The European Union and Immigration from New Member Countries


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Case Details:

Case Code : ECON017
Case Length : 20 Pages
Period : 1945-2005
Pub Date : 2006
Teaching Note :Not Available
Organization : -
Industry : -
Countries : EU countries

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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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"The [European] Union has today set itself a new strategic goal for the next decade: to become the most competitive and dynamic knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion."1

- Presidency Conclusions, Lisbon European Council, March 2000.

"The 'old' EU owes them [the new members] a welcome. In practical terms, this means that West European politicians should stop exploiting populist resentment of low-wage competition. They should explain to their voters that economic reforms would be necessary even in the absence of enlargement and that, on the whole, the addition of ten new members has been good for the EU economy."2

- Katinka Barysch, Chief Economist, Centre for European Reform,3 2005.

Introduction

On March 09, 2006, the Spanish Prime Minister, Jose Luis Rodriguez Zapatero (Zapatero), and his Polish counterpart, Kazimierz Marcinkiewicz, announced at a joint press conference that from May 01, 2006, Spain would open up its labor market to workers from Poland and the other seven countries from Central and East Europe (CEE) which had joined the European Union (EU) on May 01, 2004.4 The announcement was not unexpected as it had been widely anticipated that Spain would favor opening up its labor market to the new members5 of the EU.On February 28, 2006, Portugal had also indicated that it would open up its labor market to the new members from the CEE.

Before that, on February 13, 2006, Finland's Labor Ministry had proposed that restrictions on labor movement from the new EU member countries be lifted.

At the time of the 2004 enlargement, the EU had allowed its existing members (the old member states) to impose restrictions on the free movement of labor from the new member states for a transition period extendable up to 2011.

Twelve out of the fifteen countries opted for labor restrictions, fearing that there would be a large-scale influx of immigrants from the new member countries chasing jobs and driving down wage rates. Only the UK, Ireland, and Sweden decided to allow the new member countries access to their labor markets. (Refer to Exhibit I for a map of the European Union in 2005).

The European Union and Immigration from New Member Countries - Next Page>>

1] www.union-network.org/uniibits.nsf/ 0/78c33233adb68984c12568b0002bc5a9?OpenDocument

2] www.cer.org.uk/pdf/essay_eastvswest_jan06.pdf

3] The Centre for European Reform is a London-based think tank devoted to improving the quality of the debate on the future of the European Union

4] The EU was enlarged in May 2004 with ten new members. They were Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia. While the nationals of Cyprus and Malta were given the freedom to access the labor markets within the EU, others were severely restricted.

5] Here 'new' members would mean the eight new members from the CEE; i.e., all the new members of 2004, except for Cyprus and Malta. The 'old' members would mean the 15 EU member states before the 2004 enlargement.

 

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