As announced in the middle of 2011, Croatia is going to become 28th country to join the European Union on July 1st 2013. By that time, most of the acquis is about to be adopted, while, at the same time, all of current 27 members should ratify the accession treaty. Certainly, this is about to happen and while Croatian people are preparing to celebrate, accession is somehow leaving the rest of us, all other non-EU member Balkan countries that is, confused, not knowing what that actually means and what are the legal and economic consequences.
First of all, Croatia will have to leave CEFTA (Central European Free Trade Agreement), at least one day before the accession. That means that there is no more free trade for CEFTA-member companies that were conducting business with Croatian companies, since Croatia is becoming member of single European market. This will produce serious economic impacts for neighboring countries (Serbia and Bosnia and Herzegovina). According to the CEFTA trade statistics for the first half of 2012, 48 % of overall Bosnia and Herzegovina exports went to Croatian market, making them number one trade partner. Similarly, Croatia participated with 12 % of Serbia’s overall share in exports, which is not something that should be underestimated.
Croatia has started the implementation of common EU trade policy, bringing new business conditions, both in the single European market and the markets of the so-called third countries with which the European Union has a contractual relationship. In trade between Croatia and EU many of the tariffs are to be abolished as well as other non-tariff barriers. Croatian companies will be equated with those of other member states, which will provide access to a large single market, but also lead to increased competition in the domestic market.
Of course, the fact that Croatia will seize its membership in CEFTA does not necessarily mean that it will automatically close its trade borders with neighboring countries. However, since there are numerous standard and regulations that CEFTA members have to adopt in order to export their goods to the EU market, and having in mind all barriers that those countries are facing, both economic and political, it can be expected that Croatia-EU accession will significantly reduce the scale of market development in the region.
For example, in order to export any good that is of animal origin (cheese or milk, for example), Bosnia and Herzegovina is required to: a) establish the central database of the official control system; b) prepare laboratory strategy for testing of samples taken in the context of official controls on food chain and food made out of animals; c) establish a system of peer review of approvals for facilities that will export to the EU; d) establish a system of import controls for animal food and all other products that are not of animal origin; e) reorganize the structure of official controls at all levels; f) create a strategy of communication between the relevant authorities as required by Regulation (EC) 882/2004.
In order to export potatoes to the EU market, Bosnia and Herzegovina is required to implement a program of special supervision of quarantine harmful organisms on potatoes for a period of three years. Accordingly, the official inspection body of EU can issue import permit for the mercantile potatoes, if all prerequisites are full filed, earliest in 2016. Those are the three years of prohibited export for the most famous agriculture of Bosnia and Herzegovina!
Additionally, certain types of products (so-called industrial products) will need to have CE label in order to be qualified for the export to the EU market. CE label guarantees that the product is made in compliance with health and safety requirements of EU regulations pertaining to a specific product. This relates only to those products that fall under the application of these regulations, not all of the products on the EU market. These are low-voltage equipment, simple pressure vessels, toys, construction products, machinery, lifts, personal protective equipment, non-automatic weighing instruments, implanted medical devices, in-vitro diagnostic medical devices, devices to gas fuel, hot water boilers, explosives for civilian use , recreational vessels, refrigeration equipment, pressure equipment, pyrotechnics, equipment and protective systems, etc. For what is worse, only two out of current fifty one border crossing point between Bosnia and Herzegovina and Croatia will be eligible for trade of such goods.
All these are negative effects of the Croatia-EU accession. However, there are some good sides too. For example, harsh standards and strict control of the borders will have some positive consequences like higher productivity of domestic companies that will trade within domestic of CEFTA market. In addition, higher standards within the borders of EU means higher salaries for the Croatian workers, and this would most certainly mean that many of the Croatian employers will seek for cheap labor. Where? Over the borders, in their fellow non-EU neighbors.
Also, there are a lot of opportunities for the citizens that are holding double citizenship (many of the citizens of Bosnia and Herzegovina are holders of Croatian citizenship). These will, in legal sense, have the same treatment as the citizens of EU. That means free higher education and better social and health services. And since Croatian language is becoming the official EU language, it means that there will be much easier to communicate with the EU institutions and officials for all the other nations that are speaking the same or similar language (Bosna and Herzegovina, Serbia, Montenegro).
Certainly, it can be said that the rest of us are not yet prepared for the EU border that is becoming closer every day. Still, if we believe that this is our opportunity instead of a bad thing, we should start with the preparations as soon as possible. If we are about to think of a better life, that is.