Munich Personal RePEc Archive Go West: The Western Balkans towards European integration Ninka, Eniel Dipartimento di Economia, Università Politecnica delle Marche, Facoltà di Economia “G. Fuà”, April 2005 Online at https://mpra.ub.uni-muenchen.de/21459/ MPRA Paper No. 21459, posted 19 Mar 2010 00:09 UTC GO WEST THE WESTERN BALKANS TOWARDS EUROPEAN INTEGRATION April 2005 Slovenia Romania Serbia Croatia Kosova/o Bosnia Herzegovina Bulgaria Montenegro Macedonia Albania Western Balkans Region Greece ENIEL NINKA GO WEST THE WESTERN BALKANS TOWARDS EUROPEAN INTEGRATION * Eniel Ninka ABSTRACT When we talk about the Balkans we think of war, suffering, ethnic cleansing and hatred. And up to a rather recent point in time this was not a misleading idea. Unfortunately, this has been the reality in the Balkans. If one tries to imagine the map of the European Union in 2007 something would come in front of the eyes. An area in the Balkan Peninsula washed by the Adriatic Sea and circulated by Greece, Bulgaria, Romania, Hungary and Slovenia, all of them EU Member States. The Union has already coined a brand new name for this area, the “Western Balkans”. The principal aim of this work is to introduce the reader to this region. It is a rich mixture of civilisations and ethnic groups, with affiliations to Christianity, both Orthodox and Catholic, and Islam and cultural influences ranging from Roman, Ottoman and Austro-Hungarian to Greek and Italian. Who are the Albanians, the Croats, the Serbs, the Macedonians, the Montenegrins and the Bosniaks, and how many of them live in the Western Balkans? Which is their origin and what languages do they speak? This work tries to answer all these questions. An overview of the economy, with a particular attention to the Foreign Direct Investments, is then given. The size of the economy of the region or the GDP is around EUR 50 billion with Croatia being the largest economy. The area grows faster than the rest of Europe. Nevertheless it, with the exception of Croatia, remains among the poorest in the continent. The EU has in several moments sustained the idea that a future enlargement process will welcome these countries in the family. It has put in place the Stabilization and Association Process as a long-term policy tool in order to facilitate and help the WB tackle the challenges of reforming democratic institutions, promoting the development and combating corruption, ethnic violence, poverty and social exclusion. CARDS is the financial arm of this policy. The perspective of the region to join the EU within the present decade however, seems rather unrealistic. Nevertheless, to avoid that the gap between the Western Balkans and their neighbours and the Europe grow wider the EU should include the WB countries in the scheme of pre-accession financial assistance and, moreover, consider them as full Candidate Countries when they conclude a Stabilisation and Association Agreement. * Eniel Ninka, Department of Economics, School of Economics “G. Fuà”, Polytechnic University of The Marche, P.le Martelli 8, 60121 Ancona Italy. E-mail: [email protected] . I am grateful to Raffaella Santolini for comments on an earlier draft. All the remaining errors are mine. - 3 - Eniel Ninka Go West The Western Balkans towards European Integration Index Abbreviations............................................................................................................................. 5 Introduction................................................................................................................................ 6 The region.................................................................................................................................. 7 The people.................................................................................................................................. 8 The ethnic groups ................................................................................................................. 13 The Albanians................................................................................................................... 13 The Slavs of South............................................................................................................ 15 Other nationalities in the Western Balkans........................................................................ 20 The social situation................................................................................................................... 20 The economy............................................................................................................................ 23 Foreign Direct Investments in the Western Balkans. ............................................................. 28 The Political Climate................................................................................................................ 33 Corruption in Western Balkans............................................................................................. 35 The Stabilisation and Association Process so far....................................................................... 37 What do the treaties say? ...................................................................................................... 37 Where are we now? .............................................................................................................. 40 EU engagement: from PHARE to CARDS and beyond............................................................. 45 Some conclusive considerations ............................................................................................... 49 References and Bibliography.................................................................................................... 52 Annex I: Social, Economic and EU Support Data ..................................................................... 55 Annex II: FDI Indexes and Data ............................................................................................... 59 The Inward FDI Potential Index............................................................................................ 59 The Inward FDI Performance Index...................................................................................... 60 Annex III: Maps ....................................................................................................................... 63 4 The Western Balkans towards European Integration Abbreviations AP – Autonomous Province B&H – Bosnia and Herzegovina CARDS – Community Assistance for Reconstruction, Development and Stabilisation CIA – Central Intelligence Agency DG – Directorate General EC – European Community ECHO – European Community Humanitarian Operations ESI – European Stability Initiative EU – European Union FYROM – Former Yugoslav Republic of Macedonia ICG – International Crisis Group ICTY – International Criminal Tribunal for the former Yugoslavia ISPA – Instrument for Structural Policies for Pre-Accession OHR – Office of the High Representative PHARE – Poland and Hungary Action for the Reconstruction of Economy SAA – Stabilisation and Association Agreement SAP – Stabilisation and Association Process S&M – Serbia and Montenegro SAPARD – Special Accession Programme for Agriculture and Rural Development UNCTAD – United Nations Conference on Trade and Development UNDP – United Nations Development Programme UNFPA – United Nations Population Fund WB – Western Balkans - 5 - Eniel Ninka Introduction After the last wave of enlargement that took place on 1 May 2004 with the accession of ten new Member Countries now the EU stretches from the Atlantic Ocean to the Carpathian Mountains, and from the northern Lapland down to the Mediterranean coasts. Nevertheless the map of the European Union has still to cover a big area, i.e. the Balkan Peninsula. At the moment, there are two countries that, at least physically, could be placed in the Balkans, namely Greece and Slovenia, which are EU Member States. The rest of the countries in the region are preparing to accede and are in different points during the accession path. In this paper we will not refer to the whole region, but only to some of the Balkan countries. The countries under study here are the following: Albania, Bosnia and Herzegovina, Croatia, Kosova/o, Macedonia, Serbia and Montenegro. These countries constitute an area in the western side of the Balkan Peninsula lately referred to as “Western Balkans”. This brand new term has been coined by the European Union to comprise those countries that were formerly part of the Socialist Federal Republic of Yugoslavia, less Slovenia, but adding Albania. Figure 1: The Western Balkans Slovenia Romania Serbia Croatia Bosnia Herzegovina Kosova/o Bulgaria Montenegro Macedonia Albania Western Balkans Region Greece Source: Author’s elaboration The Western Balkans constitute an area of almost 264.000 square kilometres. This area lays from the Adriatic coast of Albania, Montenegro and Croatia in the West to the Balkan Mountains in the East. WB border with the European Union in the South (Greece) and in the North (Slovenia and Hungary) and with two Candidate Countries (Bulgaria and Romania) in the East. 6 The Western Balkans towards European Integration Virtually this work could be divided into two parts. After having given a classification of the terminology which we will refer to in terms of geography and “politeness”, the first part deals with the people who live in the area of the Western Balkans. It gives an overview on the main ethnic groups,