I. Introduction: NATO Enlargement and Priorities for the Alliance

1. The security landscape in Europe has been radically altered since the fall of the Berlin Wall and the "velvet revolutions" of 1989 and 1990. Though the risk of an all-out confrontation between the Soviet-led Warsaw Pact and NATO no longer exists, pockets of instability, including military conflict, remain on the European continent.

2. NATO’s adaptation to the changing security environment is mirrored in its opening up to the countries in Central and Eastern Europe. This has been reflected in the updating of the Strategic Concept, but also in a process that consists of developing and intensifying dialogue and co‑operation with the members of the former Warsaw Pact.

3. NATO’s profound transformation was initiated at the London Summit in July 1990, when it stated that it did not consider the Soviet Union and Warsaw Pact as adversaries, and invited them to establish diplomatic contacts with NATO. At the November 1991 Rome Summit, the Alliance launched the North Atlantic Co-operation Council (NACC). NACC’s primary goal was to provide its members with a platform to cope with security risks through transparency and consulting on political-military security matters. It provided for a forum to discuss civil-military relations, advancing military reform and conversion of the defence industry.

4. Responding to the demands of neighbouring countries for collaboration, it progressively developed a strategy of inclusion to create a Europe "whole and free." The change in NATO’s security doctrine also translated into a substantial reduction in its conventional and military forces. By 1999, the US had cut its troops deployed in Europe from 325,000 to approximately 100,000, while the European member states reduced their forces by more than 500,000. Overall, NATO land, air and naval units had been reduced by between 30 and 40%.

5. Enlargement is one of the priorities of the Alliance. The Alliance's Strategic Concept, approved by the heads of State and Government at the meeting of the North Atlantic Council in Washington, in April 1999 states that

"The Alliance remains open to new members under Article 10 of the Washington Treaty. It expects to extend further invitations in coming years to nations willing and able to assume the responsibilities and obligations of membership, and as NATO determines that the inclusion of these nations would serve the overall political and strategic interests of the Alliance, strengthen its effectiveness and cohesion, and enhance overall European security and stability."

The document adds that "No European democratic country whose admission would fulfil the objectives of the treaty will be excluded from consideration." Enlargement goes together with other NATO programmes and activities such as the EAPC (Euro-Atlantic Partnership Council), Partnership for Peace (PfP), NATO’s distinctive partnerships with Ukraine and Russia, as well as with other organisations, namely the OSCE, but also the EU. Enlargement to the east can promote stability and security in Europe in a number of ways: for example, the real prospect of membership of the Alliance can motivate countries to promote democracy, solve border disputes and settle ethnic problems.

6. The basic principles for further NATO enlargement apply as laid out in the 1995 Study on NATO Enlargement: Applicant countries should be accepted based on their democratic credentials, their ability to contribute to NATO’s collective security and their membership enhancing security and stability in the Euro-Atlantic area.

7. At the 1997 Madrid summit, NATO said it would consider further Enlargement in 1999. However, at the Washington summit, member states did not make a decision, and announced that they would revisit the issue at the next summit no later than 2002.

8. At the beginning of 2001, NATO Enlargement seems to be somewhat on the backburner. NATO is focused on consolidating its present changes. A growing and dangerous gap is evolving between the expectation level in candidate countries and the implicit "conservative" attitude in some member countries. NATO and the member states are already devoting a considerable amount of energy, time and resources to a number of key issues that demand their full attention. These include the reform and modernisation of the military forces in member states (DCI– Defence Capabilities Initiative), and the strengthening of the European pillar within NATO, particularly the EU’s plans for ESDP and the necessary arrangements for establishing and developing institutional links between NATO and the EU. Moreover, the fragile situation in the Balkans, particularly in and around Kosovo and the former Yugoslav Republic of Macedonia*, will require NATO’s full attention and involvement for years to come. Last, but not least, the emerging debate about how to defend against WMD delivered by ballistic missiles will demand increasing time and resources of NATO members.

9. Regrettably, few member governments seem to have devoted serious consideration to Enlargement, let alone publicly explained considerations for an Enlargement strategy. However, a number of parliamentarians and government officials have recently made some contribution to a slowly emerging, albeit cursory, debate. In Germany, the former defence minister, Volker Rühe, supports a NATO invitation to Slovenia, Slovakia, Bulgaria, and, possibly, Romania. He also proposed that NATO should, at its 2002 Prague summit, provide the three Baltic countries with a timely perspective for membership at a later stage. The former Greek defence minister Apostolos Athanasios, told journalists during a Moscow visit on 8 July, that Greece welcomed the admission of Romania, Bulgaria and Slovenia to NATO. Recently, the Greek defence minister Akis Tsokhatzopoulos, forecast the admission of Slovenia and Bulgaria in 2002. The chairman of the US Senate Committee on Foreign Relations, Jesse Helms, has voiced support for the inclusion of all three Baltic countries in NATO at the Prague summit.

10. But there is unfortunately no real structured debate on the continuation of the Open Door policy as of yet. The date for the next summit meeting of the Alliance has now been set for November 2002, which allows for a more comprehensive and informed debate and exchange of views on the next Enlargement round. Though there is no structured dialogue among the NATO capitals, a number of different scenarios are being debated. These scenarios include

· The "minimal solution": to extend an invitation to Slovenia only;

· The "Southern option": to invite Slovenia, Slovakia and Romania;

· The "reinforced Southern option": to invite Slovenia, Slovakia, Romania and Bulgaria;

· NATO Enlargement along the "EU model", i.e. to invite the countries of the "Southern reinforced option" and include a Baltic country;

· The "overall solution" (or “Big Bang"): to invite all applicant countries at the same time. This swift, one-step option, it has been argued, would avoid a protracted dispute with Russia in future Enlargement rounds.

11. Whatever the consensus among the heads of state of NATO governments in Prague in November next year, your Rapporteur views the continuation of the Enlargement of the Alliance as a pivotal tool for stabilising the security situation in Europe. Whatever the outcome of the Prague summit next year, the Alliance should send a strong signal that it is not abandoning the aspirant countries and should find ways to reinforce further the links with them. This could be achieved through further improving PfP, for example through strengthening Article 8, which currently foresees "consultations" between NATO and any active Partnership participant that "perceives a direct threat to its territorial integrity, political independence, or security", thus giving a limited security guarantee.

12. Your Rapporteur also wants to stress the need for much stronger and deeper co-operation with Russia to explain the underlying rationale of NATO Enlargement and point to the mutual interests, benefits and necessities of a truly strategic partnership. NATO has an important task to deal with and faces a double challenge, that of inclusion and exclusion. This partnership would be directed against no one, but would produce joint approaches to tackle the pressing current and future security challenges and produce results in the areas of arms control and non-proliferation, to mention only two vital areas. A real partnership with Russia allows for more effective criticism of Russia’s record on human rights (Chechnya) and press freedom.

13. Enlargement is too important an issue to have on "auto pilot" and only to focus on shortly before the Prague summit. There is a need for open, frank transatlantic dialogue on the issue and its ramifications. This is a prerequisite for avoiding last minute decisions based on, or influenced by, "politicking." This dialogue must also include the national parliaments, not only because they have to ratify the decision taken by the heads of government. What is more, parliaments should be actively engaged in the development of accession policy and the underlying strategies to secure stability in the Euro-Atlantic area. Your Rapporteur strongly believes that this organisation, the NATO PA, can and should be a pro-active catalyst in providing for a comprehensive debate among parliamentarians and among member states of the Alliance, as well as the aspirants and those countries which do not - at least not at present - want to join NATO. The NATO PA could be a highly valuable asset in the developing debate. A particularly useful contribution of the Assembly could be in the area of discussions on the desirability and feasibility of developing a policy package to reconfirm to Russia that the Alliance wants to include it as an active partner in Euro-Atlantic security. Early transatlantic dialogue is also necessary to agree on measures to reaffirm those countries which might not be invited in the second round.

14. The NATO Parliamentary Assembly has been at the forefront of opening up the Alliance to new members. It has traditionally strongly supported inclusion of all democratic countries in the Euro-Atlantic area in an open dialogue on security and stability. The NATO PA has also specifically endorsed NATO Enlargement, most recently at the 2000 Annual Session in Berlin.

