Croatia, Bosnia-Herzegovina and Yugoslavia have come to an accord on how to deal with the still remaining 1.2 million refugees and displaced persons in their countries, while at the same time an agreement was signed to speedily introduce free trade in Southeastern Europe by 7 signatory governments. The Special Co-ordinator, Bodo Hombach, welcomed these achievements as two excellent examples of how the Stability Pact is providing a platform for practical progress. "Regional co-operation is now established in SEE. This added value is the Pact’s very essence in terms of solving political problems", Hombach said, "Since this mechanism is in place, there are plenty of opportunities for creative politics."

By Signing a Memorandum of Understanding on Liberalisation and Facilitation of Trade the Governments of Albania, Bosnia-Herzegovina, Bulgaria, Croatia, Romania, FYR Macedonia and Yugoslavia made an important step forward towards the establishment of free trade in Southeastern Europe. The aim is the creation of a network of bilateral free trade agreements by the end of 2002, thereby allowing for at least 90% of goods to be exchanged free of tariffs. Chances are, that the countries of the region can now engage in a process of market extension, which by experience triggers economic growth. Liberalised markets of Southeast Europe comprise of 55 million consumers. This process is fully in line with WTO standards and recognises the relevant obligations of signatory countries vis-à-vis the EU. The agreement also includes a standstill and possible reduction of non-tariff barriers. Moldova has expressed strong interest to join this process and has signed a statement of intent to that end today.

Almost to the day ten years after hostilities started in former Yugoslavia, the region’s sad legacy of refugees and displaced persons is being tackled with a comprehensive approach involving Bosnia-Herzegovina, Croatia and Yugoslavia. By adopting the "Agenda for Regional Action" for refugees and displaced persons, the three Governments, together with donors, have taken stock of the outstanding issues. A series of bilateral initiatives combined with a National Action Plan by each of the three countries will assure that the case of the remaining 490’000 refugees and 760’000 internally displaced will be addressed. The package also provides for assistance for those, who have decided to stay and integrate at their present place of residence. Key initiatives for refugees include reconstruction programs, social housing, individual housing loan schemes, property legislation, pensions and social security.