First session of the Stabilisation and Association Committee between the Republic of Croatia and the European Union held in Brussels

The first session of the Stabilisation and Association Committee between the Republic of Croatia and the European Union, after the Stabilisation and Association Agreement came into force on February 1, 2005, marks a new stage of more intensive relations and co-operation between the European Union and the Republic of Croatia. Croatia is a candidate country, and would start its EU entry negotiations as soon as the Council of Europe confirms its full co-operation with the International Criminal Tribunal in The Hague.

Stabilisation and Association Committee is a joint body consisting of European Commission's representatives on one hand, and of the European Union member countries and the Republic of Croatia representatives on the other. Pierre Mirel, head of the Directorate at the European Commission's Directorate General for Enlargement, presided the session. Ambassador Vladimir Drobnjak, the Republic of Croatia chief negotiator with the EU, led the Croatian delegation.

The session was held in a pleasant atmosphere. The two sides exchanged views on the latest developments regarding political and economic criteria, and on Croatia's progress in the process of harmonisation with the Community's acquis communitaire. The European Partnership, adopted in 2004 and determining the priority areas in which reforms for future integration of Croatia are needed, served as the basis for this exchange of views. The European Commission stressed the results produced so far, and encouraged Croatia to persist in its efforts. The Commission stressed the importance of co-operation with the International Criminal Tribunal in The Hague. Croatia reported to the other side on the latest situation development regarding Croatia's co-operation with the Tribunal. The Committee also noted the progress Croatia had made in the fields of refugee returns, rights of ethnic minorities and regional cooperation, adding that Croatia was expected to continue with the progress. The Croatian delegation presented a strategy and an action plan for the reform of its judiciary. The headway was noticed in the reform of land offices and land books. As a conclusion, it was stressed that judiciary and state administration reforms call for constant attention, if Croatia wished to efficiently implement the acquis communitaire. Regarding the economic criteria, the Commission reminded that it assessed, in its Opinion on the application of Croatia for membership of the EU, Croatia could be considered an effective market economy. The latest economy developments and structural reforms' programs were discussed as well. It was stressed Croatia should continue to take into consideration the current macroeconomic imbalances – the deficit of the state, deficit on the current account, and its external debt, as well as other structural problems which could hamper the country's strong development. The Commission called on Croatia to continue working on structural problems, the privatisation process and restructuring of companies.

The Committee assessed progress had been achieved in most of the chapters, regarding the adoption of the Community’s acquis communitaire, and stressed the importance of strengthening the administration, and the importance of the legal system harmonisation process. The Committee explained the initiative on the proposition for the tariff rate for sugar and sugar products followed from the last year's report on the EU sugar reform, and that it had been made on grounds of economy sustainability in the light of upcoming structural changes and developments within the sector, which would include a considerable rise in sugar prices on the European Union market.

Regarding Croatia’s preparations for its pre-accession negotiations, Croatia presented its negotiations' structure, as well as the efforts made to raise the government administration's technical capability for this demanding project.

Background: The main duty of the Stabilisation and Association Committee is to assess the implementation of the Stabilisation and Association Agreement, which came into force on February 1, 2005. This is an extensive agreement, which established the settled framework of relations between the European Union and Croatia during the pre-accession period. It also sets the political dialogue, contributes to the formation of a free market for industrial products and the majority of agricultural products by 2007, implies harmonisation of the Croatian judiciary with the Community's acquis communitaire and a full co-operation in fields of all Community’s policies, including the filed of judiciary and internal affairs.

Croatia as a candidate country uses all the European Union pre-accession instruments. Those instruments would help Croatia in its future pre-accession preparations, and would lead to an increased financial help. In 2005, special-purpose funds amount to € 105 million (PHARE: € 80 million; ISPA: € 25 million).