THE COMMITTEE FOR EUROPEAN INTEGRATION

NATIONAL STRATEGY

FOR INTEGRATION

Warsaw 1997

Contents

Introduction

Introduction

Membership of the European Union is the strategic aim of Poland. Integration with the Union will help to accelerate economic growth, modernise the economy and the legal system, and eliminate the technological gap between our country and other European countries. National interest explains the Polish determination to become a member of the Union. The balance of costs and benefits of membership shows that the positive effects are much more substantial than the negative. This has been shown also by the experience of the states which joined the Union in previous enlargements. This was notably the case for those countries whose level of economic development was below that of the European Union average. In these cases membership of the Union led to an acceleration of economic growth and welfare. Poland intends to follow this same path.

Polish aspirations to membership of the Union should be considered in the light of the effects of not joining. The alternative to accession would be to consciously choose to remain behind the mainstream of European integration. Our common European historic experience, in the recent past as well as that more distant, shows that societies remaining out of the mainstream of economic co-operation get left behind.

Membership in the European Union requires substantial adjustments to the Polish economy and to its law. Without these adjustments Polish membership may be made difficult and advantages from accession will be decisively smaller. It is therefore necessary to intensify preparations so that Poland will be able not only to fulfil the formal conditions of membership but also to gain the greatest advantage in the period up to and after accession. The Polish Government will do its best to ensure that the conditions under which our Country joins the Union guarantee the fastest and at the same the most advantageous integration for Poland. This integration with the Union is based on the conviction that it is a process which will bring advantages to both sides. The Polish Government will meet some of the challenges which might emerge for certain sectors of the Polish economy by negotiating transitional periods, as allowed for in the Union. Our attempts to use these instruments will be prudent and based on the principle of moderation. In every case they will be determined through a thorough consideration of the balance of advantages and possible costs implied by delays in the integration of particular areas.

The National Strategy for Integration (NSI) outlines strategic directions of action. They constitute the directives for the work of Government ministries and agencies as well as being a road sign for all other participants in the process of integration. NSI, expressing the intentions of the Government, is designed to define the main aims of integration and to co-ordinate their implementation by the Government and a wide range of non-governmental organisations in a way that will ensure Poland's best preparation for membership in the EU.

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The National Strategy for Integration is a Government document drawn up by the Office of the Committee for European Integration carrying out the Resolution of the Parliament of the Polish Republic of March 14th, 1996.

NSI includes tasks stemming from the adjustment process in the period preceding membership negotiations, during these negotiations and also in the initial post-accession period. NSI puts existing integration activities into a consistent framework, defines priorities and key elements of the adjustment process, as well as identifying development challenges. The strategy takes into account the existing schedules of legal approximation and forms the basis for the formulation of new programmes and timetables. The main objective of the strategy is to achieve beneficial integration with the EU, incorporating political, security, economic, social, cultural and technological aspects.

NSI takes into consideration scientific studies and government documents defining the main objectives of the long-term development of the country. In particular it stresses:

• strengthening of processes compatible with positive trends seen in highly developed countries such as the development of democracy and the market economy, as well as the implementation of a strategy for balanced economic growth which is environmentally sustainable;

• intensive development and modernisation of the national economy, leading to the acceleration of economic growth, and continuing privatisation of the Polish economy;

• assisting and developing the institutional structure of the economy and undertaking adjustment measures in order to secure for Poland the best possible status within the EU;

• aiming towards the best possible utilisation of the intellectual potential of the country through the stimulation of economic growth, its participation in the modernisation of the economy and the socio-political system, and through the promotion of research and development and a rapidly increasing level of education of our society.

• securing favourable conditions for all sectors of the economy, including agriculture, in the adjustment to the rules existing in the EU. These conditions should be comparable to those laid down for countries which joined the EU in the past.

The process of integration between Poland and the EU is well advanced. Its beginning dates back to a decision taken in the summer of 1990 to initiate the Europe Agreement negotiations. It was accompanied by the conviction on the part of Poland that the process leading up to full membership would take approximately 10 years. The present strategy reaffirms and further reinforces that conviction.

The Government assumes that the membership negotiations will begin in early 1998. This is linked to the timetable of the Intergovernmental Conference of the European Union. Only after the Conference has ended can the process of enlargement to the countries of Central and Eastern Europe and Cyprus start. It is expected that [Author ID1: at Thu Feb 6 09:06:00 1997 ]The expectations concerning the course of[Author ID1: at Thu Feb 6 09:06:00 1997 ] the negotiations allow us to assume that they[Author ID1: at Thu Feb 6 09:07:00 1997 ] will end by the year 2000. Then will follow the period necessary for the ratification of the accession treaty by Poland, the Member States and the European Parliament.

As the start of the negotiations draws nearer, the need to further clarify the approach to the issues of membership and to make strategic choices is clear. This is the fundamental condition allowing the continuation of the integration process in the period preceding the negotiations, during the negotiations proper and in the initial post-accession period.

NSI is based on four main assumptions:

• Poland's membership in the Union will include integration in all areas;

• Poland's integration with the Union will facilitate the maximisation of the rate of economic growth accompanied by a gradual meeting of the criteria set for Economic and Monetary Union

• Poland's integration with the Union is a mutually advantageous process;

• there are certain adjustment costs that have to be borne as a result of the integration.

NSI is primarily addressed to the administrative organs of government implementing the strategy, the President and Parliament, and to other institutions such as political parties and social organisations, enterprise and employers' organisations, trade unions, and citizens.

In order for NSI to be successful the implementation of its principles has to be carried out in continuous dialogue with society. Therefore, the Government will spare no effort in ensuring the widest possible consultation of the strategy with organisations representing all social groups concerned with its implementation and, in particular, with trade unions, employers' organisations and local government bodies. Moreover, the European Integration Council will be established as a platform for the representatives of non-governmental organisations. Its objective will be to participate in consultations on the membership process.

European integration means an integration of people and countries. Therefore, it is important that the decisions at government level be accompanied by a process of gradual inclusion of Polish non-governmental organisations in the appropriate institutions and organisations in the EU. The Government will take steps to facilitate the implementation of this process.

The inclusion of Polish non-governmental organisations in the institutions and organisations within the Union should also mean they become an important lobbying force on behalf of Polish economic and political interests. This applies in equal measure to the preparations for the negotiations, the negotiations proper and the membership of Poland in the EU. For this reason the Government of the Polish Republic will assist the initiatives of the non-governmental organisations by organising information campaigns, training and the provision of financial aid.

NSI is centred on the best possible preparation for Poland's membership in the EU while taking into account the capacity of the administration to take action in the area of regulation. As a result of the reform of the central administration a new system of institutions has emerged. It defines the conditions of co-operation, the flow of information and the allocation of tasks between ministries and offices in charge of Poland's relations with the EU. The following bodies are charged with the implementation of NSI:

• the Council of Ministers;

• the Committee for European Integration (KIE);

• the Foreign Ministry;

• other ministries and central offices;

• regional and local authorities;

• Polish diplomatic missions, particularly in the Member States of the EU and in the states associated with the Union.

Within this system, the main co-ordinating role is played by the Committee for European Integration.

The Parliament of the Polish Republic also plays a prominent role in the implementation of NSI. This is evidenced by the transformation of Poland's legal system and includes many Acts of Parliament and legal acts of similar importance. Equally important is the constant parliamentary supervision of the work carried out by the Government. The involvement of the Parliament in the implementation of NSI will facilitate[Author ID1: at Thu Feb 6 09:08:00 1997 ]make[Author ID1: at Thu Feb 6 09:08:00 1997 ] the ratification debate concerning the accession of our country to the European Union easier[Author ID1: at Thu Feb 6 09:08:00 1997 ].

The carrying out of tasks by the organs of the Government will take place with the consent and co-operation of the President of the Polish Republic and his Office. The constitutional role of the President in the field of foreign policy allows him, as Head of State, to become actively involved in promoting Poland's interests in the states of the EU, and in implementing and monitoring the process of attaining full membership of the EU.

The co-ordination of work aimed at preparing Poland for membership of the EU and carried out by the Government will take place on three levels[Author ID1: at Thu Feb 6 09:08:00 1997 ]planes[Author ID1: at Thu Feb 6 09:08:00 1997 ]:

• strategic - the Committee for European Integration ;

• operational - on the level of Secretaries or Deputy Secretaries of State responsible for European integration;

• working - at the level of the heads of European integration departments in individual ministries and offices.

The c[Author ID1: at Thu Feb 6 09:09:00 1997 ]C[Author ID1: at Thu Feb 6 09:09:00 1997 ]o-ordination area [Author ID1: at Thu Feb 6 09:09:00 1997 ]also [Author ID1: at Thu Feb 6 09:09:00 1997 ]includes also [Author ID1: at Thu Feb 6 09:09:00 1997 ]the activity of non-governmental organisations dealing in particular with the problems of certification and normalisation.

The implementation of the strategy requires allocation of the necessary financial resources. New, adequately trained personnel will have to be hired by the ministries.

It has to be stressed most strongly that the implementation of NSI requires a stable constitutional order and effective democratic institutions fulfilling their obligations and actively participating in the European integration process. It also requires an efficiently functioning market economy. In particular, this means:

• continuing systemic transformation including, above all, privatisation and economic restructuring, and a reform of the social security system;

• continuing the policy of high and balanced economic growth and gradual attainment of the criteria for Economic and Monetary Union;

• improving the work of the institutions in charge of drawing up and implementing new legislation;

• increasing the international competitiveness of Polish enterprises;

• developing economic infrastructure with special reference to transport and telecommunications;

• supporting the development of science and technology;

• increasing the level of education of Polish society;

• intensifying training programmes on European issues designed for central and local administrations;

• implementing the provisions of the Europe Agreement and the recommendations contained in the White Paper of the European Commission on the Single Market (White Paper on the “Preparation of the Associated Countries of Central and Eastern Europe to enter the Internal Market of the European Union”).

NSI defines the overall political, economic, institutional, legal and educational[Author ID1: at Thu Feb 6 09:10:00 1997 ]training[Author ID1: at Thu Feb 6 09:10:00 1997 ]-information framework regarding Poland's preparations for EU membership. It also contains the most urgent recommendations concerning these issues.

NSI takes as its point of reference the criteria cited in the conclusions of the European Council in Copenhagen in June 1993. The Council stated then that “accession will take place as soon as an associated country is able to assume the obligations of membership by satisfying the economic and political conditions required. Membership requires:

• that the candidate country has achieved stability of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities;

• the existence of a functioning market economy as well as the capacity to cope with competitive 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 union.”

At the European Council held in December 1994, in Essen, the so-called pre-accession strategy was formulated. It was the development of the decision of the European Council adopted in 1993, in Copenhagen, and further[Author ID1: at Thu Feb 6 09:11:00 1997 ] defined the measures which had [Author ID1: at Thu Feb 6 09:11:00 1997 ]to be taken in order to further the [Author ID1: at Thu Feb 6 09:11:00 1997 ]integrate[Author ID1: at Thu Feb 6 09:11:00 1997 ]ion of[Author ID1: at Thu Feb 6 09:11:00 1997 ] the states of Central and Eastern Europe with the EU. One of its elements concerned the preparations for inclusion in the Single Market of the states associated with the EU. The integration of the associated states, including Poland, in the Single Market requires a complicated process of adapting Polish legislation, regulation systems[Author ID1: at Thu Feb 6 09:12:00 1997 ] and certification methods and standards to the requirements of the EU.

NSI is a logical step towards preparing Poland for membership of the EU. The starting-point is the evaluation of the degree of economic and legal adaptations contained in the Polish White Papers. A similar role is played by the Programme of Adaptation Measures to the Europe Agreement drawn up in 1992/93 which concerns both [Author ID1: at Thu Feb 6 09:14:00 1997 ]the economy and the [Author ID1: at Thu Feb 6 09:14:00 1997 ]law, and the annual adaptation programme implementation reports, beginning in 1993, as well as the sector adaptation programmes.

An important stage in Poland's preparation for EU membership was the presentation by the European Commission of the White Paper on the Single Market to which the Polish Government responded by drawing up a timetable for adjustment measures. Equally important was the Polish administration's reply to the questionnaire submitted by the European Commission in order to formulate an opinion (avis) concerning Poland's membership application. Such an opinion is a treaty-imposed condition in the process of accepting new EU members.

Therefore, NSI is one of the main elements of the negotiation preparations and of the drawing up of [Author ID1: at Thu Feb 6 09:16:00 1997 ]Poland's negotiation mandate. During the first quarter of 1997, the Committee for European Integration will prepare an action programme for the 1997 - 2000 period based on NSI. The sector adaptation programmes and negotiation recommendations will supplement and develop NSI. On this basis the Government of the Polish Republic will determine the negotiation objectives and the methods of their achievement. The Government will also define existing contentious issues and will collate the necessary documentation. It will also define the mechanism of co-operation between institutions and will identify the analytical potential required for solving negotiation problems.

Part I: General political objectives

1. For over one thousand years Poland has belonged to Europe in the geo-political, cultural and economic sense. Our country has shared its basic values,[Author ID1: at Thu Feb 6 09:18:00 1997 ] which we helped to create and defend. Therefore, NSI is not a strategy for the return to Europe, but rather a strategy for integration with European structures, in the construction of which, our country, against its interests and popular opinion, could not participate after 1945.

1. Poland was the first country in Central and Eastern Europe to begin building a democratic political system and a market economy. Two very important steps on the road to these objectives have been the granting of membership in the Council of Europe (1991) and in the Organisation of Economic Co-operation and Development (1996). Poles perceive the idea of including their country in the integration of Europe as part and parcel of political and economic transformation.

1. Membership in the EU is a strategic objective of Poland and one of the main challenges facing Polish politics and the economy. Poland's effort to gain EU membership is closely related to the desire to attain the fundamental goals of Polish policy in the areas of national security, the economy and the social system. European integration is a historic opportunity for the entire Polish society. The process of integration is supported here by the main political forces and economic circles and has been one of the top priorities of every Polish Government since 1989.

1. By signing, in 1991, the Europe Agreement and subsequently submitting, in 1994, a membership application, the Polish Government expressed the aspirations of the majority of Polish society to play an active part in the process of European integration. This integration has ensured peace and prosperity for all Western European nations. The European aspirations of the Poles stem from their conviction that the EU plays a vital role in maintaining peace and democracy in Europe, and the world. Poland fully shares the ideals and objectives of the EU.

1. The above mentioned reasons give Poland the right to participate in the European structures, but also impose on the country the duty to participate in their development. Membership in the EU requires that Poland should be able to co-operate in the shaping of the European democratic order. Poland - a European democratic state founded on the principle of the rule of law, with a market economy and friendly and treaty-based relations with all her neighbours and other European states - meets all the membership criteria stipulated in Articles F and O of the Maastricht Treaty.

1. This strategy stems from Poland's interests of State. Our country wishes to take a place in Europe and the world which would ensure welfare and security for its citizens. In order to meet this goal, Poland's membership in the EU is not just desirable and beneficial, but necessary. Remaining outside the EU would bring about the risk of Poland being marginalised with an overall lowering of security.

1. The benefits stemming from Polish membership in the EU are of a political, economic and social nature.

1. The political benefits are the participation in the building of a united Europe. This will be carried out through active participation in the activities of all EU institutions and in all three pillars. This will allow increased stability of the democratic system as well as the security of the state and its citizens. A united Europe will also give its citizens freedom to travel, settle and take up employment. The political benefit also lies in the building of closer individual, local and regional ties between Poland and the rest of the continent.

1. The economic advantages are: participation in the Single European Market with unimpeded movement of goods, services, people and capital, access to structural funds, and the inflow of investments and new technologies.