II. NATO’s Last Enlargement Round - Lessons learned

A. Contribution of new members to European Security

15. The latest Enlargement round, the inclusion of the Czech Republic, Hungary and Poland, is viewed as a success. None of the fears of Enlargement opponents materialised: NATO’s military effectiveness, political cohesion and decision-making were not weakened. Neither was "NATO’s system for the protection of secret data and information penetrated by a ‘Trojan horse’ packed with former communist military personnel and possible ex-KGB ties collaborating with powers hostile to the Alliance." The costs of Enlargement have been manageable for NATO and the new members. By taking in new members, NATO has not adopted new risks, nor have the new members become assertive towards non-NATO members. Moreover, Enlargement has not created a new dividing line in Europe, and Russia has - albeit grudgingly - accepted a larger Alliance.

16. The new members continue to undergo profound reform processes. All three have established civilian control of the military forces, Western-style command structures, and are upgrading their military hardware as well as their training.

17. What is more, they contribute considerably to European security and stability in a number of ways. The new members take part in SFOR and KFOR operations. For example, without the co-operation of Hungary, any peace mission in the Balkans would have been far more difficult and costly. Today, two Polish battalions serving in Bosnia and Kosovo are considered model peacekeepers. The last Enlargement round has not only increased Central European stability, but has also resulted in perhaps the healthiest Polish-Russian relationship ever.

18. Nevertheless, the Czech Republic, Hungary and Poland have all experienced continuing integration difficulties. Though each country is unique and is adapting differently to the changes since 1989, all share the common experience and burden of Warsaw Pact culture. Their armed forces are too big and too heavy, they are under-funded and, in part, poorly equipped. The three countries need to develop larger non-commissioned and junior officer corps, and phase out a surplus of high-level officers. The newcomers experience budgetary constraints, not only due to economic difficulties, but also due to a failure of political will. While this is true for a number of member states, the situation is more severe for the newcomers, as they have to develop their forces from a different starting point. Moreover, all three are preparing for membership of the European Union, which requires considerable adjustments in socio-economic, legal, financial and other structures. Other challenges that the newcomers have to overcome are planning difficulties, constitutional and legal system inadequacies, and outdated National Security and Defence concepts as well as military doctrines. Military reform has been slow in specific circumstances.

19. It was generally understood that the new members have to undergo a transition period of several years before they meet the required level of compliance with NATO military standards, primarily interoperability with NATO weaponry and the ability to communicate in English. The record of the newcomers is so far mixed, and they have been only partially successful in progressing towards these ends. Some argue that this is in part due to the loosely defined term of "interoperability" and to insufficient assistance and training provided by NATO. Members should also provide additional assistance with equipment which is no longer necessary since their forces have been reduced in size. Military security should not replace socio-economic security in the prospective new NATO member states.

20. However, even though NATO’s new members continue to experience these problems, the capacities of Poland, Hungary and the Czech Republic are more advanced than those of NATO’s MAP partners.

21. The performance of the latest NATO members is viewed as important in assessing the contribution of new members to the Alliance. When the US Senate ratified the accession of Poland, Hungary and the Czech Republic, it explicitly stated that military contribution of prospective new members should be a key consideration in the next enlargement round. As the former deputy assistant secretary of state for European Affairs, Ronald Asmus, said: "The performance of the three new member countries is essential for the future of the process."

22. But when making an assessment of the last enlargement round, it is important to remember that the Open Door process has developed over time and that the criteria for evaluating the progress made by applicant countries have been fine-tuned, mainly because of the introduction of MAP. What is more, assessing the contribution of members, as well as applicants to NATO and European security, needs not only to focus on military progress, but involves a complex set of criteria. For example, the three newcomers have stressed their strong support for further Enlargement. The Czech Republic, Hungary and Poland can substantially contribute to putting further Enlargement on the top of the Alliance’s agenda by continuing, in part also speeding up, undergoing military reforms and investments. Moreover, they play an important role as a bridge to aspirant countries as well as to non-applicant neighbouring countries, particularly Russia and Ukraine. As to applicant countries, they already provide valuable support in a number of areas to assist them to modernise their armed forces. As to non-applicants, the three newcomers have deepened bilateral and regional relations with them.

23. Therefore, an assessment of the last Enlargement round which includes the contributions - as well as achievements - of the Czech Republic, Hungary and Poland to NATO could play an important part in preparing the next Enlargement round. This assessment should be done objectively and be completed before the Prague summit.

B. THE MEMBERSHIP ACTION PLAN (MAP)

24. MAP adopted at the 1999 Washington Summit was an important signal to the aspirant countries that the Alliance remains committed to its Open Door policy. MAP is designed to assist aspirant countries prepare for membership. It also provides guidance to the national efforts of applicant countries and the assistance of the Allies. MAP is more specific and goes farther than the 1995 Study on NATO Enlargement in defining what applicant countries need to accomplish to meet the criteria for eventual membership. It draws on the experience of the last Enlargement round and the Partnership for Peace (PfP). MAP is not, however, a checklist for applicant countries to fulfil, nor could participation in the programme guarantee an invitation to begin accession talks. MAP is self-differentiating, which means that it is up to the participating countries themselves whether and how to match their participation in the programme with their national priorities. Participation in MAP does not make participation in PfP obsolete. PfP remains essential, especially in achieving inter-operability with NATO forces. MAP covers a broader range of issues than PfP, as it addresses the whole gamut of preparations required for eventual membership. It thus complements the activities available under PfP.

25. MAP consists of a comprehensive set of elements. Each aspirant is invited to submit an Annual National Programme (ANP) on its preparations for membership, including objectives and targets on all issues relevant to possible membership. These objectives and targets cover political, economic, defence and military, resource, security and legal aspects.

26. Each spring, NATO prepares individual reports for applicant countries, providing feedback and guidance focused on their progress in the areas covered by their individual national programmes. This document forms the basis for an annual spring meeting of NAC with each individual aspirant.

27. The Alliance then provides assistance - through a focused feedback - mechanism on progress. This occurs in a 19+1 format, i.e. with the North Atlantic Council, and other NATO bodies if requested, and with a NATO team. The mechanisms for providing this feedback include those currently in use with partners (e.g. the PfP framework), as well as 19+1 meetings and NATO team workshops. The workshops will be particularly valuable, as they enable in-depth discussions among experts on the entire spectrum of issues relevant to membership.

28. So-called "clearinghouse meetings" with individual aspirant countries in a 19+1 format will help to orchestrate bilateral and multilateral assistance better, both in the defence and military realms, to the country concerned. Planning targets will be elaborated with aspirant countries to cover the areas most directly relevant to nations seeking to align their force structures and capabilities with the responsibilities involved in eventual Alliance membership. These will be built on existing Partnership goals and will be subject to review, allowing for detailed feedback.

29. The first annual cycle of MAP was completed last year. Applicant countries and NATO consider it "hugely successful", because it provides, among others things, more transparency and more detailed feedback to applicant countries on how they adapt to the required changes. It has laid a solid foundation for further work on preparation for membership. MAP is a dynamic programme and has already changed, as applicant countries and NATO have concluded the first cycle and are currently in the second. The second MAP cycle has become much more specific, providing for detailed, partly direct feedback to member countries. The exchanges have become much more detailed, comparable to the dialogue between member countries.

30. After the completion of the first annual cycle, a number of observations can be made to improve the process further. For example, aspirant countries still have to make considerable adjustments in their constitutional and legal frameworks. Moreover, as a general observation, the military forces of applicant countries are often inadequate to meet today’s and tomorrow’s security risks.

31. From the standpoint of applicant countries, the experiences and "lessons learned" from the first annual cycle of MAP depend on a number of factors, including previously existing military structures. For example, Bulgaria and Romania have been former Warsaw Pact members with comparatively large armed forces. Albania was an independent country, while the three Baltic states were formerly a part of the Soviet Union, though they were never acknowledged by the United States and many other states. The former Yugoslav Republic of Macedonia, Slovakia and Slovenia did not exist as independent states before.

32. Applicant countries would welcome improvements in the assessment and feedback mechanism. They would benefit from more on-site evaluation visits for the purposes of individual profiling. A more timely release of relevant Standard Agreements (STANAG) and other NATO documents would be helpful. Most importantly, better harmonisation of bi- and multilateral assistance to individual aspirant countries is needed. Some aspirant countries also want a NATO assessment mechanism to help them prioritise their MAP activities and identify minimal capabilities. Moreover, they would like NATO to streamline its procedures to help co-ordinate PARP, Partnership Goals (PGs) and the ANP. MAP tools that need co-ordination are the ANP, Individual Partnership Programmes (IPPs) and security assistance. It is time to define a MAP partners’ capability, and co-ordinate programmes toward achieving that objective.

