EU Enlargement: Geopolitics Meets Integration Policy

The four main decisions of the European Council

The Commission has recommended that four countries advance one step in the acces­sion process: Moldova, Ukraine, Geor­gia and Bosnia-Herzegovina. According to the Commission, the 2022 reform requirements have acted as an incentive for all four. Ukraine is seen as having fulfilled four out of seven of the required steps and Moldova six out of nine. It is therefore the Commission’s recommendation that acces­sion negotiations with these two countries be opened without any preconditions. How­ever, the Council should adopt the respec­tive negotiating frameworks only after Kyiv and Chisinau have implemented the out­standing reforms, all of which are fundamental for democracy and the rule of law. The Commission will report to the Council in March 2024 on what progress has been made in this area. Thus, the first intergovernmental conferences with Moldova and Ukraine could take place as early as spring 2024, following the very rapid screening of the extent to which legislation is harmo­nised with the legal acquis.

The Commission has also recommended granting candidate status to Georgia if the country addresses all 12 of the key priorities it has been set. So far, only three have been fully addressed (see SWP-Aktuell 58/2023). As regards Bosnia-Herzegovina, the Com­mission advises opening accession negotiations when – in accordance with the very fundamental proviso – the accession cri­teria have been met to the necessary degree. So far, the country has taken only the first steps towards implementing the 14 key prior­ities set by the Council in December 2022. Nevertheless, the Commission is of the opinion that Bosnia-Herzegovina’s can­didate status has triggered a positive dy­namic and that the entire country should not be held jointly responsible for the “secessionist and authoritarian measures” in Republika Srpska. The Commission is to provide an updated assessment in March 2024. The European Council followed the Commission’s recommendations in Decem­ber, but the decisions taken were unanimous only because the votes were cast in the absence of Hungary (after Prime Minis­ter Orban had left the room).

Obstacles to accession

Russia’s war of aggression has given new im­petus to enlargement but does not remove the obstacles to accession, which remain largely the same as before February 2022. The Commission has carefully exam­ined the state of democracy, the rule of law and external relations in the six Western Balkan countries (WB6) and in Ukraine, Mol­dova and Georgia. The ranking that resulted from that assessment puts Ukraine at the top, ahead of Albania, and Serbia and Kosovo at the bottom. The Council took good note of the Commission’s findings.

New gradualism in the enlargement methodology

There is little evidence of reform momentum in most of the Western Balkan coun­tries – unlike in Moldova and, even under conditions of war, in Ukraine. Not least for this reason, the EU continues to develop its enlargement process incrementally. In its communication, the Commission did not want to jeopardise its recommendations to the Council on the advancement of the four countries’ accession processes by also sug­gesting how those negotiations could be accelerated (for example, by abolishing the unanimity requirement for the bench­marks). However, starting points for new approaches already exist. Pointing the way forward is the formula for a gradualist enlargement policy, as set out in the Euro­pean Council conclusions of June 2022: “To further advance the gradual integration between the European Union and [the West­ern Balkans] already during the enlarge­ment process itself in a reversible and merit-based manner.”

Through such an approach, a new gradualism – one that directly rewarded pro­gress – would be established. In essence, the aim is to advance a country’s political association and economic integration as far as possible before its formal accession. The enhanced association agreements (AA/DCFTAs) with Ukraine, Moldova and Georgia provide the broadest basis for achiev­ing this goal. Article 1(d) of the agree­ment with Ukraine, for example, mentions the goal of gradual integration into the EU internal market, as well as the various measures for adopting legislation, some of which are similar to the mechanisms of the European Economic Area (EEA).

The Stabilisation and Association Agree­ments (SAAs) with the six Western Balkan countries, which date back to the 2000s, are narrower in scope than the AA/DCFTAs. Thus, the new growth plan for the Western Balkans with its four pillars is a welcome addition.

Pillar 1: The EU proposes that its internal market be opened for the WB6 in a selec­tive and gradual manner. These countries would then apply the same regulations to one another. According to the Commission’s proposal, the WB6 are to name their own preferences from among seven priority actions: (1) Free movement of goods manu­factured in the Western Balkans following harmonisation with the EU’s horizontal product standards and improved customs and tax cooperation; (2) Free movement of workers (initially involving only the recog­nition of professional qualifications) and services (tourism and e-commerce); (3) Access to the Single Euro Payments Area (SEPA); (4) Facilitation of road transport (integration of road transport in the region and access to information systems); (5) Integration of energy markets (electricity) and the de-carbonisation strategy for the economy; (6) Digital single market (reduced roaming charges, cyber security cooperation); and (7) Integration into industrial supply chains, starting with sustainable raw materials value chains.