1. The social benefits are: an opportunity for Poland to come closer to European standards in internal security, health and safety at work, health care, education, information, and a general increase in living standards.

1. The benefits stemming from the implementation of European environmental standards will include an improvement in the environmental living conditions of society, and the introduction of new environment-friendly technologies which rationalise the consumption of raw materials and energy, thus improving the effectiveness of economic management and promoting sustainable growth.

1. The Government of the Polish Republic is aware that integration involves certain costs which must be considered not only from the point of view of their budgetary implications, but also from the point of view of their economic and social aspects. The budgetary costs stem from the cost of operating the central co-ordination structure, legal approximation, personnel training and information activities. The economic and social costs may take the form of difficult challenges facing certain sectors of the economy, regions or individual economic agents.

1. The existing budgetary classification makes the precise definition of the budgetary adjustment costs difficult. For this reason work has started on the adoption of a new budget classification which allows the drawing up of a precise balance of costs and benefits. The Government is of the opinion that a large part of the adjustment costs could be financed from the[Author ID1: at Thu Feb 6 09:22:00 1997 ] pre-accession funds and through transfers, within the initial membership period, from structural funds.

1. An obvious aim of the Government will be to maximise benefits and minimise costs. The calculation of costs related to the integration process is, however, an issue that cannot be presented with precision. For instance, some would argue that the transfer of certain prerogatives of certain State organs to EU institutions is a political cost, while others would maintain that this is a benefit because it gives Poland the right to participate in the EU's decision-making processes. Economic costs of adopting the EU's legislation (acquis communautaire) and the restructuring of the economy lead to modernisation and an increase in economic competitiveness. By the same token, it may mean for some an increase in the cost of labour, for others improved pay and raised living standards. For this reason the process of integration should be viewed as a whole.

1. It has to be stressed that the transformation costs are not the price to be paid for EU membership, but the price of many years of slow development of the Polish economy. These costs would have to be borne anyway, regardless of whether or not Poland became a member of the EU. The experience of other countries joining the European Union shows that, in the long run, the economic benefits of integration by far outweigh the costs of adjustment stemming from the specific nature of the rules existing within the EU. These benefits cannot be taken advantage of as long as new protectionist measures are implemented in the economy.

1. While making a huge effort to adapt and bearing all the costs involved, Poland expects that the Union, too, will show readiness to bear certain financial consequences of our membership. The Union must set these costs against the benefits stemming from Poland's accession. Even now these benefits are considerable and result mainly from the dynamic development of trade, wide access to our market, profitable investment opportunities, and the political and economic stability in the region.

1. Poland's entry to the European structures is not a straightforward process and will require the overcoming of many obvious and apparently conflicting interests on both sides. Only a strong political will on the part of Poland and the EU can surmount the existing difficulties and lead to the attainment of the intended goal.

1. Poland as a future member of the EU has a right and duty to present and defend her interests. The Government does this through structural dialogue with the Union within the framework of the strategy of preparing the country for EU membership - the Essen Strategy. The future shape of the EU is the subject of the Intergovernmental Conference. The Government will follow closely the debate on the reform of the EU and will present its position concerning this matter in due course.

1. An effective, democratic, clear, citizen-oriented, and open Union, showing solidarity, providing strengthened identity in foreign and security policy, and developing new forms of co-operation in the fields of home affairs and the administration of justice, is in Poland's interest. Only such a Union can meet the needs and membership aspirations of Poland.

1. Following its acceptance by the Government, NSI will be submitted to the Parliament of the Polish Republic. The Government intends the strategy to be not just an expression of opinions and aspirations of the parliamentary majority, but also of the majority of Poles. Therefore, the Government will strive towards the greatest possible clarity of the integration process by providing public opinion with reliable information on its progress and by entering into dialogue with non-governmental organisations and business circles.

Part II: Adaptation of the economy

1. The future position of the Polish economy within the enlarged EU will depend on the economic policy pursued today. It will depend, therefore, on the method of restructuring the basic sectors of the national economy and the speed of ownership transformation. In order fully to take advantage of the opportunities offered by integration, Poland will also have to prepare her national economy to operate within the Single Market and to create the conditions in which enterprises can achieve a high level of competitiveness.

1. The nature and direction of reforms initiated in 1989 fully meet the requirements of Poland's accession to the European Union. At that time Poland began transforming a centrally planned economy into a market economy. The legal and institutional foundations necessary for the functioning of the market have been created. New solutions concerning the creation and financing of the State budget have been established. The ratio of public debt to the gross domestic product is being steadily reduced. The tax system has been adapted to the requirements of a market economy. The rate of inflation is decreasing. The exchange rate of the Zloty has been stabilised and the currency has become convertible in accordance with Art. VIII of the statute of the International Monetary Fund. The Central Bank has become an institution pursuing an independent monetary policy utilising instruments used by the central banks of the EU Member States.

1. Within the past few years Poland has shown dynamic economic growth and has been the fastest developing European country. Poland's macro-economic policy is judged favourably by the most important international financial and economic organisations. At the same time, Poland concluded her negotiations with the OECD and has become its 28th member. The private sector dominates in the economy both in terms of the GDP (over 60%) and employment (over 63%). Favourable conditions are also being established for foreign investment.

1. The direction of economic policy has been defined by the parameters of a medium-term economic programme contained chiefly in „Strategy for Poland”, and in „Package 2000”. Both these programmes determine the basic macro-economic aggregates as well as the main goals of economic development until the year 2000. Their implementation forms the basis for ensuring internal and external balance while maintaining a fast rate of economic growth. NSI assumes the necessity of developing economic policy in the perspective of Poland's membership in Economic and Monetary Union.

1. From the beginning of reforms and parallel to the Europe Agreement negotiations, the Government has been pursuing an adjustment process leading to the acquis communautaire of the European Communities. Since 1993 the Government Action Programme for the Adaptation of the Polish Economy and the [Author ID1: at Thu Feb 6 09:33:00 1997 ]Legal System to the Requirements of the Europe Agreement has been implemented. The programme defines the main directions of the integration process and the tasks of individual ministries and central offices.

In connection with the adoption by the Cannes European Council in June 1995 of the White Paper on “the Preparation of the [Author ID1: at Thu Feb 6 09:34:00 1997 ]Associated Countries of Central and Eastern Europe to enter the Internal Market of the European Union”, the scope of the adjustment activities has been widened accordingly. The Government passed Resolution No.133/95 defining the tasks and procedures in adapting Polish law to the standards of the Single Market.

1. The economic policy of Poland is based on the general premises of policy followed by the European Union. Poland pursues a policy of balanced growth taking into account the criteria necessary for accession to Economic and Monetary Union in the longer term. These measures are aimed at turning Poland into an economically effective member of the Union.

General issues

1. Poland's efforts to accede to the EU require the continuation of economic reforms and the modernisation and enactment of commercial law aimed at creating an effective market economy, and designed to bring about organisational, ownership and restructuring transformations. Membership in the European Union will create the opportunity to benefit from the participation in an integrated economic system.

1. The main objective of the integration is to achieve an acceleration of economic growth and secure higher living standards. The closing of the economic gap existing between Poland and Western Europe necessitates long-term, fast and balanced economic growth taking into account the requirements of environmental protection. Steps also have to be taken to obtain the pre-accession funds suggested by the EU which would allow the process of adjustment[Author ID1: at Thu Feb 6 09:36:00 1997 ]aptation[Author ID1: at Thu Feb 6 09:36:00 1997 ] to be speeded up. In the process of negotiation, efforts should be made aimed at securing access, after accession, to the structural funds, at a level allowing for balanced growth of all Polish regions.

1. Poland's objective is to participate in all areas of integration as a member enjoying full rights. The long-term aim of our country is to catch up with the EU states creating Economic and Monetary Union, which means striving for macroeconomic stability guaranteeing balanced and fast growth. The policy of limiting the rate of inflation, controlling the budget deficit and the public debt is, therefore, a natural part of the integration strategy.

Costs and benefits of the integration process

1. Economic integration brings benefits to all the countries involved in this process; it is a process where all partic[Author ID1: at Thu Feb 6 09:38:00 1997 ]i[Author ID1: at Thu Feb 6 09:40:00 1997 ]pants [Author ID1: at Thu Feb 6 09:38:00 1997 ]can be [Author ID1: at Thu Feb 6 09:39:00 1997 ]winners[Author ID1: at Thu Feb 6 09:38:00 1997 ] [Author ID1: at Thu Feb 6 09:40:00 1997 ]as it is not true that for one side to profit the other must lose out[Author ID1: at Thu Feb 6 09:39:00 1997 ]. Poland does not have sufficient domestic capital needed for fast and continuous growth, but could benefit from inward investment from the EU. Many Polish enterprises, for decades cut off from the world market, lack the know-how needed for their development abroad. The technologies used in Polish industry are backward compared to those utilised in Western Europe. All the factors needed for fast economic growth, which are absent in Poland, can be readily found in the EU. On the other hand, Poland has considerable reserves of human resources which cannot yet be put to use and properly rewarded, as well as a growing market for Polish and foreign products. The economic integration between Poland and the EU can bring mutual benefits, provided that an appropriate strategy of attaining membership is pursued.

1. The analyses of the costs and benefits for the Union stemming from Poland's membership show that, in the medium and long term, the benefits to the Union of integration with the Polish economy by far outstrip the budgetary costs. These benefits arise not only from increased trade, but also from increased competitiveness of the Union's economy brought about by the allocation of production factors. Although the studies on the process of integration of the associated states have been carried out over the last five years, not one significant piece of research has shown important negative sectoral or regional effects in the EU [Author ID1: at Thu Feb 6 11:13:00 1997 ]of the[Author ID1: at Thu Feb 6 11:13:00 1997 ]is[Author ID1: at Thu Feb 6 11:13:00 1997 ] integration for the EU[Author ID1: at Thu Feb 6 11:13:00 1997 ]. On the contrary, the large surplus in trade on the side of the European Union is positive proof of the benefits for the EU resulting from the integration process.

1. Accession to the EU means incorporating goods, services, capital and labour into a single market. The barriers hampering the movement of goods and production factors must be eliminated at the time of the [Author ID1: at Thu Feb 6 11:26:00 1997 ]accession, or following a transition period. This will mean that goods and production factors will move according to market mechanisms. Capital, in particular, will flow to those areas where the returns to investment are high, where production costs are lower and where strong economic growth is leading to the development of new markets. This will be exactly Poland's situation. A speedy liberalisation of the markets for goods and production factors and, in particular, for capital is, therefore, in the interests of our country. Enterprises unable to adapt to the new conditions of competition will risk financial losses or even elimination from the market.

1. Achieving benefits in the integration process depends on a proper adjustment to the new division of labour while taking into account comparative advantages. Inappropriate adjustment measures may not only slow down the process of integration of the Polish economy with that of the EU, but also decrease the benefits resulting from the process. The ability to meet the challenges of competition provides an opportunity to benefit from the potential of the EU market consisting of over 370 million consumers. It also means that, under the conditions of the full opening of the Polish market to goods from the Union, Polish industry will have to compete effectively. Here importing is an instrument of modernisation and quality improvement. Raising import barriers points to weaknesses and promotes low competitiveness of industry.

1. Delaying the introduction of the necessary changes and adjustment is not the right method of solving these[Author ID1: at Thu Feb 6 11:28:00 1997 ] above mentioned [Author ID1: at Thu Feb 6 11:28:00 1997 ]problems[Author ID1: at Thu Feb 6 11:28:00 1997 ]. Modernisation and economic restructuring is a costly process. But these costs will have to be borne in any case, regardless of whether Poland joins the EU or not. In the case of growing unemployment in sectors undergoing restructuring, the Government will attempt to obtain a transition period and/or financial aid after accession. It is important to avoid attempts to negotiate protection periods for too many sectors of the Polish economy as this may lead to inadequate preparation of the Polish economy for accession to the EU, and consequently to the weakening of Poland's negotiating position.

1. The balance of costs and benefits of Poland's integration with the EU will depend on the solutions adopted in economic policy and the legal system, as well as on the preparation of enterprises themselves. For this reason it is still impossible accurately to calculate all the costs and benefits. The benefits gained by Poland from the integration will be both direct: increased access to markets, inflow of capital, direct transfers of resources from the Union, and indirect: better allocation of production factors, improved effectiveness of economic processes, savings resulting from the reduction of barriers in transactions with EU countries. Many of these benefits are of a long-term nature as their scale will depend on the successful carrying out of the integration process, e.g. reaction of foreign investors and the scale of capital inflow. The costs of the integration process result mainly from the need to take adjustment measures both on the macroeconomic scale and at the level of individual enterprises. Some of these costs stem from the necessity to modernise the economy and the legal system, as well as from the need to strengthen Poland's market economy. A proper adjustment[Author ID1: at Thu Feb 6 11:54:00 1997 ]adaptation for[Author ID1: at Thu Feb 6 11:54:00 1997 ]to[Author ID1: at Thu Feb 6 11:54:00 1997 ] the EU means for Poland the necessity of raising technical, security, environmental protection and social standards. This involves certain costs, but also brings about an increased level of social satisfaction. Another source of costs are the payments which will have to be made to the budget of the Union. Poland will be a net beneficiary of Union resources. However, the Government will have to take into account both payments to the budget of the Union, as well as financial resources needed for co-financing of projects paid for by the Union. Prior to the commencement of negotiations, the Government will carry out a detailed analysis of the estimated changes to the financial system of the State.

1. The overall balance of costs and benefits must also be considered from the point of view of the costs of non-membership. The point of reference is the situation arising from Poland giving up her attempts to join the European Union. All the costs and benefits stemming from the integration have to be offset against the position of Poland remaining outside the EU while the other associated states become members of the Union.

1. The economic dimension of accession also includes the ability of the Union itself to bear the costs of this process. Many studies show that for the Member States the enlargement of the Union means increased budget costs. Their scale depends on the detailed solutions concerning the speed, nature and order of the integration activities. This will be the subject of negotiations. The direction of the reforms within the EU will influence the scale of the integration costs.

Conditions of membership

1. In the process of attaining membership the ability of the applicant to implement the EU's legal regulations is very important. The fundamental issue here is not just the formal aspect of this process, but also its economic dimension. The implementation of new legal regulations will improve the functioning of enterprises because applying the same provisions throughout the EU lowers the costs of operating in the Union's market. From the point of view of Poland, i.e. an acced[Author ID1: at Thu Feb 6 11:57:00 1997 ]ss[Author ID1: at Thu Feb 6 11:57:00 1997 ]ing country, the one-off cost of changing the legal regulations and of the adjustment[Author ID1: at Thu Feb 6 11:57:00 1997 ]aptation[Author ID1: at Thu Feb 6 11:57:00 1997 ] to the new situation is also important. Therefore, an appropriate sequence of integration activities will have to be worked out.

1. Accession to the EU means that Poland will have to determine the timing and sequencing of the adoption of the entire legislation of the EU. This will be one of the subjects of the negotiations. Some regulations concerning the movement of goods, services and production factors must be implemented at the time of Poland's accession to the EU: this applies, for instance, to the policy on competition, the unification of customs tariffs in relation to [Author ID1: at Thu Feb 6 11:58:00 1997 ]third countries and issues related to the harmonisation of technical standards and certification procedures. We must, therefore, define the areas where we have the ability immediately to accept the minimum acquis communautaire, as well as present a timetable for the remaining legal adaptations.

