Squabble over EU’s border costs millions in snarled trade

Published Sun, Mar 31, 2024 · 04:04 PM

RENAULT’S Dacia brand is known for being an affordable car, but few drivers in Europe might realise the time and cost it takes for their vehicles to make it from the factory in Romania. Trucks delivering the hatchbacks need to wait anything from a few hours to a few days in lines stretching kilometres at the border with Hungary to enter the European Union’s Schengen Area, the customs-free zone that covers most of the bloc but not Romania or Bulgaria.

After years of negotiations, the two Black Sea nations received a concession on Sunday (Mar 31); they will join Schengen for air and sea travel. But the land border will remain because of opposition within the EU, primarily from Austria. The queues might look different for tourists in airports, just not for trucks at checkpoints crossing into Hungary.

The problem is that entry into the free-travel zone is now caught up in politics. Austria says it fears more illegal migration just as Western European voters increasingly embrace far-right parties ahead of EU elections. Romania’s auto industry, which includes Renault, Ford and hundreds of parts suppliers, says exclusion costs it 60 million euros (S$87.4 million) a year.

Admission to Schengen is an “important milestone” for Bulgaria and Romania, symbolising a “question of dignity, of belonging to the European Union”, said foreign policy analyst Stefan Popescu. “Any Romanian who had to walk down a lane separate from other European citizens felt being treated differently,” he told AFP.

Joining Schengen is a core tenet of EU membership, along with signing up for eventual adoption of the euro. It has been a mission for Romania and Bulgaria since they acceded to the bloc in 2007, three years after other Eastern European nations. The European Commission has said they meet all the technical criteria.

With the two countries arriving on Sunday, the Schengen zone will comprise 29 members – 25 of the 27 European Union member states, as well as Switzerland, Norway, Iceland and Liechtenstein.

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Romania’s government said Schengen rules would apply to four seaports and 17 airports, with the country’s Otopeni airport near the capital Bucharest serving as the biggest hub for Schengen flights.

More staff including border police and immigration officers will be deployed to airports to “support passengers and detect those who want to take advantage to leave Romania illegally”, it added.

Random checks will also be carried out to catch people with false documents and to combat human trafficking.

Bulgaria and Romania both hope to fully integrate into Schengen by the end of the year, but Austria has so far relented only on air and sea routes.

‘Schengen is here!’

“This partial entry won’t do the auto industry any good because the big problem is the land border,” said Adrian Sandu, one of the leaders of Romania’s Auto Manufacturers Association. “Our industry is losing about 180,000 euros a day because of the extra logistics costs. This impacts our supply chain and our competitiveness. None of the countries in the Schengen Area have this problem.” 

On a visit to Romania in early March for a European leaders’ meeting, Austrian Chancellor Karl Nehammer was greeted with billboards across Bucharest ironically declaring “Schengen is here!”

Nehammer responded by reiterating his opposition to Romania and Bulgaria fully joining the area any time soon.

Staying out of Schengen, which includes 23 of the EU’s 27 members, is costing between 2 and 5 per cent of gross domestic product, Bulgarian Finance Minister Assen Vassilev said in an interview, echoing similar figures for Romania.

The situation at the border has worsened since the two countries became the major route for transit of Ukrainian grain following Russia’s invasion in February 2022. The EU is currently looking at extending Ukraine’s access to the single market for agricultural products. 

The countries rely heavily on road for both imports and exports. Full Schengen entry would save Romanian transport companies about 100 million euros a year, according to data from the European Commission. An assessment from the Chamber of Bulgarian Road Hauliers tallied the lost profits from staying out of Schengen by land at 200 million euros annually. 

“The miles-long queues and the difficult border crossing hinder our businesses and our countries, and this is a serious problem for Europe as well,” Bulgarian Economy Minister Bogdan Bogdanov said in November, at a meeting with his Romanian counterpart at the border between the two countries.

Bulgarians, in particular, are increasingly disappointed with how the EU has handled their country’s Schengen entry process, also because of disinformation about inflows of refugees.

Austria is demanding better border controls on land and wants Sofia and Bucharest to take migrants from Afghanistan and Syria who reach the Balkan countries. In response, Romania and Bulgaria say they are not the main entry point for large migrant flows. 

“We’ll do whatever it takes to convince all the EU members that it’s our right to be part of Schengen,” said Romania’s ruling Liberal Party leader Nicolae Ciuca, who is part of the same European political group as the Austrian chancellor.

“Time is money, and no one wants to waste money waiting at border checkpoints.”

In a statement on Saturday, EU chief Ursula von der Leyen said: “This is a great success for both countries, and a historic moment for the Schengen area – the largest area of free movement in the world. Together, we are building a stronger, more united Europe for all our citizens.” BLOOMBERG, AFP

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