The Impact of European Union Enlargement since 2004 on Member State Economies - Essay Example

1 Evaluate the impact of European Union Enlargement since 2004 on member state economies and on companies doing business in the region. Is the enlargement likely to have any lasting impact on the coherence of the European Union? Definition of terms EU – The European Union represents a single market, (e.g. Harmonization, Economic & Monetary Union, Free movement of capital and labour, Regional policy). Within the single market, there are three economic systems (e.g. Command economies, Market economies, and mixed economies), the economies spawned the Customs Union (e.g. Tariffs, quotas, common external tariff and subsidies), and of course all of these entities are held together and monitored through the EU institutions (e.g. Parliament, Council of Ministers, Commission, European Central Bank and European Investment bank). As of May 2004, the total number of member states reached 25. The (10) new member states were formerly members of the Eastern Bloc, who were controlled by a communist economy since the end of World War II. The initial signers to the treaty of Rome in 1958 possessed a number of common issues and concerns; they all had experienced economic disarray which were precipitated due to the proliferation of hostilities. The concept of a common market provided the prospect of a level playing field for the diverse people of Europe; it enabled them to unify in purpose and resolve issues not relative to economic prosperity. The unity which was inherent of a unified aggregate, provided a solidified defense against all foes whose ideology or economics represented a threat to their individual well-being. Asia Pacific – generally applies to East Asia, Southeast Asia, and Australia near the Pacific Ocean, plus the states in the ocean itself (Oceania). The inclusion of Oceania 2 countries such as Australia and New Zealand is largely based upon the economic relationships between those countries and their East Asian trading partners to the north”(Wikipedia) NAFTA – (North American Free Trade Agreement) ; was an expansion of the earlier Canada – US Free Trade Agreement of 1988. It is a treaty under international law, though under the United States law, it is classed as a congressional – executive agreement rather than a treaty. In December 1992, Canada, US and Mexico signed an agreement. Since signing, trade has increased considerably among the three nations. Frame work for evaluation The PEST analysis will be utilized by this researcher in an attempt to gain an understanding of the market growth or market decline of the 25 member states since the enlargement of 2004. In doing an examination of the political; which will encompass trade restrictions and tariffs, tax policies, employment law, and environmental laws. An evaluation of the economies; with a highlight of the member states economic growth, interest rates, exchange rates, and inflation rates. An insightful inspection of the social; detailing cultural aspects, population growth rate, age distribution, career attitudes and health consciousness. Finally an examination of the technological; which will illuminate ecological and environmental aspects, the minimum efficient production level and the variables which influence outsourcing decisions. A look into automation, technology incentives and the role of technology change within the union since 2004. Political tax policies 3 It is incumbent upon the members of the European Union to exert a concerted effort to harmonize tax policies while at the same time, making an earnest effort to distribute the burden proportionately. An equitably proportionate tax distribution policy must be devised which would preclude large of small states from feeling compelled to take on more of this responsibility than its people and resources are will and able to bear. Inherent of the overall tax policy is the important variable of fostering investment. This policy may be viewed from a holistic standpoint to preclude any member state from achieving a greater tax incentive advantage over the other member states In a study initiated by Katinka Barysch, she takes issue with, “Eastern Europe being a low tax paradise that flourishes at the expense of high tax neighbours”(Barysch) The numbers largely point to levels of a successful mingling among member states, albeit there are latent fears of what could result. “…The enlarged European Union will constitute a common market with over 450 million consumers and twenty-seven economies with a combined GDP of €10 000 billion – larger than that of the United States and amounting to a quarter of the world’s GDP. The enlargement process will itself cost around €41 billion between 2004 and 2006, mainly in structural funds to the accession countries. However, against the background of the current slow economic growth in western Europe, especially in the major Economic and Monetary Union (EMU) area countries and its impact on the economies of central and eastern Europe, fiscal discipline and solidarity need