European Union Candidate Countries Research Articles

Court of Justice of the European Union and Ukrainian Legal Order: Some Pre-accession Considerations

As the European Union candidate country (hereinafter the EU), Ukraine is one step away from becoming an EU Member State. From this point on, the country will be subject to the influence of EU institutions, including the Court of Justice of the European Union (hereinafter the CJEU). It is suggested that upon the accession of Ukraine, the CJEU’s impact will be comparable to the influence on legal orders of other EU Members States provided necessary preparatory steps, such as training for judges, are taken. It is established that the main functions of the CJEU are to interpret and ensure the uniform application of EU law in each EU Member State, to ensure compliance with EU law by EU countries and institutions, to ensure respect for the rights and freedoms of individuals, to provide clarifications to national courts, and to promote “positive integration” and “negative integration” of EU Member States. With respect to the above-mentioned functions, it is argued that the CJEU will become an effective tool for Ukraine after it accedes to the EU. It will facilitate the harmonization of national legislation with EU standards through the application of precedents by national courts, influence the activities of legislative bodies, and help prevent future complaints by becoming an additional “quasi-supervisory” body in Ukraine. It will also provide interpretation of the EU law at the request of national courts through the preliminary rulings and procedures, protecting human rights and freedoms by enabling individuals to apply to the CJEU for protection. At the same time, arguably, Ukraine will also impact the functioning of the CJEU by increasing the caseload and appointing judges from Ukraine as well as potentially Advocate-General. Given these potential implications, certain preparatory actions, like preparing a cadre reserve, may be considered at the present moment. Finally, the authors argue that even before Ukraine’s accession, the CJEU has an indirect impact on the Ukrainian legal order. It is suggested that constitutional amendments, as well as certain institutional changes like the establishment of an impartial judicial system and empowering a Ukrainian state body with powers to execute CJEU decisions, will need to take place prior to the accession, which is a demonstration of the CJEU’s indirect influence.

Assessment of Innovativeness of the EU Candidate Countries Based on the European Innovation Scoreboard

Innovation is seen as a key capability for maintaining a competitive advantage, creating value for customers, and capturing a larger share of the market. In the contemporary world economy, understood as a set of mutual connections and interdependencies, innovations are crucial for economic growth and competitiveness. Internationalization and globalization processes in the world economy also concern the innovativeness of economies, and are visible in international use of technologies developed within national innovation systems, globalization of the creation and implementation of innovations, international (global) cooperation in research and development and innovation activities, international (global) protection of intellectual property. The aim of the article is to assess the level of innovativeness of the economies of selected European Union candidate countries based on the Summary Innovation Index (SII) and its components, as well as to estimate the innovation gap between these countries and the EU average of the Summary Innovation Index in 2023. The analysis was limited to Turkey (TR), Serbia (RS), Albania (AL), Montenegro ME), North Macedonia (MK), Bosnia and Herzegovina (BA) and Ukraine (UA) due to the availability of data describing the Summary Innovation Index, provided for all the EU candidate countries surveyed in the European Innovation Scoreboard. The paper formulates a research thesis assuming that the surveyed EU candidate countries are characterized by a lower level of innovativeness of economies than the EU average of the Summary Innovation Index and its components. Therefore, they show an innovation gap compared to the average for European Union countries in 2023. The results of the analysis only partially confirm this thesis. The article reviewed the literature on the innovation and innovativeness of economies and the innovation gap. The applied methods include descriptive analysis, statistical data analysis and comparative analysis along with statistical data from the European Innovation Scoreboard 2023.

3.E. Workshop: Air pollution health impacts and costs in EU accessing countries

Abstract Air pollution is detrimental for health, climate, national economies and well-being in the European Union (EU) and in EU candidate countries. In many locations air quality levels are above the EU or national legal standards and/or the guidelines recommended by the World Health Organization. Very often EU neighbours and countries in the process of accessing the EU are disproportionately more affected by the impact of air pollution than others. The newest global evidence is suggesting that human health is affected even at low pollution levels below the current European standards and WHO guideline values. In 2021, the WHO published new air quality guidelines structured in Intermediate targets and final targets which are lower than the previous recommendations published in 2005. Estimating the costs of air pollution requires analysis of extensive data sets by means of econometric and statistical methodologies. In this session is discussed the assessment at country level for Europe and worldwide which is particularly valuable for estimating statistical value of life (VSL) and the value of a life year (VOLY) for counties that have not been the focus of global estimations so far. Moreover, this workshop adds valuable new information on the Western Balkans and Ukraine that could be used in systematic efforts to develop evidence-based air pollution reduction plans and to track progress toward reducing air pollution and consequently the health impacts. The studies included in this session represent valuable efforts to acquire evidence in support of further alignment of national air quality policies with those of the EU. Key messages • The newest evidence supports efforts to further aligning the Western Balkans and Ukrainian air quality policies with those of the EU and contribute to national and local implementation. • The meta-analysis of existing literature leads to the development of econometric models for estimating VSL and VOLY at country level worldwide.

