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BUSINESS FOCUS - VISEGRAD FOCUS - BUT NO COMMON APPROACH TO EUROPEAN CONSTITUTION OR LABOUR RESTRICTIONS FOUND

V4 cooperation has a future

TOP officials of the central European countries called the Visegrad Four (V4) - the Czech Republic, Hungary, Poland, and Slovakia to agree that their cooperation should last after accession to the European Union.
The V4 is not an economic association oriented toward granting advantageous conditions for developing mutual trade, it is a political alliance. As such, it can also work after its member countries became part of the EU in May, 2004.

TOP officials of the central European countries called the Visegrad Four (V4) - the Czech Republic, Hungary, Poland, and Slovakia to agree that their cooperation should last after accession to the European Union.

The V4 is not an economic association oriented toward granting advantageous conditions for developing mutual trade, it is a political alliance. As such, it can also work after its member countries became part of the EU in May, 2004.

Further cooperation could cover the presentation of common statements in the EU structures in areas like budget contributions, common defence politics, presentation of the cultural heritage of the region, information exchange, and consulting.

"After accession to the EU, the aims could be revised but the importance of regional cooperation should be preserved," the Slovak Economy Ministry told The Slovak Spectator.

Prime ministers and presidents of the countries also expressed support for V4 cooperation efforts at their meetings at the beginning of March this year.

"The Visegrad four will also be worthwhile after accession," said Czech prime minister Vladimír Špidla at a V4 prime ministers' meeting in Prague, wrote the weekly Trend.

Slovak president Rudolf Schuster said at the V4 presidential meeting in the eastern Slovak town of Košice that the V4 could be gradually formed into an association like Benelux (Belgium, Netherlands, and Luxembourg), although it is going to be a long path, the news wire SITA wrote.

Despite the previous statements, the four countries were not able to find a common approach towards important issues like the European constitution and reciprocity measures against restrictions on access to labour markets in the current EU states.

Although Hungarians and Poles tend to introduce reciprocity measures against limited labour market accession, Czechs, for example, would consider adopting them only if conditions worsen compared to the current regulations. Slovak Prime Minister Mikuláš Dzurinda has already announced that Slovakia would not introduce such measures.

On the other hand, the V4 countries agreed on efforts to preserve contributions from the member countries to the EU 2007 - 2013 budget at the current level of 1.24 percent of the gross domestic product of each country. Some EU countries proposed lowering the limit.

The V4 would like to commonly proceed in the prepared reform of cohesion politics aimed at economic levelling between regions.

The economic issues and cooperation of the V4 are managed within the Central European Free Trade Association (CEFTA). The four countries, counting the Czech Republic and Slovakia as the former Czechoslovakia, were founding members of the CEFTA in 1992. Later, Slovenia, Romania, Bulgaria, and Croatia entered the association.

The aim of the CEFTA was to develop liberalised trade and market relationships. Although countries succeeded in abolishing duties in mutual trade on industrial products, more sensitive agricultural products have never been completely liberalised.

Apart from liberalised trade, the association touches areas like acknowledging certificates, origin of goods, dumping, state assistance, and protective measures. The CEFTA has never had integration ambitions on the scale of the EU and issues like the liberalised movement of capital, people, and services have not been on its agenda.

Since the establishment of the CEFTA, the trade turnover of Slovakia with the rest of member countries has more than doubled. Slovakia traditionally reaches an active trade balance with CEFTA states.

The association shares 25 percent of Slovak foreign trade and it represents the second most important trade partner for Slovakia, just after the EU.

"CEFTA countries were regularly exchanging information concerning accession in the EU. The coordination in this area in a sense of presentation of common statements towards the EU was, however, not that intense. But, the CEFTA simplified and hastened the accession of V4 countries to the EU," said the Economy Ministry.

As five of the CEFTA countries, the V4 and Slovenia will become EU members from May 2004, mutual cooperation could not go on according to the original conditions.

New EU member states will have to first respect the economic policy of the EU. Following the interests of the central European region, the V4 countries should preserve the information channels of the CEFTA after entering the EU.

At their last meeting in 2003 in the Czech Republic, the prime ministers of the CEFTA countries entering the EU this year expressed support for the rest of association countries entry into the union as soon as possible.

In 2003, Slovakia reached an overall trade turnover with the Czech Republic of €4.92 billion. Slovak exports to the Czech Republic represented €2.3 billion and imports €2.62 billion.

Slovakia's resulting trade balance was passive at €325 million. Machinery, vehicles, and commercial and industrial products dominated the mutual trade.

Trade turnover with Poland represented €1.5 billion. Slovakia exported goods worth €848 million to, and imported €646 million from Poland. It reached a balance surplus of €204 million. Commercial goods, machinery, vehicles, and chemicals were the most traded goods.

Slovakia and Hungary generated a trade turnover of €1.49 billion in 2003. Slovakia exported €864 million in goods to Hungary and imported €629 million's worth.

In this case, Slovakia's trade balance was active at €238 million. From its southern neighbour Slovakia purchased mainly machinery, vehicles, and chemicals; while its top exports were machinery, raw materials, and lubricants.

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