Mr. Chairman, Ladies and Gentlemen,
Introduction
It is a pleasure to have
an opportunity to address the workshop
on "EU Enlargement: Regulatory Convergence
in Non-acceding Countries", particularly
because it has been organized with the
strong support of the Government of Greece.
I would like to thank Professor Constantine
Stephanou with whom I had the pleasure
and honour to collaborate more closely
in the time of the Greek Presidency when
he was given the responsibility to coordinate
EU Member States policy in the UNECE.
I can assure you, Professor Stephanou,
that it was a unique experience demonstrating
that efficient coordination of the EU
Member States within international bodies
is possible if properly organized and
under excellent leadership as in your
case. I would like to take this opportunity
to thank you for taking ownership of this
workshop and for your efforts to make
it happen.
Ladies and Gentlemen,
Enlargement and "Beyond
enlargement" Project
During the last decade,
the UNECE region has faced many far-reaching
changes - and next year will bring the
most significant one: EU enlargement by
ten new member countries. In less than
7 months the map of Europe will be redrawn
and the EU external borders will be greatly
expanded towards the South and the East.
The enlarged Union, with
its population of more than 450 million
inhabitants and its GDP of almost 10,000
billion Euros, will undoubtedly be a driving
force in the development of stability
and prosperity throughout the European
region.
There are many question
marks about the challenges, opportunities
and implications this historical enlargement
brings to the entire region, and particularly
to the countries in Eastern Europe, the
Caucasus, Central Asia and the Western
Balkans.
To address major issues
regarding the new shape of relations between
the enlarged EU and its future neighbouring
countries, and other non-acceding countries
within the UNECE region, we have initiated
a discussion on "Beyond enlargement: economic
cooperation and integration in a wider
Europe" through a series of workshops.
This series of workshops,
which is being supported by the EU, is
designed to help limit the prospect of
new divisions arising in the region and
to look at the new shape of relations
between the enlarged EU and non-acceding
countries. The current workshop on "EU
enlargement : Regulatory Convergence in
non-acceding countries" is part of the
series under the project "Beyond EU enlargement".
Under this project we have so far organized
sectoral workshops on the impact of EU
enlargement on non-acceding countries,
and economic cooperation and integration
in the region after enlargement in the
sectors of energy, trade, business and
FDI, and environment. Late November a
workshop on post-EU enlargement in the
transport sector will be organized in
cooperation with the ECMT (European Conference
of Ministers of Transport), the EC and
the EIB (European Investment Bank). We
will continue the discussion in the joint
UNECE-OSCE high level workshop on the
economic dimension of security in post-enlargement
Europe in February next year, and in May
2004 on new challenges for trade and enterprise
development.
The objective is - as
noted - to promote a better understanding
that there is a need for coordinated efforts
to prevent new divides in the UNECE region
after EU enlargement. All main stakeholders
- the EU, governments of non-acceding
States, the business sector and NGOs,
and relevant international organizations
- have to play a role.
EU's role includes (1)
the continuation of its integration efforts
towards South-East Europe through the
Stabilization and Association Process
(SAP). An important step forward was made
at the Thessaloniki Summit in June 2003,
where the EU offered the Western Balkan
countries the new European Partnerships,
giving them the prospect of accession
to EU after they fulfil the necessary
obligations.
Furthermore, the EU supports
the transition process towards market
economies and democratic societies in
13 countries of Eastern Europe, Caucasus
and Central Asia through bilateral Partnership
and Cooperation Agreements (PCA). In addition
bilateral negotiations between EU and
Russia under the CEES (Common European
Space) outline new dimensions of cooperation
between the new partners.
In March 2003, the EU
defined its neighbourhood policy in "Communication
in a Wider Europe" which will bring closer
to the EU those countries which will become
new neighbours due to having borders with
the enlarged Europe, namely Russia, the
Western Newly Independent States and southern
Mediterranean countries.
UNECE's role in Post-enlargement
Europe
In post-enlargement Europe
a unique role can be played by UNECE.
Why?
-
UNECE is a multilateral
platform for promoting economic cooperation
in its region. UNECE has played this
important role for over 50 years through
well targeted initiatives aimed at
greater economic development and integration.
-
UNECE provides
equal participation in the decision-making
process to every UNECE member State
including non-acceding countries.
In view of the existing governance
in other organisations like BWI, WTO
it ensures a model of governance that
gives more opportunities to less advanced
countries to have a say.
-
As such it is
recognised as a non-partisan and trustworthy
organization on the side of non-acceding
countries.
-
UNECE has a long
and well recognised expertise in developing
norms, standards, conventions and
other binding and non-binding legislation
in trade, transport, energy and environment.
UNECE instruments in fact provide
the basis for many EU policies and
legislation and make a significant
contribution to the success of the
EU's Customs Union and Single Market.
Recently the EU adopted three legislative
proposals towards full application
of the 1998 Aarhus Convention on environmental
democracy developed in the UNECE.
Vice versa, many UNECE initiatives
are in fact led by EU Member States
and EU policies, and some impact of
the existing EU legislative framework
on the UNECE legislative work is already
visible.
-
The UNECE legislative
framework is indispensable for further
enhancement of trade and economic
cooperation. In order to strengthen
economic cooperation with the enlarged
EU, there is a need for non-acceding
countries to adopt and implement standards
and legislation that are not necessarily
identical but in compliance with the
acquis communautaire. The UNECE might
be helpful in developing such norms,
standards and regulatory instruments
using its existing experience and
expertise.
Importance of regulatory
convergence
Why is regulatory convergence
important?
Firstly, implementing
common rules and standards will assist
economic operators of non-acceding countries
to compete in the EU market and international
markets when they move away from their
domestic markets.