1. One of the most important elements of the evaluation of Poland's preparations for membership will be an appraisal of economic trends, i.e. the ability to achieve balanced growth accompanied by falling inflation and simultaneous liberalisation of access to the Polish market, and legal regulations concerning the functioning of the market and the readiness to implement in the shortest possible time regulations needed for the inclusion of the country in the Single Market. Another element of the evaluation will be a long-term analysis of the structure of the Polish economy estimating the feasibility of the implementation of the entire acquis communautaire, as well as the adaptation to the principles of Economic and Monetary Union.

1. Membership in Economic and Monetary Union will not be a condition for Poland's accession to the EU. However, within a few years, Poland will have to present a realistic programme designed to meet the above mentioned criteria. This, in turn, depends on the carrying out of [Author ID1: at Thu Feb 6 11:59:00 1997 ]deep reforms in the public sector guaranteeing long-term stability of public finances, and on the continuation of an effective anti-inflation policy.

1. The work on the establishment of the foundations for the institutional and organisational infrastructure needed for the implementation of the economic and legal adaptations is well advanced.

The Office of the Government Plenipotentiary for the [Author ID1: at Thu Feb 6 12:00:00 1997 ]European Integration and Foreign Assistance set up in 1991, Resolution of the Council of Ministers No. 11/91, has, through[Author ID1: at Thu Feb 6 12:00:00 1997 ]according to the assumptions of[Author ID1: at Thu Feb 6 12:00:00 1997 ] the reform of the central state administration, been replaced by the Committee for European Integration (KIE) equipped with statutory powers to co-ordinate the adjustment process. The KIE's tasks include initiating and organising work and activities aimed at Poland's integration with the European Communities, particularly in the economic, legal and institutional-organisational area. The Government organises this work through long-term action programmes which include the tasks of all the ministries and central offices.

Institutions ensuring the implementation of economic policies compatible with the law of the EU have been set up. The Public Procurement Office has been established to implement the rules governing public procurement and the newly created Competition and Consumer Protection Office has been charged with implementing procedures aimed at the prevention of monopolistic practices. As the date of Poland's accession to the EU comes closer, the infrastructure dealing with the adaptation process will be expanded.

The external dimension of the institutional changes is reflected in the ever increasing presence of State bodies and non-governmental organisations in international institutions and organisations. The participation in the work of the United Nations (UN) and its specialised agencies, the World Trade Organisation (WTO) and the Organisation for Economic Co-operation and Development (OECD), as well as the participation in the work of specialised, primarily European, organisations and institutions, also plays an important role.

1. Integration of the Polish economy with the EU will promote an increase in the growth rate of Poland's economy. However, this does not mean that the integration process will be entirely free from certain dangers or problems requiring solution:

• liberalisation will intensify the pressure to restructure those sectors of the Polish economy which are not competitive in world markets and which are characterised by limited possibilities of increasing productivity. In the long run this restructuring will prove not only beneficial for the economy, but also unavoidable. EU membership may, however, result in a pressure to accelerate this restructuring;

• acceleration of structural changes in agriculture, and in particular the faster outflow of agricultural workers to other sectors of the economy, may cause increased pressure on the labour market;

• increased inflow of foreign capital may create pressure to appreciate the Zloty;

• adoption of EU norms and standards will bring about an increase in production costs.

1. The areas where the risks of negative developments caused by the process of integration appear will be the subject of particular care and attention by the Government. Such a negative development may be, for instance, a regional or sectoral increase of unemployment caused by the need to restructure the economy. The Government will counteract such developments by implementing policies designed to make the labour market more flexible. The ability of the State to counteract sectoral or regional unemployment lie in the adoption of a taxation policy favouring private enterprise and encouraging the creation of new jobs.

1. The introduction by the Government of certain areas of EU legislation into the legal system may prove costly. This applies, in particular, to the standards of environmental protection, social issues, etc. The Government will strive towards a compromise between the rapid implementation of these measures and the appropriate spreading over time of the costs involved. One of the tasks of the State is the introduction of economic incentives which, in a market economy, will stimulate the development of environmental protection. Apart from the existing fees, fines and preferential credits for environmental investments, these measures will also include product taxes, taxes on fuel, ecological deposits, tax reductions, etc.

1. The Government will carry out a full cataloguing of norms, standards and legal provisions of the EU and will determine which of them Poland will be able to implement immediately, prior to, or at the time of accession. As far as any remaining norms, standards and legal provisions are concerned, it will be necessary to decide the methods and timetable needed for full adoption.

1. Membership negotiations may well commence as early as the beginning of 1998. Should this be the case, the negotiations could be concluded by the year 2000. Therefore, there are only three to four years left for the implementation of measures designed to adapt the Polish economy to the requirements of EU membership. At the same time, these are the last years during which the Europe Agreement allows special restructuring solutions to be used in Polish industry.

1. The Polish Government will try to make transition periods as few as possible. The duration of the transition periods will be the subject of negotiations and will depend not only on the situation of Poland, but also on the changes taking place in the Union itself.

1. Poland already benefits from EU financial aid in the form of the PHARE programme. This aid is an important instrument in supporting the integration processes[Author ID1: at Thu Feb 6 12:04:00 1997 ] and membership preparations. Poland hopes for the creation of pre-accession funds facilitating the necessary adjustments prior to our country becoming a member of the EU. From the date of accession, Poland will be entitled to receive assistance in the form of transfers from the structural funds. These transfers may prove an important aid in the development of the Polish economy, and in easing the burden of adjustment costs.

1. In the period leading up to Poland gaining EU membership the Government will concentrate on improving the functioning of the economy through:

• the strengthening of market mechanisms, the development of the legal and institutional market infrastructure and the elimination of the non-market mechanisms of market regulation;

• the continuation of privatisation and supporting the private sector which should become the main engine of the development of the Polish economy;

• improvement of the allocative role of the labour market and increased mobility of the labour force through, amongst other things, an increase in the territorial mobility of the population (facilitating flexibility in the housing sector and promoting cheaper accommodation) as well as promoting training leading to improvements in the qualifications of the labour force;

• the demonopolisation of individual market sectors and the implementation of competition principles compatible with those currently in force in the EU;

• lowering the rate of inflation, the creation of incentives to save and invest, and the attainment of full convertibility of the Zloty;

• implementing restructuring programmes in public sector enterprises, in order to facilitate the allocation of resources to the most efficient sectors of the economy;

• activities aimed at the development of the capital market, including the completion of the restructuring and privatisation process of the banking sector, increasing access to the Polish financial market and creating incentives for institutional investors;

• intensifying state participation in the development of the necessary infrastructure through increasing infrastructure financing from budget resources and creating incentives for the participation of foreign investors and the private sector;

• support for the development of human resources and in particular providing the necessary funds for the development of science and improvements in the quality of education;

• ensuring stability of public finances through limiting the scale of deficits and the public sector's debt and carrying out of reforms of the social security system and the financing of the health care system, while at the same time striving towards limiting taxation and the role of the State in the re-distribution of incomes;

• integrating the requirements of environmental protection with development programmes envisaged in the Implementation Programme of the State's Natural Environment Policy, as well as strengthened supervision of the observance of environmental protection regulations;

• continued implementation of the rules of the World Trade Organisation, WTO, and the Organisation for[Author ID1: at Thu Feb 6 12:09:00 1997 ]of[Author ID1: at Thu Feb 6 12:09:00 1997 ] Economic Co-operation and Development, OECD;

• intensified adaptation of commercial law;

• introduction of legal provisions, standards and technical norms of the EU.

Business strategies

1. Polish enterprises will play a crucial role in the adjustment process. They will have to maintain and increase flexibility and competitiveness in the European market under the conditions of the liberalised movement of goods and production factors. They will have to control manufacturing costs, implement modern and dynamic management and marketing techniques and obtain both domestic and foreign capital in order to finance investments aimed at closing the technological gap between Poland and EU Member States.

1. The adjustment strategy for Polish enterprises should lead to increased productivity and, in those areas where this is necessary, to radical adaptation and restructuring measures. The Government hereby declares that the enterprises concerned can expect openness and co-operation on the part of the administration and will be provided with extensive information on the changes taking place, and on the anticipated effects of integration. The Government will consult with the representatives of business on all relevant matters in the context of the preparation for and negotiation of EU accession. In special and well justified cases the Government will use the temporary protection of restructuring activities allowed to Poland under international obligations.

1. It is vital that Polish enterprises carry out a detailed calculation of the effects of the changes being introduced and adjust their plans and operations accordingly. In this area a close co-operation with the academic world could be very advantageous for both sides. The adjustment strategy of Polish enterprises should be based on the collection and analysis of the necessary information, and the evaluation of new business opportunities as well as the increase in competitive pressure. The strategy should comprise:

• drawing up of medium and long-term plans aimed at increasing productivity and the competitiveness of products which will take into consideration the timetable for liberalisation of the movement of goods and production factors between Poland and the EU;

• drawing up of a strategy for taking advantage of the free access to the EU market in order to increase production and sales, as well as the carrying out of changes in management which will allow market expansion; this applies in particular to the implementation of quality management systems (ISO 9000 and environmental protection ISO 14000), as well as the implementation of technologies that are the most suitable from the point of view of environmental protection and the efficiency of energy utilisation;

• drawing up of plans to carry out and the finance investments needed to meet the challenges posed by increased competitive pressure including searching for both domestic and foreign partners with capital;

• constantly keeping track of the changes in the legal regulations, both planned and being implemented, resulting from the integration; gathering of the necessary data base on the functioning of the Single Market;

• influencing the membership conditions being negotiated with the Union through the appointment of industry representatives capable of forming both current and long-term opinions regarding development problems and articulating the interests of these groups of enterprises during consultations with the Government;

• drawing up, wherever necessary, restructuring programmes which could form the basis for applying for temporary protection allowing restructuring activities to take place;

• searching for, evaluating and implementing new technologies.

1. Problems related to the functioning of certain sectors of the economy may require their special treatment during the integration process. This applies, for example, to agriculture, environmental protection and the financial sector. For them long-term adaptation strategies will be formulated. The final form of these strategies will depend on the membership conditions negotiated between Poland and the EU.

1. The industrial policy of the Government will be based on the assumption that the key to success of Polish enterprises in the Union market will be the role of management and their market strategies, as well as the ability to achieve fast increases of productivity through investing in both human and material resources. Thus, industrial policy will concentrate on promoting adjustment through improved functioning of the market, encouraging competition and demonopolisation, as well as the creation of general solutions favouring enterprise, improving management effectiveness, rational utilisation of raw materials and energy and the implementation of modern environmental protection technology, but not on direct intervention in individual enterprises or sectors.

1. Therefore, the Government will encourage enterprises to use the transition period in which import barriers will still be maintained to carry out the necessary restructuring and to improve their financial standing. A particular importance will be attached to the implementation of the restructuring programmes in sectors and regions experiencing adaptation difficulties. The Government will gradually eliminate barriers to competition and will avoid introducing new protectionist measures. Because of the necessity of completely abolishing protection following Poland's accession to the EU, maintaining high protective barriers prior to accession would have a negative impact on enterprises and should be avoided.

Main areas of economic adaptation

1. The strategy of attaining membership in the EU must take into account the need to rapidly adapt the Polish economy to the opening of borders. On the one hand, opportunities will present themselves for the operation of our enterprises in the wide European market. On the other hand we should expect the Polish economy to be become subjected to increased competition. The strategy defines the directions of activities regarding the four basis[Author ID1: at Thu Feb 6 12:10:00 1997 ]c[Author ID1: at Thu Feb 6 12:10:00 1997 ] tenets of the economic freedom of the Single Market, i.e. free movement of goods, services, capital and labour.

Free movement of goods

Economic significance

1. Free movement of goods is one of the four basic freedoms of the Single Market of the European Union. It means not only the abolition of all customs duties, adoption of a common custom tariff and trade policy rules, but also the elimination of all non-tariff barriers. By joining the EU, Poland will be obliged to eliminate all barriers preventing free movement of goods in the enlarged European Union. Customs duties for industrial products will be reduced to zero. Free movement of goods is also conditional on the harmonisation of legal provisions such as technical norms, customs duties applied to imports from third countries, rules governing the allocation of subsidies, competition rules, indirect taxation, etc. The experience gained in the process of trade liberalisation between the countries of CEFTA will be important in the preparations for the establishment of the customs union. The progress made in the liberalisation of trade within CEFTA may have an impact on the course of the negotiations with the EU.

Potential problems in the period leading up to membership

1. The abolition of customs duties for industrial goods is regulated by the Europe Agreement. Agricultural products remain outside the scope of the liberalisation. At the time of Poland's accession, trade in agricultural products will be liberalised. Liberalisation of the movement of goods may affect the trade balance, viz. additional increases of imports. This means that Polish producers must take advantage of the access to the market of the Union.

Activities which have to be carried out prior to the accession

1. The Government will continue to adapt Polish customs tariffs to those in force in the Union so as to allow, at the time of accession, the adoption of a common external customs tariff and common rules of trade policy.

1. The problem of mutual recognition of technical and quality certificates has to be solved. This will require far-reaching standardisation and adaptation of technical norms to those currently in force in the Union.

1. A gradual adaptation of Polish legislation and the organisational and institutional framework with respect to[Author ID1: at Thu Feb 6 12:11:00 1997 ]in regard to the[Author ID1: at Thu Feb 6 12:11:00 1997 ] Value Added Tax, VAT, and excise tax to the legislation in force in the Union is also necessary.

1. The Government will expand the border infrastructure in those sections of the Polish border which will become an external border of the Union following Poland's accession to the EU.

Integration tasks

1. In this case, the transition period may concern the implementation of particularly costly technical norms and the liberalisation of the movement of other sensitive goods.

The course of further preparatory work

1. In 1997, the Government will adopt a programme of harmonisation of indirect taxes which will be implemented in the 1997 - 2000 period.

1. In 1997, the Government will draw up and implement a programme of harmonisation of technical standards, and will prepare a programme co-ordinating the level of customs tariffs to that of the EU.

Free movement of services

Economic significance

1. The freedom to provide services in the entire territory of the EU is a cornerstone of the Single Market. In the case of services which require a direct contact with the recipient, key importance is attached not only to the abolition of the technical and physical barriers preventing the provision of those services, but also to the right of service providers to operate without hindrance in the entire territory of the Union. This means freedom to engage in commercial and service activities without the need to establish any other form of permanent economic presence.

Potential problems in the integration process

1. Following Poland's accession to the EU, the freedom to provide services will also include those sectors of the economy which hitherto have never experienced foreign competition. According to the Europe Agreement, the liberalisation of these services will take place at the end of the transition period. This applies, in particular, to the banking and financial sector, as well as some sectors treated on preferential terms, viz. air transport and telecommunications. Liberalisation of the access to the financial market is a condition of the free movement of capital. It is necessary to find such a liberalisation path which will allow the domestic financial sector to provide services effectively while withstanding the competition of foreign institutions with greater experience, knowledge and capital base. The timetable of the liberalisation of access to the Polish financial services market is determined to a large extent by the provisions of the Europe Agreement and the membership in OECD.

Activities that have to be carried out prior to the accession

1. Coping successfully with the competition on the financial services market depends on a radical improvement in efficiency and a capital strengthening of Polish financial institutions. In the period leading up to accession, it is necessary to draw up and implement a policy of supporting the restructuring, consolidation and privatisation of the Polish financial institutions which will also include finding foreign strategic investors. The improvement of the effectiveness of the financial sector and its preparation to meet the challenges posed by market competition must take place before accession to the EU.

1. As far as the telecommunication sector is concerned, it will be necessary to continue the rapid development of the infrastructure, the demonopolisation of the market, and to undertake the privatisation of Telekomunikacja Polska SA.

