1. EPC EDUCATION AND TRAINING – www.epctraining.be Applications for Membership of the EU Turkey - April 1987 Cyprus - July 1990 Malta - July 1990 Hungary - March 1994 Poland - April 1994 Romania - June 1995 Slovakia - June 1995 Latvia - October 1995 Estonia - November 1995 Lithuania - December 1995 Bulgaria - December 1995 Czech Rep. - January 1996 Slovenia - June 1996 Croatia – February 2003 Macedonia – Spring 2004

2. EPC EDUCATION AND TRAINING – www.epctraining.be EU USAJapan 0 100 200 300 400 450 million 272 million 126 million Population from May 2004

3. EPC EDUCATION AND TRAINING – www.epctraining.be Increase in area

4. EPC EDUCATION AND TRAINING – www.epctraining.be Population change

5. EPC EDUCATION AND TRAINING – www.epctraining.be GDP change

6. EPC EDUCATION AND TRAINING – www.epctraining.be Bilateral European Agreements between the EU and applicants have created convergence with the EU in economic, political and social areas. Has covered a wide range of issues such as: trade, political dialogue, legal approximation and other areas of cooperation, including industry, environment, transport and customs. We have practiced membership for a decade already:

7. Important effects of Enlargement EPC EDUCATION AND TRAINING – www.epctraining.be A more peaceful Europe A Europe of nearly half a billion inhabitants Addition of rapidly growing economies, boosting economic growth and job creation Better quality of life for citizens through the protection of the environment, and the fight against crime, drugs and immigration. Wider cultural diversity Stronger role for the EU in world affairs

8. Stable democracies have emerged in a record period Economic reforms have proven successful, leading to high rates of economic growth EUs financial assistance and the prospect of EU membership have stimulated development Trade and investment has developed well EPC EDUCATION AND TRAINING – www.epctraining.be Any progress yet?

9. EPC EDUCATION AND TRAINING – www.epctraining.be GDP per Capita – 2003 Index. EU-15 = 100. PPS US: 139; Japan: 102

10. EPC EDUCATION AND TRAINING – www.epctraining.be GDP per Capita – 2003 Index. EU-15 = 100. PPS

11. EPC EDUCATION AND TRAINING – www.epctraining.be Growth Rate of GDP – 2003 Percentage change on previous year US: 2; Japan: 0,3 %

12. Annual Growth in GDP EPC EDUCATION AND TRAINING – www.epctraining.be %

13. Total Unemployment Rate -2003 % USA: 6,0 Japan: 5,3

14. Employment by sector 2001 EPC EDUCATION AND TRAINING – www.epctraining.be

15. Sector effects EPC EDUCATION AND TRAINING – www.epctraining.be Risk sectors are characterised by high labour intensity. Accession countries have favourable wage/productivity ratio The labour force in the accession countries is well educated so some more ‘skill-intensive’ sectors might come under pressure in the EU as well In the service sectors, advantages for the EU are mainly in the fields of business and financial services, whereas among the accession countries’ exports, tourism and transportation services are dominant

16. EPC EDUCATION AND TRAINING – www.epctraining.be Labour productivity GDP in PPS per person employed relative to EU-15 = 100. 2003 US: 120,7 Japan: 89,4

17. Earnings Average gross annual earnings in industry and services, EUR, 2001 EPC EDUCATION AND TRAINING – www.epctraining.be

18. Wage/Productivity EPC EDUCATION AND TRAINING – www.epctraining.be New Member States roughly delivers half the productivity for a quarter of the price Threat or opportunity?

19. EPC EDUCATION AND TRAINING – www.epctraining.be The knowledge economy: Gross domestic expenditure on R&D % of GDP - 2000 %

20. EPC EDUCATION AND TRAINING – www.epctraining.be The knowledge economy: Internet penetration in EU households - 2003 %

21. EPC EDUCATION AND TRAINING – www.epctraining.be The knowledge economy: Internet penetration in enterprises 2003 %

22. EPC EDUCATION AND TRAINING – www.epctraining.be The knowledge economy: Patent applications to European Patent Office Per 1 million inhabitants - 2001

23. EPC EDUCATION AND TRAINING – www.epctraining.be Energy intensity of the economy- 2001

24. EPC EDUCATION AND TRAINING – www.epctraining.be Energy intensity of the economy- 2001

25. Business effects – Four drivers EPC EDUCATION AND TRAINING – www.epctraining.be Strong boost to foreign direct investment due to higher confidence in a predictable political and regulatory framework. Raising training and skills standards, as well as productivity improvements, technology transfers, modernised plant and equipment, and better environment and social standards. Higher levels of international competitiveness in both the new and the old Member States. Increased cross-border trade between the new and the old Member States.

26. Regional effects EPC EDUCATION AND TRAINING – www.epctraining.be Countries with no borders with the new Member States will be affected less by the increase of competition from the accession countries The impact on countries with borders to the new members will be much higher: They will benefit more from the demand in the accession countries but also fell increase in competition

27. Impact on SMEs EPC EDUCATION AND TRAINING – www.epctraining.be In many sectors the impact will be restricted to regions close to the new EU members. Micro and small enterprises tend to serve local needs and impact will be more moderate. Medium-sized companies are often hampered in their international activities by transaction costs, which will be reduced because of enlargement Medium sized companies will have new partnership and market opportunities in the enlarged market. Requires an effort!

28. The business environment Level of cooruption: Transparency Internnational 2003 EPC EDUCATION AND TRAINING – www.epctraining.be

29. Investment, enlargement and SMEs EPC EDUCATION AND TRAINING – www.epctraining.be Enlargement will mean a reduction of transaction costs due to Internal Market. Therefore, enlargement could improve the position of SMEs in terms of trade and investment, but the question remains as to whether and which SMEs will invest. Partnership opportunities should be considered. Enlargement: Threat or opportunity for SMEs?