Brussels, 20/07/2007 (Agence Europe) - The European Union has published a report which examines the economic and budgetary performances of the states which are potential candidates for EU membership. The exercise, similar to the one, in place since 2001, for applicant countries, allows the medium-term policies that have been put in place with a view to future accession to be assessed. The DG Economic and Financial Affairs analysis focuses principally on the objectives for 2006-2008 in terms of public finances and structural reform in Albania, Bosnia and Herzegovina, Montenegro and Serbia.
From the information contained in the programmes submitted by these four countries in December 2006, it is clear that it will take time for them to catch up economically before they could join the EU, says the Commission, noting that a strengthening of administrative capacity will have to go hand in hand with their policy efforts. Overall, the four countries forecast continued growth in 2007 and 2008 of around potential: 7% in Serbia and 6% in the three others. Inflation will continue to fall particularly in Serbia (6.8% this year) and no change in the current monetary frameworks is planned. According to the Commission, the macro-economic scenarios presented seem relatively realistic, although lacking in detail in some cases.
The Albanian, Montenegran and Serbian fiscal frameworks are consistent and envisage continued consolidation of public finances. The Serbian programme is ambitious, comprehensive and detailed. It predicts a decline in spending relative to GDP and a balanced budget by 2008. Public expenditure in Montenegro is also likely to fall, with a small surplus over the programme period. In Albania, the forecast is for a 5% budget deficit this year and 4.1% next. Bosnia and Herzegovina did not provide consolidated budgetary information.
In terms of structural reforms, the programmes highlight mainly reforms of the business sector, the financial sector labour markets and public administrations. The outlined reform agendas are often not very precise and the impact of the proposed measures on public finances is often not clear.
The DG Ecfin document is available at: http: //ec.europa.eu/economy_finance/index_en.htm (ab)