III. STATUS OF PREPARATIONS OF THE NINE APPLICANT COUNTRIES

33. Article 10 of the NATO treaty stipulates that the Alliance "may invite any other European state in a position to further the principles of this Treaty and to contribute to the security of the North Atlantic area". While the 1995 Study on Enlargement outlines general guidelines, NATO has not established formal criteria for accepting new members. However, as an organisation of members that share common values, it has stated that only democracies with market economies and proven human rights records can join. Candidates must also have resolved all territorial disputes with neighbours, as well as and domestic ethnic conflicts. Finally, states must have transparency in military matters, including civilian control of the military and transparent defence budgets. Overall, the criteria are less clear than those for EU membership. There is a need for a proper, neutral and objective evaluation of aspirant countries’ progress, and objective operationalisation.

34. The following brief overview of applicant countries is not "all-inclusive", but can only be preliminary and needs to be elaborated. The report for the autumn session in Ottawa will provide a more comprehensive overview of the progress achieved by applicant countries. The autumn update will include additional information obtained during the visits of the Sub-Committee to applicant countries in 2000 and 2001. Thus far, the Sub-Committee has visited Bulgaria, Lithuania, Romania, Slovakia and Slovenia. The Sub-Committee plans to visit Albania, Estonia, the former Yugoslav Republic of Macedonia, and Latvia in the autumn and spring of 2001 and 2002.

A. ALBANIA

35. Albania was the last country in Central and Eastern Europe to begin a process of transforming its economic and political structures towards a democratic, market-oriented society. Progress has been uneven, but Albania’s human rights situation has steadily improved after the 1997 financial crisis which had brought the country to the edge of a civil war. However, significant problems remain, and the US State Department’s 1999 report on Human Rights Practices and the 2001 Human Rights Watch World Report cited organized crime and corruption, illegal police practices and a weak judiciary that is subject to political pressure and corruption, among the factors slowing down the country’s democratic progress.

36. After decades of international isolation, Albania has achieved significant progress in establishing and improving relations with neighbouring countries and international organizations. Albania is a member of the OSCE, the Council of Europe and the WTO, and participates in NATO PfP and EAPC partnership programmes. At the November 2000 EU Balkans summit in Zagreb, the EU named Albania a potential candidate for EU membership.

37. However, the EU had assessed that Albania was not ready to open negotiations over participation in the Stabilisation and Association Agreements which were set up by the EU during the Kosovo war.

38. Like most countries in the region, Albania needs direct and indirect assistance from international organisations. Bilateral relations with Greece have considerably improved since they had deteriorated over ethnic Greek issues and border skirmishes in the early 1990s. Relations with the former Yugoslav Republic of Macedonia have also improved: both countries are participating in numerous regional initiatives. In January 2001, Albania restored diplomatic ties with Yugoslavia which had been severed by the Milosevic regime during the Kosovo war. During NATO’s air campaign, Albania played a pivotal role and has substantially contributed to Allied efforts, accepting up to 450,000 of the nearly one million Kosovo refugees.

39. Albania’s army - currently some 40,000 strong - had largely disintegrated during the 1997 crisis. In April 2000, the government approved a ten-year plan for the comprehensive restructuring and reform of the armed forces. The first stage, from 2000 to 2004, focuses on rebuilding the army. In the second stage, from 2005 to 2010, the plan calls for improving the army’s capabilities and approaching NATO standards. Army personnel will be reduced to approximately 30,000. Albania has received bilateral military assistance from the United States, as well as neighbouring Italy, Greece and Turkey. A small contingent of Albanian troops has served with NATO’s SFOR operations in Bosnia since 1996. The country also participates in the South-Eastern European multinational peacekeeping force (SEEBRIGG) located in Bulgaria, which the Sub-Committee visited last year. Albania’s cooperation with NATO increased as a result of the 1999 Kosovo crisis. The Albanian army assisted the 7,000-strong NATO Albania Force (AFOR) in setting up refugee camps throughout the country. During the Kosovo crisis, NATO extended a limited security guarantee to Albania and other countries neighbouring Yugoslavia. Moreover, NATO considerably upgraded Albania’s transportation and communications infrastructure and facilities. A smaller contingent of NATO forces (AFOR-2) remains in Kosovo to support KFOR. The Albanian government welcomed NATO’s South-Eastern Europe Initiative and has offered NATO full use of its military facilities throughout the country.

40. As to civilian supervision of the military, Albania has made some progress in adopting fundamental documents on national security strategy and defence doctrines. In general terms, Albania’s 1998 constitution defines the mission of the armed forces, and the parliament passed a National Security Strategy document in January 2000. Albania benefits from its participation in programmes such as PfP by obtaining expertise in civil-military relations and characteristics of the armed forces in a democratic society.

B. BULGARIA

41. Bulgaria’s reform process after 1989 has progressed unevenly and more slowly than in the Czech Republic, Hungary and Poland. Under Socialist Party-led or supported governments, Bulgaria’s economic reforms lagged behind during most of the 1990s, resulting in a deterioration of economic conditions. However, after the 1996 presidential and subsequent 1997 parliamentary elections, political and economic reforms have been consolidated. Even though the US State Department’s 1999 Human Rights Practices report noted that the independent Bulgarian judiciary is continuing to struggle with corruption and lacks sufficient staffing and faces structural problems. The EU Commission has assessed that Bulgaria meets the criteria set out in the 1993 Copenhagen declaration. (A country must demonstrate that it has achieved "stability of institutions guaranteeing democracy, the rule of law, human rights, and respect for and protection of minorities.") The European Commission’s regular 2000 report on Bulgaria stated that the political situation remained stable, but that it needed to make further progress in judicial reform and in its efforts to combat corruption. The report also noted the country’s continuing progress toward becoming a market economy.

42. After years of stagnation and decline, the Bulgarian economy has undergone an impressive turnaround in recent years, due also to the backing of the IMF and other financial institutions. In 2000, the Bulgarian government identified economic growth, macro-economic stability and employment as its primary economic goals. Bulgarian GDP increased by approximately 5% in 2000. In February 2000, Bulgaria opened accession negotiations with the EU.

43. Bulgaria’s top foreign policy priorities are membership of NATO and the EU. Bulgaria is a member of the OSCE, the Council of Europe and the WTO; it is also an associate partner of the WEU and participates in NATO’s EAPC and PfP programmes.

44. During the Kosovo war, Bulgaria granted NATO unrestricted use of its airspace, despite domestic opposition to NATO’s actions in Kosovo. The government also allowed NATO troops to cross Bulgaria to deploy KFOR peacekeeping troops. NATO extended a limited security guarantee to Bulgaria during the Kosovo war. Bulgaria’s support of operation "Allied Force", NATO’s 1999 air campaign over Kosovo, has been praised by both NATO and its members states. Bulgaria presented its first annual MAP in October 1999 and its second in November 2000. While there was no national consensus over NATO membership while the Socialist party was in power, all parliamentary groups in Bulgaria now support NATO membership.

45. Bulgaria has actively supported and sometimes led numerous regional security initiatives. It participates in the Stability Pact for South-Eastern Europe. Bulgaria maintains good relations with its neighbouring states. A dispute with the former Yugoslav Republic of Macedonia over language was resolved in early 1999.

46. In 2000, Bulgaria’s armed forces comprised approximately 80,000 active forces, of which 49,000 are conscripts. It has a reserve of some 300,000. Bulgaria’s defence budget had decreased during the 1990s but began to increase again in 1999 and the 2000 defence budget was about US$ 350 million, representing approximately 2.30% of GDP. Based on a US study on Bulgaria’s armed forces, the Bulgarian government adopted "Plan 2004" in October 1999. It foresees a reduction of the armed forces to approximately 45,000 by 2004, i.e. half of its size in 1999. Following a visit of NATO Secretary General, Lord Robertson, in October 2000, the Bulgarian government reportedly plans to accelerate its reforms. Bulgaria has participated in numerous PfP training exercises, as well as in PARP and is currently working to implement some 80 partnership goals. Bulgaria contributes a small transportation platoon to NATO’s Stabilisation Force (SFOR) and a small engineering platoon to KFOR.

47. Bulgaria has completed its first year of implementing Plan 2004, a programme to reform and restructure Bulgaria’s armed forces. Bulgaria hosts the headquarters of the Multinational Peace Force South-Eastern Europe (SEEBRIG), formed by seven countries of the region.

