Postwar: A History of Europe Since 1945 (143 page)

There were good reasons for this. Even the wealthiest of the new hopefuls—Slovenia, say, or the Czech Republic—were distinctly poorer than any existing EU member, and most of them were very poor indeed. By any measure the gulf separating East and West Europe was huge: infant mortality in the Baltic states was twice the average of the fifteen EU member states in 1996. The life expectancy of males in Hungary was eight years short of the EU average; in Latvia, eleven years.

If Hungary, or Slovakia or Lithuania—much less Poland, with its 38 million inhabitants—were admitted to the Union on the same terms as its present members the cost in subsidies, regional assistance, infrastructure grants and other transfers would surely break the EU budget. In December 1994 the Bertelsmann Foundation in Germany published a study suggesting that if the six countries of Central Europe then seeking entry (Poland, Hungary, Slovakia, the Czech Republic, Romania and Bulgaria) were admitted on the same terms as existing members, the cost in structural funds alone would exceed thirty billion
Deutschmarks
a year.

This, it was widely feared, could provoke a backlash in the electorates of the countries paying most of the Union’s bills and who would surely have to be asked to contribute even more: the Netherlands and Britain but especially, and more ominously, Germany. In any case, the recipient countries in the East were in no position to put up even the minimum matching funds required under existing EU regulations. What post-Communist Europe really needed was a Marshall Plan, but no-one was offering it.

In addition to being expensive, the new recruits would be troublesome. Their legal systems were corrupt or dysfunctional, their political leaders untested, their currencies unstable, their borders porous. Their needy and indigent citizens, it was feared, would either head West in search of welfare and work or else stay home and accept derisory wages—tempting foreign investors and employers away from the old countries of the EU. Either way they would constitute a threat. There was talk of western Europe being ‘overrun’—a distant but unmistakable echo of Herder’s fears of the rumbling of the ‘wild peoples’ of eastern Europe. No one doubted that the EU could do wonders for eastern Europe. But what might eastern Europe do to the EU?

With these concerns in mind, the western Europeans duly procrastinated. In the immediate aftermath of 1989 the German Foreign Minister Hans-Dietrich Genscher initially proposed that the European Union absorb all the countries of Eastern Europe as soon as possible, as a prophylactic measure against a nationalist backlash. But he was soon brought to heel; and although Margaret Thatcher continued to press enthusiastically for early enlargement (calculating that an enlarged Union would inevitably be diluted into the pan-European free trade area of British dreams) it was the French approach that came to dominate EU strategy.

François Mitterrand’s first response had been to propose a loose-knit ‘European Confederation’—a sort of outer tier of associate membership, open to all-comers with no conditions and few material benefits. In later years French diplomats would bemoan the lack of support for this suggestion, regretting the lost opportunity for ‘calm collaboration’ towards an enlarged Union. But at the time it was rightly seen as a transparent ploy, to corral the newly liberated Eastern European states into an ersatz ‘European community’ that would justify keeping them out of the real thing indefinitely. Václav Havel understood this from the start, which is why he rejected it out of hand (and became for a while
persona non grata
at the Elysée Palace).

Instead, relations between eastern and western Europe remained for the next few years stuck at the level of bilateral exchanges and trade accords, with certain countries—Hungary, Poland, the Czech Republic and Slovakia—accorded a strictly limited ‘associational’ status vis-à-vis the EU but nothing more. However, the Moscow coup of 1991 and the Balkan wars that broke out shortly afterwards focused Western attention on the risks of letting the post-Communist countries fester in uncertainty; and it was duly agreed at an EU summit meeting in Copenhagen in June 1993 that in principle—and at a date yet to be determined—‘the associated countries in Central and eastern Europe that so desire shall become members of the European Union’.

This did little to alleviate the frustration of the would-be members whose dealings with Brussels and the Western capitals had left them, in the understated words of the Polish Prime Minister Hanna Suchocka, ‘disappointed’. And indeed the political leaders of Eastern Europe spent much of the rest of the decade patiently and frustratingly seeking firm commitments from their reluctant Western partners, promising their domestic constituents that EU membership really was on the agenda while taking every opportunity to impress upon their foreign interlocutors the urgency of making it so.

