date and location:
08 April 2005
Hyatt Regency

Europe, Conferences, Macroeconomics and macroeconomic policy, Trade, economic integration and globalization

Europe after the Enlargement

 CASE  International  Conference
Hyatt  Regency  Warsaw, Poland
April 8-9, 2005

In spite of the obvious
integration successes,
the European economy
and European institutions
face a number of serious challenges

- said Marek Dabrowski,
Chairman of the Council of the CASE Foundation at
the conference opening
on April 8, 2004.


Challenges facing Europe

Over the last fifty years Europe went through a unique historical process of economic and political integration, something which could not be expected during the tragic first half of the 20th century.

The last fifteen years brought remarkable progress in this respect. Launching the Single European Market and the common currency (the Euro) significantly deepened the earlier, mostly trade-related integration. The newly adopted Treaty establishing a Constitution for Europe gives a chance not only to consolidate the previous integration accomplishments but also make Union more efficient. The subsequent enlargements, including the last and biggest one, which increased the number of member states from 15 to 25, strengthened an economic and geopolitical importance of the EU. Most of Europe's nations and population are already inside the EU.

Several other countries are either already engaged in various stages of EU accession (Bulgaria, Romania, Turkey and Croatia) or would like to join this process in the not so distant future (Western Balkans and Western CIS). We believe that no European nation can be denied the right to participate in European integration and that the future EU borders will move further to the East and South East. In spite of the obvious integration successes, the European economy and European institutions face a number of serious challenges. The biggest European economies are close to stagnation and Europe as a whole is losing in competition with the US, Asia and Pacific region.

The implementation of the Lisbon Agenda, an ambition EU program to revitalize the European economy and make it the most competitive and innovative region in the world, has fallen short of original expectations so far. The EU fiscal discipline rules have been notoriously breached. The crisis of the welfare state is going to deepen in the future as a result of the aging of the population. The EU decision-making process is far from being effective and lacks in sufficient democratic legitimacy on the European level. There is no clear vision of the further EU enlargements and how to help less developed countries on Europe's periphery and in its nearest neighborhood to close the development gap and modernize their economic and political systems. All these problems were the subject of CASE Conference "Europe after the Enlargement". 

To read the full text of Marek Dabrowski's opening speech presented at the Conference "Europe after the Enlargement" click here.

Main conclusion of the
conference is that structural reforms are needed in all
countries under discussion
albeit different
in individual states

- summarized Ewa Balcerowicz, President of the Board of CASE
on April 9, 2005.


Conference conclusions

The conference agenda is well known, let me then only say that we have covered a very wide range of important issues united by the topic "Europe after the Enlargement".

In the first session discussants raised various and serious objections regarding Europe's new constitution. The constitution is far from being ideal, nevertheless,  most, if not all of the debaters appeared to think that it would be better if the  constitution is accepted rather than rejected.
In the second session which dealt with macroeconomic governance all panellists and commentators emphasized the importance of fiscal discipline as a factor of economic growth. They also deplored the recent changes in the Stability and Growth Pact.
Fiscal consolidation emerged again in the panel on Lisbon Agenda. In addition, the need for other structural reforms was emphasized so as to increase in the longer run employment and productivity.
In the fourth session the panellists presented an interesting comparative analysis on poverty, employment and unemployment in post transition countries. The separate report presented the change in trade that followed the political and economic transition in the region. The key conclusion is that rapid economic growth is fundamentally important for job creation and, consequently, reducing poverty.

The fifth session. Ageing is a common feature for old and new EU - member states, as well as for some other post-socialist countries. To cope with consequences of this phenomenon, EU member countries require specific reforms, such as the following:

  • raising the employment rate,
  • lengthening retirement-age,
  • reforming social security system as not to enhance people to leave the labour market early,
  • reforming pension system in the countries that lag behind in this respect.

There is also work to be done by individuals. There is a need for reorganizing the life cycle due to the fact that we will live longer. Individuals should retire later and save more.
The panellists in the session on the future borders of the EU stressed the need for the clearer vision of the future enlargement. One of the panellists implicitly posed a question whether Europe shall not end at Mongolia or the Korean border. The debate also touched upon economic integration as a distinct one from the institutional one.
In the last session the panellists and discussants focused on the past developments and reforms needed in less advanced transition economies. One of the issues hotly debated was how to cope with political and social problem of unfair capital accumulation in hand of "oligarchs" that emerged in early transition.
However, in some respects these countries are already better prepared for rapid economic growth than CEE countries. For example, they have lower budgetary spending and tax burdens.

As you can see the main conclusion is that structural reforms are needed in all countries under discussion albeit different in individual states. And reforms are not only about economics but they are also about political economy. Indeed, behind every serious issue of economics, there is a political economy issue. As a result, we should perhaps shift our attention to the social and political determinants of reforms.

To read the full text of the closing remarks addressed by Ewa Balcerowicz at the Conference "Europe after the Enlargement" click here.





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'I would like to thank you for having invited me at the Conference. It was very interesting and very well organised' - Fabienne Ilzkovitz

'It was my privilege to participate at the CASE conference. I think that the conference could contribute with new colours to the discussion on European integration' - Judit Neményi

'I enjoyed the conference that I thought was well organized and interesting' - Vittorio Tanzi

'I am still impressed by your kind welcoming and by the perfect organization CASE delivered to us all' - José A. Herce

'Very interesting and well organized conference' - Charles Wyplosz

'It was a pleasure to participate your excellent conference' - Daniel Gros

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'It was a pleasure to be there! I thought this conference was excellent' - Anders Aslund

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