48. Control of the military is assured by civilian government and parliamentary authorities. The Bulgarian parliament approved the military doctrine as law in 1999. It also considered reforms of the defence and armed forces legislation. The government established an inter-departmental committee on NATO integration.

C. ESTONIA

49. Estonia is a member of the OSCE, the Council of Europe, NATO’s PfP and EAPC, and an associate partner of the WEU. Overall, the country has very good relations with its neighbours. Links between Estonia and the Nordic countries, especially Finland, are close. In particular, through the Baltic Council, the Baltic Assembly and numerous inter-governmental organisations, Estonia has developed a very close partnership with the two other Baltic countries, Latvia and Lithuania, both politically as well as in the areas of defence and economy. However, Estonia’s relations with its largest neighbour, Russia, have sometimes been difficult. Russia has repeatedly expressed criticism of Estonia’s treatment of the Russian-speaking minority and has warned against Estonian NATO membership as a threat to its security interests. A Russian-Estonian border agreement has been reached, but, owing to Russia’s delay, not yet signed.

50. The 1999 US State Department country report on Human Rights Practices considered that Estonia to "generally respected the human rights of its citizens and its large non-citizens community." A November 2000 report of the European Commission stated that Estonia meets the political criteria for EU membership, namely a democratic political system, the rule of law, respect for human rights and the rights of minorities. Estonia has a large Russian-speaking minority numbering some 480,000 of a total 1.45 million inhabitants. Estonia adopted legislation to allow children of non-Estonians born after 1991 to acquire citizenship under certain conditions, thus fulfilling the last of several OSCE recommendations to harmonise Estonia citizenship law with OSCE standards. Responding to criticism by Max van der Stoel, OSCE Commissioner for National Minorities, Estonia’s parliament modified its language law in the spring of 2000.

51. After becoming independent, Estonia has successfully adjusted to becoming a free market economy: almost all state-owned companies are now privatised. It has been one of the most successful countries in attracting foreign direct investment (FDI). The EU began accession talks with Estonia in 1998, and the country is now engaged in harmonising its laws and policies with EU standards.

52. Estonian expenditures on defence reached approximately US$ 79 million, or 1.6% of GDP, in 2000. Current government plans foresee an increase to about 1.8% in 2001, followed by 2.0% in 2002. In 1994, the three Baltic countries agreed to form a joint peacekeeping battalion (BALTBAT) with training and equipment provided by NATO members. Parts of BALTBAT have become operational and participated in SFOR.

53. Civilian supervision of the military is ascertained through parliamentary control of the defence budget as well as the defence policy guidelines. Moreover, parliament approves the nomination of the commander of the armed forces. The president is commander-in-chief of the armed forces and appoints top military officers; the defence minister is a civilian.

54. The US president, Bill Clinton, and the presidents of the three Baltic countries signed a "US‑Baltic Charter of Partnership" in January 1998, which states that the United States has a "real, profound and enduring interest in the independence, sovereignty, territorial integrity and security of the Baltic states" and "welcomes and supports” their efforts to join NATO.

D. LATVIA

55. The EU’s November 2000 country report on Latvia stated that Latvia meets the political criteria for membership of the Union. The 1999 US State Department report said that Latvia generally respects the rights of minorities and non-citizens.

56. With almost 600,000, out of a total population of 2.4 million, Latvia has the largest Russian‑speaking minority of all three Baltic countries. Earlier EU and OSCE criticism of parts of the Latvian citizenship law led the Latvian parliament to adopt changes in 1998 which now make the law compliant with all requirements in both organisations.

57. The European Commission’s November 2000 report said that Latvia has a functioning market economy. The report added that, if necessary reforms were implemented, the country would be able to withstand competition from EU countries. Earlier, in February 2000, the EU opened membership negotiations with Latvia.

58. Latvia is member of the OSCE and the Council of Europe, and participates in NATO’s PfP and EAPC. It enjoys good relations with its neighbours and is actively co-operating with Estonia and Lithuania in political, security and economic fields. But its bilateral relations with Russia have been difficult at times, owing to Russian criticism of what it considers to be Latvia’s unfair treatment of the Russian-speaking minority and its application for NATO membership. Like the two other Baltic countries, Latvia had not opted for membership of the Commonwealth of Independent States (CIS). Like Estonia, Latvia has completed a border agreement with Russia, but not signed it.

59. The Latvian armed forces comprise some 5,600 men and 14,500 National Guard reserves. Latvia’s 2000 defence budget amounted to an equivalent of little more than US$ 74 million, or 1.05% of its GDP (compared to the NATO member state average of 2.4). The government has pledged to increase the budget in following years to US$ 88,3 million (some 1.31% of GDP) and 1.75 and 2% in 2002 and 2003 respectively. Latvia participates in PfP and PARP, and has set up joint initiatives such as BALTBAT and BALTRON (Baltic Naval Squadron, a mine-sweeping unit comprising five vessels), with its two Baltic neighbours. On a rotating basis, Latvia, Estonia and Lithuania are contributing to SFOR through a platoon as part of the Danish battalion. Moreover, Latvia committed (very) small units to KFOR and NATO-led forces in Albania in 1999.

60. Civilian control of the military is assessed through the existing legislative framework which provides parliament with authority over the defence budget as well as over laws concerning national defence. The defence minister is a civilian. A visit to Latvia by the Sub-Committee on Central and Eastern Europe is foreseen for November 2001.

E. LITHUANIA

61. Lithuania is member of the OSCE and the Council of Europe, as well as NATO’s PfP and EAPC. Overall, it enjoys good relations with its neighbours. Though historically it had a somewhat difficult relationship with Poland, it has forged positive ties with its southern neighbour since its independence in 1991, including, for example, the joint Lithuanian-Polish peacekeeping battalion. Poland backs Lithuania’s bid for membership in the Alliance. Lithuanian-Russian relations are also generally good, even though they have been rocky at times. While Lithuania has only a relatively small Russian-speaking minority (less than 9% of the population), Russia strongly opposes Lithuania’s application to join NATO. Russia voices particular concern about the Kaliningrad exclave which would be surrounded by NATO countries. Lithuania and Russia signed a border treaty in 1997 and Lithuania allows the transfer of Russian military equipment and personnel through its territory.

62. The European Commission’s 2000 report on the country’s qualifications for joining the EU stated that Lithuania fulfils the political criteria for membership. According to the 1999 US State Department report Lithuania has held free and fair elections since becoming independent in 1991. The report concludes that the country generally respects the human rights of its citizens, including those of minorities.

63. Concerning the economic reforms currently underway, the latest EU report on Lithuania assessed that "it can be regarded as functioning market economy and should be able to compete with competitive pressure and market forces within the EU in the medium term" if it continues implementation of its structural reform programme. In February 2000, the EU opened accession negotiations with Lithuania.

64. After gaining independence in 1991, Estonia, Latvia and Lithuania had to build up military forces from scratch. Of these three countries, Lithuania has the largest armed forces with approximately 12,700 military personnel, including 2,000 in the National Defence Volunteer Forces. It spent the equivalent of US$ 186 million (1.7% of GDP) on defence in 2000. Lithuania pledged to increase defence spending to 1.95% in 2001. Lithuania participates in PfP and PARP, as well as MAP. Together with its two Baltic neighbours, it created a number of joint initiatives such as BALTRON, BALTBAT and BALTNET (a joint air surveillance network which became operational in 2000). Moreover, the three countries founded a joint Baltic Defence College (BALTDEFCON) in Tartu, Estonia, charged, among other things, with the education of staff officers. Lithuania has contributed some 80 soldiers serving as part of the Danish battalion with SFOR, most recently until January 2001. Moreover, 30 Lithuanian military personnel are currently serving as part of a Polish battalion with KFOR. In 1998, the previous US administration signed a US-Baltic Partnership (see the observations on Estonia). The Sub-Committee on Central and Eastern Europe had the opportunity to get first-hand impressions of Lithuania’s preparations for NATO membership during its visit in June 2000.

65. Concerning the civilian supervision of the military, the president of Lithuania is the supreme commander of the armed forces. The Ministry of Defence is responsible for the preparation of defence plans and the request and implementation of the defence budget which is adopted and controlled by the Seimas, the Lithuanian parliament.

F. THE FORMER YUGOSLAV REPUBLIC OF MACEDONIA *

66. The former Yugoslav Republic of Macedonia is a multi-ethnic state with ethnic Albanians comprising the largest minority (approximately 23% of the population according to the latest census in 1994). The 1999 State Department report on human rights practices viewed that the judiciary is generally independent and that human rights are generally respected in The former Yugoslav Republic of Macedonia, even though there is some police abuse and societal discrimination against minorities. The Human Rights Watch 2001 report pointed to some cases of police brutality and deficiencies regarding the independence of the judiciary.

