What to Reform in the European Budget? Some Reflections on the Stakes of the Current Budget Review Process
The EU budget is the financial tool supporting European integration. The way it has developed over decades, both as concerns revenues and expenditure, superposed to a complex decision-making process, where member states retain veto rights in crucial respects, means that it currently displays a significant inertia, while its size and structure are not the most appropriate for endowing the Union with the means allowing it to best react to the present-day challenges. Tensions are also rising between the national interests of individual members and the common interest, which previous attempts to reconcile by way of special treatments granted to some countries are clearly unsustainable, while inducing additional rigidities to the budgetary construction. This obviates the need for a comprehensive reform, which the 2008/2009 budget review that the Commission was mandated to undertake may set in motion. The following paper attempts at taking stock of the most significant problems in need of a solution and to explore the most appropriate ways available for tackling them.
Analysis: The Agenda 2007 Proposals: Evolution or Revolution?
On 10 February 2004 the Commission published its proposal for the financial perspective 2007-2013. A week later it adopted the third report on economic and social cohesion. These two documents form the basis of the so-called ‘Agenda 2007 reforms’. They will be the greatest challenge for the enlarged EU after the intergovernmental conference, since they will determine the financial basis for EU policy-making until the middle of the next decade. The Agenda 2007 proposals certainly hint at courageous reforms, because they place a previously unheard-of emphasis on performance and quality. Under the proposals, structural operations should generate value for money, and the funds should focus on projects which generate added value at a European level. Overall the Commission’s proposals point in the right direction, because they balance, on the one hand, solidarity for the new Member States and weak regions in the old Member States with, on the other hand, investments in future tasks. Moreover, they constitute a paradigm shift. For the first time, the Common Agricultural Policy will not be the dominant expenditure category. Now it is up to the Member States to examine the proposals politically and find a compromise between sometimes very divergent interests. It is to be hoped that, during the debate over expenditure limits and division of funds, national interests do not outweigh European interests.
Did the metamorphosis from Export Processing Zones to Special Economic Zones improve the efficiency of trade enclaves in India?
In this paper, the efficiency of seven conventional Special Economic Zones in India is analyzed, by adopting a stochastic production frontier technique, for the period between 1986–1987 and 2007–2008.Results indicate that although the efficiency scores of these enclaves have improved over the years, specifically with the introduction of the SEZ policy (2000–2001), it is far below the threshold level as identified in the literature. Besides, one can also observe a discrepancy emerging between better export earning zones and efficient zones. On the determinants side, policy intervention and large geographical area, accompanied by clustering of units, are found to have impacted the efficiency scores of these enclaves positively.