But Western attention was elsewhere. The transition to a new common currency and the translation into practice of the Maastricht plans for institutional integration were the dominant preoccupation in every Western European capital. In Germany there was growing anxiety at the costs and difficulties of integrating the territories of the former GDR. Meanwhile the Yugoslav catastrophe—which at first had served to remind Western statesmen of the risks of underestimating post-Communist problems in general—had now become a full-time obsession.

The gaze of prominent intellectuals—a sure barometer of passing political fashions—had moved away. It was only a few years since ‘Central Europe’ had been rediscovered by Western commentators, with Havel, Kundera, Michnik and their colleagues the toast of editorial pages and higher-brow periodicals from Paris to New York. But history was passing swiftly on: Prague and Budapest, their miraculous transition out of tyranny already a fading memory, had been left to tourists and businessmen. Bernard-Henri Lévy and Susan Sontag were more likely to be found in Sarajevo. Central Europe’s fifteen minutes of fame had passed and with it any public pressure to expedite its absorption into Western institutions. In public, politicians and managers in Brussels insisted upon their continued desire to see the Union enlarged to its East when conditions were ‘ripe’. Off the record they were more candid. As one very senior European Commission official observed in the mid-Nineties, ‘no-one here is serious about enlargement’.

Enlargement, nevertheless, was on the agenda. Under the EU’s own rules it could not deny countries the right to apply for membership. The European Commission was accordingly constrained to accept applications from Hungary and Poland in 1994, Romania, Slovakia, Latvia, Estonia, Lithuania and Bulgaria in 1995, and Slovenia and the Czech Republic in 1996. The ten former Communist candidates thus joined Malta and Cyprus, both of whom had submitted applications in 1989, and Turkey (whose application had been languishing since 1987). All of these candidate countries were now parked in a rather crowded ante-room, awaiting the Union’s attention.

In 1997 the Treaty of Amsterdam added a series of important technical amendments to the original Rome Treaty, filling out the goals of Maastricht and putting teeth into the Union’s stated intention to develop a program of European citizenship and Europe-wide institutions to address employment, health, the environment and the glaring absence of a common foreign policy. At this point, with the common currency scheduled to come into effect in 1999, the Union had completed a decade of internal integration that had absorbed all its bureaucratic energies. There was no longer any excuse for postponing the far thornier issue of expansion.

The preference of some national leaders, and many of the senior officials at the European Commission, would have been to limit accession negotiations to the ‘easy’ cases: small countries like Slovenia or Hungary, contiguous to the Union’s existing borders and with relatively modernized economies, which posed only a limited challenge to the EU’s institutional framework and its budget. But it soon became clear that this might be politically imprudent—left out in the cold Romania, or Poland, could drift into dangerously undemocratic waters—and so, beginning in 1998, the European Union officially initiated the accession process of all ten eastern European applicants together with Cyprus. Malta was added to the list shortly afterwards. Turkey, however, was held back.

From this point the enlargement took on a dynamic of its own, notwithstanding continuing misgivings on the part of a number of existing EU members and, to judge from opinion polls, widespread lack of enthusiasm among their populations. Bilateral accession negotiations were set in motion, first with a presumptive inner core of candidates: Cyprus, the Czech Republic, Estonia, Hungary, Poland and Slovenia; and then, a year later, with the rest: Bulgaria, Romania, Slovakia, Latvia, Lithuania and Malta. Poland’s presence in the first group, in spite of the economic difficulties it posed, was explained by its size and prominence. Slovakia, conversely, was ‘relegated’ to the second tier in response to the stagnation and corruption wrought there by Mečiar’s authoritarian rule—and as a warning and example to others.

There followed five years of intense and sometimes acrimonious negotiations. ‘Brussels’ descended upon the capitals of all the candidate countries, showering them with advisors, recommendations, examples, programmes and instructions in an effort to bring their institutions, laws, regulations, practices and civil services up to a minimum standard compatible with those of the Union. The applicants, in turn, pressed as hard as they dared for assurances that they would have free access to EU consumers, while defending their domestic market from being overwhelmed by more attractive and efficient goods and services from the West.

