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EU Eastern Enlargement: Economic Effects on New Members 2000-2012

34 Pages Posted: 11 Jun 2014  

Miroslav N. Jovanovic

University of Geneva, Global Studies Institute

Jelena Damnjanovic

Novi Sad Business School

Date Written: June 9, 2014

Abstract

The European Union (EU) has a splendid record concerning enlargement. Judging by the number of EU member countries, enlargement has been the most successful EU policy ever. The economic side of its eastern enlargement is a hybrid bag of effects for the EU's eastern countries. Membership in the EU is not a tide that lifts all boats. This primer provides data for the period 2000-2012 which show that economic growth, expansion of trade and increase in foreign direct investment to the east of the EU are obvious successes and gains for the ‘new’ EU countries. The eastern countries are modernising, but there is a cost: an incredible acceleration in domestic and foreign debt which financed these successes. The danger is that this debt burden may partly suffocate the newly acquired economic vigour in the EU's east, especially at a time when there are serious concerns about the future of the eurozone and the EU.

Keywords: enlargement, old and new EU countries, debt, mixed blessing

JEL Classification: F13, F15, F50

Suggested Citation

Jovanovic, Miroslav N. and Damnjanovic, Jelena, EU Eastern Enlargement: Economic Effects on New Members 2000-2012 (June 9, 2014). Journal of Economic Integration, Vol. 29, No. 2, 2014. Available at SSRN: https://ssrn.com/abstract=2447612

Miroslav N. Jovanovic (Contact Author)

University of Geneva, Global Studies Institute ( email )

Sciences II, 30 Quai Ernest-Ansermet
Geneva 4, 1211
Switzerland
+41 22 379 3706 (Phone)

HOME PAGE: http://www.miroslavjovanovic.com

Jelena Damnjanovic

Novi Sad Business School ( email )

Vladimira Perica-Valtera 4
Bulevar kralja Petra I 38
Novi Sad, 21000
Serbia

HOME PAGE: http://jelenadamnjanovic.rs/

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