Pillar 2: Single-market integration is ex­pected to give an additional boost to eco­nomic integration based on EU rules and standards for the Common Regional Market, which was agreed in 2020 as part of the Ber­lin Process. There is already an action plan in place and a governance mechanism – the Central European Free Trade Agreement (CEFTA) – that can be utilised.

Pillar 3: Governance and the rule of law should be improved, not least to create a more favourable environment for growth and economic reform.

Pillar 4: The EU intends to support economic reforms and national budgets with an additional €6 billion (non-repayable sup­port accounting for one-third of that amount and loans two-thirds) disbursed over four years. Similar to the European Semester for EU members, the WB6 are to present their own reform agendas, whereby the national economic reform programmes (ERPs) and the Commission’s progress reports could serve as the starting point. The Commission’s aim is to interlock financial instruments and incentives to encourage more binding and targeted reforms. It intends to allocate the funds on a country-by-country basis, on top of the thematic IPA III funds made available via the Instrument for Pre-accession Assistance. However, it is likely that the Council will want to be involved in the decision-making process. The money is to be disbursed at six-month intervals, pro­vided that predetermined conditions are met. The German government should wel­come the fact that the growth plan enables synergies to be created not only with the Berlin process, which it initiated, but also with the Germany-West Balkans climate partnership, which is being financed by Germany to the tune of €1.5 billion until 2030.

The size of the growth plan that the Commission wants to include in the current discussions on the EU budget up to 2027 is nowhere near as big as that of the cohesion funding for member states. However, the Balkan countries are already oriented to­wards the latter amount, which is why they are always dissatisfied with what they are offered. In the WB6, GDP per capita accord­ing to purchasing power parity is currently between 30 and 50 per cent of the EU aver­age. Because of relative poverty and the low competitiveness of their economies, it is understandable that countries may not want to open their markets reciprocally to EU suppliers and have to depend on miti­gating adjustments in the form of larger transfer payments from the EU. This, to­gether with the challenging legal and technical problems involved in gradually opening up to the single market or even participating in it, means that integration will inevitably be limited if anything less than membership is achieved. Even an EEA-oriented alternative as an intermediate or final step would have to be supplemented by a strong cohesion component.

As regards political association, the EU has been testing forms of participation aimed at the early socialisation of future members since the 1990s, including struc­tured dialogues and expanded (informal) Council meetings. It would be a much bigger step forward to institutionalise inter­mediate steps – as has been proposed with the Partnership for Enlargement or Euro­pean Political and Economic Area, both of which are modelled on the EEA. Such arrangements would also provide a safety net should accession negotiations come to a standstill or even fail.

Overall, the EU continues to rely on market access and transfers as levers to help improve the “fundamentals” and economic situation of applicants. The WB6 are compet­ing with one another, as well as with Ukraine and Moldova, for attention, resources and political support; and this could spur more consistent reforms in some Western Balkan states.

Negotiating framework and accession management

Entry points for “gradual integration” into the EU are also offered by the bilateral nego­tiation frameworks. This is where the Union determines how it wants to negotiate – for example, through the use of the benchmark system. Some would like to see that system abolished altogether, while others are in favour of no longer requiring unanimity for each benchmark so that processes can be expedited. Of particular interest, however, is whether the member states are eyeing transitional arrangements for a limited period only or whether they want to make them permanent and possibly exclude entire policy areas – such as the Common Agricultural Policy. After all, permanent exceptions are something rather different from varying speeds, such as when coun­tries are joining Schengen or the euro zone. And they have already been mentioned as an option by the EU within the negotiating framework with Turkey. This would amount to partial membership through the back door.

