European Affairs

Austria Needs More Time Before Free Entry of Workers     Print Email

Federal Minister of Economic Affairs and Labor of Austria

The prospect of enlarging the European Union to take in up to ten countries in Central and Eastern Europe is the greatest single challenge facing both the EU and Austria; yet it is at the same time an important contribution to peace, stability and security. It should not be underestimated in any Transatlantic discussion of burden-sharing.

Austria has already benefited economically from the opening up of the Central and Eastern European countries, and will reap further important gains from their entry into the EU. Austrian companies will benefit from the enormous investments that will be needed in the region - in infrastructure, energy and the environment.

The application of EU laws and regulations in the new member countries will lead to the harmonization of competition rules, creating a more level playing field for business. The elimination of tariffs and non-tariff barriers to trade will improve companies' access to Central and Eastern European markets.

But while Austria is very much in favor of EU enlargement, there are several important issues that will have to be addressed first, particularly the free movement of workers, owing to the country's geographical location and the fact that its wages are presently considerably higher than those in the candidate countries.

Austria and Germany have called for a seven-year transitional period for the free movement of workers and the cross-border provision of services. At the same time, we have proposed §exible instruments for adopting the system and a possible gradual phasing-in according to labor market requirements. We also plan to negotiate bilateral employment agreements with the applicant countries.

Agreement has recently been reached on a common EU position on this issue, which in substance re§ects the proposals made by Austria and Germany. The fact that candidate countries are starting to accept these transitional arrangements shows that they accommodate very well the specific interests both of the future EU members and their neighboring countries in the EU.

German studies estimate that, once the free movement of persons applies fully, some 125,000 people from Central and Eastern Europe will enter the EU each year. Other estimates run as high as 220,000 or even 350,000 a year. These figures, however, are rather theoretical.

In Austria today there is a majority in favor of enlargement. Let us use this transition period for free movement of labor as a kind of safety net that we may not need after all - in view of labor market developments. In the medium and long term, we need qualified immigration. Although we have full employment in Austria, there is no shortage of unskilled labor. It is skilled labor that we lack.

We are starting a debate on the need for immigration into Europe in order to maintain our competitiveness. Our low birth rate of 1.1 to 1.3 children per couple presents us with the same demographic challenge as is facing most industrialized societies.

What kind of migration do we need? How do we attract qualified skilled workers to our countries? These are major questions that are not necessarily related to the enlargement negotiations, the main aim of which is to find compromises that will relieve anxieties in both old and new member states.


This article was published in European Affairs: Volume number II, Issue number III in the Summer of 2001.

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