PARIS -- Croatia became the 28th member of the European Union on Monday, a joyous moment for the small, predominantly Catholic country about 20 years after it won independence in the bloody wars of the Balkans.
With Europe roiled by financial crisis, Croatia's accession offers a rare moment of satisfaction for the union, underlining how a country's desire to join the world's biggest trading bloc can push it to make difficult economic and political changes.
Since the end of the cold war, the European bloc's soft power, its ability to press for concessions from countries that want to join, has been a powerful foreign policy tool and an alternative to American military might. In the case of Croatia, the incentive of joining the union pushed it to revamp a statist post-Communist economy, pass more than 350 new laws and arrest more than a dozen Croatian and Bosnian-Croat war criminals.
In return, Croatia stands to benefit from gaining access to a market of 500 million consumers as well as about $18 billion in financing earmarked for the country from 2014 to 2020.
Elsewhere in the region, Kosovo and Serbia recently signed a power-sharing agreement aimed at overcoming ethnic enmities and proving to Brussels that they have the European credentials to join the bloc. On Friday, they were rewarded for their efforts, with Serbia gaining the go-ahead to start entry negotiations in January and Kosovo gaining closer trade, economic and political ties.
The accession of Croatia is an important step in the European integration of one of Europe's poorest regions, one that has struggled to shrug off a legacy of war and bloodshed. Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro and Serbia -- states carved from the former Yugoslavia -- are all hoping to join the bloc. Slovenia joined in 2004.
Croatia's entry is the bloc's first enlargement since 2007, when Romania and Bulgaria joined. In 2004, 10 members entered, including the Czech Republic, Hungary and Poland.
To mark the occasion in Zagreb, Croatia's capital, thousands of Croats turned out to celebrate. Fireworks exploded, and Beethoven's "Ode to Joy" was played at midnight. "This will change the life of this nation for good," Herman Van Rompuy, the president of the European Council, told the crowd. "I welcome you wholeheartedly."
But many Croats remain ambivalent about joining a divided union mired in a crippling debt crisis that has roiled Greece, Italy, Spain and others and pushed some members to the brink of bankruptcy. While Croatia is not joining the euro zone, the source of the worst of Europe's economic problems, it is nevertheless in recession and has an unemployment rate of 21 percent.
Alluding to the challenges of entering a club in decline, President Ivo Josipovic of Croatia told Nova TV on Saturday that he was repeatedly asked by journalists from other European countries why the country wanted to join.
"My counter question was, 'You come from the E.U. Is your country preparing to leave the bloc?' " he said. "They would invariably reply: 'Of course not.' Well, there you go, that's why we are joining, because we also believe the E.U. has a future."
If some Croats are cautious about membership, many countries in the bloc remain wary of expansion, fearing that an overstretched European Union will become unmanageable. The problem of endemic corruption in new member states from the east like Bulgaria and Romania has also fanned fears in Brussels that countries are being admitted too quickly, and importing lawlessness and graft into the bloc.
Transparency International ranked Croatia as the 62nd most troubled nation out of 176 countries in its 2012 corruption perception index, which ranks countries based on how corrupt their public sector is perceived to be. That compared with Romania at 66, Bulgaria at 75, Italy at 72 and Greece at 94.
Marko Prelec, Balkans director at the International Crisis Group in Sarajevo, noted that Croatia was an important test case for whether other countries in the region would be let in to the union. "If Croatia turns into a problem child for the E.U., then it's going to be next to impossible for anyone else to join," he said. "But if it goes well, then the doors will be open for its neighbors, too."
This article originally appeared in The New York Times.