From Stability to Integration: South Eastern Europe Taking Ownership of the Regional Co-operation Agenda

Ladies and Gentlemen,

As a professor I always enjoy giving a lecture and having an open debate, in particular on a topic, as today, that is both gathering increasing importance on the European political agenda and at the same time causing controversy in some quarters.

What is regional co-operation and why is it important in the context of European integration?

Today it might seem to some as a distant memory, but the violent conflicts in the Western Balkans have left more scars than appear on the visible surface: while we cannot and must not forget thousands of people who have died in the wars and must ensure that those responsible for these atrocities face justice, whether in The Hague or in front of national courts, we must also reconnect the peoples of South Eastern Europe. This is what regional co-operation is all about. I don’t want to call it reconciliation, because it is a very complex word, but co-operation on very practical issues, which will bring people together step by step. Before the war, very natural relationships existed between all the people of the region, trading, exchanging ideas, addressing common problems… And the war cut these links which need to be recreated in order for South Eastern Europe to move ahead.

In 1999, the Stability Pact was mandated to re-establish these broken links.

Seven years on, we see a mature region, in which regional co-operation is placed highly on national political agendas. There is an increased dynamism in relations between the governments in South Eastern Europe. We see companies taking full advantage of regional free trade with the result of intra-regional trade doubling over the past few years. We see common approaches to addressing difficult issues such as the fight against organised crime. We see the exchange of best practices in the area of migration. The Energy Treaty has created a regional electricity market consistent with EU standards. Four countries have formed the Sava River Commission to manage the economic and environmental issues of this important basin. To summarise – the relations between the countries in the region are – if I can put it this way – normalising.

These examples manifest that the region has matured and that the relations between the countries are – in most areas – being based once again on mutual understanding and trust. Take it from a person who spends most of his time talking to people in the region - and not only politicians: the importance of regional co-operation is better understood today than it was a few years ago.

So why is regional co-operation necessary?

Firstly, it is a necessity in South Eastern Europe in itself – quite a few issues, from fighting organised crime, to attracting investments, to strengthening disaster prevention, can only be addressed on a regional basis. To give you an example – a foreign investor will not be interested in investing into a country with a market of only 2 million consumers but a market of 55 million consumers, which is currently being established with the amendment and enlargement of CEFTA, also makes investments here in your country much more attractive. And also many of our international partners, such as the International Financial Institutions, are starting to look at the region as a whole and not into each of the individual country, taking a regional approach to their programming.

Secondly, regional co-operation is both a prerequisite and a tool for the European integration of SEE. To put it differently – it is one of the criteria of EU and NATO membership, as the two organisations want to take in only those countries that show maturity in relations with their neighbours – regardless of how painful memories of recent events might be.

However, regional co-operation should not be mistaken for a substitute for EU integration. Since regional co-operation is the basis the EU itself is built upon, it is also a condition for the further integration of South Eastern Europe into the EU. Regional co-operation should thus be seen as a practicing ground for future EU membership.

How does this relate to Serbia? As I have already said in the past, the potential of Serbia to gain a prominent role in the region – being on the crossroads of South Eastern Europe, quite physically with Corridor 10 and with the Danube being an important inland waterway – has been constrained by the burdens of the Milosevic era. The velvet divorce with Montenegro was a step forward, and must now be matched by Serbia’s full compliance with ICTY, which means ensuring that General Mladić faces justice in The Hague. The issue of Kosovo status is moving to its resolution, and I hope that the Serbian Government will act responsibly and in a manner consistent with its EU and Euro-Atlantic aspirations.

If you overcome all these difficulties, I am confident that Serbia will have a naturally important role in the region due to its geopolitical location, size and by the sheer fact that Belgrade is one of the main metropolises in the region, both economically and intellectually. In turn, this will bring much needed development of Serbia.

While Serbia has not been part of the Stability Pact when it was established in 1999, it has since then taken full advantage of the Pact as a neutral framework for regional co-operation. With its strong human capital, Serbia has been able to overcome the delayed start successfully. It is now a constructive and creative partner in all Stability Pact initiatives and can take this experience as a training ground for its Euro Atlantic membership aspirations.

Over the years not only Serbia but the region as a whole has changed, witnessing positive developments on a whole range of issues - most notably by the fact that all countries have moved closer to EU membership. The framework for regional co-operation that the Stability Pact provides has to reflect these changes and adapt to them. This is the main rationale behind the transformation of the Stability Pact into a more regionally-owned, streamlined and effective co-operation framework.

The Regional Table in Belgrade (our highest decision-making body) took far-reaching decisions in May on the establishment of a Regional Co-operation Council. It will gradually take over the tasks of the Stability Pact as the forum for regional co-operation in South Eastern Europe. These decisions have been made not only possible but necessary due to the very positive developments in SEE over the past seven years. The region is much more mature today and therefore can – and must – take greater ownership of its own affairs.

This phased evolution of the Stability Pact into a regionally-owned Regional Co-operation Council should not be interpreted as the international community withdrawing its support. Many of our international partners have assured us that they will stay engaged, but want to see the countries of the region gradually taking more ownership of the process – politically, financially and also personnel-wise.

The timelines for the implementation of these decisions which we have taken together at the last Regional Table are tight – by mid 2008, the Stability Pact is to phase out and the new RCC to take over. The responsibility for implementation is a shared one between the countries of the region, the international donor community and the Stability Pact Secretariat.

From the side of South Eastern Europe, it is in particular the SEECP – which considers itself the voice of the region – and the countries in the region who need to take a leading role in this process. Your Government, just as all the other governments in the region, has an important task – and a quite challenging one – ahead. But this process also provides an opportunity for South Eastern Europe to show the international community that it has left the violent conflicts of the past behind itself.

In order to make this transition real and feasible, a number of decisions need to be taken as soon as possible.

First of all, the SEECP needs to define its relationship with the RCC. The Regional Table has taken decisions on the future of the Pact and has suggested that the newly established RCC should have a close relationship with the SEECP. But the ultimate decision, of course, lies with the SEECP itself.

Secondly, the financing of the new RCC and its Secretariat needs to be determined. We are already working with the European Commission and the donor community to secure the international share of the financial costs. But the South East European countries need to come to an agreement among themselves on how they wish to divide their share of the costs. I am glad to say that the representatives of Ministries of Finances have already met and made significant progress in this area.

Thirdly, the question of where to locate the Secretariat of the RCC and the person of the Secretary General will require a decision by the countries of the region.

Furthermore, a detailed mandate and legal basis for the RCC needs to be defined. This is of particular importance to establish the RCC on firm legal grounds and to allow financial means to be made available – we are all accountable to our taxpayers and need to prove that the funds are spent appropriately.

And finally, based on the priorities for regional co-operation agreed at the last Regional Table, the portfolio of the RCC needs to be refined further. The streamlined Regional Co-operation Council and its Secretariat will be dealing with six areas which the countries of the region have already identified as those where regional co-operation will be beneficial to all: Economic and social development; Infrastructure; Justice and Home Affairs; Security Co-operation and Building Human Capital with Parliamentary Co-operation being an overarching theme that is linked with each of the areas.

I think it is in all our interests to ensure the sustainability of the co-operation processes initiated within the Pact and thus safeguard its legacy. There are two pre-conditions for this to be successful: enhanced regional ownership and continued international support in the transition phase.

In conclusion, the times when an initiative such as the Stability Pact could be established and driven mainly by the international community and imposed on the region are over. We are of course keen to ensure the sustainability of the co-operation processes initiated within the Pact. We can make proposals on how this can be achieved in the future, but the responsibility lies with the South East European Governments and it is you who must take the decisions.

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