Modelling health effects of air pollution in Ukraine

Abstract Background Air pollution places a burden on health, climate, national economies and well-being in the European Union (EU) and EU candidate countries. Ukraine was the country with most deaths per 100,000 inhabitants attributable to atmospheric air pollution in 2017 according to the World Health Organisation. Harmonisation of air quality monitoring regulations and control methods with EU standards is important to lower the burden of air pollution in Ukraine. Methods This study applies the JRC-Fast Scenario Screening Tool (JRC-FASST) with ground air quality measurement data in order to study how premature mortality in Ukrainian cities is affected by the pollutant PM2.5 pre- and during COVID-19. Furthermore, a scenario analysis at country level is carried out to evaluate past and projected trends of mortality in Ukraine under three different air quality policy scenarios. Results The preliminary results show that estimated PM2.5 attributable mortality is significantly lower in the year 2020 compared to 2019 in all studied cities. Both at a country level and at a city level, ischemic heart disease is the main cause of death associated with PM2.5 attributable all-cause mortality. Conclusions Increasing the body of research on the health effects and costs of air pollution in Ukraine is important to acquire evidence in support of further alignment of Ukrainian air quality policies with those of the EU.

Pharmaceutical policies in post-communist Albania: Progress and challenges toward European Union membership

Aim: Shifting from a communist regime to a democratic system has affected health system fundamentally in most of the Western Balkan countries including Albania. Albania became a European Union (EU) candidate country in 2014. Since then, one of the main concerns has been to approximate the legislation with the EU framework. The aim of this paper is to review the evolvement of pharmaceutical legislation in Albania and challenges toward achieving full approximation to the EU’s respective legislation.
 
 Methods: We used qualitative techniques, especially means of conventional content analysis and two sources to collection data. First, we consulted the Albania’s National Publications Office webpage and analysed all available legislation regarding “pharmacy”, “medicine” and “pharmaceutical products” from 1994 to 2021. Then, we analysed the National Integration Plans that have been published by the Government of Albania from 2014 to 2021.
 
 Results: The decrease of the price margin system goes in parallel with the increase of the pharmaceutical expenditure, including out-of-pocket expenditure on medicines and lack of adequate and sensitive reimbursement policies. The main pillars of the pharmaceutical sector in Albania are well-covered legally but not fully in concordance with the EU framework.
 Conclusion: There is a need to foster laws implementation that regulate the opening of pharmacies; a detailed regulation on pharmacovigilance; and a regulation on medicinal products for paediatric use. Also, the existing legal framework should be aligned with the European one. Medicine pricing methods should go in the same line with the decrease of out-of-pocket expenditure.

Politický systém a súčasná politická situácia v Bosne a Hercegovine: všeobecné voľby 2022

The aim of this article, based on an analysis of the political system of Bosnia and Herzegovina and the overall political situation in the country, is to assess the results of the general elections held there on October 2, 2022. These elections were probably the most watched elections of 2022, mainly because of the expected accession negotiations and the granting of the status of a European Union candidate country. The general election results were supposed to indicate whether Bosnia and Herzegovina is ready to join the ranks of developed democratic countries and whether it has finally become a functioning multi ethnic state. The methods of analysis, synthesis, deduction, induction, and generalization were used to achieve the set goal. In the end, we will point out the impact of the election results on the current political situation, which, however, does not foresee any changes compared to the current situation in Bosnia and Herzegovina.