67. Given its geographic location, namely its proximity to a country with volatile security, the former Yugoslav Republic of Macedonia has handled the challenges rather successfully. In the early 1990s, its relations with its immediate neighbours, particularly Serbia, were not without problems. Relations with the Milosevic regime were strained, but improved significantly after the change in government in Belgrade. Bilateral relations with Albania were sometimes difficult because of Albanian complaints over the treatment of the Albanian minority. Because of some bilateral disputes, Greece had introduced a unilateral embargo against the country, but lifted it one year later in 1995. Relations with Bulgaria have been rather positive, though. The former Yugoslav Republic of Macedonia played a very important and constructive role in the 1999 Kosovo air campaign. It received about 250,000 refugees from Kosovo. As recent developments have demonstrated, The former Yugoslav Republic of Macedonia remains affected by regional instability, particularly the instability of its borders and the infiltration of radical Albanians from Kosovo, and is concerned about the former Yugoslav Republic of Macedonia's membership of the OSCE and the Council of Europe.

68. The former Yugoslav Republic of Macedonia signed up for PfP in 1994 and is also a member of EAPC. In 1999, the EU agreed to sign a Stabilisation and Accession Agreement (SAA) with The former Yugoslav Republic of Macedonia to improve economic conditions in the country and foster its trade with the EU. The former Yugoslav Republic of Macedonia became the first country to sign the SAA with the EU at the EU Balkans summit in Zagreb in November last year.

69. The former Yugoslav Republic of Macedonia did not have military forces of its own when it became independent. The Army of the former Yugoslav Republic of Macedonia (ARM) was created in 1992 and currently has about 16,000 military personnel, of whom 8,000 are conscripts. The reserve forces number 60,000. ARM is in a profound structural reform process based on a 1998 defence strategy and White Paper prepared by the Defence Ministry. As part of its ANP for MAP, the Defence Ministry adjusted its restructuring plans and defence cuts in May 2000. Priorities are border security, increasing combat readiness and improving equipment, as well as improving inter-operability with NATO forces. The main challenges for the country’s armed forces are the lack of both trained personnel and modern equipment.

70. The 1991 Constitution of the former Yugoslav Republic of Macedonia states that the President is commander-in-chief of both the armed forces and the Security Council. The 1998 Defence Strategy states the civilian and democratic control of the military, and identifies the parliament in active participation in designing and overseeing defence policies. The parliament has discussed, but not yet adopted, a new law on defence which refers to the instruments of civilian control. The Defence Ministry publicises annual White Papers to increase public awareness of defence matters.

G. ROMANIA

71. The 1999 US State Department report on human rights practices described some weaknesses concerning the independence of the judiciary in Romania, but assessed that the Romanian government "generally respected the rights of its citizens." But the report pointed to some serious problems in law enforcement, violence against and trafficking of women, juvenile homelessness, and societal discrimination against religious and ethnic minorities, especially the Roma. However, the situation of the Hungarian minority of approximately 1,6 million had significantly improved.

72. Romania’s economy is still suffering from decades of mismanagement and corruption under the Communist dictator, Ceaucescu. But its record of economic reforms after the 1989 revolution had been rather mixed, producing, among other things a very high inflation rate (approximately 150% in 1997) and falling GDP between 1997 and 1999. In 1996, the IMF and the EU froze credits to Romania owing to the failure of the Romanian government to implement agreed-upon economic reforms. The EU’s November 2000 economic report on Romania assessed that it was "not yet a functioning market economy." Lately, however, there have been signs of improvement, and GDP rose by approximately 2% in 2000.

73. Romania is a member of the OSCE (of which it assumed revolving chairmanship in January 2001) and the Council of Europe and participates in NATO programmes and initiatives such as PfP, PARP, MAP and the EAPC. Romania has good relations with its neighbours and has signed a number of bilateral treaties and agreements with its neighbours. It is also actively pursuing regional co-operation with them.

74. Romania continues to contribute actively to peace and stability in the region and beyond. A Romanian battalion and medical staff participated in the UN peacekeeping mission in Angola in 1995, and it sent military observers to Central Africa and the Persian Gulf. Moreover, Romanian forces participate in SFOR and KFOR. The country has participated in numerous PfP exercises.

75. Romania’s military budget amounted to some US$ 780 million in 2000, or 2.2% of GDP. The 2001 defence budget foresees a 14% increase of roughly US$ 890 million. The current government is investing considerable political capital to garner support for sustained efforts to prepare for membership of the Alliance. According to the 2000 "Military Strategy of Romania", released by the Defence Ministry, the armed forces will undergo a restructuring programme over the next eight years, reducing manpower from 207,000 to 112,000 between 2000 and 2003. The second phase will focus on the modernisation of equipment, including combat aircraft and naval vessels.

76. Romania has enacted legislation to assure civilian control of the military. Since 1994, the Defence Minister has been a civilian.

H. SLOVAKIA

77. Slovakia and the Czech Republic separated in 1993, but unlike the Czech Republic, Slovakia’s international standing diminished because of domestic political instability. When the EU issued its first observations about the qualifications of EU applicants, Slovakia was the only country which explicitly failed to meet the criteria. However, the situation changed significantly in the late 1990s under the present government, and the 1999 European Commission regular progress report on accession stated that Slovakia had met the political criteria for membership.

78. Despite political difficulties, a slow restructuring process and little foreign direct investment earlier in the 1990s, Slovakia’s economy featured robust growth rates of between 4.4 and 8% from 1995 to 1998. The European Commission’s 2000 progress report describes Slovakia as a functioning market economy.

79. Slovakia is a member of the OSCE, the Council of Europe and the WTO. It participates actively in NATO activities and programmes, such as PfP, PARP and EAPC. During the Kosovo air campaign, Slovakia opened its air corridors to NATO planes, even though NATO’s intervention was not popular among a majority of the population.

80. Like the Baltic countries and the former Yugoslav Republic of Macedonia, Slovakia did not have military forces of its own before becoming an independent state. In 2000, Slovakia’s armed forces numbered approximately 39,000 which the government plans to reduce to 30,000. Slovakia’s 2000 defence spending amounted to 1.62% of GDP, some US$ 348 million. The current government plans to increase military expenditures gradually by 0.1% annually to reach 2.0%. The current government has devised a concept aiming at increasing public awareness of all aspects of Slovakia’s accession to the Alliance. As a result, public support for NATO membership, which had fallen strongly during the Kosovo air campaign, is now slightly higher than 50% of the population.

81. The parliament is active in developing and monitoring the country's defence policy, thereby assuring civilian control of the military. In February 2001, the Slovak National Council approved constitutional amendments which, among others things, aim to strengthen the democratic control of the armed forces. The security strategy of Slovakia was approved in March 2001.

I. SLOVENIA

82. The 1999 US State Department report on Human Rights Practices states that Slovenia has held free and fair elections since its independence in 1991. The European Commission’s November 2000 report notes that the country meets the political criteria for EU membership.

83. Slovenia is a member of the OSCE, the Council of Europe, the WTO, the IMF and the World Bank, and participates in NATO’s EAPC, PfP and MAP. Slovenia has contributed to stabilisation in Bosnia and Kosovo by participating in SFOR, KFOR and UNMIK.

84. Slovenia has achieved impressive progress in the economic field. It has the highest per capita GDP in Central and Eastern Europe, and reaches about 71% of the EU average. Privatisation is almost complete, but its foreign direct investment is comparatively modest. The EU’s November 2000 progress report on Slovenia states that the country has a "functioning market economy."

85. Slovenia’s relations were strained with Italy and Croatia after it became independent in 1991. But Italian-Slovene disagreements over the property of Italian citizens who had left after World War II were settled in early 1995. Italy had strongly supported Slovene membership of NATO in 1997. As to Croatia, border issues - especially over the Bay of Piran - have clouded bilateral relations. Though not all issues are solved, it appears as if they do not pose any serious problems. Today, Slovenia enjoys friendly relations with all its neighbours.

86. 9,000-strong Slovene armed forces are currently undergoing a restructuring process. Slovene defence spending reached almost US$ 300 million, or 1.45% of GDP in 2000. In 2001, defence spending is planned to reach 1.87%. Slovene officials stress the priority to improve interoperability with NATO forces.

87. Civilian supervision of the military is provided by parliament’s control of the defence budget, as well as supervision of military and defence programmes.