1. As far as the transport sector is concerned, the most urgent tasks will be to undertake investment leading to the elimination of bottlenecks in the system and the improvement of transport services for the public. The investment projects currently under way must be completed, and new projects designed to improve the competitiveness of Polish transport services by way of the modernisation and restructuring of the rolling stock, marine fleet and transport infrastructure including ports, as well as by the development of multi-modal transport, must be launched. The restructuring of Polish Railways, PKP, and the privatisation of PLL-LOT SA airline are considered urgent.

Integration tasks

1. As far as the fishing sector is concerned, it is necessary to determine the principles of participation in fish resources in the waters of common interest with the EU.

1. Following Poland's accession to the EU, the service sector should fully enjoy the benefits of the inclusion in the Single Market without derogations and transition periods limiting those opportunities. However, it may transpire that some service sectors will require short transition periods necessary for the complete adaptation of Polish systems and legal provisions to those existing in the EU. The above mentioned issues will be defined in detailed adaptation programmes beginning with the priorities adopted in the process of implementing the recommendations contained in the White Paper of the EU. Following any transition period, the remaining restrictions imposed on the freedom to provide services would be abolished.

The course of further preparatory work

1. The Government will draw up and implement programmes supporting the restructuring and privatisation of the service sector enterprises and, in particular, the enterprises currently occupying a privileged position - market demonopolisation. Sector programmes concerning selected types of services and designed to adapt them to the standards of service provision used in the EU will also be developed.

Free movement of capital

Economic significance

1. The freedom of movement of capital is the basic condition of EU membership. Poland needs to take advantage of this in order to achieve an acceleration of economic growth. This freedom means the right of companies and persons from the EU to invest in Poland without constraints and with the right to free transfer of profits, as well as the right of Poles to invest abroad. Taking into consideration the differences in the abundance and relative cost of production factors which exist between Poland and the EU, in the long run, the balance of capital movement should be favourable for Poland.

Free movement of capital also means the right to unlimited purchasing of property and financial assets in Poland by foreigners from the EU.

Potential problems in the integration process

1. Full liberalisation of capital movement may pose a risk to the balance of payments. An appropriate monetary, exchange rate and state reserve policy should prevent this.

1. Another potential problem is an increase in undesirable and illegal practices. Preventive measures will include increased supervisory powers to be granted, in accordance with OECD and EU standards, to institutions entrusted with financial sector supervision and tax administration.

1. A problem that may arise during negotiations is the unrestricted[Author ID1: at Thu Feb 6 12:12:00 1997 ]limited[Author ID1: at Thu Feb 6 12:12:00 1997 ] freedom for[Author ID1: at Thu Feb 6 12:12:00 1997 ]of[Author ID1: at Thu Feb 6 12:12:00 1997 ] foreigners[Author ID1: at Thu Feb 6 12:12:00 1997 ] nationals[Author ID1: at Thu Feb 6 12:13:00 1997 ] to acquire property.

Activities which have to be carried out prior to the accession

1. The Government will implement the programme of capital movement liberalisation leading to the full convertibility of the Zloty around the year 2000 - adopted in connection with Poland's membership in the OECD. The key element of this programme will be a new currency law which will come into force in early 1998.

Integration tasks

1. Free movement of capital is of paramount importance when it comes to investment,[Author ID1: at Thu Feb 6 12:13:00 1997 ] and the Government hereby fully confirms its significance in the integration process. The practical implementation of some of its elements, e.g. the right to purchase some types of assets, should be one of the ultimate steps in the overall sequence of adjustment measures.

The course of further preparatory work

1. In accordance with their respective responsibilities, the Government and the National Bank of Poland, will be improving the systems of monitoring capital movements, and will pursue a policy guaranteeing stability in the balance of payments.

Free movement of labour

Economic significance

1. Free movement of labour means unlimited right to settle, engage in commercial activities and take up employment in any of the EU countries. The aim is to facilitate rational utilisation of labour resources in the EU. Despite certain fears, the implementation of this principle following the accession to the EU of the poorer states did not result in a mass migration of people in search of better working conditions. However, it is impossible to discount the possibility that in the case of Poland, where the average pay is much lower, the effects of unlimited freedom of movement will be much stronger.

Potential problems in the integration process

1. Free movement of labour may mean different results for Poland and the Member States of the EU. EU Member States may fear a significant influx of job seekers from Poland. For the Poles the possibility of finding employment in the EU will be seen as an undoubted attraction. As far as the Polish labour market is concerned, the outflow of highly skilled employees, which is already noticeable, could be a problem. Yet another consequence could be the upward pressure on wages and salaries, outstripping increases in productivity. However, as the gap between remuneration here and in the EU closes, as a result of both economic growth and the expected appreciation of the Zloty, so the risk stemming from the liberalisation of the movement of labour falls. It is in the interest of Poland to preserve the principle of the free movement of labour as an integral part of the overall liberalisation.

1. An important problem in the process of adjustment in this area is the reform of the system of social insurance. This implies the necessity of implementing new legal regulations allowing for the creation of pension funds.

1. Another problem is the cost of the [Author ID1: at Thu Feb 6 12:45:00 1997 ]gradual adoption of certain standards in the area of labour and social policy.

1. Also, the reciprocal recognition of qualifications and the right to practice a profession may prove to be a problem. It is, therefore, important to carry out a review of the rules and regulations concerning the recognition of qualifications and to implement the law of the European Union in Poland.

Integration tasks

1. A most important task of the Government will be to increase access for Polish employees to the EU labour market. The Government will take steps designed to bring about reciprocal recognition of degrees, qualifications and of the right to practice a profession and will carry out a review of the law concerning the right to practice professions, labour law and other social regulations in order to make them compatible with the rules existing in the EU. Poland will also increase its involvement in the international institutions and conventions regulating labour law.

1. The Government will establish the National Bureau for the Recognition of Education and Qualifications which will be charged with the implementation by Poland of the [Author ID1: at Thu Feb 6 12:45:00 1997 ]EU law concerning the recognition of certificates and degrees for academic and professional purposes. At a later stage, this Bureau will become the Polish agency of ENIC/NARIC.

1. The fastest possible implementation of the free movement of labour, and of employees in particular, is in Poland's interest. This means eliminating, or keeping short, transition periods in achieving full access to the labour markets of the Union. The only area, where Poland may be interested in interim solutions, is certain costly social regulations currently in force in the Union.

The course of further preparatory work

1. The Government will prepare an evaluation of the current state of legislation concerning labour law and conditions, as well as social policy. This will be accompanied by the creation of a programme designed to bring about gradual unification of these regulations with those in force in the EU. While evaluating individual regulations, the Government will also take into account budgetary costs, and costs which would have to be borne by the [Author ID1: at Thu Feb 6 12:45:00 1997 ]Polish enterprises.

Competition policy

Economic significance

1. Fair competition is a vital condition for the effective operation of the Single Market. This applies, in particular, to the limiting of the opportunity of enterprises to abuse their dominant role, to the supervision of the scale and forms of aid granted to enterprises by individual governments, and also to the non-discrimination principle in public procurement. The observance of the same rules concerning competition by all EU Member States prevents the use of different legal regulations to discriminate against enterprises from other member States.

Potential problems in the integration process

1. Poland has already adopted a large part of the European legislation on competition policy. The scale of Government aid for selected sectors of Polish industry is not excessive. However, this aid is not always granted in a proper manner. The functioning of certain State-owned enterprises which enjoy an almost monopolistic position may bring about conflicts with the rules of[Author ID1: at Thu Feb 6 12:46:00 1997 ]n[Author ID1: at Thu Feb 6 12:46:00 1997 ] competition existing in the EU. For some investors the implementation of the EU supervision rules concerning mergers and the reduction of subsidies and other forms of state aid may pose problems. For instance, such a problem could arise from the shift away from the current system of supporting individual producers and products towards the financing of basic and downstream research.

Activities which have to be carried out prior to the accession

1. It is necessary for the appropriate organs, including the Competition and Consumer Protection Office, to continue adapting legislation and practice in the field of competition policy. Particular attention should be paid to the system and rules for granting public aid.

Integration tasks

1. It may transpire that a transition period is needed for the abolition or reduction of state subsidies which are contrary to EU rules.

The course of further preparatory work

1. The Government will continue adapting Polish regulations concerning competition and State aid to the legislation of the EU. It is necessary to implement a system of permanent monitoring by the Ministry of the Economy of the forms and scale of state aid in Poland.

Consumer protection

Economic significance

1. One of the conditions of Poland's effective participation in the Single Market of the EU is the equalisation of consumer protection standards, particularly in the areas of health and economic interests. Buyers must be given the right to information and consumer education and it is necessary to implement consumer claims vindication [Author ID1: at Thu Feb 6 12:46:00 1997 ]procedures. Regulating the above mentioned issues in accordance with EU directives and judicial decisions is particularly important in the face of the continuing opening up of markets and the abolition of barriers preventing free movement of goods and services.

Potential problems which may appear in the integration process

1. Polish legislation in the field of consumer protection is not adjusted to European law and practice. Its full harmonisation will be a long process. The incorporation of Union directives into our domestic legislation will have consequences for business, due to increased requirements set for the m[Author ID1: at Thu Feb 6 12:46:00 1997 ]m[Author ID1: at Thu Feb 6 12:46:00 1997 ]anufacturers and retail outlets, which may slow down the integration processes[Author ID1: at Thu Feb 6 12:46:00 1997 ]. It can be assumed that the negotiation issues will concern product safety, viz. tests and certificates, standardisation, market supervision.

Activities which have to be carried out prior to accession

1. Work will continue on the establishment of a consumer protection system and, in particular, on the adaptation of Poland's legislation to the requirements of the Union. The activities pursued by the Competition and Consumer Protection Office will be aimed at speeding up the passing of legislation and at co-ordinating pro-consumer initiatives.

Integration tasks

1. From the point of view of consumer interests it is expedient to implement the consumer directives as soon as possible. The transition period may concern certain regulations having an economic effect upon enterprises or the State budget.

The course of further preparatory work

1. Drawing up of concepts for adapting legislation to the requirements of consumer protection, as well as implementing this legislation. Drawing up of a product safety monitoring system.

Environmental protection

Economic significance

1. The adoption of ecological norms will make it necessary to:

• limit production at the most environmentally harmful plants or carry out the modernisation and replacement of outdated technologies with modern ones which should ultimately lead to a more rational utilisation of water, raw materials and energy, marine resources and to increased productivity and improved competitiveness of industry;

• fit existing plants with environmental protection equipment which may result in increased production costs and possibly lower the competitiveness of those sectors of industry which developed at the expense of the natural environment;

• take into consideration the necessity of the participation of the civil defence services (fire service etc.) in environmental accidents to close off affected areas and to participate in the reconstruction of these areas;

• decentralise decision-making regarding environmental protection issues and involve the local communities in the decision-making process, particularly when it comes to decisions concerning plant location and the evaluation of their impact on the environment.

1. In areas of particular significance for the environment such as water supply, disposal and treatment of sewage and local public transport, the Government, in accordance with the principles of municipal policy adopted in January, 1996, plans to attain the desired standards after the year 2010. The Executive Programme drawn up for Environment Policy envisages that the relevant legislation, procedures and norms will be fully adapted to EU standards by the year 2000.

1. In the short run, the adoption of the EU's environmental standards may involve particularly high adjustment[Author ID1: at Thu Feb 6 12:47:00 1997 ]aptation[Author ID1: at Thu Feb 6 12:47:00 1997 ] costs. Such a speedy adjustment[Author ID1: at Thu Feb 6 12:47:00 1997 ]aptation[Author ID1: at Thu Feb 6 12:47:00 1997 ] process may have considerable impact on the competitiveness of Polish enterprises. The Government will draw up a path towards attaining EU standards which over the next few years will allow minimisation of the costs involved.

Potential problems in the integration process

1. Here problems stem mainly from the high costs of implementing the EU's environmental standards, which will have to be borne by the State budget and the enterprises themselves. The Government will consider the expediency of retaining those Polish standards and regulations which have already been implemented with good effect but are more stringent than the ones currently in force in the EU.

Activities which have to be carried out prior to the accession

1. The Government will continue adapting Polish environmental standards and environment monitoring systems[Author ID1: at Thu Feb 6 12:47:00 1997 ] to the rules in force in the EU. The Government will draw up a long-term programme taking into account the costs to the budget and the impact of these adaptations on economic processes[Author ID1: at Thu Feb 6 12:48:00 1997 ]adjustments on the economy[Author ID1: at Thu Feb 6 12:48:00 1997 ]. This programme will be based on the principle that the cost of environmental protection must be borne by the polluter. The above mentioned principle will be introduced through the development of a system of market incentives and penalties designed to stimulate pro-ecological attitudes among enterprises.

Integration tasks

1. The Government will strive towards the fastest possible attainment of a level of environmental protection comparable to that existing in the EU. In areas requiring the greatest outlays, e.g. water purity norms, transition periods have to be envisaged so as to prevent adjustment[Author ID1: at Thu Feb 6 12:48:00 1997 ]aptation[Author ID1: at Thu Feb 6 12:48:00 1997 ] costs from exceeding the financial capacity[Author ID1: at Thu Feb 6 12:48:00 1997 ]biliti[Author ID1: at Thu Feb 6 12:48:00 1997 ]es[Author ID1: at Thu Feb 6 12:49:00 1997 ] of the State. The Government will seek to obtain financial support from the EU.

The course of further preparatory work

1. The Government will draw up a multi-scenario [Author ID1: at Thu Feb 6 12:49:00 1997 ]programme t[Author ID1: at Thu Feb 6 12:49:00 1997 ]of[Author ID1: at Thu Feb 6 12:49:00 1997 ] attaining[Author ID1: at Thu Feb 6 12:49:00 1997 ] EU environmental protection standards according to[Author ID1: at Thu Feb 6 12:49:00 1997 ]containing[Author ID1: at Thu Feb 6 12:49:00 1997 ] various time schedules and cost projections.

Structural policy and financial co-operation

Economic significance

1. The aid given to Poland within the framework of the structural policies of the Union may prove to be an important source of financing accelerated development of economic infrastructure, development of the education and science system, and the adaptation of Poland's legislation to that of the EU. Past experience of such countries as Ireland or Spain shows that access to the structural funds of the Union may be an important economic growth factor. From the point of view of Poland, the possibility to obtain aid for the development of the economic infrastructure, e.g. the transport system, and the increased competitiveness of regions experiencing persistent development difficulties is particularly important.

Potential problems in the integration process

1. Poland's participation in the structural policy of the Union will be defined by the magnitude of the aid received as well as the conditions attached to it. Several factors are going to play a role here: future rules regulating the functioning of structural funds, the future share of the structural funds in the Union's budget i.e. the propensity of member States to bear financial costs, the Union's budget policy in the 2000 - 2005 period and last, but not least, the evaluation of Poland's ability to absorb aid - which is a function of institutional preparation and the ability to co-finance aid programmes.

1. During the period leading up to Poland's accession, the Government will strive towards appropriate preparation of the economy and the national institutions to absorb financial aid granted within the framework of the Cohesion Fund and the Structural Funds. The Government will also endeavour to adapt the profile of the aid programmes implemented within the framework of structural funds to the specific needs of the Polish economy.

Activities which have to be carried out prior to the accession

1. Pursuit of the correct macroeconomic policy will be the main requirement for the utilisation of transfers from the EU. Macroeconomic criteria already partly condition the receipt of financial resources from the Cohesion Fund. It has to be assumed that following the implementation of the expected reform of the EU structural policy the tendency to tie access to aid to the meeting of certain macroeconomic criteria will be intensified. For Poland this means the necessity to pursue an economic policy which in the medium term will strive towards the meeting of the convergence criteria defined in the Maastricht Treaty.

