BASIC NOTES

12 July 2000

Stabilizing South Eastern Europe:
When Actions Must Follow Words

By Jack Seymour and Rick Rust
with Walter Ferrara

The bureaucracy and rhetoric surrounding the year-old Stability Pact for South Eastern Europe have grown apace, but there have been few tangible results so far. On June 20, in Skopje, Macedonia, the international Stability Pact Working Group on Trade Liberalization held its third meeting. The event is important because, without viable economies, creating a healthy democracy in the Balkans is a lost cause. But there is another, more crucial importance. Everyone – Balkan nations and the Western world alike – is scrutinizing the Stability Pact, wondering when, if ever, it will produce significant results.

Just over a year ago, in Sarajevo, the Stability Pact was formally launched with the help of the European Union, 44 other nations, 36 international organizations, and the World Bank. It’s purpose, summarized by Bodo Hombach, Stability Pact special coordinator, is to create "a democratic and unified Europe without political and economic divisions."1 It would accomplish this by bringing the countries of South Eastern Europe together with those in Western Europe, the United States, and their institutions. Making these lofty goals a reality requires rebuilding infrastructure, fostering law and order, creating strong democracies, encouraging free trade, strengthening economies, and ultimately, paving the way to incorporation of South East European nations into the European Union.

The Stability Pact is divided into four Tables. Working Table I is concerned with democracy and human rights issues – while the second and third Tables deal with economic development and security issues, respectively. Sitting above these three Tables, acting as a "steering body" and sounding board for related questions, is the Regional Working Table. At the helm is Hombach.

Victory for Peace
Conceptually, the Stability Pact is a tremendous victory for advocates of peacekeeping and conflict prevention. It represents a movement away from the traditional military-centric approach of reacting to crisis situations. The United States and the European Union have finally realized that allowing crises to explode in the Balkans is much more costly – both in terms of life and money – than taking initiatives for the construction of long-term peace.

Although initial funding for the Stability Pact has been slow to arrive, the Regional Funding Conference for South Eastern Europe received more than $2.3 billion in pledges last March to finance "quick-start projects."2  This amount was surprisingly high, exceeding the fundraising target by one third. In addition, the European Union has pledged "to devote 11.5 billion euros ($12.07 billion) to the region over the next seven years."3  The countries that will receive this aid are Albania, Bosnia, Bulgaria, Croatia, Macedonia, Montenegro and Romania. Limited aid also will go to opposition parties in Serbia. The country as a whole, however, will not receive aid as long as Slobodan Milosevic remains in power.

There are 50 new projects on the "quick-start" agenda, ranging from water planning in Albania to fixing Bosnian power grids to building a bridge across the Danube between Romania and Bulgaria. On a more political level, there are plans to demobilize troops in Bosnia-Herzogovina and organize a conference to promote free media.

European Leadership is Crucial
These first initiatives are only the beginning. Fundamentally, two new attitudes must develop for the region to mesh with Western Europe. First, EU members must develop habits of leadership akin to the role the United States played during the post-World War II Marshall Plan. Second, the Balkan nations must learn to cooperate with each other. Encouraging, even demanding, such cooperation among Western European recipients of U.S. assistance was a prime feature, and the genius, of the Marshall Plan. If these key changes can occur, peace, stability, and prosperity in the region could follow.

With regard to the first point, it is important to understand the U.S. position in the Pact relative to that of the European Union. Daniel Hamilton, special U.S. coordinator for the implementation of the Stability Pact, has emphasized that although the United States plays a large role, the European Union "should do the lion’s share of the project."4  In conjunction with the recent EU summit in Portugal, the White House stated that in efforts to stabilize the region, Europe "has properly assumed its role as the largest provider of resources."5 Hopefully, these are signs that the European Union will assume the leadership role needed for the plan to work.

