economy to lift the country out of a deep reces-
sion. Finland, also in recession in the early 1990s,
found itself freed from its dependence on the
Soviet Union, whose collapse also meant that it
lost its best trade partner. Austria in 1992 replaced
a president, Kurt Waldheim, who had become an
international embarrassment, and in the same year
its international reputation was greatly enhanced
by the generous way the small country opened its
doors to refugees from the former Yugoslavia. The
Community welcomed the possible accession of
the wealthier countries, which would help to pro-
vide funds for the poorer Mediterranean members
and for Portugal.
Fundamental problems remained to be solved.
These included the reform of the Community
budget, and more particularly the need to curb
farm spending; the relationship to be developed
with the newly liberated nations of Eastern and
central Europe; and trade relations with the rest
of the world, especially the US, which demanded
a reduction of the Community’s protective barri-
ers. It held up the ‘Uruguay’ round of negotia-
tions to liberalise world trade through the
General Agreement on Tariffs and Trade begun
in 1986 and concluded in December 1993. The
main remaining obstacle was US congressional
approval before the agreement could come into
force in 1995. Agreement also had to be reached
on the respective roles of the Community insti-
tutions, the relationship between the European
Parliament, the Commissioners and national gov-
ernments. There was a readiness among national
governments to relinquish sovereignty to a
limited degree.
It appeared that a high point of cooperation
had been reached when in December 1991 the
leaders of the Community as part of the Delors
Plan concluded a new treaty at Maastricht to
create an ‘ever closer union among the peoples of
Europe’. Britain led the opposition to the ideals
of a ‘federal Europe’ and a single common cur-
rency. Britain also opted out of the ‘Social
Chapter’, which sought to provide minimum
conditions and standards in the workplace for
employees. French, Dutch and Belgian support
for Maastricht was based to a large extent on a
desire to ensure that the power of the recently
unified Germany should remain firmly anchored
in European institutions. This view had the
enthusiastic support of Germany’s Chancellor
Kohl. John Major agreed, albeit with important
reservations, because he wished to keep Britain’s
place of influence at the ‘heart of Europe’.
Within a few months it turned out that the
Community’s leaders were far ahead of their elec-
torates and had concluded a treaty difficult to rat-
ify and short of obvious popular appeal. The
threatened loss of national identity and objections
to giving Brussels more central control underlay
misgivings. Ratification was finally achieved in
November 1993, when the European Community
became the European Union. The margins for rat-
ification were slender in France and required two
referenda in Denmark. In Britain it caused a seri-
ous rift in the Conservative Party. Britain opposed
moves to ‘closer union’, but had to give way when
in March 1994 the European Union offered to
admit Sweden, Norway, Austria and Finland while
restricting the rights of members to block deci-
sions. Sweden, Austria and Finland joined on 1
January 1995 after holding national referenda.
The Norwegian people rejected the advice of their
government and voted against joining the Union.
Three countries – Greece, Spain and Portugal
- were for many years barred from applying to join
the European Community, not principally on
account of the economic difficulties which their
membership would arouse but because of their
political systems. A fourth country, Turkey, an
‘associate’ since the 1960s, still awaited a
favourable verdict in the early 1990s. Greece’s
treaty of accession was concluded in 1979 and it
1
THE EUROPEAN COMMUNITY 877
Six members of EFTA, 1989
Population Gross National
(millions) Product per head
(US$)
Sweden 8.5 21,500
Norway 4.2 22,290
Finland 5.0 22,100
Iceland 0.254 21,100
Austria 7.6 17,300
Switzerland (1990) 6.8 37,800