1. Another element of Poland's preparations to join the structural policy of the Union should be the pooling of experience in the creation and operation of structures and institutions charged with future absorption of transfers from the EU. Therefore, efforts must be made to create within PHARE pilot programmes which will meet the current requirements set for the utilisation of structural funds, e.g. through the introduction of co-financing from budget resources of the operating costs or some elements of certain programmes.

1. It should be expected that the assessment of Poland's ability to absorb transfers from the EU will depend on the evaluation of the adaptation of Polish structural policy to the requirements of the EU structural policy. The degree of development of institutions implementing this policy, on both central and local levels, is the condition of meeting one of the fundamental criteria of EU structural policy, i.e. the partnership between the Union, central government and regions in the planning and implementation of aid programmes. For this reason the Government assumes that the adjustment programme in this area should contain the following elements:

• establishment on the regional level of institutions and structures facilitating decentralisation of financing;

• preparation of regional institutions for the designing and implementing of aid programmes;

• continuous training of civil servants and local government officials in the rules and operating procedures of structural funds;

• creation of financial auditing institutions supervising the correctness of the utilisation of financial resources, viz. establishment of audit departments in ministries and drawing up of financial auditing procedures;

• creation of an effective system of gathering the statistical data needed for identifying regions most eligible for aid, as well as for the evaluation of the effectiveness of aid utilisation;

• defining the concept of the country's regional development together with a compatible set of priorities to be used for selecting regions most eligible for aid;

• drawing up of rules and methodology which combine the existing development concepts with EU practice;

• supporting the activities of local communities taking part in trans-border co-operation.

Integration tasks

1. The Government will continue to work towards adapting the procedures used in central, regional and local administration to the requirements stemming from the participation in the structural policy of the Union.

The course of further preparatory work

1. The Government will take action concerning those aid programmes the creation of which requires the participation of the central administration. This applies first and foremost to the projects concerning the establishment of the transport infrastructure, within the framework of the Transeuropean Networks Programme (TENs), development programmes for the Polish countryside, education projects and cross-border co-operation programmes, i.e. areas meeting the priorities of the structural policy of the Union as well as the requirements of the Polish economy. The objective of the programme preparation is to gain fast access to the funds of the Union - having carried out such preparatory work Finland received her first funds just four months after the accession to EU.

Macroeconomic policy

Economic significance

1. The fundamental objective of macroeconomic policy in the period leading up to accession should be the attainment of a high rate of economic growth which, in the long run, will bring about a considerable increase in living standards, and a narrowing of the gap between the GDP per capita in Poland and the Union. It is necessary to continue the fight against inflation and to maintain macroeconomic stability. From the point of view of the integration process, achieving long-term economic balance is particularly important. In the long term, this would allow Poland to join Economic and Monetary Union.

Potential problems in the integration process

1. The meeting of the requirements set for accession to Economic and Monetary Union necessitates strict budgetary discipline, and close attention being paid to the internal and external fiscal balance. The fulfilment of the Union conditions requires the Government to work out the optimal path leading to the accession and to obtain EU support for such a policy. Hence the need to implement reforms; as a priority in the areas of pensions and the national insurance system.

Activities which have to be carried out prior to the accession

1. The Government will continue to pursue anti-inflation policy while aiming at high economic growth. The Government will carry our reforms of the public sector including, above all, the pensions system.

Integration tasks

1. Several years on the path leading to the fulfilment of the convergence criteria.

The course of further preparatory work

1. A policy of limiting the budget deficit and - in co-ordination with the National Bank - a policy aimed at reducing inflation. The Government will, again, in agreement with NBP, draw up a strategy for the attainment of Poland of the convergence criteria. This strategy will take the form of the „Euro 2006” Programme.

Integration strategy in the agriculture and food industry

1. The integration strategy designed for the agriculture and food industry should ensure an increase of productivity and competitiveness, thus securing a favourable position for this sector in the Union market. The integration of agriculture is one of the most difficult aspects of the entire integration process. This applies in equal measures to Poland and to the EU.

1. The necessity to carry out structural transformation stems from the low productivity of Polish agriculture caused by:

• considerable fragmentation, obvious in certain agricultural regions, which prevents fast increases of productivity, effectiveness of production, and adversely affects the ability of farms to absorb the benefits of biological and technical progress;

• traditional production techniques resulting from low accumulation, hidden unemployment and considerable overpopulation of the countryside.

Economic significance

1. The role of agriculture in Poland is much more important than that in the EU due to its considerably greater contribution to employment and GDP. Large qualitative differences between the food industry sectors in Poland and those in the Union also exist.

The degree of protection enjoyed by Polish agriculture is far smaller than that existing in the EU. The economic position of Polish farming precludes the financing of development entirely from our own resources. This justifies the decision adopted by the Government to attach special importance to agricultural issues in the preparation and the actual conduct of accession negotiations.

Necessary adaptations of Polish agriculture in the pre-accession period

1. The process of adapting Polish agriculture requires the acceleration of the process of modernisation of agriculture and of the rural areas. Such modernisation cannot be carried out using the resources of this sector alone and requires, in the pre-accession period, considerable support from the budget, credits and special funds.

1. Rural development and the structural transformation of agriculture will be related to the implementation of two parallel processes:

• modernisation of agriculture aimed at improving the agricultural and socio-professional structure and increasing the competitiveness of Polish agriculture;

• diversified development of the rural areas allowing permanent or temporary outflow of agricultural workers to non-agricultural jobs and support for alternative sources of income accompanied by intensive development of the technical and social infrastructure of the rural areas.

1. The implementation of the structural development policy will involve:

• supporting the modernisation of agriculture and food processing;

• promoting the development of and stimulating activity in the rural areas;

• supporting counselling and vocational guidance, vocational training, research and development activities;

• improving the functioning of governmental and non-governmental institutions involved in the development processes, including local authorities and public services.

1. The large number of people employed in agriculture in combination with considerable unemployment hamper European integration and the efforts to increase the competitiveness of this sector. Therefore, economic policy will aim at raising productivity, relocating labour from agriculture to related sectors and to non-agricultural sectors of the economy in the rural areas. These processes require very considerable financial outlays and for this reason they need support from external resources, viz. pre-accession funds, credit supplements, loans from potential investors, credits, etc. Obtaining access to the above mentioned resources should be one of the priorities in the period preceding membership.

1. Trade requires the development of a modern infrastructure of the agriculture market, i.e. exchanges, wholesale markets, market information systems, export promotion. Accelerated development of the market infrastructure requires increased involvement of budgetary resources to establish the basic wholesale markets and exchanges prior to the integration with the EU. This process also needs the producers to organise themselves - branch organisations and marketing groups.

1. The integration strategy puts a considerable emphasis on the multifunctional development of the rural areas - similar to that existing within the EU. This requires new jobs to be created outside agriculture in the rural areas.

Potential problems in the integration process

1. The purchase of land by foreigners is subject to administrative control. Poland liberalised this area following membership of OECD. The principles of land sale will be shaped by taking into account the interests of the Polish economy and by utilising the instruments applied in the Member States of the EU.

1. Poland should attempt to gain full access to the agriculture products' market of the EU. At the same time it should take into account its accession to the EU in its trade negotiations with other partners.

1. The Common Agricultural Policy (CAP) puts increased emphasis on subsidising agricultural incomes and not production. This applies first and foremost to payments unrelated to agricultural production, and which have no impact on production decisions. Therefore, the Government will attach considerable importance not just to agricultural production, but also to agricultural incomes. The Government will also pay attention to the accompanying activities such as environmental protection programmes, afforestation and pension programmes for farmers, and for this purpose will attempt to obtain support from the budget of the Union.

The Government will also strive towards including Polish farmers in the system of compensation payments or obtaining the necessary resources to be used for financing other forms of support, e.g. structural reconstruction. The Government will endeavour to ensure equal conditions of competition between Polish and Union farmers.

A key negotiation task is the defining of the suitable level of production quotas which will have to be appropriate from the point of view of either the maximum volume of production mentioned in the reply to the questionnaire submitted by the European Commission, or the entitlement to a precise level of budget support, including future compensation payments.

The evolution of trade in food and agricultural products with the EU

1. The Europe Agreement does not envisage the creation of a free trade zone for agricultural products. The exchange of concessions has so far been selective. It should be assumed that the further liberalisation of trade in agricultural products between Poland and the EU will maintain its selective character and will entail the widening of the scope of products included in liberalisation, reduction of customs duties, increase in quotas and their gradual elimination.

Structural funds

1. Gaining access to structural funds for the rural areas, including funds for the development of the agriculture and food industry and funds for the environmental protection programmes, is another key task in the process of preparation to the accession to the common market. The ability to absorb and effectively utilise these funds must be developed. To this end regional development programmes matching those existing in the EU must be drawn up. This will necessitate the defining of new objectives and the identification of areas with special needs, as well as the preparation of general and detailed integrated action programmes based on the diagnosis of the situation of agriculture and employment, local involvement and the co-operation between government and local government administration.

The necessity of having the means to cover one's own contribution to the structural programmes, co-financing, may limit the size of the available resources. Therefore, a system of co-financing based on central and local budget resources and private capital has to be established.

The administration of agriculture

1. The participation in the CAP brings about the need to develop administrative procedures which will become more complex. This is also a feature of the structural programmes. In addition, the latest obligations imposed by the WTO have led to the necessity of carrying out detailed monitoring of trade in agricultural and food products and of support to agriculture and exports.

The CAP requires keeping precise records of the production processes and their monitoring by central and local administrative institutions. The system of production quotas and the programme of direct support requires the establishment of an integrated supervisory-administrative system including a detailed record of farms and arable land.

Therefore, effective negotiations and participation in the decision-making processes of the EU even at an early stage of the preparations require properly trained personnel. A personnel review is important therefore due to the number of persons who will be involved in protecting Poland's interests in Brussels, and in the implementation of the CAP in Poland.[Author ID1: at Thu Feb 6 12:15:00 1997 ]

Effective implementation of the Union's programmes requires the development of new institutions and the re-organisation of the existing ones. This applies to the Ministry of Agriculture and Food Management itself, agencies, regional and local offices, institutions fulfilling intervention functions, customs offices, veterinary supervision and groups of producers and processors. These tasks may be perceived from the point of view of the negotiation process and from that of future participation in the decision-making processes of the Union. The importance of the decentralisation of decision-making will increase, and the accession will mean the transfer of certain important decision-making powers to the EU.

The harmonisation of legislation on rural areas and agriculture

1. Poland must demonstrate the ability to introduce the legislation and procedures of the Union. Therefore, the Government considers the preparation of a detailed plan for introducing all the aspects of the acquis contained in the CAP as its priority. This will require the implementation of legislative, institutional and procedural changes.

The veterinary, sanitary, animal health and food safety and supervision issues will be of particular importance for the speed of the integration. However, the high cost of implementing these regulations may justify Poland's wish to receive financial support from the Union during their implementation and may lead to full[Author ID1: at Thu Feb 6 12:16:00 1997 ]complete[Author ID1: at Thu Feb 6 12:16:00 1997 ] implementation after accession.

Membership conditions

1. Due to their social and macroeconomic effects, the introduction of many protectionist measures contained in the current CAP is not in Poland's general economic interest. Certain elements of the CAP will probably be adopted prior to the gaining of membership. For this reason the Government will draw up a timetable of the introduction of individual instruments of the CAP. Actions designed to develop absorption capacity and effective utilisation of the structural funds will also be taken.

1. Two of the requirements for accelerating the adjustment process are the granting of the announced pre-accession structural funds and improved access to the EU markets for Polish agricultural exports.

1. Polish agriculture must be represented in the EU by farmers' unions and their self-governing bodies. To this end, the above mentioned organisations should appoint their joint representatives entrusted with the representation of the interests of Poland's farmers in the EU.

1. Poland should try to influence the development of the CAP through the building of alliances with other Member States and through a public debate held prior to and during the negotiations.

Potential dangers associated with membership

1. The period prior to accession should be used for making the necessary adjustments of Poland's agriculture designed to counteract the following potential dangers:

• disturbances in the system of food and agricultural product prices caused by a considerable allocation of public funds to support prices, and the use of supply control instruments[Author ID1: at Thu Feb 6 12:17:00 1997 ]mplements[Author ID1: at Thu Feb 6 12:17:00 1997 ], including all the direct and indirect economic and social costs;

• insufficiently fast and effective reaction of domestic enterprises to increased competition which may result in the loss of domestic and export market shares;

• incurring of budgetary losses caused by an ineffective fiscal supervision system;

• weak position of Polish food products on the market of the Union resulting from the absence of modern marketing techniques;

• weaknesses in the system of credits for agriculture and the rural areas preventing Poland from obtaining the financial support needed for the carrying out of the necessary structural changes. The current position of agriculture on credit markets is very weak. Lately, the sector has also proved unable to generate its own financial surpluses;

• insufficient support given to the restructuring, development and growth of competitiveness of the agro[Author ID1: at Thu Feb 6 12:18:00 1997 ]iculture[Author ID1: at Thu Feb 6 12:18:00 1997 ]-food sector by domestic research institutions, the education system and training organisations;

• low effectiveness of the institutions charged with the drawing up of programmes and with the management of the structural funds which may lead to their insufficient utilisation and bring about negative economic results for the weaker social groups and the less developed regions.

Supervision systems

1. As agriculture accounts for over half of the overall EU budget, it is crucial to prepare Poland's supervision system to allow proper overseeing of the utilisation of resources obtained from the budget of the Union.

Information campaign

1. The implementation of the CAP will mean fundamental changes in the way Polish farmers manage their businesses. Therefore, it is necessary to carry out an information campaign addressed to the rural population which should facilitate early adjustment at the local level and prepare them to take on the challenge of integration with the EU.

Part III: Adaptation of legislation

1. The Polish State and its citizens need a modern legal system ensuring the protection of such values as economic freedom, fair competition, freedom of movement and settlement and personal security. The adaptation of Polish law to the principles of Union legislation will allow Polish citizens to develop their commercial, social and cultural activities on a European scale.

The Union law carries universal values which are permanently rooted in European culture. It facilitates economic development of the Member States and ensures the gradual increase of prosperity of their citizens. It is a set of modern regulations which guarantee progress and as such is of considerable value.

Polish law shares the same roots with the law of the Union and forms a part of European legal heritage. The severing of ties between Poland and a democratic and developing Europe which lasted for many years caused the natural process of development in Polish law to come to a halt, thus preventing it from following the path taken by the legal systems of the democratic European States.

1. The convergence of existing and future Polish legislation with European law is a basic requirement for Poland's integration with the European Union. This process should be accompanied by a high quality of legal acts.

1. The Europe Agreement does not define a detailed plan of adjustment measures but only a general timetable for their implementation. According to that timetable, the adaptation is carried out in three phases:

• at the entry into force of the Europe Agreement;

• within the first five years of the implementation of the association agreement;

• during the entire transition period, i.e. during the ten years following the entry into force of the Europe Agreement.

This places on Poland an obligation to draw up a timetable of the necessary legislative work. This obligation is fulfilled by an Annexe to Resolution No. 133/95, i.e. the timetable of adaptations of the Polish legal system to the legislative standards of the EU.

1. The adaptation process will not end with Poland's accession to the European Union. This work will have to continue after Poland gains membership of the EU, as is the case with all other member States. The adaptation process has to lead to a gradual absorption of the entire legal aquis communautaire and subsequently must ensure Poland's active participation in its future development.

Scope of adaptation

1. Article 69 of the Europe Agreement stipulates that the convergence of legal provisions will include the following areas: customs law, company law, banking law, company accounts and taxes, intellectual property, protection of workers at the work place, financial services, rules of competition, protection of health and life of humans, animals and plants, food legislation, consumer protection including product liability, indirect taxation, technical rules and standards, transport and the natural environment.

