Ladies and Gentlemen,

It is a great honour for me to participate as a representative of the European Commission at this conference.

You might agree with me that today the vision of the Founding Fathers of a united, politically and economically interdependent Europe, with governments co-operating on an increasing number of issues, with citizens able to travel freely without border controls, has largely become a reality.

Over the last decades and years we have in fact achieved a great deal:

• The Economic Community of the Six has become the Union of the Fifteen and the new enlargement is under way
• The internal market is nearly complete, offering a single market with 370 million consumers
• On January 1999 we have introduced a common single currency
• Important progress has been made in the field of a European defence and security policy
• And finally the European Union has begun to address matters which are of concern to many members of the general public and the citizens of Europe, such as employment, the environment or social policy.

In the same time, at the beginning of the 21st century, one of the biggest challenges, the European Union is facing, is - without any doubt - the enlargement towards the East and South, which today has become an irreversible process and one of the key priorities of the European Union.

But this new enlargement of the Union is different from any other round of accession which took place until now and it will be a totally new experience despite all lessons learned from extending the Economic Community of the Six to the Union of the Fifteen. The forthcoming enlargement must in fact be seen as part of a historic process which will shape the future political geography of Europe.

Why is this enlargement different from previous ones?

First, as I already mentioned, the Community itself has progressed and is steadily progressing in covering new policy areas and in deepening its common policies. Consequently, the efforts, a new member state has to make to join in the rapidly progressing integration process with its complex legislation and its big internal market, has become greater. Unlike other former accessions, the negotiations now include areas such as justice and home affairs, the monetary union and security and defence issues.

Secondly, the starting point of the candidate countries from Central and Eastern Europe is somewhat different from those of previous applicants. Despite all historical and cultural links between Western and Eastern Europe, there is also, besides the big economic gap between these countries and the current Member States, a different political and also cultural tradition formed by the previous system in power, which cannot be ignored.

Third, the new enlargement is also of an unprecedented scope: it will increase the population from 370 million to 550 million people, and it will nearly double the number of Member States to 28 or more.

The so-called pre-accession strategy involves in fact screening and setting priorities for the candidate countries, providing them with financial and expert assistance, involving them in Community programmes and agencies and closely monitoring their progress toward meeting the membership requirements.

These requirements include the Copenhagen criteria adopted in 1993 by the Copenhagen European Council. The political criterion comprises a functioning democracy with stable institutions, the application of the rule of law, the respect of human rights and the protection of minorities. The economic criterion requests the establishment of a functioning market economy able to cope with the competitive pressure of market forces from within the Union. And the third criterion is related to the capacity to adopt the obligations of membership, which is the complete set of rules of European Community law, the so-called acquis communautaire.

The most difficult issue regarding the enlargement process will however be to keep the momentum, both in the candidate countries as well as within the Union.

As you know, the major decisions on enlargement have been so far taken at the European Council in Luxembourg in December 1997 where it was decided to open negotiations with 6 candidate countries including the Czech Republic, Estonia, Hungary, Poland, Slovenia and Cyprus and at the Helsinki Council in December 1999 which decided to include in the negotiation process the remaining six countries, Bulgaria, Latvia, Lithuania, Malta, Romania and Slovakia, on the basis of the fulfilment of certain conditions.

These decisions have, I am sure, sent a positive signal to the people in the candidate countries of the EU’s determination to move ahead concretely with enlargement. The fact that there is a strong political will has also been once more confirmed this weekend by German Chancellor Schroeder during his meeting with the Prime Ministers of the Visegrad countries in Gnezdo.

The decisions taken at the Helsinki summit actually intend to keep the momentum and they have set up a flexible multi-speed accession process, based on the principle of differentiation: thus each of the candidate countries now proceeds on its own pace, is assessed on its own merits and will join when it is finally able to meet all the obligations of membership. The fact that second wave candidate countries, the so-called Helsinki group get from now one the chance to catch up with countries from the Luxembourg first wave group might also have an important leverage effect on the progress of reforms within those countries.

In the meantime however, we are all aware, that also the EU must push through important and indispensable institutional reforms needed to create an enlarged Union which works. Everybody agrees that institutions designed for six member states, already not as effective as they should be today in a Europe of 15 Member States, will have to be adapted to a Union of 28 countries. As you know, the Intergovernmental Conference has taken up this challenge and is currently trying to tackle at least the issues related to the number of commissioners, the extension of majority-voting, and the re-weighting of votes allocated per country. Of course, the IGC may decide to add other issues to its agenda. But the decision belongs to the Member States.

