Balkans ’ Integration Process at the Crossroads Rethinking Southeastern Europe through a pan-European perspective Transcending Europe’s Borders: The EU and its Neighbours — ICCEES Regional European Congress — Berlin, 2 August 2007 Center for European Integration Strategies (CEIS) Geneva — Vienna — Sarajevo Christophe Solioz

2 Welcome

3 Focus  Assess the current situation in Southeastern Europe  Review the EU Integration process  Outline a pan-European perspective

4 [ 1. Economy is doing fine - take GDP ] st quarter Forecast Croatia The fYR Macedonia Turkey Candidate countries Albania Bosnia and Herzegovina Montenegro Serbia Potential candidate countries

5 [ 1. An overall positive picture ] ò Continued growth can be assessed to be sustainable ò Business climate has improved ò Rapid growth of exports ò Increased foreign investments ò Recovered labour market ò Macroeconomic stability and low inflation ò Employment tends to recover more slowly 4Southeast European countries clearly show signs of the catching-up economies

6 [ 1.a. Transition indicators for 2006 ] large scale privatization small scale privatization restructuringprice liberaliz- ation foreign trade and exchange rate regimes compe- tition policy Banking reform and interest rate liberalization Albania Bosnia and Herzegovina Croatia The f YR Macedonia Montenegro Serbia

7 [ 1.b. Transition indicators for 2006 ] Stock- exchange and other non- banking financial services Other infrastructure reforms Telecommu- nications railroadselectricityroadswater and waste-water Albania Bosnia and Herzegovina Croatia The f YR Macedonia Montenegro Serbia

8 [ 1. Consequences of the ‘pause’ ]  ‘ Enlargement fatigue ’ has had negative consequences  ‘ Reform fatigue ’ characterizes the public governance  ‘ Soft powers ’ show some limits in Bosnia and Kosovo 4EU needs to rethink the European project in the region and, above all, embrace politics in order to make Southeastern Europe work

9 [ 2. Towards a EU ‘Reform Treaty’ ] ò Aimed to replace the defunct proposed constitution  Improve the EU international presence with a High Rep ’ ò Provide the institutional framework to resume the enlargement ò Would-be EU members will face monitoring regime ò Planning for Instrument for Pre-Accession Assistance (IPA) 4The institutional and financial capacities to proceed with the EU integration process are now available

10 [ 2. SEE EU Accession Forecast ] SAANegotiationsEUEuro Bulgaria Romania Croatia The fYR Macedonia Albania by 2015by 2017 Bosnia and Herzegovina by 2015by 2017 Serbia by 2015by 2017 Montenegro by

11 Outlook no 1 4EU membership perspective: not as a false hope, but as a realistic development prospect 4The EU integration process remains essentially a country-by- country approach that partly undermines regional co-operation in spite of the rhetoric 4The fostering of effective neighbourhood relations, regional co-operation should be seen not as a conditionality, but as strategic setting

12 [ 3.1. Necessity of a broader Approach ]  Individual strategies and good-neighbourly relations cannot tackle all the challenges that the countries in the region face  National and bilateral solutions are not enough when it comes to economic development, climate change, migration pressure, energy policy strategies and international terrorism etc. 4Only a pan-European vision sets the bilateral issues and the regional dimension in a coherent and significant framework

13 [ 3.2. A pan-European approach ] òLinks national and regional, local and global perspectives in a multilateral cooperation framework òEncompasses political and socio-economic aspects, the security dimension and the development challenges òCovers Eastern and Southeastern Europe, the Black Sea Region, the Caucasus region, Russia, reaching out towards Eurasia

14 [ 3.3. A pan-European approach ]  Fosters these countries ’ European identity  Contributes to the development of a common EU-U.S.- Russia approach to the open questions  Promotes a pan-European economic integration and co- operation process, beyond too narrowly conceived regional frameworks. 4Complementing the EU integration process, pan-European institutions should give life to a renewed pan-European dynamic.

15 Outlook no 2 Taking into account that  Europe has to face new divisions  A newly assertive Russia  The necessity to enhance co-operation in a new environment. 4Pan-European organizations have an obvious role to play in restoring confidence and building new bridges

16 Thank you for your attention