1. The objective of adapting Polish legislation to the law of the Union is to eliminate obstacles in trade between Poland and the EU and to create a coherent set of rules facilitating the development of that trade. From the point of view of the economy, the most important are the norms regulating the financial situation and functioning of economic entities,[Author ID1: at Thu Feb 6 12:18:00 1997 ] and the norms regulating economic relations.

The former concern, in particular:

• commercial activities carried out by natural and legal persons, both domestic and foreign;

• setting up and functioning of companies, co-operatives and public enterprises;

• fo[Author ID1: at Thu Feb 6 12:18:00 1997 ]unding and functioning of banks and insurance firms;

• protection of intellectual and industrial property;

• competition protection law;

• bankruptcy law;

• rules governing the functioning of commercial and agricultural self-government.

The latter include, amongst others:

• customs duties and import quotas;

• technical regulations;

• financial flows, domestic and foreign;

• transport and telecommunications;

• consumer protection.

1. Only the complete adaptation of the law will allow Poland to participate in the Single Market. Effective legislation work in this area requires, amongst others:

• determining the current state of Union legislation;

• analysis of the equivalent Polish regulations;

• drawing up of the basic principles of the new regulations which have to take into account economic aspects, i.e. the costs of changes and the expected benefits.

Methodology

1. The Government of the Polish Republic is responsible for the adaptation of Poland's law to that of the Union. In order to meet this responsibility the Government uses its legislative powers. The Government co-operates in this area with the Parliament.

1. The adaptation of the Polish legal system to Union law in individual areas is a duty of the appropriate central and supreme administrative organs. The tasks and responsibilities of individual government departments in this field are defined by Resolution No. 133/95 of the Council of Ministers on the Fulfilment of Obligations Necessary for the Participation in the Single Market. The adaptation programme drawn up on the basis of this Resolution takes as its point of reference the Union legal acts listed in the White Paper of the European Commission.

1. The supreme state administration organ charged with the programming and co-ordinating of the adaptation activities in the field of law is the Committee for European Integration. It carries out its tasks through the Office of the Committee.

1. In the course of their work, the organs participating in the process of adapting Polish legislation to European law use the assistance of the Experts Team on the Harmonisation of Polish Law with the Law of the European Union appointed in 1994 and made up of the leading experts in various legal fields.

1. The drafts of the legal acts being drawn up are scrutinised from the point of view of their compatibility with European law. Resolution No. 16/94 of the Council of Ministers envisages such scrutiny in respect of bills submitted by the Government. A system of scrutinising members' bills and changes in the Government drafts introduced in the course of legislative work must be set up as soon as possible.

1. The new law should be of high legislative quality and practicality. For this reason, close co-operation with various parts of the legal profession in the course of adapting Poland's law to Union legislation is required. The participation in this process of academics, judges, prosecutors, barristers, legal advisers and notaries will ensure its more effective implementation. It will also contribute towards easier acceptance of the new regulations by Poland's legal system. In the course of legal approximation, the issue of the equal treatment of men and women should be taken into account. The new law must not be developed separately from Polish social conditions, or its legal tradition.

Supplementary activities

1. The adaptation of Polish law to that of the Union also means that, in order to support the necessary work in this field, the State has to bear the organisational and financial costs. The process of legal adaptation must be given sufficient personnel and organisational and financial support.

1. It is necessary to complete the official translation of the Union legal acts into the Polish language and to compile the necessary dictionaries. This work will be carried out and co-ordinated by the Committee for European Integration.

1. If, for economic reasons, the adoption of certain regulations should prove impossible, this would lead to the necessity to negotiate with Poland's Union partners the adoption of temporary measures acceptable to both parties.

Part IV : External affairs

Integration with the EU in the area of the Common Foreign and Security Policy (CFSP)

1. Integration with the European and Euro-atlantic institutions is the main priority of Polish foreign policy. Only membership in the EU, NATO and WEU can, under present conditions, guarantee our sense of security, long-term balanced development and the opportunity to participate in the making of decisions which are important from the point of view of Poland's interests. From the Polish perspective, security is an indivisible concept which includes economic and military security. Membership in the EU will ensure our security and social and economic development, membership in NATO will give us peace and military security and membership in the WEU will allow Poland to participate in the building of the European defence identity.

1. A natural supplement of the Euro-atlantic orientation of Poland is the establishment of the best possible relations with neighbouring countries, the development of regional co-operation, active participation in the international arena, particularly in the United Nations, and the development of relations with the world's most dynamic national and regional economies.

1. The implementation of the process of integrating Poland with the EU will be accompanied by the following external conditions:

• the integration process within the European Union will proceed due to the implementation of the decisions adopted by the Intergovernmental Conference of the EU, the implementation of the Economic and Monetary Union and the preparations for the eastward enlargement of the Union. The deepening of integration within the EU will also concern CFSP;[Author ID1: at Thu Feb 6 12:19:00 1997 ], which will, nonetheless, remain a domain of intergovernmental co-operation;[Author ID1: at Thu Feb 6 12:19:00 1997 ]

• the internal reform of NATO will take place parallel to the above mentioned developments. The development of the European Defence Identity and the expected role of the WEU is also considered important by Poland;

• the co-operation between the WEU and the EU will continue, accompanied by closer co-operation between the WEU and NATO;

• the process of developing the new security architecture in Europe will continue. Here an important role will be played by the relations between EU/NATO and Russia and Ukraine;

• the involvement of the EU in future crisis situations, both in Europe and elsewhere, will increase.

1. Poland already meets the requirements allowing it to participate in the CFSP. The continuation and development of the current balanced foreign policy based on the following principles will make Poland a desirable partner of the Union.

• Internal stability and strength of the State. Poland is a country with an efficient market economy and a stable democratic system. Our membership in the OECD and the Council of Europe is institutional proof supporting these assertions. Reforms aiming at better adjustment of our economic and socio-political systems to the requirements of future membership[Author ID1: at Thu Feb 6 12:23:00 1997 ] in the EU and NATO are continuing.[Author ID1: at Thu Feb 6 12:24:00 1997 ]

• Friendly bi-lateral relations. Poland has concluded treaties and is developing constructive co-operation with all neighbouring countries. The work on the Stability Pact has confirmed the significance of the steps undertaken by Poland in this area. Poland's readiness to develop co-operation with other candidates seeking membership in West European structures has been well received.[Author ID1: at Thu Feb 6 12:25:00 1997 ]

• Regional [Author ID1: at Thu Feb 6 12:25:00 1997 ]co-operation. Poland is developing regional [Author ID1: at Thu Feb 6 12:25:00 1997 ]co-operation at all levels[Author ID1: at Thu Feb 6 12:25:00 1997 ] and considers this [Author ID1: at Thu Feb 6 12:26:00 1997 ]to be a significant dimension of the process of European integration and a factor preventing a renewed division of the Continent. An example[Author ID1: at Thu Feb 6 12:27:00 1997 ] of this is Poland's membership in the Council of the Baltic Sea States, the Central European Initiative and CEF[Author ID1: at Thu Feb 6 12:28:00 1997 ]TA.[Author ID1: at Thu Feb 6 12:29:00 1997 ] [Author ID1: at Thu Feb 6 12:27:00 1997 ]

• Readiness to make contributions towards increased international security. This applies both to Europe and the non-European regions. The current membership in the UN Security Council, the prospect of chairing, in 1998, the Organisation of European Security and Co-operation, the participation in the peace-keeping forces in the former Yugoslavia and the Middle East are all confirmation of Poland's position. Poland has some 2000 armed forces personnel stationed abroad as part of various peace-keeping operations.

• Readiness to bear costs of possible future participation in the activities of the EU States. This may necessitate taking joint risks and accepting responsibilities, including financial ones. Poland will make efforts to be included in the external activities of the Union. The fulfilment of this task will be made easier due to the fact that we share the same values and objectives. We are prepared actively to co-operate with the EU in the pursuit of foreign policy of the Union directed towards eastern Europe. This applies in particular to the relations with Russia and Ukraine. We hope to be included in the co-operation with Asian countries, as well as in the Mediterranean and Euro-atlantic dialogues.

Mechanisms of co-operation

1. Poland's path leading to the participation in the CFSP largely depends on the effective utilisation of the existing instruments and mechanisms of dialogue and co-operation. The Europe Agreement and the Essen Strategy have defined the basic forms of action in this field. The bi-lateral dialogue with the EU will be intensified, particularly due to the approaching commencement of membership negotiations. This dialogue will also be maintained with new bodies set up following the Intergovernmental Conference. Efforts will continue to improve the political dialogue in its multilateral dimension: associated States - the EU. This applies particularly to the many institutions of the CFSP: the EU Council, the Political Committee, European correspondents and working groups.

1. An important supplement to the dialogue and co-operation with EU institutions in the field of CFSP will be the development of political relations with other member States at the Foreign Ministry level and through diplomatic missions in Warsaw and the capitals of the EU member States. The co-operation within the framework of the Weimar triangle (France, Germany, Poland) is very important from the point of view of the implementation of our integration aspirations.

Polish foreign policy

1. Activities undertaken in the area of foreign policy will concern: representing Polish interests in our relations with the EU, identifying the positions of EU member States, identifying potential threats to the process of integration between Poland and the EU and informing the State authorities of the Polish Republic of the EU views and initiatives which are important from the point of view of our membership in the Union and providing information on the development of Polish attitudes to European integration.

1. The external activities will be adapted to the individual levels on which decisions are made or positions agreed in the EU and the Polish Republic and will be carried out with the participation of the President, the Government and the Parliament. The main organs entrusted with the implementation of the tasks assigned by the President, the Government and the Committee for European Integration will be the Ministry of Foreign Affairs, Polish diplomatic missions in the capitals of EU Member States and the Mission of the Polish Republic to the European Union. Special European integration groups will be established in Poland's diplomatic missions in the capitals of EU member States, and, should such a need arise, also in other countries. This will require personnel, material and financial support.

Scope of external activities

1. The external activities will be carried out on several planes:

1. The [Author ID1: at Thu Feb 6 12:35:00 1997 ]Institutions of the European Union are [Author ID1: at Thu Feb 6 12:35:00 1997 ]located in Brussels, Luxembourg and Strasbourg.

The above mentioned activities[Author ID1: at Thu Feb 6 12:35:00 1997 ]institutions[Author ID1: at Thu Feb 6 12:35:00 1997 ] will be directed towards[Author ID1: at Thu Feb 6 12:35:00 1997 ]include[Author ID1: at Thu Feb 6 12:35:00 1997 ], first and foremost, the European Commission, the Secretariat of the Council, the EU Committee of Permanent Representatives (COREPER) and the European Parliament. The organs of the Association Agreement will be also utilised in this respect, i.e. the Parliamentary Association Committee, the Association Council and the Association Committee.

The external activities will also include the European Court of Justice, the European Monetary Institute, the European Investment Bank, the Committee of the Regions, the Economic and Social Committee and the EU-level organisations represented therein such as: UNICE, CEEP, COPA-COGECA, ETCU, etc. Apart from the Government, the parties involved on the Polish side will include Poland's non-governmental organisations such as: employers' organisations, trade, farmers' and artisans' unions, consumer organisations, etc. The Government will lend its support to the initiatives aimed at the establishment of a group co-ordinating the efforts designed to foster co-operation between Polish non-governmental organisations and the efforts to set up a coherent lobby for Polish economic and political interests in the EU.

1. Activities directed towards EU member States.

These activities will be addressed primarily towards governments and State administrations as well as parliaments and political parties represented therein. They will include monitoring and influencing the positions of individual member States which are then reflected in decisions adopted by the organs of the Union. These activities will be based on combining and co-ordinating actions taken in respect of the member States and the institutions of the EU.

In addition, the scope of the above mentioned activities will include: mass-media, commercial and social organisations involved in industry, trade and agriculture, trade unions as well as scientific, cultural and arts institutions.

1. Co-operation with the EU on other planes.

Much attention will be particularly given to: the United Nations and its specialised agencies, the OECD, the Council of Europe, the WTO, the Organisation of European Security and Co-operation, T[Author ID1: at Thu Feb 6 12:37:00 1997 ]t[Author ID1: at Thu Feb 6 12:37:00 1997 ]he Council of the Baltic Sea States[Author ID1: at Thu Feb 6 12:36:00 1997 ]Baltic States Council[Author ID1: at Thu Feb 6 12:36:00 1997 ] and theCentral European[Author ID1: at Thu Feb 6 12:36:00 1997 ] Mediterranean[Author ID1: at Thu Feb 6 12:36:00 1997 ] Initiative.

Foreign policy promotion aims

1. The objective of the promotion will be the enhancement[Author ID1: at Thu Feb 6 12:37:00 1997 ]creation[Author ID1: at Thu Feb 6 12:37:00 1997 ] of the[Author ID1: at Thu Feb 6 12:37:00 1997 ]a[Author ID1: at Thu Feb 6 12:37:00 1997 ] positive image of Poland as a democratic, economically and socially stable state which accepts free market rules and the principle of respecting private property, which boasts a fast-growing economy, friendly relations with its neighbours and which is active in the international arena.

1. The promotional activities carried out abroad will be addressed primarily towards heads of state, governments and parliaments, representatives of influential political, economic and social groups, as well as broad public opinion in the member States.

1. The strategy presumes that the President, the Prime Minister and Ministers, Members of Parliament, Senators and representative of the political, economic and social life will be actively involved in the promotional activities.

1. This promotion of Poland will support the traditional diplomacy used in the efforts to create a positive image of Poland in the countries and institutions of the EU. This is particularly important in the pre-accession period.

1. The identification of problems which may emerge during negotiations and pre-accession period is a key condition for successful promotion of Poland. Therefore it is necessary to identify interest groups which may favour or act against our membership. Depending on the identification of problems, promotional activities will be initiated in order to implement the objectives of NSI in this area.

The promotion of Poland abroad should include efforts aimed at both creating a positive image of the country and reacting to negative opinions regarding Poland. The development of co-operation with foreign media will be actively pursued.

The actions undertaken should contribute to increasing of general knowledge and interest in Poland, to positive changes in the way Poland is perceived and to increased information about our country. This promotion campaign should result in easier negotiations, better membership conditions and a speedy ratification of the accession treaty by the national parliaments and the European Parliament.

Part V: Justice and home affairs

1. Co-operation with the EU in the administration of justice and in the field of home affairs has acquired a real dimension following Poland's application for membership and following the adoption by the EU of the Essen Strategy in December, 1994. As a result, the co-operation within the framework of the III Pillar has been included in the structural dialogue. Therefore, the measures mentioned here concern the areas listed in the European Union Treaty.

1. The issues of the administration of justice and home affairs are one subject of the discussions at the EU Intergovernmental Conference, where the member States have suggested making numerous changes in the functioning of this particular field of co-operation. Therefore, following the closing of the Conference, NSI must be verified and supplemented with the new resolutions.

1. The overall objective of NSI in the area of the III Pillar is the full inclusion of Poland in the co-operation with the EU and its Member States. This would, for instance, subsequently result in Poland joining the Schengen Treaty, which gives citizens full freedom to cross borders, and the EUROPOL.

1. The Government will also continue the co-operation with the EU within the framework of the structured dialogue. Poland participates in the meetings of the Justice and Home Affairs Ministers Council, the K-4 Co-ordinating Committee and some of the working groups. Therefore, it is necessary to preserve the functioning in the Polish administration of the structure parallel to the III Pillar of the EU, viz. Interdepartmental Co-ordinating Committee with participation from representatives of the Foreign Ministry, Ministry of Internal Affairs and Administration, State Protection Office, Justice Ministry and the Office of the Committee for European Integration.