Their success or failure will often depend
on how familiar they will be with the
regulations and standards in export markets.
In those areas where differences exist
between the standards applied in the non-acceding
countries and those applied in the EU,
trade with the EU will be difficult for
companies from non-acceding countries.
Therefore PCA and SAA assume legislative
and regulatory convergence, although they
do not set out a time frame.
Secondly, trade liberalization
and the adoption of common rules and standards
are the fundamental components not only
for creating greater market integration
between the enlarged EU and non-acceding
countries, but also for creating greater
trade and market integration among the
non-acceding countries themselves.
Let me point out a very
recent example - the agreement on the
creation of a Single Economic Zone, which
was signed by the presidents of the Russian
Federation, Ukraine, Belarus and Kazakhstan
at the CIS Summit in Yalta in September.
Apart from the fact that this agreement
provoked some conflicting reactions and
even criticism on the side of the Commissioner
for EU enlargement, I would just like
to underline that this agreement foresees,
among other objectives, the convergence
and harmonisation of relevant economic
and trade-related legislation leading
to the free movement of goods, services,
capital and labour.
Agreement framework
for regulatory convergence
The importance of regulatory
convergence is more increasingly recognized
by non-acceding countries in the context
of their future participation in globalised
markets. So, the driving force behind
regulatory convergence is not only the
EU enlargement and existing bilateral
agreements with the EU, but also their
ambitions to compete in the global markets
which are institutionally linked to their
WTO membership.
Moving target
The existing agreement
framework for regulatory convergence therefore
includes PCA and SAA concluded with the
EU, regulatory obligations derived from
their WTO accession process or membership
and from membership in other international
organizations, including UNECE.
The regulatory convergence
process is a dynamic one, it is clearly
a "moving target". Although "overregulation"
should be avoided and different stakeholders'
views taken into consideration it is clear
that the regulatory framework for international
economic cooperation will continue to
change and respond to new challenges (e.g.
new norms and standards in e-economy).
This makes the process of regulatory convergence
for less advanced countries more difficult.
An agreement framework
for regulatory convergence should therefore
take into consideration the time and speed
and costs of regulatory convergence. Regulatory
convergence is a time-consuming process
which in the case of acceding countries
has lasted 10 and more years. The costs
of regulatory convergence include costs
linked to the adoption of new legislative
frameworks and the building of new regulatory
institutions.
An optimised speed of
adoption of new legislative framework,
norms, standards, etc. should take into
consideration the potential negative implications
of too rapid/ too much postponed adoption
of new legislative framework. Too rapid
an adoption might generate costs - for
example from undesirable bankruptcies,
increased unemployment and other social
and economic losses, but too much postponement
- if not accompanied by necessary structural
reforms - may lead to further losses in
competitiveness and even greater undesirable
negative consequences.
Where harmonization of
technical regulations and standards is
not immediately possible, Governments
and national bodies should try to create
a simple and transparent framework for
adopting and applying their national technical
regulations and standards and keeping
foreign companies informed of how to meet
these requirements.
Mutual confidence can
be increased and the cost of trading reduced
through the mutual recognition of national
conformity assessment bodies in accordance
with the requirements of an importing
country.
One approach to minimizing
regulatory convergence costs and responding
to the challenge of a "moving target"
is Recommendation "L" on Standardization
Policies, also referred to as the "International
Model for Technical Harmonization" which
was based originally on a proposal from
the European Union, and has been well
received by a large number of our member
States.
This Recommendation is
based on two principles:
- That "Common regulatory objectives"
should form the basis of technical regulations
and should be based on mutually agreed
safety and other legitimate requirements
(such as those related to safety, the
environment, etc.). This, in turn, means
that regulators should not harmonize
existing regulations but rather should
try to agree on, for instance, what
safety levels they would like to achieve
(i.e. on their common regulatory objectives)
and then agree on what relevant standards
could be used for this purpose.
- The need to base national technical
regulations on international standards
or, in their absence, on applicable
regional or national standards. Such
an approach would create a level playing
field for companies. Thus a company
that is manufacturing a product according
to a standard referenced in a regulation
would be able to demonstrate automatically
its compliance with such a regulation.
The telecommunications
sector was the first to show interest
in the application of Recommendation L
and the first steps towards implementation
are being taken in order to harmonize
technical regulations on certain telecom
products. In the respective expert community,
this effort is know as the "UNECE Telecom
Initiative".
I am very pleased to
note, therefore, that mechanisms suggested
in the "International Model" are not only
theoretical but are already being applied
in one of our subregional projects.
On the basis of the International Model,
the CIS countries have prepared a draft
agreement on harmonization of technical
regulations within the CIS. This draft
agreement was prepared in cooperation
with the CIS Interstate Council for Standardization,
Certification and Metrology (which unites
the standardization agencies from the
12 countries of the former Soviet Union).
The implementation of
such an agreement would not only contribute
to development of trade between the CIS
countries but also provide a useful and
practical showcase for regional cooperation,
which could also serve as an example for
regulatory cooperation in our other subregions.
Conclusions
The harmonization of
regulatory measures, such as technical
regulations, standards and product specifications,
stimulates markets and creates common
understandings between market operators,
and thus facilitates trade.
For non-acceding countries
it is crucial to adopt international standards
so as to make their products competitive,
thus increasing their export capacity
and their participation in global trade.
Regulatory measures, their convergence,
and the possibilities for linking them
to regional and international standards,
have therefore become one of the central
issues for UNECE discussions about a wider
Europe.
Through its intergovernmental
mechanisms and its advisory services,
the UNECE offers its experience and expertise
to its member States, and particularly
to non-acceding countries, to assist them
in adopting the necessary international
standards for trade.
Thank you for your attention
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