause is shifted to imposing more disadvantageous finance conditions and accession delaying as a result of a slow ratify process.
• We could express the economic effect upon Bulgaria in result of the aggravated European situation with further decrease in the structural aid funds, an eventual decrease of the speculative investor’s interest, in areas like the real estate market, and last but not least with significant postponement of the free labor force movement. The latter could give reflection on the financial transfers towards the country. The macroeconomic effects could be more significant only under the conditions of growing political instability and strong destabilization of the public finance system that seems unlikely.
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