Macron and Merz need to tackle the veto to really unlock EU enlargement

Since Russia invaded Ukraine, the European Union has, for security reasons, been rethinking its approach to the long-stalled enlargement process – the last country to enter the EU was Croatia, in 2013. A proposal from French President Emmanuel Macron and German Chancellor Friedrich Merz, circulated in early June, could reinvigorate enlargement by allowing EU candidates gradual integration or access to the EU single market before accession.

In particular, the plan would see candidate countries adopt EU rules on rule of law, trade, competitiveness, environmental policy, agriculture and cohesion policy, in order to integrate with the single market. For the Western Balkan countries especially, this could offer significant economic benefits through proper integration into EU supply chains. The region is already strongly economically dependent on EU trade partnerships and investment. This is particularly true for countries strong in manufacturing exports, such as Serbia, Bosnia and Herzegovina and North Macedonia.

The current legal setup for these countries, largely implemented through the Stabilisation and Association agreements between Western Balkan nations and the EU, offers little prospect for tackling trade barriers beyond tariffs. This is different from the situation facing countries in the Eastern Partnership, including Ukraine and Moldova, which have Deep and Comprehensive Free Trade Agreements with the EU that provide frameworks for alleviating non‑tariff barriers.

Trade barriers in the Western Balkans obstruct EU firms operating in the region: 13% of German firms in Serbia and Bosnia and Herzegovina, for example, and 28% of German firms in North Macedonia, perceive these trade barriers as a business risk. Trade costs impose high economic costs to doing business with the EU, from sanitary and phytosanitary measures to cross-border checks and long waits at the border. The reforms advocated by Macron and Merz target such barriers, and should lead to progress being credibly rewarded with access to the EU single market.

Unfortunately, the Macron/Merz plan has one big weakness: it does not address the power of vetoes. Several stages of the accession process require unanimous approval by current EU members. These include the early steps of granting candidate status and opening accession negotiations with candidate countries, and later stage steps such as the provisional closure of reform negotiations.

The Balkans have experience of how veto rights can be overused to slow accession to a crawl. North Macedonia’s progress was vetoed by Bulgaria at an early stage, preventing the opening of accession negotiations. Closure of negotiations with Montenegro on foreign, security and defence policy was blocked by Croatia, despite the technical criteria having been met.

It would be better to reserve veto privileges for the very last step, of ratifying a treaty, once all reforms are fulfilled and negotiations are closed. This would greatly benefit the EU in the meantime by extending supply chains to candidate countries. Under the current setup, regulatory misalignment, potentially arising from veto-related delays, weakens EU firms’ incentives to do business in this region.

By waiving unanimity during early stages of the enlargement process, the Macron/Merz proposal could therefore more effectively facilitate the integration into EU supply chains of countries that remain far from membership, meaning all current candidates except Montenegro and (possibly) Albania.

António Costa, the president of the European Council, has already issued a plea to lift unanimous-voting requirements for early stages of EU accession. The Merz and Macron proposal reinforces this. Western Balkan countries need avenues to build stronger trade ties, because they are geographically hemmed in by the EU. If they do their homework and reform, they ought to be able to participate in the single market without yet being full EU members.

Rebecca Christie, Hans Geeroms, Heather Grabbe and Lucio Pench are thanked for their valuable inputs.