The Western Balkan’s accession has been mostly driven by the EU, while countries’ role in defining their own path to the Union was rather limited. Besides Copenhagen and Madrid criteria that serve as a regular channel for accession to the EU, additional instruments were set for these countries such as benchmarks for progress in chosen areas and initiatives for strengthening of the regional integration in the Balkans. In purpose to get into the EU, the Western Balkan’s governments have already shown high degree of commitment to undertake the demanding reforms and willingness to establish deeper regional cooperation. What were the results achieved? With exception of Croatia that has started the negotiation talks in October 2005 and it is paving its road to the EU, the other countries are running to the EU very slowly. Macedonia got candidate status in December 2005 and European Commission’s (EC) recommendation to start the negotiations in October 2009. However, no date has been set by the Council of Ministers yet, due to the bilateral dispute with Greece about the country’s name. Other Western Balkans countries are lagging behind in the process.
The annual EC Reports, which provide assessment of each country’s progress towards the EU, regularly indicate areas for further reforms in the Western Balkans. The common problems related to predefined criteria for EU membership include an inefficient judiciary system, corruption proneness, an insufficient capacity of the public administration and low competitiveness of the national economy to cope with the pressures on the EU market. The EU has introduced specific benchmarks for most of the countries, such as fulfilment of the Ohrid framework agreement in Macedonia, settlement of the Croatian-Slovenian border dispute; Serbia’s response to the Haag Tribunal requirements, etc. In parallel to the process of setting additional criteria, the EU debate on enlargement fatigue was blooming, providing a basis for countries’ frustration regarding the EU enlargement policy towards the Western Balkans. Implicitly, the major question deriving from such developments would be: Does the EU enlargement policy towards the Western Balkans offer the region a prospect for the undertaken reforms?
In economic terms, would the costs of the EU integration (human resources, finances and time) result in a desired outcome? Western Balkan countries need to harmonise their complete institutional and legal set-up with the EU, to establish functional and competitive market economy and to ensure the rule of law. Also, they need to fulfil the specific benchmarks tailored for them. The costs are undeniably high. In return, promises that these countries will be granted the EU membership after fulfilling the criteria (or would be smoothly allowed into the next accession phase, at least) remained scarce. Officially, EU continuously declares its support to the region and provides extensive assistance. In practise, the outcomes do not provide ground for enthusiasm that EU instruments really assist the Western Balkan countries to overcome the major EU critics. This especially refers to the outcomes related to two instruments – assistance programmes and regional economic cooperation.
The EU has provided financial support of over €5bn. to the Western Balkan countries in the period 2000-2006, including CARDS and macro-financial assistance. Also, the EU pledged over €4bn to the region within the frame of the Instrument for Pre-accession Assistance (IPA) for the period 2007-2013. Other instruments for technical assistance were also provided, including TAIEX, Twinning, SIGMA, etc. However, the outcomes were mixed, in particular with regards to the institutional capacity building, as well as amount of financial assistance used. The EC’s country reports stress out the problem about the substandard efficiency and effectiveness of the public administration in all Western Balkan countries, despite considerable assistance provided. Also, the statistics indicate insufficient level of use of the IPA in most of the countries. In Macedonia, only about 25% of the total available IPA assets per year have been used so far. In this context, the EU bureaucratic burden related to use of the assistance has been perceived as a tremendous impediment by the countries to benefit more significantly from the EU assistance programmes. Nevertheless, the critics did not lead to an analysis about the success and sustainability of the assistance programmes’ outcomes. Complete and in-depth evaluation about the effectiveness of the EU assistance towards the Western Balkans countries has not been provided yet. The assessment has been focused only on the progress of the receiving party, without a discussion about the tailoring policy of the granting party and the actual complementarity of the assistance instruments with the specific needs of the Western Balkans.
The other instrument – regional economic cooperation has been a milestone of the EU enlargement policy towards the Western Balkans for a longer period of time. The EU has already encouraged several initiatives of the region, aiming to increase the Western Balkan’s capacity to deal with competitive forces on the EU single market. The current regional economic integration is employed via CEFTA 2006. It has been enforced in 2007, as a single free-trade agreement among the Western Balkan countries plus Moldova. CEFTA 2006 followed after the intense trade liberalisation among these countries pursued through 32 bilateral free-trade agreements (FTAs), concluded under the EU auspices. CEFTA 2006 has been promoted as a driving force for intensification of the trade flows, as well as FDI attractiveness of the region. Statistical data indicate that aggregate intra-regional imports in the Western Balkan countries accounted for about 9% in the total imports in 2008, intra-regional exports had share of about 22% in the total exports, while EU 27 share was 66.3% and 69.8% in the total countries’ import and export, respectively. With regards to the FDI, Western Balkan region remained at the edge of the foreign investors’ interest with average FDI stock/per capita of US$872 for the period 2002-2006. Due to the crisis, no positive movements with respects to the regional FDI were registered in 2008. These data do not suggest considerable changes in the trade flows and FDI compared to the period prior CEFTA 2006, indicating no substantial effects from this regional integration yet.
The economic theory suggests that regional integration could not provide significant effects instantly. The debate is whether CEFTA 2006 could provide considerable economic results in a mid-term period, leading to an increase of the competitiveness of the region? Evidently, the Western Balkan countries consider EU single market as the most attractive one, given the free-tariff access they enjoy. Furthermore, the Western Balkan countries do not have diversified export structure that will boost their mutual trade, as they all export mainly primary commodities and labour intensive goods and at some extent, technology intensive goods. No industrial and other economic policies have been developed in CEFTA 2006 parties so far, promoting specialisation of specific industries and services in the regional context. Implicitly, the regional economic integration has not been truly perceived by the countries as a tool for faster economic growth, but only as a prerequisite for their accession to the EU. So far, EU insisted only on formal integration, while policy harmonisation based on the understanding of the nature and specifics of the CEFTA 2006 market has not been really pursued. Most of the CEFTA 2006 activities were focused on harmonisation of the regulation and reduction of the formal trade barriers, which do not automatically translate into considerable increase of the intra-regional trade flows. Without introduction of the policy dimension in CEFTA 2006 set-up, no remarkable reward of the engaged resources by both – EU and CEFTA 2006 could be expected in a mid-term period.
The short debate about the assistance programmes and regional economic integration of the Western Balkan suggests that both instruments only partially provide the necessary support to the countries. In the case of the assistance programmes, the focus was rather on fulfilling the formal requirements such as elaboration and adoption of the legislation, while implementation, though crucial, has been frequently neglected. Partiality also applies to the capacity building of the public administration and other institutions. The regional economic integration has been also formally pursued, without current prospects for building-up of the regional competitiveness. On the other hand, the EU accession bears high costs, whether producing formal or genuine outcomes. It also provokes dilemmas about the appropriateness of the invested time, efforts and resources of the Western Balkan countries in the EU accession process, given the results achieved. In this respect, the argument would be that (re)tailoring of the EU instruments, based on targeting of the real problems could enable economically justified spending of the assets and accomplishment of actual progress. Introducing the concept of sustainability of the outcomes from the EU programmes could lead to a more effective use of the EU assistance provided to the region. Building a policy mainstream towards compatible trade policies of the Western Balkan countries should provide a solid ground towards increase of the competitiveness in the region, leading to a better position of the Western Balkan countries on the EU single market, too. Both instruments’ (re)tailoring requires “under the surface” approach, i.e. tailoring beyond the formal requirements which could contribute to faster reforms and fuel the Western Balkans’ faith into their indisputable integration into the EU.