to be strengthened overall and the capacity to absorb funds bolstered, in particular in the accession countries. The Assembly notes with satisfaction the 4 fruitful partnership between the European Commission, the European Investment Bank, the European Bank for Reconstruction and Development and the Council of Europe Development Bank in boosting investment volumes, not only in the accession countries but in the whole of Europe”(Parliamentary Assembly 2004). Employment laws The member states and their respective policies on employment are at least varied and probably conflicting with the macro approach sought by the EU commissioners. The problem is that employment law was in need of a consolidation, which would make it clearer and more accessible to the average citizen. It is both tedious and cumbersome to assemble the needed information because much of it has gone thru numerous amendments (which is often quite substantial), are located in different places. This fragmentation necessitated a consolidation of community laws. “…the conclusions of the Presidency of the Edinburgh European Council (December 1992) confirmed this, stressing the importance of legislative consolidation as it offers certainty as to the law applicable to a given matter at a given time”(Commission of the European Communities) Article 13 which established the European Community and was modified by the Amstredam treaty concerns itself with eradicating the lingering controversy on the community’s ability to effectively and efficiently address the issues accompanying and surrounding anti-discrimination. The Amstrad am Treaty addresses the pertinent issues at a community level as it grants direct power on the council to fight a plethora of discriminatory practices. The content of the treaty reads, 5 …“without prejudice to the other provisions of this treaty and within limits of the powers conferred by it upon the community; the council, acting unanimously on a proposal from the commission and after consulting the European Parliament, may take appropriate action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation”(Council Directive) Gender Diversity While Article 13 deals with discrimination, the proposal for a Council Directive, establishing a general framework for equal treatment in employment and occupation states that, “…the appropriate legal basis for community legislation on equal opportunities and equal treatment of men and women in matters of occupation and employment is Article 141 of the treaty; also, Council Directives 76/207/EEC, and 86/613/EEC have already established the principle of equality of treatment between men and women in this field”(CD). Legal right to locate and to work “…The European Union's highest court ruled that trade unions can in principle take action to prevent employers from using cheaper workers from EU countries with fewer labor rights. But unions criticized the European Court of Justice for setting conditions to workers' hard-won right to strike collective wage deals that uphold a basic rate of pay and working conditions. The court tried to balance that against the rights of EU companies to do business anywhere in the 27-nation bloc. The court said unions could take action to protect jobs and existing employment conditions, but it 6 could not stop an employer from being based wherever it likes”(International Herald Tribune 2007). This case involved a Finnish Ferry Company who reflagged its ship, in an attempt to avail of cheaper labor, in the new (2004) member state of Estonia. Clearly, this case opens up an argument which has long been put forward: “…over which country's rules companies should follow while working in another EU state has reflected concerns about low-wage Eastern European workers threatening jobs in better-paid nations such as Finland, Sweden or France, where fears of a wave of migrant "Polish plumbers" led voters to reject the EU Treaty in 2005”( IHT 2005). Eight of the newly admitted member states of 2004 are mostly poorer eastern European nations, and the new dilemma of the EU has been how to find a way to address this sticky wicket, and not ruffle the feathers of any of the concerned parties. Environmental regulations “…The European Union has adopted a common regulation – the EU environmental Liability Directive 2004/35/CE – in addition to existing EU and national environmental regulations. The addition is the responsibility for environmental damages to non-owner property, such as natural resources”(Global Environmental Practice 2004). The new Directive is commonly referred to as the “Biodiversity Directive” and has been active since April 30, 2007. Since enactment of the new legislation, the response by individual countries have been varied regarding application. Agriculture has a basic role in Hungary and the utilisation of favourable ecological conditions serves as a catalyst in 7 the development of rural areas. Given the criteria used by the EU,The majority of Hungary’s landscape (96.1%) is classified as rural area. These areas are home to close to (73.6%) of the country’s total population Hungary has always embodied an attending responsibility towards the economic, social and welfare problems of its rural population and the resource, on which they reside.       