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The article analyzes the institutional and legal foundations of combating transnational drug trafficking in the European Union (EU), as well as the regulatory and legal regulation of Ukraine's cooperation with relevant EU structures in the specified area. The regulatory and legal regulation and policy of the EU in the field of combating drug trafficking are studied from the point of view of their implementation in Ukraine as part of the implementation of the policy aimed at gaining full membership in the European Union. The works of Ukrainian and foreign scientists related to combating illegal drug trafficking in the context of the implementation of the EU anti-drug policy were analyzed. It was concluded that the European Commission sees the fight against the drug trade and organized crime in general as a key component of the EU agenda, emphasizing the need to develop a new strategic approach to the drug problem. Effective activity in this direction requires cooperation at the EU level and beyond, while the European Union tries to act as a driving force at the global level. The article points to the importance of Ukraine's acquisition of the status of an EU candidate country in June 2022. Acquiring full membership in the European Union requires our country to carry out a number of reforms and adapt its legislation in line with European criteria. Further steps in this direction will also require the implementation of strategic documents in the field of combating organised crime, and the integration of the activities of the Security Service of Ukraine into the overall European security environment. The author concludes that bringing Ukraine's anti-criminal policy in line with European standards will significantly contribute to the implementation of the European integration policy in general. It is noted that the Agreement on Operational and Strategic Cooperation between Ukraine and Europol, signed in 2017, is the main legal act regulating cooperation between Ukraine and the EU in the field of combating transnational drug trafficking. For the SSU, Europol is one of the most important international partners, the use of which is crucial for ensuring effective operational and service activities in a number of areas. Countering drug trafficking is embedded in the core of the EU's external relations, and the role of this area is increasing as the threats to the EU's security from this phenomenon grow. Such relations in this area should be based on the principles of shared responsibility, multilateralism and coordination of the global response. In the international arena, the European Union is promoting an approach that is evidence-based, holistic, balanced and multidisciplinary. Cooperation should be established with countries of origin and transit of drugs and international organisations. The application of approaches in this area developed in the European Union is important for the implementation of the European integration policy of Ukraine, which should be taken into account in the organisation of operational and service activities of the Security Service of Ukraine.

2022 Crisis Preparedness Training: Annual Report

During 2022, the European Food Safety Authority (EFSA) organised 2 crisis preparedness training events: 1 event involving European Union (EU) Member States (MSs) and EU candidate countries (designated the External Crisis Preparedness Training or ECPT); and another event dedicated to EFSA colleagues (designated the Internal Crisis Preparedness Training or ICPT). The selected scientific domain for both training events was chemical contamination, with a fictional scenario focusing on heavy metal contamination of a foodstuff forming the focus for the simulation exercise elements during both events. The external event was organised in conjunction with the Bulgarian Risk Assessment Centre on the Food Chain (RACFC) and took place over 3 days in Sofia, Bulgaria. The internal event was a day-long session at EFSA's offices in Parma, Italy. EFSA's crisis training contractor, Instinctif Partners, co-organised both events. In addition to simulation exercise elements, both events also included informational presentations relating to chemical contamination of the food chain; facilitated discussions on crisis response topics; plus practical training and rehearsal on EFSA tools and/or procedures. The objectives of each event were achieved, based on recorded outcomes and feedback provided by participants in an evaluation survey completed at the end of each event.

COMPARATIVE ANALYSIS OF ENVIRONMENTAL ATTITUDES OF YOUTH FROM EU MEMBER AND CANDIDATE STATES: CASE STUDY CENTRAL AND EASTERN EUROPE

Worldwide, great efforts are being made in order to establish sustainable development at all levels. European Union (EU) member states are obliged to meet the requirements in the area of environmental protection. In this paper, the authors conducted a comparative study of environmental attitudes among young people from both EU transition countries and EU candidate countries. The objective was to determine the differences in environmental attitudes, environmental awareness and self-efficacy of the youth from these two groups of countries and the EU environmental policy implementation level. Results indicated that the influence of EU membership exists when it comes to the environmental attitudes of youth from the analyzed countries. Average values showed the unsatisfactory situation regarding environmental awareness and self-efficacy of respondents. In order to define the relations among environmental attitudes, self-efficacy and environmental awareness, a structural model was created. This analysis showed that these three components work the same way in both groups of countries.

