When the Bosnia-Herzegovina and Bulgarian chief negotiators initialled the final text of the free trade agreement between the two countries in Sarajevo on 18 February 2003, it marked the formal conclusion of a total of 21 such negotiations. This means that the seven SEE countries, which committed themselves to creating a free trade regime in SEE, have probably set a new speed record worldwide for completing the necessary negotiations, as SC Erhard Busek pointed out in Belgrade today. Speaking at an investment promotion event organized by the Serbia Foreign Investors Council and the OECD in the Stability Pact (SP) framework, Busek lauded the strong determination of SEE governments to a process, which will stimulate trade among the countries of the region, make SEE more attractive to investors, is fully in line with WTO and the countries’ ambition to integrate more closely with the EU.

As Busek explained, the political act of negotiations is only the beginning. Implementation, promotion and dispute settlement are now the challenges ahead. “At the end of the day” Busek said, “individual businesses and traders must know about the new free trade regime and the governments duty will be to instruct its customs and export authorities accordingly. This entails a change of philosophy and practices compared to the past and technical assistance to the SEE governments in this respect is crucial.” Within the SP, a vast array of trade-related technical assistance is available, mostly at national level. Regional seminars and workshops on the practicalities of customs co-operation, implementing food and safety standards and use of state aids for export companies are already underway. Free trade and its benefits will be further enhanced as the countries implement the agreements and, in the process, tackle areas such as non-tariff barriers and harmonisation of legislation. Pact activities in 2003 will accordingly focus on these topics.

The Stability Pact has always recognised that trade liberalisation in SEE is a crucial element for both economic and political development, and as a road to prosperity. In June 2001, ministers from seven SEE countries (Albania, Bosnia-Herzegovina, Bulgaria, Croatia, FR Yugoslavia, FYR Macedonia and Romania) signed a Memorandum of Understanding on Trade Liberalisation and Facilitation. Moldova has associated itself to the process with a somewhat extended timeline. A key objective of this agreement is the creation of a free trade area amongst the signatory countries with approximately 55 million consumers. This emerging free trade area combined with the generous provisions of the Autonomous Trade Preferences, granted to SEE countries by the European Union in 2000, creates significant trading and investment opportunities.

Annexes:

a) Matrix and list of dates of entry into force
b) Facts and figures on free trade negotiations in SEE