With the adoption of the European multi-functional model of agriculture, to its deep seated concern for the environment, they have exhibited a positive commitment to quality and healthy food production. It is certain that Hungarian agriculture runs parallel to the EU agricultural model. “…The liability for environmental damage falls into three categories: Projected species and natural habitats Water and Soil It is not surprising that certain countries like the Czech Republic (2012) has laid out a time frame for certain types of businesses to comply with adherence. The Czech Republic is heavily dependent upon agriculture, and food processing, and as a consequence they have a vested interest in preserving their rural environment for long term development; they have initiated plans for high environmental standards (it is critical to have a safe environment for livestock; clean water, and non-contaminated soil), their consciousness will ultimately lead to further development of the countryside. Additionally, Spain has also pursued a similar pattern for specific types of businesses which become effective in 2010. “…European legislation sets out detailed rules for the management of waste produced 8 by businesses, both for “traditional” waste (recycling, landfill, incinerator, etc;,) and for certain specific types of waste (radioactive substances and waste, plastics, waste resulting from certain industrial activities). In addition to this, the European Union has set out strict measures combating pollution of the natural environment by industrial substances. This includes among other things, a framework for preventing and reducing pollution”(IPPC Directive), and the thresholds by certain sectors into the atmosphere, soil and water”(Europa). The most substantial polluters of the environment are the power stations and the large industrial concerns. These companies are aware of the broad range of sanctions which will be imposed if they do not comply with existing legislation.(See Appendix ‘A”), as Stara Enso, seeks to rectify pollution problems in the short term. Trade Restrictions and Tariffs The European Union is proposing a compression mechanism: This process would attack tariffs from top to bottom, wherein it will eliminate low tariffs and bust high tariff peaks, and this will eventually pave the way to reducing tariff escalations. “…The EU Economy is already one of the most open to trade.” “The EU average level of customs duty protection amounts to around 4 per cent on industrial goods, taking into account MFN (Most Favourite Nation) rates. For instance, steel imports from Mediterranean countries, linked to the community through bilateral co-operation agreements or Euro-Mediterranean agreements, enter at zero duty”( Tariff and non-tariff barriers). The compression mechanism initiative will capture the 70 per cent of developing countries export which are confined to non- agriculture products. A standing proposal presently exist for all WTO members to accept a 9 tariff close to zero on textiles clothing, and footwear. The movement also attempts to require a substantial reduction on non-tariff barriers which are geared towards removing all export restrictions on raw materials. “…It is of strategic importance to the EU that all trading partners remove other non-tariff barriers, since they frustrate any additional market access acquired via tariff liberalization. The EU is particularly pursuing the elimination of export duties that distort international commodity process and disrupt trade”(Europa). Political Stability The European Union has taken the stand that enlargement can be a reality for any country in Europe who can withstand the scrutiny of the economic and political criterion required for membership. Its official position is that the existence of membership by any member state serves to promote reform and foster stability. Subsequent to the enlargement of 2004, there has arisen a segue to debate on the watering down affect which additional countries would have on the Union’s present size (25). A number of countries in Europe have weak economies and are struggling with unemployment (See Appendix C”), these countries, it is feared, would sap economic, political, and social will of the existing member states, and cause waves of instability. Moreover, it is the position of some that a number of the newly admitted (2004) members (e.g., Romania, & Bulgaria), where there is a perceived lack of judicial reform, and in Poland, the Czech Republic and Hungary where the remnants of political turmoil may result in serious and long term affects on the Union as a whole. One of the most controversial points of debate has caused some members to question the validity of the concept which the Union was initially conceived. A number of concerns have arisen 10 over the admission of Turkey which has been described in the media as, “a large Muslim state with a culture considered to be vastly different by many Europeans, and not compatible with a European culture’(International Herald Tribune 2006).”