For the European Union and the North Atlantic Treaty Organisation NATO, 2002 was a year of parallel paths. Both the alliance and the EU reached historic decisions on admitting new members, mostly from Eastern Europe, into their organisations.

In November, NATO's Secretary-General George Robertson announced that the Alliance would take in seven new East European countries. Just a few weeks earlier in Brussels, the EU Commission had said it would be inviting ten new members to join at the Copenhagen summit in December.

Still, for NATO and the EU, expansion means different things. A community of nations based on a common market and shared values faces more serious challenges than those confronting a military alliance of sovereign states. Disputes with Poland over the level of farm subsidies and the debate about a starting date for membership talks with Turkey have indicated the scale and complexity of the task that lies ahead for the EU.

Danes and Spaniards

Despite the challenges Denmark faced during its half-year presidency, the Scandinavian country has earned a tick of approval for its efforts. The conservative government, initially received with some scepticism, succeeded in steering the EU through the final stages of enlargement negotiations without any serious hiccups.

By contrast Spain, which held the presidency in the first half of 2002, left almost no mark. Even the introduction of the euro, which occurred during Prime Minister Aznar's term as Council President, seemed to take care of itself.

At the start of 2002, after years of preparation, the common European currency finally entered circulation. The German Chancellor Gerhard Schröder described it as a "sickly, premature child". But in twelve months, the euro has slowly gained acceptance. Some, including those who travel regularly within the Euro-zone, have given it a definite thumbs-up.

Yellow card for Germany

Germany, once Europe's model economy, this year learned the hard lesson that the introduction of the common currency demanded discipline. Early in the year the country narrowly avoided a warning from Brussels for breaking a rule it had helped devise. Europe's largest economy appeared to have breached the terms of the Stability Pact, which state that no country's budget deficit may exceed three percent of the GDP.

To escape penalty, Germany had to commit to producing a balanced budget by 2004. But in October, just a few days after the federal election, the finance minister conceded what observers had been predicting for several months: Germany would not be able to keep its promises. Brussels' next move would be to hold up the red card, beginning legal proceedings against Berlin.

Rapid reaction force

Meeting in Copenhagen in December, the EU was forced to confront the difficult question of a European Rapid Reaction Force. After the Helsinki agreement which determined that the EU should develop its own military identity, negotiations had come to a standstill.

NATO-member Turkey vetoed the establishment of the EU force. But at the Copenhagen summit, Ankara at last capitulated. The EU will now be able to use NATO's infrastructure in deploying its troops, saving money and buying time to develop an information and logistics-infrastructure of its own.

The fledgling European Rapid Reaction Force will not compete with NATO, but is intended to enhance the Alliance's capability, especially in the area of humanitarian and peace work.