Round table on regional cooperation and promotion of publication REGIONAL COOPERATION FOR DEVELOPMEN

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Round table on regional cooperation and promotion
of publication REGIONAL COOPERATION FOR
DEVELOPMENT AND EUROPEAN INTEGRATION THE FUTURE
OF CEFTA Panel 2 CEFTA - Challenges of
Consolidation of Regional Trade 10 October 2007

• RESULTS AND EXPERIENCE OF CEFTA 1993 LESSONS
  FOR CEFTA 2006?
•  Martin DANGERFIELD
• University of Wolverhampton
• UK

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• WE, THE COUNTRIES IN SOUTHEAST EUROPE, ARE ALSO
  TRYING TO DEVELOP REGIONAL COOPERATION. THE
  PROCESS IS PROCEEDING WITH SOMEWHAT GREATER
  DIFFICULTY BECAUSE OF THE POLITICAL PAST, THAT
  IS, THE WAR. HOWEVER, BUSINESSMEN HAVE BEGUN TO
  REMOVE OBSTACLES AND POLITICS, I THINK, WILL HAVE
  TO FOLLOW THEM.
• (Croatian President Stjepan Mesic addressing the
  ASEAN Secretariat in Jakarta on 14 February 2002)
  

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SOME QUESTIONS

• WHAT DO EARLIER EXPERIENCES TELL US ABOUT THE
  POTENTIAL OUTCOMES OF SUBREGIONAL (RE)INTEGRATION
  ENDEAVOURS?
• WHAT DO EARLIER EXPERIENCES TELL US ABOUT THE
  PROBABLE DEEPENING LIMITS OF SUBREGIONAL
  (RE)INTEGRATION ENDEAVOURS?
• WHAT ARE THE WIDENING LIMITS OF CEFTA 2006 ?

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EVIDENCE FROM THE CEFTA EXPERIENCE - RESULTS

• TRADE AND ECONOMIC DEVELOPMENT
• RESTORATION THEN RAPID GROWTH OF INTRA CEFTA
  TRADE (TABLE 1)BUT FOOD FIGHTS IN 1998/99
• CEFTA FURTHER ENCOURAGED FDI INTO CEFTA
  COUNTRIES.
• PRACTICAL PROGRESS TOWARDS FUTURE DEEP
  INTEGRATION IN EU CONTEXT
• POLITICAL EFFECTS
• IMPROVED POLITICAL RELATIONS/UNDERSTANDING
  (DIALOGUE, MEETINGS, DISPUTE SETTLEMENT WITH NEW
  MEMBERS).
• SUBREGIONAL MARKET INTEGRATION MET EU
  CONDITIONALITY
• DEMONSTRATED ABILITY TO PARTAKE IN
  INTERGOVERNMENTAL COOPERATION
• OTHER EU TRAINING GROUND/FITNESS CENTRE
  FUNCTIONS
• PRACTICE INTERGOVERNMENTAL COOPERATION

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EVIDENCE FROM THE CEFTA EXPERIENCE TRADE
DEVELOPMENTS

• Table 1 Growth of intra-CEFTA trade, 1993-2001
  value)
• Exports
  Imports
• Bulgaria 19
  100
• Czech Rep 359
  425
• Hungary 496
  307
• Poland 363
  449
• Romania 175
  184
• Slovakia 334
  429
• Slovenia 84
  53
• Notes
• TRADE LIBERALISATION NECESSARY BUT NOT SUFFICIENT
  CONDITION FOR EXPORT GROWTH (REFORM STRATEGY
  NEEDED ALONGSIDE)
• CEFTA FOUNDED ON DISCIPLINE OF WTO MEMBERSHIP AND
  EUROPE AGREEMENTS

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EVIDENCE FROM THE CEFTA EXPERIENCE -
LIMITS OF SUBREGIONAL (RE)INTEGRATION ENDEAVOURS

• CEFTA HAD DEEPENING AGENDA
• PROPOSALS TABLED DURING (1995-7) ENTHUSIASTIC
  PHASE
• FREE CAPITAL MOBILITY
• FREE TRADE IN SERVICES
• FREE MOVEMENT OF LABOUR
• ATTEMPTS TO TACKLE NON-TARIFF BARRIERS COVERED BY
  CRACOW TREATY
• ARTICLE 23 (STATE AIDS)
• ARTICLE 24 (PUBLIC PROCUREMENT)
• HOWEVER
• NO INDEPENDENT SOLUTIONS ACHIEVED AT CEFTA LEVEL
• ABOVE MEASURES ADVANCED ECHELONS OF INTEGRATION
  PROCESS
• POTENTIAL FOR DISRUPTION OF ADVANCED INTEGRATION
  IF EU ACCESSION TIMETABLES DIFFER

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CEFTA 2006 FURTHER WIDENING?

• CEFTA HAS OPENED TO COUNTRIES WITHOUT EU
  MEMBERSHIP PERSPECTIVE (MOLDOVA)
• THEREFORE OPEN IN PRINCIPLE TO ALL PARTNERS IN EU
  NEIGHBOURHOOD POLICY COUNTRIES
• EUROPEAN CRITERIA MAY RESTRICT TO EUROPEAN EU
  NEIGHBOURS
• CEFTA COULD BE SOLUTION TO PROBLEM OF SUBREGIONAL
  ECONOMIC COOPERATION IN POST-SOVIET SPACE
  (FAILURE OF SINGLE ECONOMIC SPACE)
• UKRAINE HAS HAD LONGSTANDING INTEREST IN CEFTA
  (APPLIED IN 1997!!)
• NO LOGIC TO RESTRICT CEFTA TO ARTIFICIAL -
  STABILITY PACT TERRITORIAL PARAMETERS
• WHY CREATE NEW ECONOMIC ASSOCIATIONS FOR
  NEIGHBOURS WHEN VEHICLES FIT FOR PURPOSE ARE
  ALREADY AVAILABLE CEFTA TOOK IN SOUTH EAST
  EUROPE WHY NOT EAST EUROPE TOO?
• LACK OF REGIONAL SPECIFICITY ADVANTAGE OF THE
  CEFTA BRAND

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CONCLUSIONS

• CEFTA EXPERIENCE SHOWS
• SUBREGIONAL ECONOMIC COOPERATION YIELDS PRACTICAL
  AS WELL AS POLITICAL ADVANTAGES
• CEFTA EXPERIENCE ALSO SHOWS THAT AGRICULTURAL
  TRADE LIBERALISATION NEEDS CAREFUL CONSIDERATION
• SUBREGIONAL INTEGRATION IN CONTEXT OF EU
  ACCESSION ENDEAVOUR IS LIMITED TO BASIC MARKET
  INTEGRATION
• BASIC SUBREGIONAL INTEGRATION PROGRAMME DOES NOT
  COMPROMISE INDIVIDUAL EU ACCESSION EFFORTS
• ABSENCE OF INSTITUTIONS NOT AN IMPEDIMENT TO
  EFFECTIVENESS OF CEFTA

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