The most important conclusion however is that the European Union will be ready for enlargement, as soon as the changes agreed upon during the IGC are ratified by all Member States. Of course, it is up to the national parliaments to decide the speed at which they are ready to accept changes to the EU treaties.

Nevertheless, the timetable the EU has set out for itself is very clear: the Union has made a firm political commitment to make every effort to complete the IGC by December 2000, enabling rapid ratification by all the EU Member States of the results of the IGC in the following couple of years. This should permit the Union to accept new members as of 2003.

Whether the first accessions can then take place as from 2003 will entirely depend on the speed with which each applicant country can make progress in meeting the before mentioned criteria and thus in the adaptation by the candidate countries of their economic, social, environmental and legal systems.

In the specific case of the Czech Republic, everything will depend on the speed with which the Czech Republic is tackling issues such as the reform of the public administration, the reform of the judiciary and the acceleration of the restructuring and privatisation process, including further price liberalisation and the improvement of the legal framework for enterprise activity.

More specifically, as far as the Copenhagen criteria are concerned, let me give you a quick overview on how the Czech Republic does in relation to these Copenhagen criteria.

As far as the political criterion is concerned, you know that the EU has been particularly concerned about the protection of minorities. The situation of the Roma community in the Czech Republic has been identified as the key area where progress is needed in terms of the first criterion.

The situation of the Roma community is a multi-faceted issue that requires the continuous effort of the public authorities in order to register significant progress in the medium-term. In that respect, I would like to point out the progress has been taking place in this area. The introduction of a medium term integration concept is a very positive development that demonstrates the commitment of the Government to work towards a resolution of this difficult issue.

As to the second criterion, the general macroeconomic situation in the Czech Republic is improving slowly after a long recession. Economically, the Czech Republic is already well integrated with the EU: thus in 1999, more than 69% of Czech exports were absorbed by EU markets, while 64% of Czech imports were coming from EU countries. And this balanced and mutually beneficial relationship highlights that the Czech economy has the potential to meet the second Copenhagen criterion in the medium-term.

I the economic sphere, some significant progress has taken place since the last Regular Report: the privatisation of the banking sector has continued apace with the sale of Ceska sporitelna to Erste Bank; the bailout plan unveiled recently by the Government should also provide the basis for concluding the sale of Komercni banka by the end of the year, or the beginning of 2001.

Progress has been also noted in terms of the restructuring of the Czech companies. The Revitalisation Agency has started its work, and has so far demonstrated its determination to tackle the difficult financial situation of many companies in a manner consistent with a market economy.

The Regular Report also pointed out the need to improve significantly the legal framework for economic activity in the Czech Republic. Here, also, one can see some hopeful signs. An amendment to the bankruptcy act has been signed into law. It is already clear that, even further changes will be needed, the amendment will streamline the bankruptcy procedure in order to facilitate restructuring.

Other key pieces of legislation have also been passed or introduced. Let me just quote the copyright law, the Telecommunications Act, and the law on State aids. The overall reform of the judiciary, now being discussed in Parliament, should significantly contribute to making the judiciary faster, more effective, and more friendly to business than it has been until now.

As to the third Copenhagen Criterion: the legal and administrative criterion, the pace at which EU-related legislation is being proposed by the Government and approved into law by Parliament has increased markedly since the release of the last Regular Report of the European Commission on the Progress made by the Czech Republic towards accession in October 1999. This is a very positive development, which allows for reasonable optimism in terms of the possibility of the Czech Republic entering the EU with the best-prepared countries.

However, in addition to this, as I already said, a well-trained civil service and judiciary that could implement EU law effectively is an essential and complementary condition on which the Czech Republic has to continue to work. In that respect, very important reforms such as the establishment of regions or the civil service law are essential in order to meet that challenge.

Let me conclude.

There is no doubt that enlargement of the European Union is in the interests of both the candidate countries and the Union itself. Enlargement will bring an internal market of over 500 million consumers and an open border-free area where goods and services can freely circulate. And an enlarged Europe also offers a greatly expanded zone of stability and security, where human rights are respected, the rule of law prevails and which will experience growth and prosperity.

As I said, from the side of the European Union there is a firm political will to proceed with the enlargement process and we have already gone a good way in the right direction. This will be demonstrated before the end of the year when the Commission will put to the Council a proposal which will establish which Candidate Countries - hopefully, including the Czech Republic - are in a position to finalise their negotiations with the Union in order to secure accession by the end of 2002.

But of course, a lot of work needs to be done, both within the Union and outside. This may be a challenge in the short term for many of us, but if we continue working, I am sure, we will make the forthcoming enlargement a big success.