Relief for Cypriot property investors
The nail-biting for EU candidate countries Romania and Bulgaria, along with thousands of Cypriot property investors in these countries, came to an end on Tuesday as the European Commission decided to give a qualified Yes to a 2007 date for accession, which would bring the total number of EU member states to 27.
“The Commission considers that Bulgaria and Romania should be prepared for EU membership on 1 January 2007, provided that they address a number of outstanding issues. The Commission presents a carefully calibrated approach that is aimed at ensuring the continuation of the reforms in both countries up to and beyond accession,” it said in a statement.
EU pundits see this as a 90% cert. for entry in 2007, with perhaps tougher monitoring than usual in the post-accession period.
Fears that the two former eastern bloc countries would be made to wait another year came out of the Commission’s report last October, when it demanded more improvements to the judiciary systems and to tackle corruption otherwise face missing the 2007 deadline.
It gave them six months to improve.
The Commission’ on Tuesday noted that progress had been made, and gave the two countries until October to show even more.
Commission President Jose Manuel Barroso said that Bulgaria and Romania have “made clear progress since October last which we acknowledge. Both countries should be able to reach the finishing line on 1 January 2007. But in order to do [so], efforts must be intensified, especially in the reform of the judiciary and fight against corruption.”
In the Commission’s updated report Bulgaria’s “areas of serious concern” dropped from 16 to 6, while Romania’s dropped from 14 to 4.
In the area of corruption, the Commission said “Bulgaria needs to demonstrate clear evidence of results in the fight against corruption, in terms of investigations and judicial proceedings. It also needs to further reform the judiciary, in particular to reinforce its transparency, efficiency and impartiality” .
For Romania, it said “Romania needs to continue its efforts and demonstrate further results in the fight against corruption. It also needs to consolidate the implementation of the ongoing justice reform and further enhance the transparency, efficiency and impartiality of the judiciary.”
It’s been a long hard road
Both countries have come a very long way since the 1990s. Having inherited Soviet modes of production in 1989 and with the fledgling democracies often trying to function with unstable coalitions, the countries were then rocked by one external shock after another.
They suffered the loss of former Soviet markets, the former Bosnian and Croatian wars next door, the collapse of the Russian rouble in 1998 which hit all emerging markets, the Kosovo war in 1999 which because of the destruction of bridges cut off transport via the Danube for many years afterwards, a briefly unstable Macedonia and finally the long financial market downturn from 2001 which hit all markets.
Despite that, in 2005 Romania posted its six consecutive year of growth (4.1%) and Bulgaria its eighth (5.5%).
Now these countries, both lying on the Black Sea, are competing with Cyprus for tourists and holiday home-buyers — and will do so all the more now that EU membership is almost in the bag.
Former President George Vassiliou recommended at a CLR conference on Bulgaria as far back as 2003 that investors should look at property in Bulgaria. Investors who took that opportunity on both countries will now be breathing a sigh of relief.
Fiona Mullen
