The Baltic States burden or mover of The European Union

1
The Baltic States - burden or mover of The
European Union

• Viljar Veebel, University of Tartu  
• May 12, 2006, Vilnius

2
Tomorrow's Europe
13 December 2002
3
General questions

• EU about being developing and cost effective or
  stable, cultural and social?
• Irish or Greece model?
• Regional logic versus general logic of efficiency
• Using some regions for specific purposes
• Budget who's initiative? What purpose? What
  alternative?
• How big the cost?
• Compared with GDP? Compared with tradition?
• Who is growing and who is not?
• Is it better to be contributor or burden?

4
Specific questions

• Can EU have sustainable development without
  enlargement
• Can there be efficient competition against China
  and USA without input of CEE labor force?
• Would it be cheaper for EU with Baltic States
  having extreme market economy and tax paradise
  outside but next to their door?
• Environmental and judicial concerns
• What we get is minimum of what is seen common
  interest (like CAP)
• Ca 300 ur per capita (in reality) per year in
  Baltics compared with Irish 1100 and Greece
  800 in best years?

5
Baltics as a mover in the EU

• Baltic states having ca 9 economic growth
• Three first places in EU 25
• Estonia giving away almost 10 of its labor force
  to the EU labor markets
• Initiatives on institutional reform, tax reform
  and ratification Constitutional Treaty
• Initiative for the economic efficiency Laval vs
  Swedish Labor Union
• Most concerns about Baltic is about being too
  open-market and tax-liberal not too
  social-democratic

6
Baltic as a Burden

• For the EU it is dilemma economic stagnation or
  enlargements
• Most countries in the EU receive more than
  contribute
• EU is agreement of war avoidance and economic
  solidarity not pact of economic efficiency.
• Most what we are received is quite inevitable
• Where there is possibility for restriction there
  is restriction.
• Receiving will mostly end after 2014
• If we are successful, we start contribute
• Baltic population is less than 2 of the EU
  population
• Baltic GDP is less than 1 of EU GDP
• EU is redistributing ca 1.4 of its GDP
• Baltic is like a precedent not as a problem
• Accession of Bulgaria and Romania

7
Conclusions

• Enlargement is inevitable
• Baltic is fastest part of CEE
• EU is not about efficiency in economic but in
  social terms
• Social security ,low inflation, low unemployment
• Citizens support, cultural traditions
• Maybe we should evaluate our situation based
• CEE comparison
• Historic experience of Ireland, Greece, Spain,
  Portugal