IV. FURTHER NATO ENLARGEMENT AND SECURITY IN THE EURO-ATLANTIC AREA

A. RELATIONS WITH RUSSIA

88. Russia had opposed the accession of the Czech Republic, Hungary and Poland to the Alliance. As NATO Secretary General, Lord Robertson, stated during his most recent visit to Moscow in February 2001:

"Some in Russia still perceive NATO as a predominantly military bloc, propelling its military infrastructure up to the borders of Russia. That is not the case. In the Founding Act NATO committed itself to the famous three nuclear "no's" - no intention, no plan and no reason to establish nuclear weapon storage sites on the territory of the new members - a commitment still valid. The same is true for the statement that in the foreseeable security environment NATO will carry out its missions by ensuring interoperability, integration and capability for reinforcement - rather than by additional permanent stationing of substantial combat forces."

89. As to continuing NATO Enlargement, Russian government officials, with few exceptions, have voiced strong criticism, if not outright rejection, of this policy. The Russian President, Mr Putin stated that Russia "fundamentally does not accept this policy in relations with NATO”. In the context of a meeting on 30 January 2001 with the German Defence Minister, Rudolf Scharping, Sergei Ivanov, Secretary of the Russian Security Council, maintained that further NATO enlargement would "create a fundamentally new situation in Europe that objectively infringes on Russia’s political and military interests" and that "this could lead to a serious crisis".

90. In the Founding Act, Russia no longer considers the Alliance an adversary. Moreover, Russia has entered into a privileged partnership with the Alliance. Numerous OSCE documents, signed by Russia, provide every sovereign nation in Europe with the equal right to choose its security alignments freely. However, the new Russian National Security Concept of Russia describes NATO Enlargement as a "threat" to Russia.

91. NATO’s defence spending has been significantly reduced. Both in absolute and in relative terms, military forces have been cut substantially and force structures have also been adapted to the post-Cold War world. More importantly, NATO’s Strategic Concept reflects this above all, as it now focuses much more on co-operation with its partners. Overall, NATO’s commitment and that of its members, to peace and security, its structure and decision-making processes, ascertain that NATO cannot behave in an aggressive manner. At the same time, NATO member countries have - sometimes in an unjustified manner - shown significant restraint in commenting on Russia’s cause and conduct of the war in Chechnya.

92. The last round of Enlargement has not been at the expense of Russian security interests. For example, no new obstacles were raised to close co-operation between Poland and the Kaliningrad Oblast. On the contrary, the Russian President, Mr Putin, stressed the good bilateral relations when he visited Poland in January 2001. There is no reason why cross-border co‑operation between a new NATO member and Russia should differ from close partnership between an old NATO member, say Norway, with neighbouring Russia. When the Sub-Committee on Central and Eastern Europe visited Bulgaria, Lithuania and Romania, Slovakia and Slovenia, in 2000 and 2001, all representatives of applicant states echoed their desire for good-neighbourly relations with Russia. They will continue to have strong political and economic interests in co‑operating with Russia.

93. While Russia continues to reject further Enlargement in principle, some officials have signalled that Russia’s reaction would depend on the countries which would be admitted. Russian experts repeatedly spoke of a "red line" which the Alliance would overstep if it were to invite countries which formed part of the territory of the former Soviet Union, namely Estonia, Latvia and Lithuania, which have applied for NATO membership.

94. NATO membership of any Baltic country is a neuralgic issue for Russia. Russia considers the Kaliningrad Oblast, which hosts a considerable military infrastructure, one of the most sensitive issues. Russia and Lithuania have an agreement which gives the Russian side transit rights, including the shipment of military equipment and personnel. Russia fears that if Lithuania were to join the Alliance, the Kaliningrad district would become an enclave inside NATO territory. The sizeable Russian minorities in the Baltic countries (approximately 35% in Latvia, 29% in Estonia, and 9% in Lithuania) is another sensitive issue for Russia.

95. Moscow’s attempt to draw "red lines" against certain applicant countries is fundamentally opposed to each sovereign state’s right to choose for itself which alliance it wants to join. Moreover, the Alliance has explicitly stressed in both the 1995 Enlargement Study and the communiqué issued at the 1999 Washington Summit that the geography of an applicant country cannot in principle stand against membership of the Alliance. Russia has a voice but no veto.

96. However, due regard should be given to Russian interests, including along its southern periphery. On this point, while NATO should continue to bolster the military reform and development of democratic institutions in PfP countries of the Caucasus and Central Asia, neither the Alliance nor any of its members should seize upon Russia’s weakness to develop challenges in these regions that could become sources of long-term instabilities and possible conflict.

97. Some critics of Russia’s foreign policy maintain that Russia’s ambition for superpower status translates not only into exercising greater control over its "near abroad"; but also into using every opportunity to weaken NATO and damage Western interests. They claim that there is an expansionist mentality among Russia’s ruling elite, deeply rooted in the country’s past, which makes it difficult for it to consider forming a partnership with the West. Your Rapporteur does not share this view, but wants to stress that the Alliance should continue to find common ground with Russia to deepen and widen co-operation. This is not sufficiently done at present. Your Rapporteur views Russia as a strategic partner for the Alliance. New joint NATO-Russian initiatives in the areas of Arms Control, Non-Proliferation, as well as Counter Terrorism, should be developed and pursued.

98. It is indeed in NATO’s interest to have a strong Russia as neighbour. Russia is an indispensable partner in securing peace and stability in the Euro-Atlantic region. However, using Russia’s potential as a pivotal pillar for security requires a Russia that is strong and at peace with itself and its neighbours. As a former US Ambassador to NATO said: "The West will be far better off with a Russia that succeeds rather than fails at home, politically, socially, economically." But Russia’s internal distractions and external frustrations make it an awkward partner. The West will benefit from a Russia that can be drawn out of isolation and urged to play a constructive role in European security.

99. NATO should further develop its co-operation with Russia. As Lord Robertson stated: "NATO enlargement is only one part in the far broader effort of building true European security. A strengthened OSCE, the Euro-Atlantic Partnership Council and Partnership for Peace, the distinctive partnership NATO has with Ukraine and Russia's own good neighbourly relations with the newly independent states also contribute to that. Enlargement is not - as outdated perceptions have it - a zero-sum-game where NATO wins and Russia loses. Creative security in the 21^stcentury for all is served through integration, constructive partnership and co-operation. We are aiming at including, not excluding, Russia. And Russia itself must define the degree of its inclusion in this emerging European security network."

100. However, Russia cannot have veto power in Alliance decisions. A refusal or indefinite postponement of admission of those applicant countries which fulfil the criteria for membership generates the danger of creating a grey zone. Worse, it would be seen by Moscow as tacit recognition by the West that these countries are within Russia’s exclusive sphere of influence. This would be counterproductive.

101. As the US Ambassador to NATO, Alexander Vershbow, has rightly stated: "The Enlargement of NATO is in Russia’s interest, even if Russia does not yet recognise this fact." Thus, NATO countries should not abandon the Enlargement process in the face of Russian attitudes that are based on Cold War assumptions instead of contemporary realities.

B. RELATIONS WITH UKRAINE

102. Ukraine does not consider NATO enlargement as a threat to European security and stability. However, NATO enlargement will have an effect on Ukraine’s security situation.

103. Ukraine does not want to become a "buffer state" in Europe. NATO’s last Enlargement round, the accession of Poland, the Czech Republic and Hungary, creates a new geopolitical situation for Ukraine. As NATO continues its Open Door policy and accepts new members in Central and Eastern Europe, the question of self-identification becomes more pressing: does Ukraine consider itself a European country or something else? With neighbouring Romania, Bulgaria and Slovakia joining the Alliance, this concern is likely to grow. Though Ukraine is interested in reintegrating in to Euro-Atlantic structures, it is also interested in good neighbourly relations with Russia.

104. Some analysts had expressed concern that NATO Enlargement could destabilise Ukraine by placing it between a growing Alliance and an increasingly assertive Russia. However, at least for now, Ukraine’s security has actually been enhanced. Its bilateral relations with Poland have considerably improved, partly because of Poland’s accession to the Alliance. Relations with Romania also improved after both sides signed a treaty recognising Ukraine’s border. They also pledged to abide by international standards for ethnic minorities in each country. Enlargement has also led to improvements in ties with Russia, despite the latter’s strong objections to Enlargement. Shortly before the Madrid summit in May 1997, it signed a treaty of friendship, co-operation and partnership, and an agreement on the Black Sea Fleet was concluded with Russia. In the treaty, Russia formally recognised the sovereignty and territorial integrity of Ukraine, including over Sevastopol and the rest of Crimea. Both sides solved a number of contentious issues, including energy and border issues, as well as over ownership of the Black Sea Fleet. However, in a number of areas, the co-operation agreements have to be filled with life. Recently, during the visit of the Russian President, Mr Putin, to Dniepropetrovsk, Ukraine and Russia have signed a number of bilateral co-operation agreements, primarily on energy and economic co-operation.

