Brussels, 5 November 2008
Key findings of the progress reports on the candidate countries: Croatia, Turkey and the former Yugoslav Republic of Macedonia:
EU accession negotiations began with Croatia on 3 October 2005 and are progressing well.
Based on the overall good progress made by Croatia the Commission earlier this year held out the prospect of presenting an indicative timetable for the technical conclusion of negotiations in 2009, provided conditions are met. Such a conditional road map now is presented in this year's Strategy paper.
Croatia continues to meet the Copenhagen political criteria. New strategies and action plans as well as legislation for reforming the judiciary, the public administration and in fighting corruption have been adopted. The anti-corruption body USKOK continues to intensify its activities. Croatia has taken some steps to address problems of minorities, including refugee return. Croatia has continued to participate actively in regional cooperation.
However, considerable challenges remain in key areas, such as reform of the still inefficient judicial system and public administration and in fighting organised crime and corruption, which remains widespread. Sustained efforts are needed across the board, leading to concrete results. Further attention needs to be paid to minority rights, especially refugee return. The prosecution of war crimes requires continued attention. There are some problems of access by ICTY to certain documents in Croatia.
Regional cooperation needs to continue, as do efforts to solve outstanding bilateral problems with neighbours, especially on border delimitation.
Croatia is a functioning market economy. It should be able to cope with competitive pressures and market forces within the Union in the medium term, provided that it further implements its comprehensive reform programme with determination in order to reduce structural weaknesses. The economy of Croatia continued to show a solid performance. Macroeconomic stability has been preserved. Employment grew and unemployment continued to decline. Business registration procedures have improved further.
However, inflation has risen considerably, largely due to higher energy and food prices. The current account deficit has been growing.
The implementation of structural reforms has been slow. Significant subsidies to enterprise have not been used effectively for restructuring. Further improvements in the business environment are needed.
EU legal order
Croatia has improved its ability to take on the obligations of membership. Preparations for meeting EU requirements are moving forward at a steady pace. Significant progress has been made in economic and monetary policy and information society and media. Good progress has been made in many chapters, such as public procurement, intellectual property law, customs union, food safety and financial services. However, significant efforts lie ahead, in particular in areas such as judiciary and fundamental rights, environment, competition policy and agriculture and rural development;
EU accession negotiations with Turkey began on 3 October 2005 and have moved forward over the reporting period.
8 out of 33 negotiation chapters have been opened so far. One chapter has been provisionally closed. In addition, opening benchmarks have been set as conditions for opening negotiations on 13 chapters.
Turkey continues to sufficiently fulfil the Copenhagen political criteria. However, progress on reforms was limited in 2008. The government achieved legislative progress in the areas of freedom of expression and in enhancing the property rights of non-Muslim religious communities. Furthermore, it pledged to increase spending on the South-East Anatolia Project, which is addressing the economic and social difficulties of the South East.
Now that Turkey has averted a political crisis linked to the Constitutional Court case against the governing party, it needs to reinvigorate the process of political reform. The lack of dialogue and a spirit of compromise between the main political parties had a negative impact on the functioning of the political institutions and on political reforms. Turkey continued to suffer from terrorist attacks by the PKK, which is on the EU list of terrorist organisations.
A consistent and comprehensive programme of political reforms is now needed, in particular as regards the reform of the constitution, the judiciary reform. Furthermore, significant efforts are needed on most areas related to the political criteria.
As regards the Copenhagen criteria, Turkey is a functioning market economy. It should be able to cope with competitive pressure and market forces within the Union in the medium term, provided it implements its comprehensive reform programme in order to address structural weaknesses.
The Turkish economy continued to perform well, although growth fell below potential. This happened due to a slowdown in domestic demand which followed the implementation of a strong stabilisation programme.
Macroeconomic stability remains weak through considerable external financing needs, which makes Turkey vulnerable to changes in investor sentiment. The budget performance has been satisfactory, but structural rigidities in the labour market hinder job creation, particularly female and youth employment.