Seeking Balkan Cooperation
The other half of the solution is intra-Balkan cooperation, another of the Stability Pact’s main goals. Regional economies are rife with smuggling and clientelism. Misha Glenny, writing in the New York Times, even went so far as to call them "kleptocracies."6  Through a history of outside rule, authoritarian regimes, uneasy ethnic balance, and limited trust, personal and family or clan relationships have become a basis of existence. A group of prominent Balkan intellectuals recently emphasized this problem, writing in a report that "the international community, in its administration of Bosnia and Kosovo, has lacked the will and the capabilities to deal with illegitimate economic activity and corrupt behavior."7 

For real change, crime and corruption must give way to openness, cooperation and integration. Already, there have been promising steps – small beginnings that need to be augmented and enforced. For example, Balkan leaders signed a regional charter on good neighborly relations at a summit in Bucharest last February. An investment compact and anti-corruption initiative also have been signed.

The Need for Speed
Despite this modest progress, the Stability Pact’s plans have not been implemented with enough speed to please anyone. Indeed, State Department officials joke about the "Sterility Pact." The stubborn gears of bureaucracy and sheer scale of reconstruction remain difficult foes. Last February, U.S. Secretary of State Madeleine Albright warned that "no one should be naïve enough to think that the Stability Pact will achieve instant results."8  The quick-start package itself is designed to combat ludicrously slow realization of long-term projects. For example, the European Union 'invested' 42 weeks to draw up plans and approve $19.9 million to clean up post-war debris in the Danube River. Starting construction of the Romania-to-Bulgaria bridge also has moved with ponderous speed. In Kosovo, the agreed-upon number of police, 4500, remains an unfulfilled promise. Javier Solana, new EU high representative for foreign and security policy, has admitted openly that programs are "bogged down in bureaucracy."9  Hombach agrees, realistically recognizing that even within the "quick-start" programs only a handful of transport projects will get under way this year.10 

While generous pledges were received at the Funding Conference, the money is slow arriving and Balkan nations are still waiting to see the cash the West has promised. Expediting EU finance is an endemic problem. Last spring, in a discussion with BASIC analysts, a State Department specialist stated that "on average, it takes 8 years for EU project funding" to work its way through the bureaucratic pipeline. Patten, acknowledging the problem, said his department is drawing up plans to "streamline procedures for granting aid for the region."11  He and Hombach are trying to reduce the 42-week timetable typically needed to plan and approve tender EU-backed projects to 16 weeks.

Another fundamental problem dogging the 'Marshall Plan for the Balkans' is Serbia’s glaring lack of participation. Sitting in the center of the region, and holding hostage to many a trade route, according to Solana, Serbia is a "black hole."12  For the moment, Serbian leader Milosevic remains in power. His propaganda machine is running at high speed. Every delay and failure the Stability Pact experiences gives him the chance to further convince his people – and their neighbors – that the West does not really care about them. Numerous promises have been made, and the international community must rapidly achieve them. We cannot afford a further loss of trust.

Hombach is leading the crusade to accelerate projects. He looks at Central and Eastern Europe in an optimistic light,and believes that the word 'Balkans' is tainted with too many negative nuances. According to him, the bureaucracy is his 'Balkans' and "we have to make sure that actions follow words."13  Americans have every reason to wish him success.

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Endnotes

 1 Speech in Florence at the Euro-Atlantic Partnership Council on May 25, 2000

 2 Japan Times, April 1, 2000

 3 Speech by Daniel Hamilton of the State Department, testifying before the House International Relations Committee, March 9, 2000

 4 Journal of Aerospace and Defense Industry News, March 31, 2000

 5 White House Fact Sheet: Working for Greater Stability in Southeast Europe, released May 31, 2000

 6 New York Times, June 23, 2000

 7 Joint Statement on the Future of the Balkans, presented by Damir Grubisa, Ognyan Minchev, Arian Starova, and Ivan Vejvoda at the Atlantic Council in Washington on June 29, 2000

 8 Wall Street Journal, February 11, 2000.

 9 Wall Street Journal, March 29, 2000

 10 Financial Times, June 23, 2000

 11 CNN.com, The Associated Press, July 10, 2000

 12 Associated Press Online, article written by Patrick Quinn, June 17, 2000

 13 Speech in Florence at the Euro-Atlantic Partnership Council on May 25, 2000

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