…These public concerns have led leaders such as Germany’s Merkel and France’s Sarkozy to suggest that there be a need for debate about the final borders of Europe, or as for a precise definition of Europe’s eastern border”(The Atlantic Times 2006). “…Under Article 49 of the Treaty on the European Union, any European country may apply for membership if it meets a criteria established for by the treaty. The criteria requires candidates to achieve “stability” of institutions guaranteeing democracy, the rule of law, human rights, and respect for and protection of minorities; a functioning market economy, as well as the capacity to cope with comparative pressure and market forces within the Union; the ability to take on the obligations of membership, including adherence to the aims of political, economic and monetary”(President Conclusions) Economic economic growth The Economic Union economy is a combination of 27 member states and is producing a GDP of US $17.6 trillion as of 2008, (see Appendix “C”), according to the IMF. The new member states account for approximately 31 per cent of the economic output in the world. A single currency (Euro) has been adopted by 15 of the member states, which is managed by the Euro Central Bank. The economy of the EU is a single market and it is represented as a unified entity in the WTO. The European Union Committee of the House of Lords provided an assessment on the 11 economic growth of the Member States since the 2004 enlargement, which stated “…Most of the new Member States (with the exception of Poland) are small, and their income levels are much lower than in most of the EU-15 countries. Taken together, their economies have a GDP of €5.6 billion, which is the equivalent of the size of the Dutch economy and accounts for only around 5 per cent of the EU-15 GDP. (See Appendix “D”)Therefore, it is clear that the impact has been significantly bigger for the new members than the old ones. While the EU-15 is the destination of 70 per cent or more of the new members' exports, the new members account for only around 4 per cent of EU-15 trade. Total EU-15 exports amount to €2,150 billion, of which €82 billion go to the new Member States. The equivalent figures for imports are €2,070 billion and €59 billion”(EUCHL) Further the European Union Committee of the House of Lords, goes on to state; “…The economic impact of the 2004 enlargement has been positive, both for the old EU-15 countries and for the new Member States. Enlargement has acted as a catalyst of economic dynamism and modernisation for the European Union, helping the economies of old and new Member States to better face the challenges of globalisation. At the same time, the economic changes induced by this enlargement have been absorbed quite smoothly, and there is no evidence of disruptive impacts on the product or labour markets”(EUCHL). The individual economic performance of member states reflect a variance, as would be expected.Within the EU the Growth and Stability Pact is the measure of all fiscal policy. The specific rules of the stability pact set forth minimum and maximum perimeters on public debt (not to exceed 60% of GDP), and the individual state’s deficit (not to be in excess of 3% GDP). These optimistic benchmarks have not always been achieved by some of the larger member states, and 12 the entire eurozone has a debt percentage in excess of the 60 % benchmark. All of the countries possessing a below average GNP (the exception being Poland), are those who became members in 2004. While the new members are adjusting to their new situation, they are experiencing some settling in difficulities, the old members (pre-2004) have made needed adjustments and their GNP per Capita’s are above average. (See Appendix “E”) Inflation rates, interest rates and exchange rates The Eurozone economy is more exclusive and larger than the economies of most countries. It has more than 300 million persons, which qualifies it as one of the world’s largest economy’s. “…Over the years the EU has lowered inflation, interest rates and unemployment, and demands these characteristics from any country that wishes to adopt the euro”(Euro). If a nation has an inflation rate above the 3 per cent threshold, it is not allowed to use the euro. If one compares the euro to the US dollar, the euro demands a higher exchange rate. This phenomenon is persistent because there is an abundance of euros circulating within the market. The Union has a strong connection to OPEC and its oil prices. The European Central Bank holds the responsibility for establishing a common interest rate, for the twelve euro zone countries who are being permitted to use the currency. Each country participating is expected to achieve a year to year increase of below 2% in the harmonized index of consumer prices. If this objective is reached, then presumably, price stability is attained. In achieving a common interest