105. But Ukraine’s main concern about Enlargement relates to Russia’s response to Enlargement. For historic and economic reasons, the country has strong links with Russia. It is economically dependent on Russia, particularly in the energy field. Ukraine also has a significant Russian‑speaking population in its eastern regions. Russia has repeatedly exercised strong pressure on Ukraine to beef up military c-ooperation and scale down its co-operation with NATO, but Ukraine has continued its close co-operation with the Alliance. Ukraine has not joined the Pact of Collective Security for the CIS countries, rather it is searching for alternative security arrangements, as its active development of GUUAM structures demonstrates.

106. After becoming independent, the Ukrainian government has been very interested and active in developing close links with the Alliance. It views a close partnership with NATO as a means of strengthening its own security, also partly vis-à-vis Russia. Ukraine has steadily improved its co‑operation with NATO. It was the first country of the CIS to sign the PfP in February 1995 and is actively participating in the programme. At the 1997 Madrid Summit, NATO and Ukraine signed the Charter on a Distinctive Partnership. The charter aims at developing closer co-operation on numerous areas, particularly in economic security, conflict prevention and crisis management, military reform and democratic control of armed forces, non-proliferation and arms control technology transfers, as well as combating drugs and organised crime. NATO-Ukraine co-operation is especially focused on the reform and restructuring of the Ukrainian armed forces. The reform was decided on in 1997 and is scheduled to be completed by 2005.

107. According to the Ukrainian Defence Minister, Mr Kuzmuk, Ukraine could also contribute to the EU’s rapid reaction force: "Ukraine is open to any activity aimed at strengthening security and stability in Europe." While successive Ukrainian governments have been very interested and active in widening and deepening co-operation with NATO, a majority of the Ukrainian population holds a sceptical view of the Alliance, dating back to Cold War views. The Kosovo war led to a temporary deterioration in Ukraine-NATO relations, as the Rada, then controlled by a left-wing majority, condemned NATO’s "violent act" in Yugoslavia as "unjustified" and "inhumane", and the majority of the public was critical of NATO’s military intervention. However, the Ukrainian government supported NATO’s actions, even if it deplored the fact that NATO did not act under the umbrella of a UN mandate.

108. Ukraine has also developed close links with key countries in the Alliance, namely the United States and the United Kingdom. It has developed close military cooperation within the "spirit of PfP" with these two countries. Between 1996 and 2000, Ukraine was the country with which the United Kingdom had the largest military programme. On average, approximately 90 activities were conducted each year, including military, border units and national guards forces. Concerning Ukrainian bilateral military relations with the United States, both countries have signed annual co‑operation plans since 1993. The United States organises annual "Sea Breeze" exercises in Odessa, which include approximately ten NATO and Partner countries.

109. Ukraine actively contributes to securing peace and stability in the Balkans. It currently contributes to KFOR by supplying a helicopter unit and to the Ukrainian component (300 personnel) of the Polish-Ukrainian battalion.

110. Ukraine is more concerned about EU Enlargement than that of NATO. It fears that the EU is creating a "Eurocurtain" to replace the old Iron Curtain. While Ukraine also wanted to sign a partnership with the EU at the Helsinki Summit the latter refused to do so. But the EU adopted a “Common Strategy" on Ukraine which acknowledged Ukraine’s "European aspirations" and welcomed its "pro-European choice". More importantly, the Strategy declared that the door was not closed. The Common Strategy set in motion a regular dialogue between EU institutions and Ukraine. However, Ukrainian officials regarded the Common Strategy as disappointing because their country was not included in either the fast or slow track list of future EU members. Moreover, the country fears significant negative consequences when Poland and other neighbours to its west join the Union. In particular, the implementation of the Schengen agreement would be critically viewed by Ukraine.

V. NATO ENLARGEMENT AND EU ENLARGEMENT

111. NATO and the EU are Europe’s two great core institutions. Enlargement of both the EU and NATO will help to reduce political tensions in Central and Eastern Europe, a region that has suffered from considerable instability in previous centuries. Enlargement of the EU and NATO is also likely to result in increased economic growth and social stability as it will generate increased direct foreign investment because it will provide greater international confidence in the region.

112. NATO and EU Enlargements are closely linked both politically as well as strategically. But when the Cold War ended, NATO and the EU set out from different starting points. NATO seemed to have lost its raison d’être as it had been established as a necessary means to counter the Soviet military threat. For the EU, on the other hand, the end of the Cold War represented the opportunity to continue the process of building pan-European unity as envisaged by its founding fathers. When Czechoslovakia, Hungary and Poland signed the Visegrad Declaration in February 1991, pledging mutual support in "returning to Europe”, i.e. primarily achieving membership of NATO and the EU, neither of the two organisations was prepared to define a clear position on Enlargement. Western management of Central and Eastern Europe will require a truly integrated policy between them.

113. The development of the EU’s ESDP will further strengthen this link. The new emphasis on defence in the European Union means that membership will now bring security dimensions, and no longer just economic opportunities. During a visit in Latvia in the spring of 2000, the Commission President, Romano Prodi, went so far as to say that "any attack or aggression against an EU member nation would be an attack or aggression against the whole EU." Thus he envisaged a more complete role for the EU, to bring security together with economic prosperity and broader stability. NATO Secretary General, Lord Robertson, has claimed that the creation by the Union of a credible defence dimension is "only logical".

114. NATO and EU Enlargement should move in tandem, or at least in parallel. Membership of one must not be regarded as a substitute for joining the other. On the contrary, membership of one can reinforce prospects of joining the other. But efforts to meet requirements for joining one organisation can have negative effects on preparing for membership of the other. For applicant countries, reforming outdated structures often requires considerable investments, both in financial and other resources. This can pose serious problems for applicant countries, as they often do not have either the finances or the expertise for reform. For example, Poland, which joined the Alliance in March 1999, needs approximately US$ 12 billion for environmental improvements in order to become an EU member.

115. The requirements of membership and political circumstances are not always parallel. Moreover, the applicant states have different historical experiences concerning democracy and the socio-economic development. This could have an important impact on the institutional frameworks, decision-making processes and policy outputs of both the EU and NATO.

116. The EU has an accession process but no sufficient enlargement strategy. In particular, the EU’s accession process is focused primarily on the criteria applicant countries have to meet. Such a technocratic approach is necessary but not sufficient. Eastern Enlargement can be the EU’s greatest contribution to stability and security, but it can only be achieved if there is political leadership. Political leadership is necessary not only to forge a consensus of EU member states on an enlargement strategy, but also to "sell" EU Eastward Enlargement to increasingly sceptical West European populations.

117. Creating truly pan-European structures will require mutually supportive efforts involving international financial institutions and leading industrial states, working in tandem with the EU and NATO.

VI. PRELIMINARY CONCLUSIONS

118. Enlargement remains one of NATO’s priorities. It will play a pivotal role in strengthening security in the Euro-Atlantic area. How to proceed with Enlargement is first and foremost a political decision by the member states. This decision will have to take into account a realistic assessment of NATO’s needs as well as the contributions of applicant countries to NATO security and European stability. The key considerations for the next Enlargement round depend on NATO’s decision-making structures and include a number of factors, primarily political, geo-strategic, and military-technical ones. These factors and their weight in the decision-making process partly both depend on and influence each other. How they are weighed will have an important impact not only for the Alliance but also for enhancing stability and security in the Euro-Atlantic area. Hence there is a need for early transatlantic debate.

119. As to the political aspects, NATO’s needs a convincing strategy for the Enlargement process. The Alliance has to balance a number of "competing demands" as it approaches its next round of Enlargement. These demands include maintaining its political cohesion (as well as military effectiveness), maintaining its credibility by continuing the Open Door process and maintaining its commitment to strengthening security and co-operation within the Euro-Atlantic area. This would include strengthening existing partnerships will all countries in (Central and Eastern) Europe, but primarily with Russia and Ukraine.