1. The Government will continue its activities in this field in the Council of Europe, the Baltic States Council, the Central European Initiative, the OSCE, NATO and the UN. The Government will conclude the review of the conventions of the Council of Europe and will make a final decision on the possibility and expediency of their ratification.

Co-operation in the administration of justice

1. Taking into account the consequences of the opening of Poland's borders stemming from the accession to the Single Market, the Government will continue the co-operation with EU countries in the area of the administration of justice in regard to criminal and civil cases.

1. The basic aim of co-operation in civil law matters will be the inclusion of the Polish judicial system into that of the EU. In this respect it will be necessary for Poland to join the European Union conventions in this area. Taking into account that these conventions are only accessible to Member States, the Government will propose another formula for Poland's association with these conventions in the pre-accession period.

1. The aim of the co-operation in criminal cases will be more effective combating of crime, particularly organised crime; drug trafficking, money laundering, car theft, and trafficking in and [Author ID1: at Thu Feb 6 12:38:00 1997 ]sexual exploitation of[Author ID1: at Thu Feb 6 12:38:00 1997 ] women and prostitution[Author ID1: at Thu Feb 6 12:38:00 1997 ], and also the pursuit of criminals hiding on the territory of other states. In the short-term this co-operation should lead to more effective legal support in criminal cases.

1. Appropriate resources will be provided for the financing of co-operation with the EU. These resources will be supplemented by funds from the PHARE programme. The drawing up of projects resulting from NSI requires a horizontal approach which means creating programmes which envisage the financing of the operational activities, infrastructure as well as the legal basis - including translations of legislation with respect to the III Pillar of the EU.

Protection of the EU's external borders

1. Following Poland's accession to the EU, some sections of our borders will become external borders of the Union and some its internal borders. In both cases Poland will adapt its legislation and practice to the norms which are in force in the EU. The basic objective of the activities undertaken in this area is to combat illegal immigration, organised crime - amongst others, the smuggling of drugs and goods including stolen vehicles - and terrorism.

1. The Government will, therefore, strive to establish and develop the co-operation with the Schengen Group and EUROPOL and CIREFI[Author ID1: at Thu Feb 6 12:38:00 1997 ], and will make efforts to gain access to the data bases and registers of the EU and Schengen, i.e. The Schengen Information System. Establishing co-operation with the Schengen Group in the pre-accession period should have a positive impact on the results of Poland's efforts to combat organised crime and certain illegal [Author ID1: at Thu Feb 6 12:39:00 1997 ]activities accompanying trans-border movement of people, as well as on the adaptation of the immigration and visa policy and the general harmonisation of the system of border controls. Due to the reluctance on the part of the Group to formalise relations with associated members, the Government will attempt to establish ad hoc co-operation in individual fields.

1. The Government will develop visa policy closely following the principles on which the unified visa policy of the EU is based. It will develop and implement legal regulations executing the new law of foreigners, which would prevent the abuse of asylum procedures. This will be in accordance with the general trend in implementing stricter asylum policy in the EU Member States. The Government will also prepare and adopt legislation allowing the utilisation of the EU and Schengen information systems and registers. This legislation will include a law on personal data. At the same time the network of border posts will be expanded and the Border Guards will be given equipment allowing co-operation with the equivalent services of the EU member States as well as the exchange of information with the EU and Schengen systems. The border services and the services responsible for actions taken in regard of immigrants and refugees will also be increased in size.

Co-operation of police forces

1. The Government will strive towards establishing and developing co-operation between the Polish Police and the equivalent services in the EU member States and EUROPOL. This co-operation will contribute to an increase in the sense of security of all citizens, which is one of the most frequently raised issues mentioned in connection with the process of European integration. The level of anxiety among the citizens of the EU caused by the state of internal security is similar to that experienced by Polish citizens. In the opinion of the Polish Government, joint efforts to combat crime may improve the situation[Author ID1: at Thu Feb 6 12:39:00 1997 ]concerns[Author ID1: at Thu Feb 6 12:39:00 1997 ] in this area. Hence the necessity of preparing the National Bureau of INTERPOL to fulfil the role of the national agency of EUROPOL, which is in accordance with the policy of the EU Member States.

1. Therefore, the Government will strive towards:

• establishing co-operation within the framework of the administration of justice and internal affairs, i.e. working groups and specialised agencies;

• development of the operational infrastructure for the tasks of the police forces;

• exchange of liaison officers;

• establishing co-operation between academies of the police forces;

• the training of police forces in matters concerning the structure and functioning of the judicial and pursuit systems as well as the practice of implementing the legal code (courts, tribunals, prosecution services) in the Member States;

• creating a coherent training system for police officers, especially training in foreign languages.

Assuring the safety of citizens

1. The Government will strive for the better protection of the population, property and the environment in cases of catastrophes and natural disasters; better protection should increase the sense of safety of the citizens. The co-operation between Poland and the Member States, which will comprise mutual assistance in crisis management, will be supported by the Government. The Government will ensure the possibility of utilising the instruments of co-operation existing between the Member States.

Part VI: Training and human resources

General training

1. The knowledge of Union law, its institutions, policies and procedures is vital for the process of preparing for membership and afterwards for operating within the Union. Hence the need to set up a training system for the central, regional and local administration designed to improve the knowledge of the European integration issues. This system should also include Members of Parliament and personnel employed by specialised parliamentary services.

1. The need to educate civil servants in European integration issues stems also from the developing co-operation between Poland's administration, institutions of the EU and the administration of the member States. This co-operation is of great importance from the point of view of the attainment of Poland's strategic objectives.

The forthcoming membership negotiations and the subsequent realisation of the tasks and obligations resulting from the membership in the Union are additional factors necessitating the intensification of civil servant training.

According to current estimates there are several hundred specialists presently employed in the central administration and research institutes who will be able to implement the adaptation process and assist the negotiation process and the first phase of membership. This number includes employees who are already undergoing training in issues of European integration as well as persons working in scientific and research institutions. Rough estimates suggest that efficient implementation of the adaptation measures, conduct of the negotiations and cadres needed in the initial period of membership will require a very large increase in specialists in European affairs.

1. In most Member States civil servants working in the central and regional administration undergo continuous training in European integration issues. Particular emphasis is put on the knowledge of the Union's functioning; its law, policies, institutions and procedures. This training is carried out by specialised government agencies, universities, public and private education establishments as well as institutions which are indirectly or directly managed and financed by the European Union within the framework of the EU's education and training programmes.

In the course of planning of the adjustment, the Polish Government will take into account the experience of the Member States and, in particular, of those which joined the EU in the last two enlargements. The Government will strive towards the fullest possible inclusion of the Polish training infrastructure in the EU's training network. This is partly facilitated by the coming into force of the Additional Protocol to the Europe Agreement which establishes the legal framework for the participation of Associated States in EU programmes.

1. The personnel training and education issues in the period preceding accession may be divided into three groups.

1. The first group includes urgent current tasks resulting from the preparation for the negotiations concerning the accession treaty, and subsequently from the appointment of the negotiating team supported in the course of the negotiations by experts. These tasks include:

• training of the negotiating team in negotiation techniques, and the preparation of the group of experts. To this end, it is necessary to establish a wide basis of expertise in ministries, central offices, the Sejm, the Senate and the supreme courts;

• ensuring professional stability of employees in the central administration participating in the preparations to the negotiations and who will serve as the expert base of the negotiations. For this reason, it is necessary to prevent the already trained civil servants from leaving the administration and moving to better paid positions in the economy. This can be achieved by creating a system of financial incentives and promotions.

• including in continuous training, employees of these central units who are responsible for the implementation of the departmental programmes of adaptation to the standards of the EU, and, in particular, those entrusted with legal approximation;

• setting up of a data base containing information on European Studies' graduates and on the participants in training courses on European integration. This should help in the recru[Author ID1: at Thu Feb 6 12:40:00 1997 ]i[Author ID1: at Thu Feb 6 12:41:00 1997 ]tment[Author ID1: at Thu Feb 6 12:40:00 1997 ]hiring[Author ID1: at Thu Feb 6 12:41:00 1997 ] of personnel involved in the preparation and conduct of the negotiations and in the filling of posts in public administration institutions;

• creating teams of translators working during the negotiations and subsequently, to be employed in the EU institutions. Equally important is training in team management, social communication, modern techniques of administrative work, electronic document storing and data processing.

1. The second group includes the preparation of sufficient numbers of civil servants and specialists who will be involved in the implementation of tasks stemming from Poland's membership in the EU. In the initial period of membership, in particular, there will be a strong need for specialists implementing the tasks resulting from the accession of Poland to the Union and experts who will be sent to the Permanent Representation of Poland to the EU. In addition, a sufficient number of specialists must be trained to take up posts allocated to Poland in the EU institutions, viz. the Commission, the Secretariat of the Council, the Secretariat of the European Parliament, the European Court of Justice and the Court of the First Instance, the Court of Auditors, the Economic and Social Committee and the Committee of the Regions, as well as to supply the needs of the negotiating teams.

This group of tasks also includes the training of specialists for central, regional and local administration, particularly in such areas as the law of the Union and the Union's policies and programmes. Translators and interpreters must also be trained in order to meet the domestic needs as well as the needs of the Union's institutions. The speed and the degree of Poland's inclusion in the policies and programmes of the Union, as well as social perception and appraisal of the first phase of membership, will depend on the scope and quality of the above mentioned training schemes.

1. The third group contains tasks necessary for securing the availability of cadres to fill positions in the institutions involved in implementing Poland's membership in the EU at all levels of the administration, in all walks of economic and social life of the country and in the institutions of the Union. This group should include representatives of economic self-governments, non-governmental organisations, professional and social organisations and other important interest groups.

1. The system of education and training concerning European integration issues currently existing in Poland has been developed over the past five years. It includes European Studies courses, both undergraduate and post-graduate, offered by universities, specialised courses, seminars and periods of special professional training. An increasingly important role is played by the network of European studies and research centres which have at their disposal specialised European Documentation Centres. The statutory task of these institutions is to develop education, including personnel training, as well as to carry out research in the area of integration.

An important element of civil servant training is the so-called “European track”. This training is designed for civil servants working in the departments entrusted with the implementation of tasks set by the Europe Agreement and the implementation of adaptation programmes.

1. The „European track” consists of three phases and includes:

• interdisciplinary post-graduate studies;

• periods of special professional training at the European Commission in Brussels, individual periods of professional training in the institutions of the EU and periods of training in the administrations of member States;

• specialist training.

1. Particular emphasis in the development of the training system should be placed on:

• programming, co-ordinating and promoting training activities;

• development of the existing training system and preservation of the training continuity principle in regard to clearly defined groups of persons;

• training and trainee evaluation systems as well as career development (electronic data base);

• development of institutional forms of training and education at university level;

• development of training programmes and units in individual minstries[Author ID1: at Thu Feb 6 12:41:00 1997 ]departments[Author ID1: at Thu Feb 6 12:41:00 1997 ];

• training of regional administration, including a system of incentives for local-governments;

• educational role of scientific research in the field of European integration.

1. At present training is financed by:

• the State budget;

• aid resources, PHARE and bi-lateral aid;

• participants' fees;

• resources from foundations

Training in legal issues

1. The nature of the adaptation activities in the areas of law and the preparation for membership negotiations requires specialised training programme for employees of the legal departments and other ministerial and office departments involved in the integration issues to be extended and accelerated. This training will be extended so as to include representatives of the legal services of regional and local administrations in specially prepared programmes.

1. The adoption by Poland of the aquis communautaire requires, even now, that the training of employees operating in the fields belonging to the competence of the Justice Ministry be extended and accelerated. This concerns in particular judges and public prosecutors.

1. Training programmes should include: the types and systems of legal provisions in force in the EU, sources of Union legislation, judicial decisions of the European Court of Justice, judicial institutions of the EU, incorporation of EU's regulations into the legal systems of member States, application of the Union law in the member States, EU institutions and their powers, and decision-making procedures.

1. Training programmes should be supplemented with periods of professional training spent in the institutions of the EU and, what has up to now been impossible, in the European Court of Justice, the Court of the First Instance, the Secretariat of the Council of the European Union and the European Parliament.

1. In order to achieve the desired training results it is necessary gradually to create an electronic network allowing access to the legal - EUROLEX, CELEX - and bibliographical - SCAD - data bases. This network will initially include the supreme and appeal courts, then in a second phase the Voivods and finally the district courts. Language training of lawyers must also be intensified.

1. The implementation of European integration training must be given programme and material support. This applies in particular to the curricula of higher education courses in law, administration, economics, political sciences, agriculture, etc.

1. The co-ordination of the training programmes in this area belongs to the competencies of the Committee for European Integration. The KIE, in co-operation with the appropriate ministries, central offices and economic and professional self-government organisations, will shortly define the programme and personnel requirements as well as the estimated resources necessary for the implementation of training programmes in accordance with the needs stemming from the application of NSI .

Part VII: Information activities

1. The specific nature of Polish integration process is characterised by the fact that this process is closely related to the systemic transformation. Therefore, the adaptation procedures carried out within the framework of the said process are distinguished by:

• the scale of changes, which concern almost all walks of political, economic and social life;

• the effects of these changes which, by virtue of a strongly diversified society, will have a different impact upon its different segments;

• the speed and sequence of changes which depend on the adjustment capacity of the State administration and economic structures as well as on the varied adjustment capacities of individuals and social groups participating in this process.

1. The fundamental objective of the information strategy is to retain and deepen permanent support of Polish society for our membership aspirations. Activities in this field will be directed towards:

• familiarising society with the issues of the EU;

• making society aware of the impact of Polish membership in the EU upon State sovereignty, security, international status and the economy;

• explaining the changes in the area of citizens' rights and duties which will be brought about by Poland joining the EU;

• introducing issues concerning European integration into national education system at all levels.

1. Extensive education - information - promotion activities will be initiated. They will consist of three blocks of operational activities:

• monitoring of the state of awareness and the resulting level of social acceptance of the successive integration phases;

• drawing up of concrete education - information - promotion action programmes;

• implementing of the programmes thus drawn up, while taking into account the characteristics of different social groups as well as the requirements of a given integration phase.

1. The overall positive attitude of Poles towards integration, nonetheless, contain many myths and stereotypes, anxieties and hopes as well as ideas concerning the benefits and costs of membership in the Union. This is a result of insufficient information on integration with the EU and its consequences for Poland.

1. Information on society's opinion on the adaptation process being implemented in Poland has been compiled and constantly reviewed since 1990, thanks to the annual research carried out by the Government's Public Opinion Research Centre, CBOS, and non-governmental institutions. At the same time specialised research teams carry out studies in this field. On this basis it is possible to identify the following data:

1. The level of social acceptance of Poland's integration with the European Union has stabilised at approximately 75 - 80%. This tendency is accompanied by a whole range of positive developments which point to its permanent nature:

• increased knowledge of the institutions of the EU;

• increasing understanding of the benefits and costs associated with the implementation of the adaptation process;

• increased social awareness concerning the time of Poland's accession to the EU;

• correcting and reducing the public's expectations of increasing social benefits from accession to the EU.

1. The tendencies creating a positive climate for the implementation of the integration process are, however, accompanied by certain negative phenomena:

• acceptance of the integration of Poland with the EU is still based on a limited knowledge of the functioning of the EU;

• opinions concerning European integration are diverse, depending on the social and professional status, affluence, area of residence and age of the respondents;

• strong variation in public opinion exists in the evaluation of the benefits and costs associated with the accession of Poland to the Union;

• acceptance of the integration process is based on a shallow consensus which may waver under political conditions less stable then the current ones;

• despite improved understanding, social expectations concerning Poland's membership in the structures of the EU are still idealised.