rate for all of the member states, the argument of whether one size fits all is applicable among the member states. The prevailing question is;… “are they sufficiently similar (or convergent) in terms of economic performance for benefits of euro membership to outweigh the costs of having to accept a single rate of interest”(A2 13 Macroeconomics). It has been suggested that if the proper manuvering is present, then prudent objectives can and will be achieved; In a recent New York Times article by Mark Landler, the occurrence of a lesser of evils scenario was given as an example. When given the choice of whether to increase the interest rate, or allow the euro to float and experience an increase in the exchange rate, the decision was made not to increase the interest rate, which would have brought only short term relief, and possibly feed the inflation rate. Instead, it was decided to allow the euro exchange rate to float, and reap the long term benefits of prosperity. Of course, an increase in the euro rate presumably meant that importers and exporters would be affected in some markets. However, the article by Landler provides this account; “…as the euro rocketed into uncharted waters against the dollar, Europe reported a healthy gain in industrial output, with Germany, France, Italy and Spain all chipping in good numbers”(Landler 2008). “…while a surging euro is indisputably a burden for Europe’s exporters, making their good more expensive in the United States and dollar-linked markets, it has not yet had a sharp effect on Europe’s economy, which continues to grow, although at a more subdued pace”(Landler). Even though the exchange rate was increased, “Germany will shop 1.02 trillion euros worth of goods this year, 5 per cent more than last year. At the latest exchange rate, that works out to some $1.6 trillion.(Landler 2008) Social Cultural aspects and health consciousness In each member state there are volumes of policy which is attached to the government and other entities containing outline and detail framed by individuals, officials and politicians which 14 presuppose problems and solutions. It is viewed as the duty of organizations and institutions to formulate attitudes of acceptable behaviour, which they expect the general public to both adhere too and abide. Otherwise they stand to be judged and dealt with in the manner laid out in those documents previously formulated. The chances of adopting new European standards are at best extremely low unless what is commonly characterized as a goodness of fit exists.Whenever a general consensuis exists on a subject or situation in Europe, then few Europeans are subject to turn their heads in dismay, if and when the activities of some run counter to the policies of a European institution, then the authorities recognize there is a problem, of which there may not be a solution, without having to jump some hoops. “…If Sweden and Finland liberalize and deregulate the liquor market and adopt a non-Nordic model of informal control mechanisms, the state monopoly company and social welfare agencies active in the alcohol field forfeit their claims on state funding to run programs, employ specialists, and gather specialized knowledge. Aside from institutions, however, the electorate also rallies against external pressures because European formulations of socially sensitive issues contradict basic ideas on how to tackle problems such as alcohol or drug dependency. Prohibitionist drug policies are not compatible with the moral permissiveness of the Dutch, Continental drinking models are irreconcilable with the Nordic desire for order and security, while post-Christian materialism and individualism negate the definition of a good Irish man or woman”(Markets and Moral Regulation). It is one thing to compel a people to become a part of a harmonization process which will enable their monetary policy, telecommunications, environment, capital markets, or state aid into a European structure. Yet it is solely another matter to demand that they subject themselves to 15 Europenization, against their own cultural will or desires. In the opinion of this researcher, the area of national sovereignty, pitted against cultural expressions, has not received its due consideration in literature. population growth According to a report prepared by Population Change in the European Union, “…Population in the member states of the European Free Trade Association has been growing both due to natural (2.4%) and migration (6.3%) gain. The highest natural increase is seen in Iceland (7.8%), with the lowest figure (1.6%) in Switzerland but the latter, however, has the highest migration gain (7.0% against 5.4% in Norway and Liechtenstein and 4.7% in Iceland).Migration loss was seen in 6 EU countries, varying from -1,0‰ in Lithuania to –2.2% in the Netherlands, and natural loss was observed in 9 countries: from -0.1% in Slovenia to – 5.3% in Bulgaria. The most intense natural increase is still typical for Ireland, with estimated 8.8% in 2006. In other countries with natural increase remaining, the figure is two and more times lower”(CCEU). Age distribution 0-14 years: 15.72% (male 37,208,905/female 35,254,445) 15-64 years: 67.16% (male 155,807,769/female 153,690,235) 65 years and over: 17.11% (male 32,592,595/female 46,273,197) (2007 est.)”