THE EASTERN ENLARGEMENT OF THE EUROPEAN-UNION - MAJOR CHALLENGES FOR MACROECONOMIC POLICIES AND INSTITUTIONS OF CENTRAL AND EAST EUROPEAN COUNTRIES

The paper analyses the major challenges for macro-economic policies an d institutions of Central and East European countries raised by access ion. The analysis starts by proposing an interpretation of the economi c conditions that the CECs would need to satisfy in order to become me mbers of the European Union. The paper then proceeds to discuss the ac quis communautaire in the area of EMU which the new members will have to implement, at least as non-participating countries. It is argued th at EMU should not be an immediate target for the majority of the Assoc iated Countries (ACs). The successful conclusion of the transformation calls far a certain degree of flexibility in the conduct of economic policy which the adoption of too strict criteria could actually preven t. This does not mean that the effort to follow sound economic policie s should be discontinued. The paper simply concludes that a too short policy horizon should not constrain the ACs' ability to converge or to undertake macro-economic stability-oriented policies in the future. ( C) 1997 Elsevier Science B.V.