In December, EU leaders agreed to open membership talks with Moldova and Ukraine and to grant candidate status to Georgia. Visnja Vukov writes the EU must learn from previous EU enlargements by managing the developmental consequences of integration in each of the three states.
It is well established that integration among countries at different levels of development can create disadvantages for less developed countries. These include premature deindustrialisation, rising inequality and unemployment or fiscal losses.
This has been a long-standing challenge for the EU, which contains countries with vastly different levels of income. Many EU policies have been designed to address this challenge, including cohesion policies, rules concerning state aid and the distribution of European Investment Bank loans.
As the EU moves towards a further round of enlargement for Georgia, Moldova and Ukraine, developmental disparities are likely to dramatically increase. The GDP per capita of these countries is only between 12% and 14% of that in the EU and the complexity and technological sophistication of their economies is far below those of EU member states in eastern Europe, let alone countries like Germany and Finland.
In addressing these challenges, lessons can be drawn from previous EU enlargements that included less developed economies. In the 1980s, the EU’s “southern enlargement” saw Greece, Portugal and Spain become members. More recently, in 2004 and 2007, the EU’s “eastern enlargement” resulted in 12 new member states joining, mostly from Central and Eastern Europe.
The two enlargements were managed by the EU in a dramatically different way and have given rise to very different developmental pathways and economic growth models. The diversity of developmental outcomes can be illustrated using an Economic Complexity Index produced at the Growth Lab of Harvard University. This captures the diversity, complexity and sophistication of a country’s exports.
About the Author
Visnja Vukov is an Assistant Professor / Universitätsassistentin in the Department of Political Science at the University of Vienna. She holds a PhD from the European University Institute in Florence. Her research deals with capitalist diversity in peripheral countries in the EU and the developmental aspects of European integration. Her work has been published in New Political Economy, Journal of European Public Policy, Review of International Political Economy and West European Politics, among others.