The struggle was decidedly unequal. Whereas the EU was the longstanding and openly avowed object of Eastern desires, the putative new members could offer little in return except the promise of good behaviour. And thus it was agreed that while the new members would be accorded a few limited concessions—among them temporary restraints upon foreign purchases of land, a sensitive political issue—they would have to accept that the EU, despite its commitment to a single market, was going to impose considerable restrictions upon their own export of goods and, especially, people.

In response to wildly exaggerated estimates of likely population flows (one European Commission report published in 2000 prophesied an annual exodus of 335,000 from the ten eastern accession states if the frontiers were opened without restriction), most of the Western member-states insisted on quotas being placed on the number of eastern Europeans who could move to the West—in blatant disregard of the spirit and indeed the letter of a decade of proclamations and treaties. Germany, Austria and Finland imposed strict limits for two years with an option to extend these for a further five. Belgium, Italy and Greece followed suit. Only the UK and Ireland declared their willingness to conform to the ‘open door’ principles of the Union—while announcing that welfare benefits for work-seekers from Eastern Europe would be kept to a minimum.

The eastward extension of agricultural subsidies and other benefits was also placed within strict limits. In part, as the Commission’s
Transition Report 2003
put it, this was because of ‘questions about the accession countries’ capacities to absorb and use efficiently the post-accession grants from the EU’s cohesion and structural funds’. But the main reason was simply to hold down the cost of enlargement and minimize competition for Western producers. Not until 2013 would East European farmers get the same subsidies as those already being paid out in the West—by which time, it was hoped, most of them would have retired or gone out of business.

By the time the negotiations were complete, the terms agreed and the 97,000 pages of the Union’s
acquis communautaire
duly incorporated into the governing codes of the applicant states, the actual enlargement itself came as something of an anti-climax. Having waited fifteen years to join, most of the new states could be forgiven for lacking the enthusiasm they might have exhibited a decade earlier. In any case, many of the practical benefits of Western engagement had already been discounted—notably in car manufacturing, where former Communist states had a ready supply of cheap, skilled labour and in which companies like Volkswagen, Renault and Peugeot-Citroën invested heavily during the Nineties. Between 1989 and 2003 the cumulative total of foreign direct investment for Eastern Europe as a whole had reached $117 billion.

By the early twenty-first century, foreign investment in former Communist Europe was actually tailing off. Ironically, this was largely a result of the coming EU enlargement. Once they were inside the Union it would certainly be easier to do business in and with countries like Poland or Estonia. And they in turn would be able to sell more to the West: Poland expected to double its food exports to the EU within three years of joining. But these were the fruits of relative backwardness. Once they were inside the EU, wages and other costs in the countries of Eastern Europe would begin to rise to Western levels. The region’s cost advantage over factories in India, or Mexico, would be lost. Profit margins—at least in the manufacturing sector—would start to fall.

Meanwhile, thanks to the heavy cost of unraveling the Communist economies, East Europe on the eve of accession remained far behind the countries of the EU. Per capita GDP even in the most prosperous new member states was far below their Western neighbours: in Slovenia it stood at 69 percent of the EU average, in the Czech Republic at 59 percent, in Hungary 54 percent. In Poland it was just 41 percent, in Latvia, the poorest new member, 33 percent. Even if the economies of the new EU states kept growing on average 2 percent faster than those of the existing members
³⁵³
, it would take Slovenia twenty-one years to catch up with France. For Lithuania the time lag would be fifty-seven years. The citizens of former-Communist states had no access to such data, of course. But most had few illusions about the difficulties ahead. When Czechs were asked, in a series of opinion polls in 2000, how long they thought it would be before their situation ‘improved’, 30 percent of respondents answered ‘within five years’; 30 percent answered ‘in ten years’; 30 percent answered ‘fifteen years or more’; and 10 percent said ‘never’.