{
  "id": "98-402",
  "type": "CRS Report",
  "typeId": "REPORTS",
  "number": "98-402",
  "active": false,
  "source": "EveryCRSReport.com",
  "versions": [
    {
      "source": "EveryCRSReport.com",
      "id": 105125,
      "date": "1998-04-23",
      "retrieved": "2016-05-24T20:54:46.968941",
      "title": "NATO and the European Union: Economic Capacity of New Member Countries and Opportunity Costs",
      "summary": "Formal entry of the Czech Republic, Hungary, and Poland into the North Atlantic Treaty\nOrganization (NATO) is scheduled for spring 1999, with accession to the European Union (EU)\nseveral years later. In tight budgets over the coming decade defense spending in these three nations,\nwith or without NATO membership, would have to compete with other incremental programs\ndesigned to further economic transition and meet European Union (EU) accession requirements. The\ncost of opportunities foregone by choice of one required program over another could represent\nsignificant opportunity costs when all desired appropriations can not be fit into tight budgets.\n  Providing adequate budgetary outlays for satisfying the full requirements of security plans --\nwith or without NATO accessions; full requirements for fulfilling economic and political plans --\nwith or without European Union accession will be difficult for even the most successful transition\neconomies in the region. Joining NATO and the European Union may ease these tough decisions\nas both organizations provide financial and technical support and offer integrative advantages that\nwould facilitate transitions in each acceding country. Tight budgets and opportunity costs will make\njudicious decisions on budgetary inclusion a central factor in the success of comprehensive\ntransitions. Although the three candidate countries are the success stories of transition to date and\nmay well be the best performing in the future their state budgets constrained by a tight cap on deficit\nfinancing, will not have the capacity to simultaneously meet all the priority claimants of both \"guns\nand butter.\" Each of the three new NATO members has more incremental programs especially\ncritical to economic transition than can be funded in projected budgets, e.g., pension fund\nrecapitalization, restructuring and retraining costs for privatization efforts in critical sectors,\ncontributions to construction of an the EU-sponsored railroad/road network, increased debt servicing\nburdens, health, education, and administrative reforms. These programs are the key requirements\nfor stabilization, liberalization, and privatization, which are all interlinked as they determine\neconomic growth, economic assistance, and investment from abroad. Each of these programs and\nmore are part of the EU accession requirements. The EU assistance programs are now being tied to\nmeeting these criteria. These are critical programs in the decade 1999-2009 when both the NATO\nand the EU enlargement costs are projected to be concentrated.\n  How well the likely new members to NATO assess their opportunity costs in formulating their\nbudgets in the decade ahead may be of special interest to the U.S. Congress in discharging its foreign\nand appropriations policy responsibilities. These first accessions may set precedents for successive\naccessions to both NATO and to the EU. The rising opportunity costs in countries with less\neconomic capacity may affect how quickly the EU and/or NATO will decide to integrate new\nmembers. For NATO and the EU, the timing and the conditions of subsequent accessions will pose\ncontinuing questions.  \n  This report will be updated as justified by events.",
      "type": "CRS Report",
      "typeId": "REPORTS",
      "active": false,
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          "url": "http://www.crs.gov/Reports/pdf/98-402",
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      ],
      "topics": []
    }
  ],
  "topics": [
    "Appropriations",
    "Economic Policy",
    "Foreign Affairs",
    "National Defense"
  ]
}