The government developed new initiatives to boost investment in infrastructure with aim to reduce high regional disparities. Significant progress was made in the area of price liberalisation in the energy sector.
EU legal order
Turkey has further improved its ability to take on the obligations of membership. Turkey has made progress in aligning with the the EU's legal order in a number of areas, in particular in chapters Trans-European networks, energy and science and research. Moderate progress was made in the area of financial control. Alignment is advanced in some areas, such as free movement of goods, intellectual property rights, enterprise and industrial policy, anti-trust policy, consumer and health protection, science and research, energy. Alignment needs to be pursued, in particular in areas such as agriculture, fisheries, veterinary and phytosanitary policies, state aid, justice and home affairs, social policies and employment. Turkey's overall administrative capacities need to be improved.
Owing to Turkey's non compliance with its obligations related to the additional protocol to the Ankara Agreement, in December 2006 the EU decided to freeze eight chapters of the negotiations, but to continue with the other chapters.
The former Yugoslav Republic of Macedonia
The former Yugoslav Republic of Macedonia obtained the status of candidate country in December 2005.
The former Yugoslav Republic of Macedonia made some progress in the course of the last year but does not yet meet the political criteria. Steps have been taken to address the key priorities of the Accession Partnership; further efforts are required.
Implementation of the Ohrid Framework Agreement continues to consolidate multi-ethnic democracy. A law which provides a framework for the use of the languages of non-majority communities has been adopted. The country has made progress in the implementation of the Stabilisation and Association Agreement (SAA) and has reached a high level of compliance. Progress can be reported on judicial reform and on police reform.
However, considerable challenges remain in key areas. The OSCE-ODIHR election observation mission reported that key international standards were not met in the conduct of the elections. Political dialogue needs to be strengthened and sustained in order to allow the effective functioning of political institutions, in particular the parliament. Corruption remains widespread and remains a particularly serious problem, although a number of steps have been taken in this regard. Measures need to be taken to ensure that recruitments into the civil service are free from undue political interference.
The economy of the former Yugoslav Republic of Macedonia strengthened during the last year and the country has moved closer towards becoming a functioning market economy. It should be able to cope with competitive pressures and market forces within the Union in the medium term, provided that it vigorously implements its comprehensive reform programme in order to reduce significant structural weaknesses.
Macroeconomic stability was improved by more effective tax collection, by lowering the tax burden on labour, and by increasing spending on education and infrastructure. However, threats are posed by the deteriorating trade balance, which accompanied the recent high growth rates. Persistently high unemployment, particularly among young, remains a source of concern.
The country continued with structural reforms. Price liberalisation and privatisation are largely accomplished. FDI inflows increased markedly during the last year. Challenges remain in building up an attractive business environment, which is still hampered by administrative weakness and low degrees of legal certainty.
EU legal order
The former Yugoslav Republic of Macedonia has made good progress in legislative alignment with the EU's legal order in a significant number of areas such as public procurement, competition, transport, enterprise and industrial policy, information society and media. There has been good progress in the introduction of biometric passports. However the country still faces shortcomings in implementing and effectively enforcing legislation, mainly in areas as free movement of goods, taxation, food safety, veterinary and phytosanitary policy.
EU Financial Assistance under the Instrument for Pre-Accession Assistance (IPA) for the candidate countries
 21 opened chapters: science and research, education and culture, economic and monetary policy, industrial policy, customs, intellectual property rights, services, company law, statistics, financial services, financial control, information society and media, consumer and health protection, external relations, financial and budgetary provisions, TENs, transport, energy, free movement of workers, social policy and employment, free movement of goods.
 Opened and provisionally closed: science and research, education and culture, industrial policy, and external relations.
 Enterprise and industry, statistics, financial control, trans-European networks, consumer and health protection, intellectual property law, company law, provisionally closed: science and research
 Free movement of capital, public procurement; competition policy; agriculture, taxation, employment and social policy, customs union, free movement of services, food safety, free movement of goods, environment, financial services.
 Free movement of goods,
right of establishment and freedom to provide service, financial services,
agriculture and rural development, fisheries, transport policy, customs union