EU unveils growth plan for Western Balkans, offers financial stimulus for reforms

EU unveils growth plan for Western Balkans, offers financial stimulus for reforms
According to European Commission President Ursula von der Leyen, the plan has the potential to double the size of the Western Balkans’ economies in the next decade. / bne IntelliNews
By bne IntelliNews October 17, 2023

EU leaders presented a new growth plan for the Western Balkans during the Berlin Process summit in Tirana, Albania, on October 16 involving granting partial access to the EU single market. They also offered financial support for the six Western Balkans countries contingent on their commitment to significant reforms prior to the planned EU enlargement.

The Berlin Process, which started in 2014 under the leadership of former German chancellor Angela Merkel, is a cooperation initiative associated with the prospective EU expansion.

European Commission President Ursula von der Leyen said in her opening speech in the Albanian capital that the growth plan's primary objective is to narrow the gap with the EU by leveraging the potential within the Western Balkans and aligning it with the European single market. Currently, there is a considerable disparity between the Western Balkan economies, which are at 35% of the EU average GDP per capita (on a PPP basis).

According to her, the plan has the potential to double the size of the Western Balkans’ economies in the next decade.

Von der Leyen emphasised that the enlargement process not only brings economic benefits to the joining countries but also enhances the EU as a whole by expanding the single market, which includes free movement of goods and services, road transport, energy, electricity, and integration into the EU's Digital Single Market.

Additionally, efforts will be made to streamline cashless payments through a unified European payment area.

Furthermore, deep-rooted reforms are imperative to enhance the business climate and attractiveness of the environment, the European Commission chief highlighted.

These reforms will be accompanied by funding for investment from the European Union, if they take place.

“The EU Commission put forward an investment package totalling €6mn, comprising €2bn in grants and €4bn in loans. The underlying principle aligns with our investment strategy under NextGenerationEU for the member states,” von der Leyen said.

In Tirana, it was suggested once more that the year 2030 is realistic for the EU's enlargement, with a primary focus on the Western Balkans.

Serbia-Kosovo conflict

The summit in Tirana also included discussions on Serbia and Kosovo's ongoing dispute. Charles Michel, President of the European Council, stressed that the EU cannot allow bilateral conflicts to hinder progress, particularly given the recent tensions between Serbia and Kosovo. Michel highlighted that cooperation hinges on reconciliation and that a stable future is contingent on it.

Serbian Prime Minister Ana Brnabic emphasised that in Kosovo, the essential conditions for the well-being of Kosovo Serbs are absent, categorising their plight as a humanitarian issue rather than a political one.

She also expressed bewilderment at Albanian Prime Minister Edi Rama's call for sanctions against Serbia, deeming it inconsistent with the principles of good neighbourly relations and contrary to the objectives of the Open Balkans initiative, which include Albania, North Macedonia and Serbia.

Kosovo’s Prime Minister Albin Kurti was also present at the Tirana summit, although Brnabic did not have a meeting with him. Nevertheless, Brnabic conveyed a clear message that it is crucial for Belgrade and Pristina to reengage in dialogue and establish the Association of Serbian Municipalities, as outlined in the Brussels Agreement.

German Chancellor Olaf Scholz emphasised the importance of implementing agreements brokered by the European Union to normalise relations and promote dialogue.

While this marks the tenth Berlin Process summit, it is the first time it has been hosted in a Western Balkan country.

Six Western Balkans countries are at various stages of the process. Montenegro and Serbia started the EU accession negotiation in 2012 and 2014, respectively. Albania and North Macedonia were given the green light for the start of negotiations last year, but Skopje has to make constitutional amendments required by Bulgaria to proceed in the process. Bosnia and Herzegovina is a candidate country, while Kosovo, which is not recognised by Belgrade, is a potential candidate.