Almost twenty years after the biggest enlargement of the European Union to date in 2004, the EU's drawn-out aspirations to accept new members are gaining momentum. Beyond the moral and geopolitical arguments for EU expansion to the East, is there a commercial argument to be made?
Jobs, stagnating wages, economic hardship and high inflation are just some of the issues affecting EU voters ahead of the European elections in June, not to mention companies concerned about enhancing productivity amid a continent-wide recession.
Ultimately, is integration good for business? Euronews tackled this question and others in a panel entitled 'The Business Case for EU Enlargement' at the World Economic Forum in Davos, Switzerland on Tuesday. Guests included: Milojko Spajić, Prime Minister of Montenegro; Rostyslav Shurma, the Deputy Head of the Office of the President of Ukraine; Mariya Gabriel, the Deputy Prime Minister of Bulgaria who also serves as the Minister of Foreign Affairs and, Christian Levin, President and CEO of Scania (Sweden), a member of the Alliance of CEO Climate Leaders.
Mariya Gabriel: 'Enlargement turns external factors into something we can manage'
Former European Commissioner Mariya Gabriel stressed that Russia's full-scale invasion of Ukraine is the reason why talk of the Western Balkans joining the EU is back on the agenda. She recalled the importance of the EU-Western Balkans summit in 2018 and its results as well as the Western Balkans digital agenda, innovation program and investment plans. Gabriel also highlighted the "huge investments" carried out by the EU.
"Even for inflation, let's be very honest, there are a lot of external factors for inflation, and enlargement is transforming them into something that we can manage, that we can control even... so I definitely see benefits much more than risks" she said.
Christian Levin: “New, very competitive markets”
Levin's company has heavily invested in some of the EU's younger members, like Poland. the CEO of Scania, for his part, outlined how the transport solutions provider has grown from strength to strength since Poland's accession.
"Our sales of vehicles in Poland and the total Polish market have increased five times; if we look at our service sales, which are so important for the profitability of a company supplying trucks, they have increased ten times," he said.
Scania has also been operating in Ukraine for thirty years. “We can only encourage other private companies to take advantage and come to Ukraine and invest there, now,” he said. “For example, we had our best year in Ukraine in 2023, based on the huge need for transport that is coming, partly because of the war and partly because of that development".
As for other future members, he emphasised that prospective members will also benefit from similar trends. "Some of the new markets of the EU are very competitive, which is a good thing for us."
Milojko Spajić: “A strong signal for the private sector”
While Montenegro boasts steady GDP growth and a thriving tourism industry considered one of the most successful candidate countries in the EU's Eastern Neighborhood, its Prime Minister Spajić recalled how far Podgorica has come since the tiny Balkan country applied to join the EU in 2008. “ Previously, Montenegro was more like Mongolia or Kazakhstan in terms of economic structure, but then we were, geopolitically and strategically, turned towards Brussels and this discrepancy does not work in the long term,” he said.
Although his country's economic performance is good, he reminded the other panellists that "the EU growth plan is very important because it constitutes a strong signal for the private sector."
“We are going to experience a big investment cycle in the next five to six years in Montenegro, we expect EU companies and EU financial intermediaries to be much more active than they were before, we are ready for this and I think the EU is finally ready,” he added.
Rostyslav Shurma: "Ukraine has things to contribute to the EU"
Ukraine's enthusiasm for EU membership has put enlargement back at the top of the political agenda. For the most part, member states have rallied behind Ukraine since Russian President Putin's full-scale assault began in February 2022 and, continue to stress the importance of Ukrainian sovereignty. However, it is the largest and most populous candidate country after Turkey prompting some EU voters and member states to question if Europe will be able to easily “digest” Ukraine.
"The European Union was much smaller when it integrated Poland and 'digested' it, so I think it won't be a problem," assured Rostyslav Shurma. "It turns out that Ukraine has things to offer the EU, in terms of security, defence and military technology.
"An industry which serves the defence and security of the whole of the European Union, [...] a very good contribution to manufacturing production, to the control of certain resources in the value chains, [thanks to] natural resources, which the European Union currently lacks." And to “make the entire energy system stronger and more sustainable.”
“So I see this as a long-term business project where you can get a satisfactory return on investment by investing in the development of these territories.”
Watch our entire debate in the video player above.