European Union and the Western Balkans: A Game of Hot and Cold

The second EU-Western Balkans Summit took place in Sofia on 17 May 2018, bringing together the heads of state or government from EU Member States and the leaders from the six Western Balkans countries: Albania, Bosnia and Herzegovina, Serbia, Montenegro, the former Yugoslav Republic of Macedonia and Kosovo.

The event resulted in the adoption of the Sofia Declaration. The views regarding the success of the Summit and the Declaration range from utter disappointment to a more optimistic outlook that the EU has fully embraced the European path of the Western Balkans countries.

The official statements during and after the Summit, and the Declaration itself, avoid the term “accession” and instead opt for more elusive phrases such as the “European perspective”, “European path”, or, in the words of French President Emmanuel Macron, “anchoring” of the Western Balkans countries to the EU.

The authors of the Declaration made sure to offer some incentives to the WB countries. The document foresees a package of measures to boost connectivity within the region and between the region and the EU, such as grants for eleven high-priority transport projects (road, rail, ports) worth EUR 190 million, EUR 30 million for investments in broadband rollouts across the region with the aim of developing the new Digital Agenda for the Western Balkans, support for the region’s energy transition through promotion of renewable energy sources, support for the region’s own plan to develop a Regional Economic Area, and support for youth and education, in particular by doubling the funding for Erasmus+ for the region and by launching a pilot project for mobility in vocational education and training. The Summit participants also agreed to deepen security cooperation in order to stem illegal migration flows, counter terrorism and extremism, corruption and organised crime, and curb disinformation and hybrid threats.

Notwithstanding the carrots, the Declaration is effectively a step backward when measured against the Commission’s strategy for “A credible enlargement perspective for and enhanced EU engagement with the Western Balkans”, adopted in February 2018. This strategy elaborated the steps Serbia and Montenegro had to take in order to complete the accession process by 2025. While justifiably cautious regarding Bosnia and Herzegovina and Kosovo, the Commission praised the progress made by Albania and Macedonia and voiced its readiness to open the accession negotiations with these two countries. Albania and Macedonia therefore held high hopes that the decision on the opening of the negotiations would be adopted in Sofia. That, however, did not happen. Not to leave Serbia and Montenegro less disappointed, the Sofia Declaration dropped any mention of 2025 or any other specific year as a prospective accession date.

With this shift from the “when we join” to the “if we join” perspective, the countries of the Western Balkans, especially Serbia, Bosnia and to a lesser extent the NATO member Montenegro, have to find extra motivators to maintain the momentum of the accession-related reforms. Harmonisation of laws with the EU single-market acquis has been largely done to thick the boxes, without the national legislators fully grasping the policies and market realities behind the regulations. As a result, many of the laws and regulations adopted go ahead of the capacity of the national institutions to enforcing them. However, even with the less-than-perfect institutions, the process of harmonisation of national laws with those of EU greatly improved the national economic and legal environments. Market liberalization and legal certainty of foreign investors are more enviable than 18 years ago. Harmonization and institution building efforts should continue in parallel, irrespective of the accession prospects.

On the harmonization front, much of the local legislation is aligned with an earlier, more bureaucratic, generation of the corresponding EU regulations or directives. The countries should analyse in which areas an update would be appropriate. For example, Serbia, Montenegro and Bosnia and Herzegovina still have individual exemption system to deal with agreements restrictive of competition. Companies would benefit from the loosening of the red tape in this respect. A shift to self-assessment model or, at least, an optional exemption system would be welcome. In the area of data protection and privacy, national laws are not aligned with GDPR. Efforts on that front in Serbia and in Bosnia and Herzegovina are already at an advanced stage, but Montenegro is lagging behind. Public procurement would benefit from better remedy mechanisms. Industry-specific regulations need brush-up as well. For example, Serbia has aligned with the Payment Services Directive 1, but its National Bank is countering the liberalization of payment services by occasionally issuing extremely narrow interpretations of the law. On the other hand, Bosnia and Herzegovina has not yet liberalized payment services. Most importantly, those enforcing the laws need more competence and independence. These goals cannot be achieved overnight but are worthwhile pursuing independently of the EU agenda.

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