EU Needs New Approach to Western Balkans

When the European Union’s historic Big Bang enlargement takes place on May 1, the western Balkan countries will feel few substantial changes in the short-term.

But the EU needs to change policy on the region if it wishes to see long-term stability there. For the enlarged union, stability in the Balkans will become increasingly important once more member states border it.

Brussels needs to find a Balkans strategy that corresponds to the region’s real needs and capacities. Without it, the EU could face another Big Bang. This time, however, it would not be expansion, but a Balkans-style explosion.

THE 1990s – A LOST DECADE

Of the eight countries now joining the EU, six are from Central and Eastern Europe and only two from the Mediterranean (Malta and Cyprus).

The former Soviet satellites in Central and Eastern Europe made it clear as early as 1989 that their goal was EU entry and they immediately embarked on a long and painful reform process with membership in mind.

Whilst several former Yugoslav republics were locked in war, their northern neighbours stuck to the course of reform and association with the EU.

After fifteen years of tough choices and fundamental changes, they are now being rewarded with entry to the world’s most prestigious club – the EU – helping to guarantee them a secure, democratic and prosperous future.

But for most Balkans countries, stability and prosperity remain distant goals. Bulgaria and Romania still plan to join in 2007, with Croatia hoping to jump on the bandwagon.

Whilst these countries may conceivably join the union by the end of the decade, for Albania, Bosnia and Herzegovina, Macedonia and Serbia and Montenegro (including Kosovo) - the prospect of EU accession is distant and their general prospects grim.

ENLARGEMENT – NO IMMEDIATE EFFECTS

In the short-term, the western Balkan countries will feel few effects from enlargement, as neither EU attention nor aid is likely to diminish.

Instead, many commentators believe the entry of several new countries adjoining the region will push the western Balkans higher up the EU agenda.

Brussels has not forgotten the Yugoslav wars of the 1990s and an enlarged union knows it cannot afford to ignore the plight of its Balkan neighbours.

“They might want to forget about us, but that’s not really possible,” said Nenad Sebek, director of the Centre for Democracy and Reconciliation in South Eastern Europe, a Thessaloniki-based NGO.

The EU has invested a lot in the Balkans since the early Nineties in terms of aid and expertise. It has representatives in every country. As the United States reduces its presence militarily in Bosnia and Kosovo, and hands the political initiative to Europe, Brussels’ share of the responsibilities has correspondingly increased.

The EU is expected to assume ever greater military and political responsibility in Bosnia as well as increasing involvement in Kosovo.

In Macedonia, the EU played a key role in brokering the Ohrid peace deal that ended armed conflict between ethnic Albanians and Macedonians in 2001, and it continues to support the country in many ways; Macedonia was the first country to sign a Stabilisation and Association Agreement, SAA, with the EU.

Brussels was also instrumental in brokering an agreement concerning the constitutional arrangements between Serbia and Montenegro in 2003, establishing a weak “State Union” between the last remaining republics of former Yugoslavia.

Although the future of the State Union of Serbia and Montenegro is unclear, owing to the unwillingness of the authorities in the two republics to cooperate, the EU cannot be charged with being unwilling to take initiatives.

Enlargement will not reduce EU aid to the western Balkans. At the EU summit in Thessaloniki in June 2003, the union committed an extra 210 million euro to the 4.65 billion euro it had earlier allocated to the Balkans for 2001-2006.

Fears that the needs of the new, poor member states will divert funds from the Balkans are misplaced. The funds allocated to the western Balkans are in any case negligible compared to the money allocated to new EU entrants, which in 2004-6 alone will be eligible for nearly 40 billion euro.

Some Brussels officials hope enlargement may speed up the reform of the EU’s wasteful Common Agricultural Policy, CAP, which heavily subsidises European agriculture and accounts for more than 40 per cent of EU expenditure. Money freed up from a reformed CAP would release funds for other projects, in the new member states and in the Balkans.

The western Balkan economies will not feel any immediate impact from enlargement. Trade with the EU has already been liberalised and more than 80 per cent of all goods from the region enter the EU with no customs restrictions.