(EUPG) References A2 Macroeconomics/International Economy The European Central Bank, retrieved on line on March25,2008, from www.tutor2.net Barysch, Katinka, Eastern Europe as a low tax paradise, Enlargements positive impact, European Voice 27 April 2006, Retrieved on line on March 24, 2008, from www.cer.org.uk Commission of the European Commission, Retrieved on line on March 24, 2008, from www.wikipedia.org Cross Border Corporation (2007) European Population Growth in 2006, 21 May 2007, retrieved on line o9n March 24, 2008, from www.doserkoping.org.ua Europa, Retrieved on line on March 25,2008, from www.europarl.europa.eu European Union Committee of the House of Lords, (2006) House of Lords Report on the enlargement of the European Union, retrieved on line on March 24, 2008, from www.tutor2.net Global Environmental Practice 2004, Retrieved on line on March 26, 2008, from www.eurunion.org Index Omundi, European Union population growth rate, Retrieved on line on March 26, 2008, from www.indexmundi.com International Herald Tribune, 2007, EU Court: unions can act against cheap labour, but only to protect workers, December 11, 2007, retrieved on line on March 25, 2008, from www.iht.com IPPC Directive, retrieved on line on March 24, 2008, from www.europa.eu Kurzer, Paulette, Cultural change in the European Union/Cultural norms and national identity, retrieved on line on March 24, 2008, from www.madeinatlantic.com Landler, M. Dollars fall is no cause for alarm in euro zone, New York Times World Business, March 19, 2008, Retrieved on March 25, 2008, from www.nytimes.com Parliamentary assembly, Resolution 1365 (2004) Economic Aspects of European Union enlargement; the crucial years ahead, retrieved on line on March 24, 2008, from www.assembly.coe.int Population change i8n the European Union, Markets and moral Regulation, Retrieved on line on March 24, 2008, from www.assetts.cambridge.org Tariffs and non-Tariff barriers, Article 660591, Retrieved on line on March 25, 2008, from www.infa05501.ag5.mpi-sb.npg.de:8080 President Conclusion, Brussels European Council, March 9, 2007, retrieved on line on March 24, 2008, from www.google.com The council of the European Communities, Council Directive 76/207 EEC, Retrieved on line on March 24, 2008, from www.eur-lex.europa.eu     SustainabilityPerformanceEnvironmental PerformanceNon-compliances Appendix “A”     In the vast majority of cases, the requirements of the environmental permits regulating operations at Stora Enso’s units were fully met. As well as resolving the formal infractions listed below, Stora Enso units have registered complaints, and initiated appropriate measures to resolve them. Complaints received during 2004 most commonly concerned noise and odour problems. Air emissions Effluents Forestry and wood procurement Air emissions The particulate emissions permit limit of the recovery boiler at Oulu Mill was exceeded during June and August 2004. The environmental authorities were duly informed. The electrostatic precipitators of the boiler were repaired and cleaned, and their efficiency has been improved. The permit limits for hydrogen chloride (HCl) and dust concentrations in flue gases at the Ecogas plant at Varkaus Mill were exceeded between January and May 2004. The problems were caused by PVC plastic impurities in the fuel, which consists of polyethene and aluminium recovered from used liquid cartons. On the basis of an environmental risk assessment the authorities set higher permit limits at the end of May, which have subsequently not been exceeded. The time limit for the concentrations of malodorous sulphur compounds at Varkaus Mill was exceeded during three months in 2004, due to shutdowns at the pulp mill. The authorities were informed immediately and have agreed that corrective measures are not required, since the problems are caused by diluted malodorous gases released during the shutdowns. Effluents Due to increased loads of suspended solids and organic compounds in the purification plant at Anjalankoski Mill, monthly permit limits were exceeded for COD, BOD, nitrogen and phosphorus between February and May 2004. The annual limits were also exceeded. The local authorities have been kept continuously informed. Corrective measures have been taken, including repairs to filtering devices, the establishment of an improved effluent monitoring system and the optimisation of activated sludge purification. Investments to increase the plant’s purification capacity will be made in 2005. Process water going to external treatment from the Arzamas and Balabanovo converting mills for packaging materials has been exceeded the limits agreed with the owner of the treatment plant for metals (Mn, Al, Zn, Cr, Fe). New internal water treatment systems are being installed by the mills and should become operational in early 2005. The