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Saturday, September 18, 2004
Business in Romania blog
... probably I shouldn't publish this, but it's a great analysis ...

Why 2007 Is Too Soon
(by Tom Wilson, published in Ziarul Financiar)
September 17, 2004


Since this is going to be my last column for ZF for quite some time, I've decided to take the opportunity to say something particularly controversial; something that flies in the face of everything that most intelligent Romanians are praying for at the moment. In three weeks time, the European Commission will issue its country report. It will probably award Romania the status of 'functional market economy'. I desperately hope, however, that Romania won't be given this EC stamp of approval. This is because I hope that Romania fails to achieve EU entry in 2007.

The first reason is that external pressure from the EU could prove to be one of the only real chances Romania has of seeing genuine reforms - and anyone who believes that the current measures have gone far enough must be living under a rock large enough to kill them. What is needed is nothing short of a revolution at every administrative level, rather than the kind of legislative tinkering that has taken place. The EU's power to shame shouldn't be underestimated.

This alone would be a rather mean-spirited stance if it could be argued that EU membership would improve to the lot of the average citizen; should the general population really be penalised because of the shortcomings of their leaders? However, this EU entry won't be the magic wand it's expected to be. It won't improve the quality of life for the average Romanian. On the contrary, EU entry will worsen the economic exploitation of Romania. This, at least, is a view shared by Professor Tom Gallagher, Chair of Ethnic Conflict and Peace at Bradford University in the UK and author of numerous books on the region. Romania after accession will become, in his words, "Europe's very own Puerto Rico... an exploited dependency of a neighbouring Goliath."

The idea is just one of the themes explored in Gallagher's new book to be published in November, entitled "Theft of a Nation: Romania since communism". It's a scathing criticism of Romania's post-revolutionary reforms and the EU's acquiescence with the superficial changes to the regime that have taken place since 1989.

Gallagher is, however, no Euro-sceptic. "I'd be quite happy to see a United States of Europe," he explains to me in his lilting Scottish accent. I was lucky enough to catch him during his visit to Brasov earlier this week. "Turkey, for example, could be a perfect EU accession country, if it was able to sort out its problems in terms of human rights," he continues. It's a damning judgement of democratic reforms in Romania to suggest that a country with a reputation like Turkey is actually a better potential EU entrant. As he wrote in the New Statesman magazine last week, Gallagher is convinced that "there are implications for safety on the streets of Britain if a compliant Romanian judge can set free a top official involved in issuing passports to women who are sent, under coercion, to join the western European sex industry."

However, his concern isn't just for the effects Romania's entry will have on the West, but on the way in which ordinary Romanians are like to be affected by accession. "As tariffs come down, what we're seeing is a flood of imports. Pre-accession funds are supposed to be developing strong Romanian commerce, industry, agriculture or tourism, able to compete with this. But how can this possible happen when so much EU money is ending up elsewhere, the hands of a small elite?" he asks.

He identifies agriculture, in which 46% of the Romanian labour force is employed, as a central stumbling block. "Instead of designing a tailor-made solution for Romania, the EU has ploughed ahead with the same kind of agricultural policies it's used elsewhere. They simply won't work in Romania, because of its unique situation. Instead of making Romanian agriculture profitable, the end result of EU accession could be to succeed where Ceausescu failed - in driving people off the land." Unable to compete in the face of cheap (and heavily subsidised) EU imports, Gallagher is predicting some kind of EU-driven Systematisation. "The only difference," he explains, "would be that instead of being driven out of the countryside and into tower-blocks, people would be able to go and pick strawberries in Spain."

For flailing western economies, expansion would be a dream come true - a vast pool of cheap labour, a huge market for exports, and vast swathes of arable land at knock-down prices. Anyone who supports the aims that the EU was established to further needs to seriously ask themselves who it is that stands to profit from accession in 2007. Despite the numerous benefits that EU harmonisation would obviously bring, it seems unlikely that this will solve the underlying illnesses of the 'sick man of Europe'. Delayed accession, by contrast, could result in the genuine reforms that are still badly needed.

"Theft of a Nation: Romania since communism" will be published in Romania by Humanitas in November.

Author: Tom Wilson for ZF

Posted by Mihai : 9/18/2004 05:56:00 pm Why 2007 Is Too Soon
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