Enlargement may have a slight negative impact on investment in Bulgaria, Croatia and Romania, as foreign companies channel investment into the new member states. The rest of the region has seen so little foreign investment that fears of new EU entrants drawing it off have little substance.

Blame for lack of economic development in the region does not lie with enlargement, but with the region’s own endemic problems, starting with unclear legal frameworks, organised crime and corruption.

In addition, the western Balkans are a relatively small, poor market. Spyros Economides, a Balkans expert at the London School of Economics and Political Science, points out that the high jobless rate in several states keeps trade at a low level, as local people can buy little more than basics. Such an environment does not attract foreign investors.

“When you have 50 per cent unemployment, the trade you can engage in is basic stuff,” Economides said.

If the EU changes course on aid to the Balkans, this will be due to a change in thinking, rather than a result of enlargement.

“There is a growing feeling within the EU that money is not the answer,” Heather Grabbe, deputy director of the London-based Centre for European Reform, told IWPR. “There is increasing awareness of aid dependency in Bosnia and elsewhere in the region.”

WORRIES OVER THE LONGER TERM

If the Balkan states have little to fear from enlargement in the short-term when it comes to aid, they may have more reason to worry about the consequences of exclusion from the latest round of expansion.

Although the EU remains committed in theory to granting membership to the countries of the region, in reality, the size of the present round may mean Europe takes its time before considering new members.

“The union will suffer a lengthy digestion period after it absorbs the first ten [countries],” said Grabbe. “It may have little appetite for another round.”

Grabbe believes the EU will ultimately fulfil its commitment to the region. But the headaches involved in running a union with 25 members may well slow the pace of future enlargement.

“The western Balkans countries will become EU members but the question is how to manage the process between now and accession,” said Grabbe.

Unresolved regional disputes and a distant accession date do not bode well for stability in the region, and the enlarged EU itself.

Among the major possible problems are Kosovo’s final status; a resolution to the relationship between Serbia and Montenegro by 2006, when a three-year interim agreement expires; calls for the revision of the Dayton agreement on Bosnia and Herzegovina; and the potential for instability in Macedonia.

Recent riots in Kosovo on March 17 and 18, when extremist Albanians drove Serbs from several villages and torched churches, are a powerful reminder that parts of the Balkans remain explosive.

“The Balkans is an ongoing problem,” warned Nenad Sebek. “Forgetting it would be a disaster.”

A distant accession date could also be a source of trouble.

According to Grabbe, “When prospects for EU membership recede, it becomes more difficult to overcome domestic political opposition to difficult reforms.”

There is a danger that if states decide EU membership is out of their reach, they will abandon reform efforts.

Nicholas Whyte, director of the International Crisis Group Europe Programme, argues that EU involvement has already contained the region’s potential for violence.

Whyte says one reason why recent violence in Kosovo - where the EU presence is weak - did not spill over to Macedonia is because the EU is heavy involved there.

But other analysts fear Brussels’ strategy remains passive – responding to events, rather than initiating them. “Rather than tackling the underlying causes of instability of western Balkans head-on, the EU has opted for a policy of containment,” Balkans expert Peter Palmer told IWPR.

Palmer says resolutions to all outstanding border disputes and legal issues in the region need to be found now.

THE NEED FOR A BOLD POLICY

“Boldness and imagination are lacking in the EU’s approach to the region,” Palmer said.

There is growing realisation that the stabilisation and association process - the EU’s policy framework for countries in the western Balkans - needs adjusting to adequately address the realities of weak state frameworks and poor economies.

Whyte says a start would be a clear timetable for accession and tangible rewards for reforms. Grabbe suggests that the EU establish processes to help future candidate states catch up, complementing its existing approach to accession.

The EU’s new member states, which have experience of the transition process - and two of which border directly on the western Balkans - may make a key contribution towards a re-think of EU policy for the region. It remains to be seen if their accession results in a bolder and more imaginative policy.

Jehona Gjurgjeala is completing a Master’s degree in European Political Economy at the London School of Economics and Political Science.