The European Union accession has been an economic success for the new member states, according to Norbert Wunner, European Commission DG Economist Desk Officer for Bulgaria, who presented his views on the topic What Can Bulgaria Learn from the Accession of the 10 New Member States (NMS10)? during the joint Bulgarian National Bank and International Monetary Fund (IMF) seminar Bulgaria – From Transition to Convergence: The Challenges Ahead.

It was held in Sofia on May 2, when local and foreign institutional employees spoke to mark Bulgaria’s departure from the IMF, as reported by The Sofia Echo on May 4.

During the session entitled Experience As Guidance for Medium Term Policy Formulation, Wunner said that the EU accession for the NMS10 had been a catalyst for institution-building reforms and that economic convergence had been boosted.

According to him, the new EU member states, including Bulgaria, had some similarities, as they were countries with common features, but facing them stood different challenges related to their EU entry. The common features included the fact they they all had small economies open to foreign markets. All NMS had gone through transition periods from centrally planned economies, during which they had experienced some sort of crisis.

Moreover, all of the NMS had gone through a process of preparation for EU accession.

Still, the NMS were of different sizes – they were small and medium-sized countries. They also had different geographic locations, influencing the countries’ trade capacity in various ways. The starting conditions for the NMS were also not the same, as well as the reform strategies employed and the currency exchange rates.

The experience three years after accession was an important success story for the NMS10, Wunner said. There had been an improvement in per capita income. According to him, the Czech Republic, Poland and Bulgaria had experienced smooth and steady conversions; in Slovenia, Slovakia, Estonia and Lithuania, the changes were fast and rapid, while Hungary was somewhere in the middle. For all the countries, the macroeconomy had grown to be more stable and the inflation rate had decreased to under 10 per cent, which was a clear sign of improvement, even though the EU average was three per cent a year.

Moreover, Wunner said that an improvement in the market situation had been recorded and that unemployment had started to diminish to under 10 per cent (excluding Poland). This rate of unemployment was still more than the EU average and remained one of the challenges for the NMS.

Furthermore, Wunner outlined the lessons that Bulgaria could learn from the NMS10. He said that while accession could boost convergence and investment rates, the challenge for the country’s macroeconomic stability remained. Growth, he said, had been domestic-demand driven and stimulated through economic and political tools.

According to Wunner, convergence in Bulgaria had also started, but it could not be taken for granted as it depended on a good, sound economic policy forcing economy stability.

The third main lesson for Bulgaria, according to Wunner, was that convergence was mainly driven by capital deepening and technological progress. Bulgaria had been behind in both areas until recently and the local capital deepening had contributed less to growth than in the NMS10. He advised that investments should go to sectors that boosted economic stability.

Wunner said that the EU accession had been an economic success story for all the NMS. According to him, Bulgaria had started to benefit from its accession already during the pre-accession preparation period.

In his final remarks, Wunner said that reaping the full benefits of accession required sound economic policies, good governance and sustained commitment to reform.