From Ad Hoc Aid to IPA: EU Financial Support for the Western Balkans Tamás Szemlér Institute for World Economics of the Hungarian Academy of Sciences International Conference „Serbia and the EU” Institute of International Politics and Economics IIPE, Belgrade May 18, 2009

Main points EU support –between 1991 and 1999 –between 2000 and 2006 –from 2007 Remarks… …and, first of all, open questions

The 1990s: no strategy, no system The EU only followed the events No systematic approach –Nor in general, neither wrt financial assistance First changes – : OBNOVA – : Regional Approach –Milestone in 1999: SAP launched

OBNOVA objectives regional cooperation and good neighbourhood projects as well as transborder projects rebuilding of infrastructure and other individual or collective facilities damaged during the war consolidation of democracy and civil society; return of refugees integration and reintegration of refugees, displaced persons and former soldiers into working life preparation of production apparatus for economic recovery development of the private sector, primarily small businesses and promotion of investment strengthening of NGOs and cultural and educational institutions

The 1990s: EU assistance in figures

CARDS: part of a structured relationship SAP launched in 1999, reconfirmed in 2003 Areas of financial assistance –justice and home affairs –economic and social development –democratic stabilisation –environment and natural resources –administrative capacity building –other areas of assistance

CARDS in figures

CARDS: praise and critics Acknowledged as „the most important source of financial and technical support to reconstruction in the region”… …, CARDS, however, also received critics regarding –centralisation –the weakness of its regional dimension –the system of programming –the dual implementation of the programme –institution building, gender and minority rights and judicial reform

IPA: single framework, different clubs Five components –transition assistance and institution building –cross-border cooperation –regional development –human resources development –rural development Distinction between candidates and potential candidates –Candidate countries (TUR, CRO, FYROM): access to all components –Potential candidate countries: access limited to the first two components

IPA in figures (1) Source: European Commission, 2008: “Communication from the Commission to the Council and the European Parliament.Instrument for Pre-accession Assistance (IPA) Multi-annual Indicative Financial Framework for 2010–2012”, Brussels, 5 November 2008, COM(2008)705 final, pp. 5-7.

IPA in figures (2) Source: European Commission, 2008: “Communication from the Commission to the Council and the European Parliament.Instrument for Pre-accession Assistance (IPA) Multi-annual Indicative Financial Framework for 2010–2012”, Brussels, 5 November 2008, COM(2008)705 final, pp. 5-7.

IPA: frequently asked questions… „Why does the IPA regulation make a clear distinction between candidate countries and potential candidate countries? Is this not going to contribute to isolate potential candidates in the Western Balkans?” „Why not open the five IPA components to potential candidates?” „Isn’t there a risk that this differentiation contributes to broaden the gap between countries in the Western Balkans, with potential candidates lagging behind, and to reduce the opportunities for regional co- operation?” „Potential candidate countries will only benefit from the first two proposed IPA components: can you ensure that this differentiation will not weight unfavourably the level of funding available for the Western Balkans?” „Isn’t there also a risk that the differentiation increases the delays for the Western Balkans to accede?” Source:

…and frequently diverging answers On the right track? – Main issues –Differentiation componentsimplementation –Amounts in absolute terms compared to Pre-Accession Funds before 2004/2007 –Credibility of the EU as the main stabilising factor in the region

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