The impact of national legislation on psychosocial risks on organisational action plans, psychosocial working conditions, and employee work-related stress in Europe

Work-related psychosocial hazards are recognised as a key priority in the future of work. Even though European Union (EU) legislation requires employers to assess and manage all types of risks to workers’ health and safety associated with all types of hazards in the work environment, it does not include clear reference to psychosocial risks and work-related stress. In several EU member states, there is now more specific legislation on psychosocial risks that clarifies employer responsibilities. The aim of this study is to explore whether the introduction of specific legislation on psychosocial risks and/or work-related stress is related to organisations implementing action plans to prevent work-related stress, and in turn, better psychosocial working conditions (job demands and resources), and less reported work-related stress in the workforce. It does so by comparing EU member states and candidate countries that have introduced more specific legislation to those that have not, conducting multilevel modelling analysis by linking two representative European-level datasets, the 2014 employer European Survey of Enterprises on New & Emerging Risks and the 2015 employee European Working Conditions Survey. Findings indicate that the presence of specific national stress legislation is associated with more enterprises having a work-related stress action plan. The existence of action plans was found to be associated with increased job resources but not decreased job demands. Furthermore, only in those countries with specific national legislation on stress, job resources were found to be associated with less reported stress through the existence of organisational action plans. Findings lend support to the argument for more specific legislation on psychosocial risks/work-related stress in the EU. However, they also raise questions on whether current interventions implemented at organisational level to deal with work-related stress may be geared more towards the development of individual resources and less towards better work organisation and job design.

Inflation convergence over time: Sector‐level evidence within Europe

This paper investigates inflation convergence among European countries by using sector-level data for the period between 1997:M1 and 2019:M12. Panel unit root tests at the country-sector level are conducted by using moving windows, which are useful for analyzing changes in inflation convergence and the corresponding speed of convergence over time. The results suggest that there is evidence for inflation convergence for the majority of sectors within Europe, although certain countries have experienced disruptions, especially during the 2008 financial crisis. Regarding the speed of inflation convergence, the average half-life across European countries decreased from about 15 months to about 8 months during the sample period. Important sector-level implications follow for European Union (EU) candidate countries and non-euro EU member countries in regard to the Maastricht Treaty.

“Banal Balkanism?” – Rethinking Banal Nationalism and Regional Identity in the Post-Yugoslav Media Space

With the collapse of Yugoslavia, the supranational Yugoslav identity disappeared and was replaced by strengthened national identities. While some states of the former Yugoslavia have rediscovered their Europeanness, others have further strengthened their national identity. This paper answers the question of whether, three decades after the dissolution of Yugoslavia, a so-called “regional identity” still exists among the former Yugoslav states (Slovenia, Croatia, Serbia, Bosnia and Herzegovina, Montenegro, North Macedonia, and Kosovo). The authors set the initial hypothesis that belonging to a regional – in this case, Balkan – identity is more pronounced in the five candidate (Serbia, Montenegro and North Macedonia) and potential candidate countries (Bosnia and Herzegovina (BiH), and Kosovo) for European Union (EU) membership than in Slovenia and Croatia, which have become EU Member States. Hence, this article will provide insight into “regional identity” and the banality of “Balkanism” reproduced in state media. By examining articles on national online news portals, we will examine the linkage between symbols and deixes in media and their role in creating national and regional identity. This analysis will confirm our initial hypothesis that the term “regional identity” is much more prominent in the media of the EU candidate countries, than in those states which are already members of the EU. By analysing everyday nationalism in the media – a gap that exists in academic research – we aim to open up a discussion that can lead to some solutions for overcoming the identity dilemmas of the region.

2021 Crisis Preparedness Training: Annual Report

The European Food Safety Authority (EFSA) undertook two crisis training activities during 2021. Both were facilitated online and based on the fictional scenario of a Rift Valley Fever (RVF) outbreak in the European Union (EU). An External Crisis Preparedness Training (ECPT) workshop occurred in July 2021, targeting participants from EU Member States (MSs), EU Agencies and international animal/human health organisations. It was jointly devised, developed and delivered by EFSA with the Istituto Zooprofilattico Sperimentale dell’ Abruzzo e del Molise (IZSAM), and has been reported in EFSA Supporting Publications (IZSAM & Instinctif Partners Ltd., 2021). The second workshop, described in this document and designated the Internal Crisis Preparedness Training (ICPT), occurred in November 2021. Using a repurposed version of the ECPT’s RVF scenario, the ICPT’s overall training objective was to plan and practise EFSA’s management of risk communication, in conjunction with other European agencies, during a joint urgent response to a multi-country animal health/public health outbreak. Fourteen participants from EFSA, EFSA’s Communications Expert Network (CEN) and the European Centre for Disease Prevention and Control (ECDC) attended the training, plus 13 observers from EFSA and the European Commission’s (EC’s) Directorate-General for Health and Food Safety (DG SANTE). Plenary and working group activities extended across 1 day, including 3 presentations on EFSA’s and ECDC’s remits, capabilities and communications best practice. A scenario exercise explored how EU agencies and DG SANTE would respond and collaborate if RVF entered the EU. The fictional scenario’s 3 escalating outbreak phases spanned several weeks, encompassing infection spread amongst animal and human populations within several MSs and an EU candidate country. Plenary debrief sessions distilled both events’ discussions into practical recommendations for future enhancements and improvements in areas of collaboration, process and communication. The objectives of each event were achieved, based on recorded outcomes and evaluative feedback from participants.