authorities have been kept informed of developments. Due to pump failures at Corbehem Mill, about 200 m3 of untreated waste water leaked into the nearby River Scarpe in March 2004. The authorities were informed and all pumps were upgraded with the latest technology. A fine of EUR 2 000 was paid to the local fishing association. The BOD permit limit was exceeded at Kemijärvi Pulp Mill between January and May 2004 due to heavy organic loads sent to the waste water treatment plant. During the period autumn 2003 to spring 2004, several corrective measures were completed. All infractions have been fully discussed with the authorities, who have approved the corrective measures as being sufficient. Due to a malfunctioning valve, about 1.5 m3 of kaolin suspension was spilled at Maxau Mill. A part of the suspension entered storm water sewers and overflowed into the River Rhine. Kaolin is not considered to be hazardous. The authorities were informed immediately of the spillage, and did not take any punitive action. Port Hawkesbury Mill exceeded its daily total suspended solids limit on 9 January 2004, following a surge in effluent flow from the mill. Environment Canada was notified immediately on the discovery of the problem, and mill operations were stopped to allow the clarifiers to settle. Limits for phosphorus, nitrogen and chemical oxygen demand were exceeded at Oulu Mill in February 2004, due to an abnormal load from the fibre line. The environmental authorities were duly informed, and the washing process has been improved. Due to malfunctioning of Skutskär Pulp Mill’s waste water treatment plant, guiding values for suspended solids and chemical oxygen demand were exceeded during February and November. The authorities were informed, and the environmental impact was not considered to be significant. Corrective measures have included increased dosages of nutrients and improved handling of surplus sludge in the mill’s evaporation plant. The COD permit limit for effluents at Varkaus Mill was slightly exceeded in January 2004, when extremely cold temperatures caused start-up problems at the pulp mill, and hampered the use of chemical dispensing equipment in the waste water treatment plant. Discussions with the authorities took place immediately. The chemical dispensing system has been improved to ensure it will function properly during the next winter season. The Water Quality Center in Wisconsin Rapids exceeded the daily maximum BOD limit for its final effluent on 22 September 2004, and notified the Wisconsin Department of Natural Resources (WDNR) immediately upon discovery. The WDNR issued a Notice of Non-compliance. A number of corrective actions have been implemented to prevent recurrence. Forestry and wood procurement Wood Supply Baltic has been involved in two cases concerning the intensity of thinning in 2004. In forests around Rägavere and Pärnu in Estonia, the authorities have noted an increased level of thinning intensity. All relevant stakeholders have been informed about the corrective actions that should be taken by changing procedures and training the personnel involved. Logging activities will be included in the environmental management system to be implemented at Wood Supply Baltic during 2005. During a manual harvesting operation on Port Hawkesbury Mill’s licensed Crown land, a small area of forest (0.04 ha) in a neighbouring Provincial Wilderness Area was inadvertently cut in April 2004. The Wilderness Area boundary was not marked on the ground, and appeared on Port Hawkesbury’s maps in a different location than on the provincial maps. As soon as the error was noted, the operation was shut down and boundaries were re-established based on a new survey. The province appreciated Port Hawkesbury’s prompt action, and no legal charges were issued. Port Hawkesbury has since rechecked the wilderness area boundaries on its maps with the provincial authorities.   Appendix “B” Appendix “C” Economy of the European Union Currency 1 Euro (€) = 100 cents Other currencies in member states Bulgarian lev • Czech koruna • Danish krone • Estonian kroon • Hungarian forint • Latvian lats • Lithuanian litas • Polish złoty • Romanian leu • Swedish krona • Slovak koruna • Pound sterling Statistics GDP ranking 1st (2006) GDP (PPP) US $17.06 trillion (2006) GDP growth rate 3.1% (2006) GDP per capita US $29,900 (2006) GDP by sector (2006) 70.5% services 27.3% industry   2.1% agriculture Inflation 1.9% (2007) Population below poverty threshold 17% Labour force 221.5 million Labour force by occupation (2006) 67.0% services 27.3% industry   4.4% agriculture Unemployment 7.0% (May 2007) Sources: [1] [2] [3] [4] Trading partners Imports US $1.466 trillion (2006) Main import partners (2005) China, Japan, Russia, United States Exports US $1.33 trillion (ranking: 1st) (2006) Main export partners (2005) China, Russia, Switzerland, United States Public finances Public debt € 6,509.8 billion (63.8% of GDP) (2004) Public deficit € 270.2 billion (2004) Expenses € 2,134.7 billion (2004) Appendix “D” Appendix “E” Appendix “F” Read More