1. The information strategy is defined by its main objective, i.e. animating the activity of various social groups in support of Poland's membership in the EU. The source of this activity should be the desire to translate the prospects of membership in the Union into the interests of groups and individuals

1. The full identification of factors shaping the conditions under which the information strategy of NSI is being created requires the widening of the scope of research, the utilisation of information in secondary analyses and an increase in research. This necessitates the appointment of a working group dealing with information strategy and co-ordinating and inspiring research projects in this field. Such work should be carried out with the participation of both public opinion research agencies and academic centres.

1. The working group set up at the Committee for European Integration will consist of specialists from those State administrative organs which are particularly involved in the information activities as well as specialists appointed by the interested non-governmental organisations.

1. The task of the working group or the chosen research agency will be the monitoring of factors influencing the NSI information strategy. Apart from the programmes currently under way the research teams should pay particular attention to the groups that are of key importance from the point of view of the social perception of integration such as: the young - especially in small towns and rural areas, the opinion-forming circles - in particular the political elite, agricultural and business circles.

1. The working group will draw up an action plan including, in particular:

• preparation of plans in the area of education, information and promotion;

• constant updating, based on the monitoring of public opinion;

• preparation of procedures to be used for translating these plans into concrete programmes;

• supporting the establishment of these programmes and their co-ordination;

• selecting agents to carry out these programmes;

• provision of financial resources needed for their implementation;

• programme implementation supervision;

• assessment of their implementation.

1. The working group will disseminate information among government institutions, mass-media, political parties and non-governmental organisations. This information will concern the activities carried out and their effects. The group will also publish texts of pronouncements made by politicians reflecting the official position of Poland in various stages of the integration process. The group will make use of all modern information techniques.

1. The work of the group will inspire concrete programmes and create favourable conditions for their implementation while at the same time limiting the interference in their form and contents. This work should fit the framework defined by the information strategy which at present can be summarised as follows:

• Poland's integration with the European structures is not an objective in itself, but one of the means of increasing the speed of systemic transformation and attaining conditions favourable from the point of view of the long-term development of our country. The information campaign should emphasise the benefits derived by Poland from the integration seen as a process supporting these changes. The obvious costs of systemic transformation cannot be allocated to the costs of the integration process;

• The campaign on behalf of Poland's integration with the EU structures should be devoid of the emotional aspect contained in the “return to Europe” slogan. In terms of social perception, this catch-phrase turns the integration process into a backward-looking exercise whilst the current strategy requires a forward-looking attitude;

• Popular support of Poland's integration with the EU is a huge capital asset which must not be squandered. It has to be remembered that this approval is based on a shallow consensus which is not supported by sufficient recognition of the social costs which will have to be borne in the course of this process;

• The signing of the accession treaty which will fundamentally alter Poland's geo-political situation must be whole-heartedly accepted and supported by Polish society;

• The integration campaign will be addressed to the entire Polish society, but at the same time it must take into account social stratification which is more pronounced than in other countries of the region. This applies both to the economic and civilisational, and cultural dimensions. Target integration strategies preceded by the identification and analysis of the integration process and related anxieties and hopes will be drawn up for all basic social groups.

1. The half-century-long division of Europe operated on the consciousness of both sides and led to a deformed concept of societies living under different systems. These misconceptions stemmed from the inability to verify the reality through mutual contacts. Therefore, the information activities will simultaneously be directed towards the shaping in the minds of Poles of a positive image of a united Europe and the creation of a positive picture of Poland amongst our European neighbours.

Part VIII: Executive summary

1. Poland's membership in the EU is a strategic objective of the Government of the Polish Republic and of Polish foreign policy. This objective, consistently pursued since 1989 by all Polish governments, is an expression of the aspiration of the majority in Polish society to be present and active in the European structures.

1. EU membership has its benefits and costs. The process of adaptation to European standards requires a considerable adaptation and modernisation effort in Poland. However, its outcome will be permanent membership of Poland in a group of countries with highly developed economic, political and social structures.

1. In the negotiation process Poland must present a consistent and coherent stance in matters pertaining to our future position within the EU. Careful factual and technical preparation of the negotiating team will facilitate the achievement of the best possible conditions in the transition period and in areas requiring particular protection. The stance of Poland should be established[Author ID1: at Thu Feb 6 12:43:00 1997 ]taken[Author ID1: at Thu Feb 6 12:43:00 1997 ] in consultation,[Author ID1: at Thu Feb 6 12:44:00 1997 ] in the widest possible way, [Author ID1: at Thu Feb 6 12:43:00 1997 ]with social partners in the widest possible way[Author ID1: at Thu Feb 6 12:43:00 1997 ],[Author ID1: at Thu Feb 6 12:44:00 1997 ] [Author ID1: at Thu Feb 6 12:43:00 1997 ]so as to make the integration a matter important to all the citizens.

1. The formulation of a uniform stance and co-ordination of Polish policy towards the EU belongs to the remit of the Committee for European Integration (KIE) set up by the Act of August 8th, 1996. The strategic role of the Committee is underlined by the fact that its Chairman is the Prime Minister.

1. In the period of intensified adjustment, negotiation preparations and their actual conduct, it will become necessary to identify, rapidly, the positions of the member States and the European Commission regarding:

• the forthcoming membership negotiations;

• the future EU budget, directions of the structural funds' reform and the modification of the CAP;

• the political and institutional consequences of the 1996 Intergovernmental Conference.

1. It is necessary to accelerate the work of experts on the balance of benefits and costs taking into account the negotiation options (transition periods, transfers, etc.). Analysis of the accession treaties signed during the second (Spain, Portugal, Greece) and third (Austria, Sweden, Finland) phase of EU enlargement, and analysis of the experiences of these States in the initial membership period will be helpful here. On this basis, the Government will estimate the costs of integration with the European Union while at the same time taking into consideration the balance of potential benefits. The Government will also submit a list of the possible costs and dangers facing Poland in the event of abandoning the integration effort.

1. The fundamental condition for attaining economic benefits in the course of the integration process is a proper preparation of the Polish economy in the pre-accession period so as to make it capable of withstanding competition within the Union and, in the future, meeting the criteria of Economic and Monetary Union. The main objective should be to preserve a high rate of economic growth in the long run. This will be possible if the rate of economic reforms, modernisation and far-reaching restructuring of the entire economy is not only maintained, but accelerated.

1. The key elements of such an economic policy are: reforms of the national insurance system, privatisation of the largest State-owned enterprises, completion of the process of restructuring and privatisation of the financial sector as well as the pursuit of a macroeconomic policy which, with the right combination of monetary and fiscal policy and the exchange rate, will lead to a permanent lowering of the rate of inflation.

1. The process of implementation of the sectoral adjustments arising from the timetable of the EU accession will be accelerated. Sector programmes will be drawn up from the point of view of the negotiations and membership. The existing programmes have to be co-ordinated. The Government will, in particular:

• prepare the key elements of the negotiation strategy in individual sectors;

• draw up a comprehensive negotiation strategy;

• appoint sectoral negotiation teams;

• appoint the negotiator and define the basic composition of the chief negotiation team and its legal and material instruments.

1. It has to be emphasised that the costs of economic transformation are not the price of membership in the Union but rather the price Poland has to pay for the retardation of its economic development. These costs would have to be borne in any case, regardless of whether Poland will or will not joint the EU. In the long run the economic benefits of integration by far outweigh the costs of adjustment.

1. The Polish State and its citizens need a modern legal system. As a direct result of the signing of the Europe Agreement, such a system is already being created. Its future development will be necessary in the pre-accession and the initial membership period. The prospect of Poland joining the EU and subsequently membership itself will assist in the establishment of modern Polish legislation.

1. In view of the accession, the process of approximation of Polish law will be intensified in order to prepare the Polish State for gradual adoption of the entire acquis communautaire. Therefore, the process of adapting Polish legislation to the requirements set by the Europe Agreement and the White Paper of the European Commission concerning the Single Market will continue. The measures which must be taken in this area are:

• preparation of a comprehensive translation of Union legislation accompanied by the creation of a Polish data base;

• specialised training of lawyers.

1. The Strategy also defines the way in which Poland should attain full participation in the II Pillar of the EU, i.e. in the co-operation between Member States regarding foreign and security policy. NSI defines the circumstances of Poland's international situation and the principles guiding Poland in co-operating in the field of the Union's foreign and security policy.

1. A number of steps designed to influence the external position of the process leading up to Poland's membership will be taken within the framework of NSI. In this area, the strategy should ensure the most favourable conditions for conducting the negotiation process, and subsequently the ratification process. Ultimately the parliaments of all Member States and the European Parliament will have to ratify the treaty setting the conditions of Poland's membership in the Union. The position of the other European institutions will be important.

1. For these reasons the strategy sets out the activities which must be carried out both at the level of Member States and the Union itself. Therefore, all available channels of political influence, including diplomatic means, lobbying, influencing foreign media, opinion-makers and non-governmental organisations should be utilised.

1. Particular attention should be paid to those countries which may be of the opinion that our membership in the EU could be detrimental to the quality of their EU membership and to those circles and interest groups within the EU which may perceive the enlargement of the Union as harmful to their current position.

1. In the external activities stress was also placed on the role of the social partners in the process of attaining membership by Poland. Their potential impact upon the shaping of Poland's image abroad coincides with the need to set up a system of lobbying for Polish economic and political interests in the European institutions. The Government will support all initiatives designed to establish a permanent mechanism of co-operation with non-governmental organisations including consultations during preparations for negotiations and after they have started. Appointment by the non-governmental organisations of their co-ordinating group would be helpful. That group's external partner would be the Social and Economic Committee of the EU.

1. In the pre-accession period, steps will be taken to bring Poland closer to the III Pillar of the EU which consists of co-operation in the field of the administration of justice and home affairs. These steps will be aimed in particular towards Poland joining the Schengen Treaty and EUROPOL.

1. Training of central administration personnel in EU issues will be developed using budget resources and bi-lateral aid. This training will be extended to regional and local government administrations, as well as economic and professional circles.

1. The selected group of future negotiators and heads of integration departments in ministries, particularly those represented in the KIE, will undergo specialist training. Similar training will be offered to professional groups of particular importance such as:

• lawyers - European law experts, judges;

• economists;

• team managers;

• translators and interpreters;

• secretaries, archivists, computer experts - knowledge of foreign languages and modern work techniques;

• specialists in public relations.

1. Although the majority in Polish society and its representatives support Poland joining the EU, the knowledge of the Union affairs amongst the population is insufficient. Therefore, a vigorous information campaign aimed at presenting all the benefits of membership in the EU as well as the challenges posed by our accession has to be organised so that when the accession treaty, dramatically changing Poland's geo-political situation, is signed, it should be fully accepted and supported by Polish society.

1. The education-information campaign addressed to Polish society will be carried out through:

• including in the education system certain elements of knowledge on the EU, including elements stimulating interest in European integration and preparing the young for a life in a Europe which is growing together;

• encouraging research and academic education in the area of European Studies, as well as introducing a new degree course called European Studies;

• promoting information on the EU and Poland's integration in the media and initiating a national debate concerning these issues;

• supporting non-governmental organisations, particularly those involved in promoting European integration.

1. A working group on information strategy will be established. Its task will be to draw up a modern information policy of the State in view of Poland's membership in the EU. This group will include representatives of the state administration, opinion-making and political circles and also representatives of non-governmental organisation. The strategy should make use of all modern techniques and methods of mass communication, should influence the level of knowledge among journalists and carry out permanent monitoring of the effectiveness of activities undertaken in this area.

1. Scientific analyses necessary for the proper implementation of NSI should not be carried out solely in official government institutions. Therefore, many of the most important activities carried out within the framework of NSI should be supported by a reputable institution which will conduct research and carry out publishing activities and deliver expert opinions in the field of European integration, while providing a venue for international meetings and conferences. The Government will instruct the Committee for European Integration to set up as soon as possible the Polish European Institute, ensure its independence and provide funds. This Institute will follow in the footsteps of similar centres existing in EU member States.

1. NSI will form the basis for the drawing up of a detailed negotiating mandate. The KIE will present a list of expert opinions needed for the preparation of the negotiating mandate. The chief negotiator and the core of the negotiating team will be appointed.

1. The Government of the Polish Republic will strive towards agreement on the rules of EU co-operation and aid during the preparation period by suggesting a faster transformation of PHARE in the direction of the structural funds, and the setting up of pre-accession funds. To this end, appropriate executive structures taking into account the principle of co-financing will be established. The Government is of the opinion that PHARE should become one of the main instruments for financing the adjustment process. The Government and the European Commission are at present conducting a review of long-term aid programmes in order to adapt them to the requirements of the pre-accession period.

1. The Government will implement a new system of budgetary classification, compatible with the European classification of activities, which will allow the planning and supervising of budget expenditures resulting from the integration process. This will facilitate the drawing up of a balance sheet of budgetary benefits and costs and, in the future, the determination of the magnitude of cofinancing towards the implementation of financial programmes within the framework of the structural funds.

1. NSI will be financed from mutually supplementing sources:

• budgetary resources

• non-repayable grant assistance

• credits extended by international financial institutions, in particular, the European Investment Bank, the European Bank for Reconstruction and Development and private banks.

• private investors and private institutions.

The Government will determine the level of participation of these sources of finance.

1. It is the Government's intention that the main principles of the NSI and its implementation become priorities in the activities of the Government Administration. The Government also appeals to citizens, political and professional organisations, local government and non-governmental organisations to familiarise themselves with NSI and to decide, according to their abilities, how to support its implementation.

The Government is of the opinion that the realisation of the prospect of a democratic, secure, strong and prosperous Poland participating in a democratic, secure, strong and prosperous European Union should become the goal of Polish society on the threshold of the 21st century.

The Europe Agreement establishing the Association between the Polish Republic and the European Communities and its Member States, signed on December 16th ,1991, came into force on February 1st, 1994.

The Maastricht convergence criteria concerning exchange rate stability, lowering of inflation and interest rates and the level of public debt.

White Papers drawn up between 1993 and 1996 on the instruction of the Government's Plenipotentiary in [Author ID1: at Thu Feb 6 09:13:00 1997 ]for European Integration and Foreign Assistance and concerning the following areas: law, economy, science and technology - over 70 volumes in total. They show the required degree of adaptation of Polish systems to EU standards and contain the necessary recommendations.

Questionnaire - Poland. Information required for the preparation of an avis concerning Poland's application for membership in the European Union was sent on April 26th, 1996 by the European Commission to the Polish Government. It contained 156 pages of questions on the situation of Poland, divided into 24 chapters. The Government replied with a document running to nearly 2700 pages which was submitted to the European Commission on July 26th, 1996. Similar questionnaires are always sent to states applying for EU membership and have also been submitted to all states associated with the EU.

The "Maastricht Treaty" introduced the concept of a Union of three "pillars", each with a separate decision-making structure. Pillar 1 concerns matters decided on Community decision rules (e.g. Common Agricultural Policy, Commercial Policy etc.). Pillar 2 concerns the Common Foreign and Security Policy (CFSP). Pillar 3 concerns justice and home affairs. Pillars 2 and 3 are essentially inter-governmental in nature.

National Strategy for Integration

National Strategy for Integration - Part I: Introduction

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National Strategy for Integration - Part I: General political objectives

National Strategy for Integration - Part II: Adaptation the economy

National Strategy for Integration - Part III: Adaptation of legislation

National Strategy for Integration - Part IV: External affairs

National Strategy for Integration - Part V: Justice and home affairs

National Strategy for Integration - Part VI: Training and human resources

National Strategy for Integration - Part VII: Information activities

National Strategy for Integration - Part VIII: Executive summary

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