Who Are Belgrade’s Most Desired Allies?

Serbia presents itself as a country skillfully balancing between the European Union (EU), Russia, and Asia, trying to maintain good political and economic relations with the biggest players on the international arena. The Covid-19 pandemic and China’s media-publicized assistance to Serbia has affected the perception of which countries are seen as Belgrade’s true allies. At the same time, Serbia remains a EU candidate country (membership negotiations officially started in 2014) and the European Union is not only Serbian biggest trading partner, but also the biggest donor. The main aim of the article is to compare the distinctive meaning that EU membership and cooperation with non-EU countries (mainly China and Russia) has for Serbian political parties, taking into account that the Covid-19 pandemic and the ‘vaccine diplomacy’ influenced the Serbian public discourse and perception on who is the Belgrade’s most trustful partner.

National Energy and Climate Planning in Serbia: From Lagging Behind to an Ambitious EU Candidate?

Just in the immediate neighbourhood of the European Union (EU), the Republic of Serbia, one of the Western Balkan (WB) EU candidate countries, is lagging behind in the process of energy transition regardless of technological advances and policy instruments available. The EU created a momentum for energy transition acceleration with the European Green Deal, which has been forwarded to the WB through the Energy Community secretariat in the form of the Green Agenda; generally speaking, response in the form of National Energy and Climate Plans (NECPs) is expected in the short term. The Republic of Serbia’s Low Carbon Development Strategy with Action Plan (LCDSA) and the current Energy Strategy will be analysed, commented on, and improvements will be suggested for the acceleration of energy transition, based on the newest findings from the simulation-based optimization techniques using the sector coupling approach to achieve ambitious variable renewable energy shares. The motivation of this research is to provide decision makers in Serbia with the best available insights regarding sustainable energy system planning tools and possible shortcuts for delayed planning of activities. In addition, the purpose is to improve Serbia’s chance of benefitting from adoption of these strategies in the country’s faster transition towards EU membership. The research compares two scenarios to illustrate a possible policy shift from small hydro power plants to photovoltaics (PV). A further increase in PV and wind power plants has been simulated using the EnergyPLAN to achieve expected scenarios of 40% renewable energy share and some more ambitious ones—up to 80%, which is realistic only with the sector coupling approach.

Pharmaceutical policies in post-communist Albania: Progress and challenges toward European Union membership

Aim: Shifting from a communist regime to a democratic system has affected health system fundamentally in most of the Western Balkan countries including Albania. Albania became a European Union (EU) candidate country in 2014. Since then, one of the main concerns has been to approximate the legislation with the EU framework. The aim of this paper is to review the evolvement of pharmaceutical legislation in Albania and challenges toward achieving full approximation to the EU’s respective legislation. Methods: We used qualitative techniques, especially means of conventional content analysis and two sources to collection data. First, we consulted the Albania’s National Publications Office webpage and analysed all available legislation regarding “pharmacy”, “medicine” and “pharmaceutical products” from 1994 to 2021. Then, we analysed the National Integration Plans that have been published by the Government of Albania from 2014 to 2021. Results: The decrease of the price margin system goes in parallel with the increase of the pharmaceutical expenditure, including out-of-pocket expenditure on medicines and lack of adequate and sensitive reimbursement policies. The main pillars of the pharmaceutical sector in Albania are well-covered legally but not fully in concordance with the EU framework. Conclusion: There is a need to foster laws implementation that regulate the opening of pharmacies; a detailed regulation on pharmacovigilance; and a regulation on medicinal products for paediatric use. Also, the existing legal framework should be aligned with the European one. Medicine pricing methods should go in the same line with the decrease of out-of-pocket expenditure.

