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EU: British Official Says All Will Benefit From Enlargement

London, 8 March 1999 (RFE/RL) -- A British Foreign Office minister has unveiled figures that show the 15 European Union countries stand to benefit economically from enlargement to the east.

Joyce Quin -- who is responsible for European affairs -- says enlargement is too often viewed in terms of costs to the EU and not in terms of what economic benefits expansion will bring to both the 15 current EU nations and the applicant countries.

She told the Royal Institute of International Affairs earlier this week that research shows the national incomes of the EU 15 would be marginally increased as a result of free trade and investment among the largest applicant countries.

A "fast track" group of six countries are engaged in accession talks with a view to joining the EU early in the next century. They are Poland, the Czech Republic, Hungary, Slovenia, Estonia, and Cyprus.

Quin said the total budgetary cost of this first wave of enlargement will probably add up to 20 billion Euros -- plus another 3 billion Euros in pre-accession aid. But if the present "impressive" growth rates of countries like Poland and Hungary are maintained, she said the applicant countries themselves will contribute substantially to the EU's budget.

Quin said the cost of the initial enlargement can be managed within the EU's present budget, provided it keeps spending under control, reforms its costly support system for farmers, and makes changes to its structural and cohesion funds for poorer regions.

"Budget discipline and policy reform can both do their bit to make enlargement affordable. While the isolated net cost of enlargement can appear significant, when put in the context of the wider benefits and overall EU finances, it is not only affordable, but, I would argue, a pretty good deal."

Quin noted that a second group of nations -- Bulgaria, Romania, Slovakia, Latvia and Lithuania -- are also seeking membership in the EU, while countries such as Ukraine and Moldova want closer links.

She said that an absolute timetable for the enlargement process has not yet been set. But she said candidate countries need to be treated on their merits. As soon as candidate countries are able to meet the strict economic criteria for joining the EU, they should be able to join.

She cautioned against a discriminatory "two-tier" EU, in which the existing 15 members get better treatment than new members.

While stressing the benefits of enlargement, Quin acknowledged the possibility that expansion will increase unemployment in Europe, as some analysts contend.

She said enlargement will certainly increase competition in a new Europe made up of nearly 500 million consumers. Everyone, she said -- new and old members alike -- will need to adjust to the new competitive environment.

She doubts that EU enlargement will lead to workers from Eastern and Central Europe flooding into Western Europe in search of jobs. She said that in previous enlargement rounds (Spain, Portugal, Greece), the movement of such workers was small. If people have job opportunities at home, she said, they prefer to stay at home. Quin said enlargement will expand opportunities for trade and investment across Europe, particularly because applicant countries are "getting richer all the time." Slovenia has a per capita gross domestic product (GDP) that is 68 percent of the EU average, almost on a par with Greece. Slovenia and the Czech Republic currently have higher GDPs per capita than Portugal and Greece when they joined the EU.

Quin said enlargement -- although complex -- is "both manageable and affordable."

"It is a shared endeavor. It involves responsibility both on the part of the applicant countries and on the part of the existing EU countries. But we should not forget that just 10 years ago, the Iron Curtain still cast a shadow over Europe. Now countries which viewed each other with suspicion are working together toward a common goal. I believe that can be an inspiring policy."