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EU: Candidates Unhappy With Efforts To Minimize Their Initial Financial Gains

At a two-day meeting in Brussels, which began on 19 April and ended today, European Union accession candidates were for the first time confronted with EU negotiating positions on their participation in EU institutions following enlargement. Negotiators for candidate nations also began official talks on the technical side of financing their membership, although concrete figures will have to wait until after the German elections in September. A number of negotiators are already saying the EU position does not create a level playing field for new members.

Brussels, 22 April 2002 (RFE/RL) -- If there was a common theme to the reactions of negotiators from candidate nations at the latest round of European Union accession talks, it was that the EU appears to be trying to extract everything possible from candidates under the budget chapter while attempting to limit or delay agricultural and infrastructure aid.

Poland's chief negotiator Jan Truszczynski, who represents the biggest candidate economy involved in the talks, said the EU is effectively trying to selectively apply its acquis communautaire -- the body of European community law the candidates must enact before membership.

Truszczynski is referring to the proposal of the European Commission in late January that the direct agricultural subsidies available to farmers in current member states should not be fully applied to the new member states until 2013.

On the other hand, the EU is demanding that new members make full contributions to the community budget from the day of their accession. Truszczynski describes this as a poorly justified "imbalance."

"Let me just state something which is very obvious. If a new member state is expected by its 15 colleagues to fully adhere to the acquis communautaire on the revenue side because it is seen as acquis communautaire, then it would be justified to expect that a new member state is fully covered by acquis communautaire on the expenditure side, as well. There should be equilibrium."

The problem appears to be twofold. In the short term, the new member states face a budgetary problem in the first few years after accession. As a result of varying administrative hurdles and fiscal rules applied by the EU, what subsidies the new members do receive will not show up immediately in their budgets.

On the other hand, the candidates' expected contributions into the EU budget must be made early in the year. This could mean that the new members pay more into the EU budget in the year or two after accession than they get back.

Although the European Commission says no candidate should be worse off financially after accession, the current positions of most member states appear to make this a real threat.

In the longer term, however, as the Hungarian chief negotiator Endre Juhasz put it on 19 April, they want more than merely to avoid deterioration of their financial situations. They want to be "significantly better off." All candidates are seeking a gradual phasing-in period before they must contribute fully to the EU budget.

All of these discussions are at an early stage, however, as discussion on the concrete figures of the "financial package" -- made up of the budget, agriculture, and regional policy chapters -- cannot begin in earnest until the German elections in September.

To keep up appearances as much as stick to the agreed timetables, the EU has decided to separate the technical issues in the regional policy chapter from the financial aspects and to offer the former for closure. The same practice is expected to be applied to the agriculture chapter in June.

So far, only the Czech Republic has chosen to conclude talks on regional policy; most other candidates have cited the need for careful "reflection." The most difficult case here promises to be that of Lithuania, which seeks firm EU commitments on financing the closure of its Ignalina nuclear power station. The EU is reluctant to make binding commitments beyond 2006 when its current budget runs out.

The Lithuanian government, on the other hand, says it could need as much as 2.5 billion euros by 2020.

In the latest round of talks, the EU side somewhat unexpectedly also offered the candidates the chance to close talks on the institutions chapter. The most important part of the chapter is made up of the provisions of the December 2000 Nice treaty, which specify how many votes and/or seats the new members are entitled to in the institutions of the European Union.

Here, Poland breaks with tradition by being one of the least problematic cases. Poland's chief negotiator Truszczynski said today that his country is "satisfied" with the proposal.

"We are satisfied that this common position as presented to us could be found to be fully acceptable and in line with our expectations and our vision regarding Poland's participation in all the institutions, bodies and agencies of the European Union."

Poland has good cause to be satisfied with the provisions of the institutions chapter, as the Nice treaty treats Poland as one of the "big five" in the future EU, on par with Spain.

This is in sharp contrast to the experiences of the Czech Republic and Hungary, which were allocated fewer seats in the European Parliament than similarly sized Belgium, Greece, and Portugal. Both are protesting against the decision and say they cannot fully close the institutions chapter before amends are made.

All other Central and Eastern European candidates broadly accept the terms of this chapter.