EU-Russian Relations and the Eastern Enlargement: Integration or Isolation

Initially, in the first half of the 1990s, Russia’s plans to include the countries of the former Eastern bloc within the EU were not seen as a threat to its interests. Furthermore, in the context of NATO’s enlargement, some Russians regarded them as an advantageous alternative. Russia is aware that the EU enlargement with the Central and Eastern European states resulted in a present increase in the number of EU members supporting close trans-Atlantic relations. Moscow’s fears of further EU enlargement were softened due to a dispute that continues to grow within the Union, regarding the rationale and limits of further enlargement, primarily for the Balkan states, Turkey, and the CIS states. Moscow expects that the reluctance of European societies towards further enlargement will inhibit this process. The external relations dimension of the European Union's enlargement to Central and Eastern Europe has received surprisingly little attention despite the fact that in the long‐term the issues it raises may be far more important than those currently dominating the debate. Nowhere is this more likely to be correct than about Russia, for which the EU's enlargement poses a risk of increasing isolation from the rest of Europe. The danger of creating a new dividing line across Europe is widely recognised, and the challenge, therefore, is to find ways of ensuring that Russia can be fully integrated with Europe while almost certainly remaining outside the EU Itself. This article focuses on relations between the EU and Russia and addresses three fundamental questions: how Russia has responded to the prospect of the EU's eastern enlargement; the specific issues arising from expansion, and the kind of long‐term relationship that could develop between Russia and an enlarged EU.

The EU self-surplus puzzle: an indication of VAT fraud?

The world runs a trade surplus with itself: the reported values of exports exceed the reported values of imports. This is logically impossible but a well-known empirical fact. Less well-known is the fact that, in recent years, the EU has a trade surplus with itself that amounts to more than 80% of the global surplus. In this paper, we show that this EU self-surplus is worth a striking 307 billion Euro in 2018, equaling 1.9% of the Union’s GDP, which persists both in goods and services trade accounts. We further examine discrepancies in goods and services trade accounts at the country and country pair level. These are strongest between neighboring countries and exist for members of the Euro Area as well as non-members. Around the 2004 Eastern Enlargement, the EU self-surplus quadrupled. Our estimations suggest that Cyprus, Ireland, Luxembourg, and Sweden are EU Members with the most inaccurate statistical regimes. We observe systematic biases which unlikely root in random measurement error. By contrast, we suspect that a large fraction of the EU’s self-surplus puzzle seems related to fraud in value added tax (VAT). VAT exemptions for exporters provide strong incentives for the over-declaration of true export values. The resulting loss in tax income could amount to as much as 64 billion Euro per year.

Eastern enlargement: analysis of development processes in the EU15 in the context of creative destruction

Motivation: Studies on the impact of the Eastern enlargement on economies of the EU15 indicate that the new member states could not be a significant engine for development processes. However, this does not exclude that the Eastern enlargement and acceding countries could have a significant impact on the mechanisms of the development of the EU15. If we consider Eastern enlargement as a Schumpeterian innovation, its long-term effects should be evident in the way creative destruction affects economic development. Aim: The aim of the study was to determine the impact of the Eastern enlargement on the economic development of the EU15 in the context of creative destruction. In particular, the aim of the empirical analyzes was to determine whether and to what extent the enlargement of the EU was a factor modifying the impact of creative destruction on the development of “old” members countries, and to identify the role of the new member states in these processes. Results: Econometric analysis confirmed that creative destruction influenced economic development in the EU15, and that Eastern enlargement was a factor modifying the relationship between creation, destruction, and the rate of change of GDP per capita. The Eastern enlargement has mobilized two opposing forces. The “internal” force resulting from market selection in the EU15, which after 2004 became an active component of creative destruction, contributing however to a lower rate of change in GDP per capita. The “external” force, related to the mechanism of transmission of impulses within the grouping: synergy effects from destruction in new member countries were a catalyst for the development processes of the EU15, and synergy effects from creation were inhibitors for these processes. In the context of our research the “development leaders” can be considered the largest beneficiaries of Eastern enlargement in the EU15.

Russian-Greek Relations: Is There a Light at the End of the Tunnel?

At the end of the first decade of the 21st century, relations between Russia and Greece entered a protracted period of stagnation, which continues to this day, despite numerous attempts by both countries to intensify political dialogue. One of the reasons is the general degradation of Russia’s relations with the Western countries, which intensified in the middle of the last decade against the backdrop of the Ukrainian crisis. At the same time, the “sanctions wars” have become an important, but not the only reason for the reduction in bilateral contacts. There were other factors as well: Greece’s dissatisfaction with the excessively close cooperation between Russia and Turkey, different views on NATO’s Eastern enlargement, as well as interchurch disagreements.On the economic plane, Russian-Greek cooperation was hampered by the desire of Greece to diversify its energy supplies, the food embargo regime introduced by Russia against the EU countries, as well as the policy of investment protectionism pursued by Greece towards Russian companies.The greatest success has been achieved in the humanitarian field. Due to the cultural and historical closeness of the two peoples, as well as due to the disappointment of the Greeks in the results of European integration, Greece remains one of the few countries where most people treat Russia with sympathy. At the same time, the perception of Russia by the Greeks is distorted and often fragmentary. The positive effect of Russian-Greek humanitarian cooperation is often overshadowed by negative coverage of Russian foreign policy in the Greek media.

Restraining State Sovereignty or the Return of the German Question?

<Online Only>This chapter examines how the geopolitical constitution of Europe developed after Maastricht, in ways both continuous and discontinuous with the founding era. It discusses the continuities in inter-state constraints on the exercise of sovereign powers, now structured, however, through a ‘new intergovernmentalism’ rather than traditional forms of supranationalism. In conjunction with the move towards differentiated integration, this signalled the end of the ‘federal dream’ of European unification. The chapter concludes by discussing the return of the ‘German question’. It analyses how the reunification of Germany, and its increasing influence through the Eastern enlargement of the Union, raised the spectre of stark asymmetries, and even the prospect of semi-hegemony.</Online Only>

Outsider today, insider tomorrow : the impact of the European Union's eastern enlargement on borders and citizenship

This paper analyzes the interrelationship between European Union (EU) enlargement and the issue of citizenship and border management with respect to Poland and Romania. It examines the changes of the EU's external and internal borders through an analysis of immigration laws in Poland and Romania which have been recently changed in order to meet the requirements of the Schengen aquis. This paper argues that the transformation of European borders through eastern enlargement creates a system of differentiated memberships which is incompatible with the concept of the EU citizenship and with some of the terms of enlargement. Unfortunately, this situation is opening the door for the creation of 'second class' citizens and demonstrates that the EU enlargement process is to some extent exclusive.

Outsider today, insider tomorrow : the impact of the European Union's eastern enlargement on borders and citizenship

This paper analyzes the interrelationship between European Union (EU) enlargement and the issue of citizenship and border management with respect to Poland and Romania. It examines the changes of the EU's external and internal borders through an analysis of immigration laws in Poland and Romania which have been recently changed in order to meet the requirements of the Schengen aquis. This paper argues that the transformation of European borders through eastern enlargement creates a system of differentiated memberships which is incompatible with the concept of the EU citizenship and with some of the terms of enlargement. Unfortunately, this situation is opening the door for the creation of 'second class' citizens and demonstrates that the EU enlargement process is to some extent exclusive.