Admission to the EU is based on a treaty under international law between the EU member states and the individual candidate country. The negotiations are not conducted multilaterally for good reason. However, when there has been a large number of appli­cations in the past, the EU has ad­mitted several countries at the same time, not least because this makes it easier to adapt the treaties in accordance with Article 49 TEU and to carry out the national ratification processes. However, the EU can provide incentives at the same time – as is now the case with the growth plan – so that candidate countries achieve a level of cooperation and integration between them­selves that not only benefits them but also reduces the risk of their bilateral disputes burdening the EU after accession. In the case of the Western Balkans, such an ap­proach would argue in favour of postponing the accession of those candidate coun­tries that have met all the criteria until all six are ready. It would also increase pres­sure on the EU to adapt – at least as far as the reform of its institutions is concerned.

But those member states unwilling to support internal reforms of the EU are seek­ing to prevent such a “big bang” scenario. They would prefer to admit smaller coun­tries one at a time over a longer period, so that the need to adapt the European treaties would be minimised. The WB6 have a com­bined population of just some 17 million. Thus, it is the admission of Ukraine – on which the 27 have managed to reach a fragile consensus at best – that is the key issue in every respect and would make the “big bang” really big. Ukrainian membership of the EU by 2030 would be tantamount to an accession being rushed through for geopolitical reasons and riding rough­shod over the Copenhagen criteria and their integration-policy logic. In such an event, more radical changes than those currently being proposed by a Franco-German group of experts would be required.

Wider Europe and the limits of enlargement policy

In Wider Europe, Ukraine is already de facto part of the Western security order. In other words, it is no longer a buffer state. While there are still some grey zones – such as the South Caucasus (Armenia and Georgia, despite Tbilisi’s relations with NATO), the Black Sea region and Serbia – they are shrinking. Europe is on the way to becoming a constellation in which a Euro-Atlantic bloc in the “West” and a Russian-Belarusian bloc in the East face each other. At the political, economic and security-policy level, the EU is striving for almost complete decoupling from Russia in order to isolate that country and contain its in­fluence.

Under the bloc formation scenario, NATO and the US play a key role as the pri­mary – and, in fact, the only – guarantors of hard security. The EU must pursue the closest strategic coordination with both if it wants to participate in order-building in its eastern neighbourhood. It cannot rely on the enlargement process alone to contrib­ute to security, prosperity and democratisation. The Union must now utilise all its for­eign and security policy options and devel­op them further under pressure from new external threats and demands. Only in this way will it be able to ensure that the diplo­matic and military support it is currently providing to Kyiv continues in the long term. It is not enough to increase national defence budgets. Just as the 1999 Kosovo war served as the impetus for the European Security and Defence Policy (ESDP), so the CSDP needs to be expanded today – in areas such as defence industry cooperation, joint procurement, deterrence capabilities and interoperability.

At the Vilnius Summit in July 2023, NATO established the NATO-Ukraine Coun­cil as a strategic format because there is no quick and direct route to membership of the Alliance either. With the AA/DCFTA, the EU has created a backbone for Ukraine’s economic and political integration. It can use the institutional structure of the agree­ment to conduct a security-policy and stra­tegic dialogue of substance with Kyiv. Owing to the complex and unpredictable security situation, there is something to be said in favour of regarding Ukraine as a special case while integrating it fully into the enlargement process at the same time. Large-scale reconstruction aid as well as long-term weapons aid and military co­operation are to supplement that process.

Turkey is the second, albeit rather different special case, as is evident from the Com­mission and High Representative’s state-of-play report of 29 November 2023 on bilat­eral relations. Ankara’s actions are now too autonomous and sovereigntist for it to want to submit to the asymmetrical rules of accession negotiations in the foreseeable future and become a member of a union based on shared sovereignty. In particular, Turkey is resisting pressure to converge on foreign and security policy issues – in­cluding the 50-year-old Cyprus conflict.

Meanwhile, it is the Western Balkan coun­tries that are benefiting from the in­creased attention the EU is now paying to enlargement because of current geopolitical exigencies. The new gradualism gives both sides more flexibility and prioritises effec­tive progress in integration over rapid mem­bership for geopolitical reasons.

The German government should play an active role in shaping the gradual integration of the WB6. However, enlargement policy must not be weighed down by tasks and expectations. It is no substitute for for­eign and security policy, especially not in the case of the three Eastern European candidate countries. The CFSP/CSDP must be geared towards a very long confrontation with Russia. The driving force should be the large member states, and the way forward is through the Permanent Structured Co­operation (PESCO). In addition, Germany should intensify cooperation within the European Quad – i.e., with France, Poland and the UK.