Linkage, Leverage, and Authoritarianism: An Overview of the Collapse of Turkey’s EU Membership Prospect

The effects of the linkage and the leverage over countries that either go through a democratic transition or further advance on the democratization path have been widely discussed by comparative democratization scholars. Western leverage designates governments’ level of vulnerability in the face of foreign pressure for democratization, while linkage is meant to be the intensity of the connections and the cross-border streams between a democratizing country and the Western world. It is generally acknowledged that the linkage is a more determinative factor than the leverage. On the contrary, the authoritarian shifts of many countries that took place during the first two decades of the 21st century challenged the optimistic and deterministic role assigned to linkage. Turkey is a noteworthy example in this regard since the intensity of its linkage to Europe could not compensate the negative effects of a declining leverage over Turkish democratization since 2006. The argument that linkage matters more than leverage does not apply to Turkey. The evolution of domestic political regimes in European Union candidate countries in parallel with their accession processes constitutes separate cases differing from one another. Turkey is not only a separate case for its part, but also a unique one.

Avrupa ülkelerinin sağlık göstergeleri ve sağlık harcamalarının kümeleme analizi ile karşılaştırılması

The main purpose of health systems is to ensure citizens utilize the health services by adequately and effectively. As the quantity and the quality of health services are improved, health indicators such as quality of life and life expectancy at birth are also improved. Health indicators and health care expenditures allow policy makers to compare health systems and to monitor and evaluate the current situation of the health systems. The main reason behind the international comparison of health indicators and expenditures is to enable countries to benchmark successful health systems. In this context, the aim of this study was to compare health indicators and health expenditures of 28 European Union (EU) countries, 6 EU candidate countries and 3 European Free Trade Association (EFTA) countries by cluster analysis method. As a result of the clustering analysis, the countries were grouped under 3 clusters. The public, private and out-of-pocket health expenditure per capita averages of the first cluster, which Turkey was included in, was the lowest among three clusters. It was determined that the cluster in which Turkey was placed falled behind other two clusters in terms of life expectancy at birth, number of physicians and nurses, maternal mortality rate, and smoking ratio health indicator averages.

Agricultural Trade Competitiveness of EU Candidate Countries and Eastern Partnership Countries

Purpose: The purpose of this paper is to examine agricultural trade competitiveness of EU candidate countries (CCs) and Eastern Partnership countries (EPCs) compared to Polish agriculture, based on available 1992–2017 EUROSTAT and FAOSTAT data. Design/Methodology/Approach: This paper uses selected indicators of trade competitiveness. Findings: The study attempts to tell which of the countries covered are in a position to become competitive in European Union (EU) markets. As shown by the calculated competitiveness indicators, compared to Polish agriculture (which is competitive in respect of many agri-food products), some of the countries surveyed are also likely to become competitive players in the Union market. Due to increasing specialization indicator, Belarus and Ukraine are well positioned to become competitive in the dairy market. The market for cereals is dominated by three countries: Moldova, Ukraine and Serbia which demonstrate high levels of SI, CR and XRCA. In turn, the largest group of countries covered by this analysis specialize in fruit and vegetable exports, and are likely to attain the highest competitiveness levels in that very market. Practical Implications: The study of the foreign trade competitiveness using statistical methods is an important element in testing economic theories in the field of competitiveness research in the CCs and EPCs and it shows which countries may become competitive in the future in the EU market. Originality/Value: Showing the importance of foreign trade in the CCs and EPCs with the EU we can observe its impact on the future integration process of the CCs and EPCs. The results of the research are important from the point of view of the contribution to the economy of European integration, both in theoretical and empirical terms, but above all in the field of sectoral policy, which is the Common Agricultural Policy (CAP). A comprehensive approach to the subject of research and its multidirectional nature, as well as the obtained results will be important both for the agricultural policy of the studied countries, as well as for the CAP and for the Polish agriculture.

Should Iceland Seek Europen Union and Euro Area Membership?

Iceland is a small, resource rich country in Europe that is highly dependent on foreign trade. According to the World Bank classifications, Iceland is a high income economy, but with a population of a little bit more than 300 thousand inhabitants, is the smallest economy within the Organization for Economic Co-operation and Development (OECD). Iceland is highly dependent on foreign trade, especially on trade with the European Union, where economic and political integration is evolving and the question about the most feasible level of participation is a future challenge for the country. Iceland is a member of the European Free Trade Association (EFTA), the European Economic Area (EEA) and the Schengen area, and the European Union (EU) candidate country until recently, when its government decided to withdraw its EU membership application. Currently, the EEA agreement ensures Iceland access to the EU common market. The question remains, what is the most feasible arrangement for Iceland’s prosperity in the long term? Should it continue to rely on the current arrangement? Should it seek the EU membership in the future and, perhaps, subsequently become part of the Euro Area? What are the possible benefits and disadvantages for Iceland joining the EU and the Euro Area?