120. NATO needs to continue building on partnerships with both Russia and Ukraine. Especially with regard to Russia, NATO needs to engage more actively in frank dialogue about the ongoing Enlargement process. Convincing Russia that Enlargement is in its own interest will not be an easy task. But meanwhile, structures have been put in place to address issues of common concern. The Permanent Joint Council could be a forum for a much more active debate on Enlargement and its ramifications for Russian security concerns. Russia’s legitimate security concerns should be taken seriously. Russia should have a (strong) voice, but no veto. Similarly, the NATO-Ukraine Council (NUC) can and should be a forum to evaluate the ramifications of further Enlargement and Ukraine’s security. Ukraine remains in a critical economic and political situation, owing to a number of factors including a lack of reforms in a number of areas. Nevertheless, Ukraine needs the encouragement and support of NATO and its members. Further deepening the relationship with Ukraine will only help to stabilise this great country but might also facilitate the integration of Russia in European security architectures. In a broader sense, the Euro-Atlantic Partnership Council (EAPC) can play a constructive role in discussing the ramifications of NATO Enlargement for European Security with all partners participating in the EAPC.

121. As the example of Poland’s relationship with its Eastern neighbours - in particular Russia and Ukraine - has shown, the new members can substantially contribute to building bridges. For example, Poland has supported Ukraine’s membership of the Council of Europe and the Central European Initiative, and it has established a joint Polish-Ukrainian battalion for peacekeeping. What is more, it has established binational commissions on the highest level, identifying broad areas of economic, political, and security co-operation. Moreover, Poland’s relations with Russia have significantly improved since it joined NATO.

122. The end of the Cold War has led to a diversification of regional ties in Central and Eastern Europe. NATO Enlargement must avoid setting up new dividing lines through Europe. The Enlargement of NATO to Central and Eastern Europe must be accompanied by the construction of soft patterns of co-operation. Efforts must focus first and foremost on the areas of political and economic reform. The European Union has a pivotal role to play in enhancing economic, but also political, stability in Central and Eastern Europe. There is ample room for closer co-operation between the EU and NATO, as both are embracing the countries of Central and Easter Europe.

123. As to the military-technical considerations that need to be taken into account in a decision about Enlargement, MAP provides for something like a benchmark to measure the status of the preparedness of and progress made by applicant countries. It has become a very helpful tool in assisting the applicant countries in their preparations. It can also be a valuable instrument to de-politicise the assessment of the status of preparations of applicant countries. MAP is not a static programme, but has already been adjusted to the experience drawn from the first annual cycle. However, MAP can be developed further to live up to its full potential. In particular, the applicant countries need more detailed feedback from NATO, including better help to prioritise their needs and develop realistic timetables. It is important to improve co-ordination among NATO members, as well as with applicant countries, on the assistance given by individual member countries. There is considerable room for improvement in this area and MAP could be an important vehicle to achieve this.

124. NATO activities and programmes for aspirant countries, such as PARP, PfP and MAP, are partially having an influence that goes beyond merely technical aspects. As NATO’s co‑operation with applicant countries becomes ever closer through the MAP process, the Alliance is increasing its obligation to invite aspirants on fulfilment of the given criteria, even though NATO has always emphasised that Enlargement will not be based only on progress on military, political and economic reforms.

125. With regard to geo-strategic considerations, NATO is embedded in a very different international security framework from the period in which it was created. As the end of the Cold War required NATO to focus more on Article 4 contingency missions, obligations for its members, as well as for NATO aspirants, have changed.

126. Primary criteria for NATO membership focused on the ability to contribute to defence against massive land and air attacks. Reflecting the changes in the security environment after 1989/90, the membership criteria laid out by the 1995 Enlargement Study defined a number of additional criteria which aspirant countries should meet in order to receive an invitation to join.

127. It has been argued that geographic position, including the aspect of "defensibility", of an aspirant country should be a key criterion. NATO aspirants are discussed in geo-strategic terms: for example, Slovakia and Slovenia would provide a "land bridge" to Hungary, or Bulgaria and Romania would "tie" Hungary to Greece and Turkey and would be important land bases to contain future Balkan crises or advance Alliance interests into the Caucasus. Others point out that the Baltic states could not be defended against an all-out attack. But in today’s and tomorrow’s security landscape non-Article 5 operations are much more plausible. Moreover, the force structures of NATO members are being adjusted to muster more mobile, flexible and lethal forces. Besides, even during the Cold War, NATO had a number of "isolated" member states, e.g. Norway and Iceland, whose defence would have required sending massive reinforcements. Thus, geo‑strategy will remain important, albeit in different ways.

128. To move ahead with NATO Enlargement will require political leadership in the Alliance. While NATO has at first been reluctant to pursue actively the idea of Eastward Enlargement, for a number of reasons, it had given in to the demands of Central European countries to open itself up to new members. Enlargement did happen because of American, and German, leadership. As this report is being drafted, this kind of leadership seems nowhere in sight. With few exceptions, NATO member countries are not openly engaged in pushing for further enlargement. But NATO cannot afford to ignore the issue any longer or it might risk losing credibility, or worse, contribute to instability through inaction.

129. The NATO Parliamentary Assembly has traditionally been at the forefront of identifying new issues and challenges for the Alliance. It was the first NATO organisation to invite representatives of the then Warsaw Pact to address the elected representatives of NATO members. Early on, it has argued for opening up the Alliance to new members. Before the Madrid summit, the NATO PA had suggested extending invitations to five countries to join, namely the Czech Republic, Hungary and Poland, as well as Romania and Slovenia. It is thus only consequential that your Rapporteur concludes this report by suggesting that NATO invite new members in 2002.

130. If NATO wants to keep the door open to new members, in principle it has the following alternatives at the next NATO summit scheduled to take place in Prague in November 2002:

· to iterate that the door remains open, but to not invite new members,

· to declare that it will invite new members at the next NATO summit,

· to invite one or more members to begin accession negotiations,

· to send out invitations to all nine applicant countries to join, but specify that the entry dates depend on the progress achieved in meeting the membership criteria as laid out in the Enlargement Study and MAP,

· to invite all nine applicant countries to join, and begin immediate accession negotiations.

131. The pledge of the Foreign Ministers of the nine applicant countries to work together to prepare for membership, the so-called "Big Bang" statement made in Vilnius at the end of May 2000, was an impressive show of solidarity. In some areas, the Alliance and its members are still coming to terms with the last Enlargement round. NATO should avoid the risk of suffering from agenda overload which carries the danger of derailment if it experiences delays or setbacks. Therefore, it seems difficult for NATO to begin accession negotiations with all nine countries at the same time.

132. In conclusion, your Rapporteur wants to emphasise the positive impact of the Alliance’s last enlargement round for peace and stability in the whole Euro-Atlantic region. Therefore, NATO enlargement needs to be put higher on the agenda as one of the top priorities for the Alliance. No linkages should be established, for instance on the issue of Enlargement and an eventual compromise between NATO member states and Russia on missile defence. Efforts undertaken by NATO applicant countries to prepare for membership of the Alliance are in themselves important contributions to Euro-Atlantic security. They should be encouraged to continue their preparations and to participate in existing programmes that help prepare to meet the necessary criteria for membership. Existing programmes, particularly MAP, should be further developed. The Alliance and member countries should increase their help to NATO applicant countries to prepare for eventual membership by all appropriate means of co-operation, including, for example, the transfer of military equipment. At the same time, it is important to acknowledge the pivotal role of the Russian Federation and of Ukraine in Euro-Atlantic security and to assure that the continuation of the Open Door policy strengthens the security of all countries in the Euro-Atlantic sphere. Russia, as well as Ukraine, need to be actively engaged in the creation of a stable Euro-Atlantic security network via, among others, the NATO-Russia Founding Act and the NATO-Ukraine Charter. NATO needs to engage Russia actively in a dialogue on the benefits of further enlargement for Russian as well as Euro-Atlantic security interests, and call for joint initiatives on arms control, non‑proliferation and counter-terrorism, as outlined in the Founding Act. Finally, your Rapporteur reiterates the Berlin conclusion of the NATO PA that the North Atlantic Council should issue, no later than the 2002 Prague summit meeting, invitations to NATO accession negotiations to any European democracy that seeks membership in the Alliance and that has met the criteria for NATO membership as established in the Alliance's 1995 Study on NATO Enlargement.

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* Turkey recognises Macedonia by its constitutional name

TABLE OF CONTENTS

II. NATO’S LAST ENLARGEMENT ROUND - LESSONS LEARNED .............................. 3