EU enlargement is good for Europe

The EU ministers recently decided in favour of enlargement. Both Turkey and Croatia were given the green light.

This decision was important for at least two reasons. On the one hand, it goes to show that enlargement continues to be a critical component of the overall European ambition.

On the other hand, the decision goes to show that the EU can keep strategy ahead of internal politicking. Despite many suggesting the contrary, enlargement fatigue and enlargement postponement never evolved beyond boorish isolationism spun by the populist crowds.

The positive decision from Luxemburg should help encourage reformers in places such as the Western Balkans, Ukraine, Moldova and Georgia.

Europe today is stalling not because it is enlarging, but because parts of it are no longer competitive and can no longer keep pace with global developments and trends.

Here, some of the older EU members are guilty of underperforming. The Franco-German motor is no longer Europe's solution. Rather, the Europe of tomorrow will be successful if it manages to stimulate competitiveness on regional levels.

Accordingly, the central EU member states should, for example, continue adopting innovative solutions (like the flat tax used in Slovakia) in order to challenge the dominance of the more traditional EU markets.

Enlargement is a critical source of Europe's regional vitality, and for this reason, the EU should soon offer a clear timeframe for integrating the western Balkans.

The latest enlargement is a good example that indeed EU's competitiveness and enlargement are parallel processes.

New EU members have brought to the Union economic dynamism; highly skilled and inexpensive labour; a new willingness to adjust and innovate; and economic growth averaging 4 per cent in the last year.

Litmus test

The next litmus test of EU's commitment to enlargement will come with Macedonia this December, when EU heads of state will have to decide on whether to grant Macedonia candidacy status.

Unlike many other former Yugoslav republics, Macedonia was saved from a bloody conflict by early EU and US intervention.

The Macedonian government has implemented all the legal provisions of the Ohrid Framework Agreement this is the legal basis on which modern Macedonia is set and it is now making visible progress in reforming the justice and homeland affairs and economic sectors.

In light of the given, Macedonia is ready for EU candidacy and its future membership will only contribute to the overall stability of the western Balkans, as well as help stimulate the transition of this region into a competitive EU unit.

This inter-regional vibrancy also depends on whether Europe managed to transform into a land of small and medium size enterprises.

It makes no sense for Europe to insist on the development of the mass-production units given the comparative advantage of China's logistic and labour conditions.

Further, Europe will have to rethink the way in which Europeans manage R&D investments given the spin-off value of R&D investment on a regional and sub-national level.

It is pointless in the EU (with perhaps one or two exceptions) to run R&D programmes on a national basis.

Europe of tomorrow will be able to manage global pressures and competition only if it succeeds in fostering and sustaining inter-regional competition.

In light of this, Turkey and Croatia joining the EU is a step in the right direction.

Borut Grgic is director of the Institute for Strategic Studies, Ljubljana.