The Balkan Stability Pact: A Crucial Test for Europe

September 2000 - The bureaucracy and rhetoric surrounding the year-old Stability Pact for Southeastern Europe have grown apace, but there have been few tangible results so far. Western nations and eastern Europe alike are poised, waiting to see if the pact can live up to its goals and promises.

At the same time, urgency for the Stability Pact's implementation is building. Slobodan Milosevic has changed the Yugoslav constitution to allow him two more terms as president and to greatly diminish Montenegro's voice in national decision-making. He has called snap elections for president, parliament, and local officials for September 24. As elections in Kosovo set for October 28 draw near, tension is heating up in the region, creating the need for more soldiers and police.

The Stability Pact was formally launched with the help of the EU, 44 other nations, and 36 international organizations at a summit in Sarajevo last year. Its purpose, according to the pact's special coordinator Bodo Hombach, is to create a democratic and unified Europe without political and economic divisions.

It would accomplish this by bringing the countries of southeastern Europe together with those in western Europe and the United States, and their institutions. Success requires rebuilding infrastructure, fostering law and order, creating strong democracies, encouraging free trade, strengthening economies, and ultimately paving the way for the incorporation of southeastern European nations into the European Union.

Conceptually, the Stability Pact is a tremendous victory for advocates of peacekeeping and conflict prevention. It represents a movement away from the traditional military-centric approach of reacting to crisis situations. The United States and the European Union have finally realized that allowing crises to explode in the Balkans is much more costly - both in terms of life and money - than taking initiatives for the construction of long-term peace.

Although the United States plays an important role in the pact, the European Union should be responsible for the lion's share of the project, according to Daniel Hamilton, U.S. special coordinator for Stability Pact implementation. The European Union has allotted $2.8 billion for non-military programs in Kosovo in 1999 and 2000, compared to the U.S. contribution of $817 million. According to the White House, Europe has properly assumed its role as the largest provider of resources.

Initial funding for the Stability Pact has been slow to arrive, although the Regional Funding Conference for Southeastern Europe received more than $2.3 billion in pledges last March to finance "quick-start" projects. In addition, the European Union has pledged $10.44 billion to the region over the next seven years.

The recipient countries are Albania, Bosnia, Bulgaria, Croatia, Macedonia, and Romania, as well as the Yugoslav republic of Montenegro. There are 50 new projects on the quick-start agenda, ranging from water planning in Albania to fixing Bosnian power grids to building a bridge across the Danube River between Romania and Bulgaria. Limited aid also will go to opposition parties in Serbia. Yugoslavia as a whole, however, will not receive aid as long as Milosevic remains in power.

Fundamentally new attitudes must evolve, however, for the Stability Pact to work.

First, members of the EU must develop habits of leadership akin to the role the United States played during the post-World War II Marshall Plan. In terms of monetary assistance, Europe is already donning the mantle of leadership. From 1991 to 1999, the European Union contributed more than $15.3 billion in development, budgetary, and humanitarian assistance to southeastern Europe. Bulgaria and Romania will receive an estimated $5.6 billion in EU accession assistance from 2000 to 2006 to help prepare them for membership in the bloc. Montenegro is slated to receive $18 million in "exceptional financial assistance" from the EU.

Second, the Balkan nations must learn habits of cooperation with each other. Encouraging, even demanding, such cooperation among western European recipients of U.S. assistance was a prime feature, and the genius, of the Marshall Plan. However, intra-Balkan cooperation will not come easily. An important step is building transparency and trust in the region. Regional economies are rife with smuggling and clientelism. Through a history of outside rule, authoritarianism, uneasy ethnic balance, and limited trust, personal and family or clan relationships have served as a means of existence. A group of prominent Balkan intellectuals who recently gathered at the Atlantic Council of the United States noted that "the international community, in its administration of Bosnia and Kosovo, has lacked the will and the capabilities to deal with illegitimate economic activity and corrupt behavior."

To make a significant change, crime and corruption must give way to openness, cooperation, and integration. Already, there have been promising steps - small beginnings that need to be reinforced. Balkan leaders signed a regional charter on good neighborly relations at a summit in Bucharest last February. An investment compact and an anti-corruption initiative also have been signed.

Washington is trying to encourage fair trade and economic development in the Balkans with a Southeastern Europe Trade Preferences Act. Such legislation would help open the U.S. market to exports from the Balkans.

Serbia's glaring lack of participation is another serious problem that dogs the "Marshall Plan for the Balkans." Sitting in the center of the region and holding many a trade route hostage, Serbia is, in the words of Javier Solana, EU High Representative for Common Foreign and Security Policy, a "black hole."

For the moment, Milosevic remains in power. His propaganda machine is running at high speed. Every delay and failure the Stability Pact experiences gives him the chance to further convince his people that the West remains unconcerned for their well-being. Numerous promises have been made, and the international community must rapidly meet them. There must be no further loss of trust in the West.

Despite modest progress, the Stability Pact's plans have not been implemented with satisfactory speed. Indeed, State Department officials jokingly call it the "Sterility Pact." The stubborn gears of bureaucracy and sheer scale of reconstruction remain difficult foes. Last February, Secretary of State Madeleine Albright warned that "no one should be na?ve enough to think that the Stability Pact will achieve instant results."

The quick-start package is designed to expedite the process. It took the European Union 42 weeks to draw up plans and approve $19.9 million to clean up post-war debris in the Danube. Starting construction of the Romania-to-Bulgaria bridge also has moved at a ponderous speed. In Kosovo, the dispatch of 4,500 desperately-needed police remains an unfulfilled promise.

Solana has admitted openly that programs are bogged down in bureaucracy. Hombach agrees, realistically recognizing that, even within the quick-start programs, only a handful of transport projects will get underway this year.

While generous pledges were made at the funding conference, the money is slow in arriving and Balkan nations are still waiting to see the cash the West has promised. Expediting EU finance is an endemic problem. Last spring, a State Department specialist stated that "on average, it takes eight years for EU project funding" to work its way through the bureaucratic pipeline.

EU Commissioner for External Affairs Chris Patten, acknowledging the problem, said his department is drawing up plans to "streamline procedures for granting aid for the region." He and Hombach are trying to reduce the 42-week timetable typically needed to plan and approve tenders for EU-backed projects to 16 weeks.

Hombach is leading efforts to accelerate projects. He looks at central and eastern Europe in an optimistic light and believes that the word "Balkans" is tainted with too many negative nuances. According to him, the bureaucracy is his "Balkans" and "we have to make sure that actions follow words." Americans have every reason to wish him success.


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Jack Seymour, Senior Fellow at the British American Security Information Council (BASIC), served in the State Department Office of Eastern European and Yugoslav Affairs and the Office of Central and European Affairs, as well as the U.S. Mission to the European Union. He previously directed the Program on Atlantic Cooperation at the Atlantic Council of the United States.