EU Corner
EU Corner
In Focus: Montenegro Progress Report 2012 On 10 October 2012 the European Commission adopted the Progress Report on Montenegro as a part of the 2012 Enlargement Package. This is the first Progress Report on Montenegro since the country opened accession negotiations with the EU on 29 June 2012. The progress report presents an overview of progress made towards fulfilling political and economic criteria. In addition, the Progress Report reviews development regarding Montenegro’s capacity to take on the obligations of membership - the acquis chapters (33 chapters). The European Commission concluded that the country has made further progress in establishing a functional market economy, it has improved its ability to take on the obligations of EU membership, and is continuing to sufficiently meet the political criteria for EU membership. The screening process has begun and is expected to finish in Summer 2013. The accession negotiations will integrate a new approach for the chapters on judiciary and fundamental rights, and on justice, freedom and security, thereby reinforcing the focus on rule of law and on the irreversibility of the reforms that have been undertaken. Montenegro needs to further develop a track record in this area, in particular with respect to highlevel corruption and organized crime. Below, are the key findings of the Progress Report in terms of the private sector and the economy.
Political Criteria The section “Political Criteria” analyzes the progress made by Montenegro towards meeting the Copenhagen Political Criteria, which requires: stability of institutions guaranteeing democracy, the rule of law, human rights
10
and respect for and the protection of minorities. Regarding labor rights, the European Commission concluded that labor and trade union rights are generally respected. However, more attention needs to be dedicated to ensure the full transparency of representativeness and the right to establish new unions, negotiations on new collective agreements have not yet been finished and social dialogue still needs to be improved. Also, women remain under-represented in the labor market. Amendments to the Labor Law are still required in order to bring it in line with the EU acquis, while its implementation still remains a challenge.
Economic Criteria The European Commission analyzed Montenegrin economic development in terms of the existence of a functional market economy and the capacity to cope with competitive pressure and market forces within the Union. The European Commission assessed that Montenegro has made further progress in establishing a functional market economy. The banking sector is still recovering, and bank deposits are gradually increasing. However, bank capital and lending are declining. Further improvements have been made in market entry procedures and bankruptcy recovery. Regarding municipal licenses, further efforts are still required. The progress report stated that the telecom and energy industries have been liberalized and that the respective regulatory authorities have become more assertive. Average income per-capita in purchasing power standards increased to 43% of the EU average in 2011, from a level of 41% in 2010. However, the economy is still in the process of recovering, and the performance of several sectors still remains weak.
The progress report warns that large external imbalances have deteriorated. Also, the European Commission stated that unemployment is very high. Namely, the unemployment rate amounted to 20%, on average, in 2011 and during the first half of 2012, according to the Labor Force Survey (LFS). The European Commission used data from MONSTAT, which differs significantly from the data provided by the Agency for Employment (AEM). In addition, the progress report pointed out that inflationary pressures and public debt have continued to increase and it was concluded that the stability of public finances is challenged by a receding economy and substantial contingent liabilities. The European Commission assessed that the difficult economic situation of the aluminum plant needs to be addressed and that the country needs to attract further investment to develop its infrastructure. Regarding the legal system, weaknesses in the rule of law and in corruption continue to have an adverse effect on the business environment and remain a major challenge.
Ability to Take on the Obligations of Membership The section “Ability to Take on the Obligations of Membership” analyzed Montenegro’s ability to take on the obligations of membership — the acquis and Montenegro’s administrative capacity to implement the 33 acquis chapters. The European commission underlined that Montenegro has made some progress in improving its ability to take on the obligations of membership. Good progress has been made in the areas of public procurement, transport policy, statistics and science and research. The European Commission pointed out that progress has been limited in other areas such as the free movement of workers, the free movement of capital, company law, food safety, veterinary and phytosanitary policy, taxation, enterprise and industrial policy, the environment and climate change, and financial and budgetary provisions.
Montenegro’s limited administrative capacity represents a challenge in a number of areas and needs to be strengthened to ensure the effective implementation of EU legislation. ■ Source: http://europa.eu/rapid/press-release_ MEMO-12-769_en.htm and http://ec.europa.eu/ enlargement/pdf/key_documents/2012/package/ mn_rapport_2012_en.pdf
EU Funds The program for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME) will open during the new Financial Perspectives 2014-2020, with a planned budget of €2.5 billion. COSME is new program for small and medium-sized enterprises (SMEs), which will replace the current CIP program - Competitiveness and Innovation Framework Program. COSME will, in the first instance, target existing entrepreneurs (in their development, consolidation and growth phase) and future entrepreneurs (whilst setting-up their businesses). Further, specific target groups will be: young, new and female entrepreneurs, migrants, persons with disabilities, and senior entrepreneurs. The program will also provide public authorities with tools for policy reform; in particular through analytical studies and EUwide data and statistics. The overall objective of the program is to enhance the already business-friendly environment for SMEs in order to ensure and support their competitiveness and growth. COSME will be open to Member States, Members of the EFTA, acceding countries, candidate countries, potential candidates and European Neighborhood Policy (ENP) countries. Montenegro, as a candidate country, has access to CIP funds and will have the opportunity to apply for COSME funds during the forthcoming period. ■ Source: http://ec.europa.eu/cip/cosme/index_ en.htm
MONTENEGRIN STEPS TOWARDS EU - Accession negotiations with Montenegro have started The European Council has endorsed the decision of the General Affairs Council from 26 June, and under Danish Presidency at the Intergovernmental Conference with Montenegro , the process was officially launched in Brussels on 29 June. During the negotiation process there will be a special focus on fundamental freedoms, judiciary, the fight against corruption and organized crime. The Commission, in its negotiations with Montenegro, will apply a new approach which will allow Chapters 23 and 24 to be opened early in the negotiating process and to be closed at the very end. - Montenegro – European Economic and Social Committee (EESC) Joint Consultative Committee (JCC) established At the beginning of October 2012, the inaugural meeting of the Montenegro – European Economic and Social Committee (EESC) Joint Consultative Committee (JCC) took place in Brussels. The JCC comprises six Montenegrin and six EESC representatives as well as two permanent observers from Montenegro. The body gathered representatives of employers, of the unions, and of NGOs from both sides. Montenegro will be represented in the JCC by members of the Employers’ Union of Montenegro, the Montenegro Business Alliance, the Association of Trade Unions of Montenegro, the Union of Free Trade Unions of Montenegro, the Chamber of Commerce, NGO Ekvista, and NGO Put Nade (Road of Hope).
- The working groups for negotiations The working groups for negotiations on Chapters 23 and 24 were set up in March, while those for Chapters 5, 25 and 26 were set up in July. The working groups for Chapters 6, 8, 3, 7, 12 and 20 were set up in September, while those for Chapters 11 and 22 were set up in October. From May to October 2012, there was an explanatory analytical overview of the EU acquis communautaire regarding Chapters: 23, 24, 25, 26, 5, 6, 8, 3, 7, 12, 20, organized in Brussels. Representatives from general directorates of the European Commission created the analytical overview of the EU acquis for these Chapters by presenting all of the key documents. - Key dates o December 2010: The European Council grants candidate status to Montenegro o March-May 2012: Screening meetings for Chapters 23 and 24 o 26 June 2012: The General Affairs Council (GAC) decides to open negotiations with Montenegro and adopts the negotiating framework. o 29 June 2012: The European Council endorses GAC decision. Formal opening of the accession negotiations at the first Intergovernmental Conference. o 24 September 2012: Start of the screening meetings for the remaining chapters. ■ Source: www.mip.gov.me, http://ec.europa.eu/ enlargement/
11