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Some ideas are better than others

I have been puzzled by some Balkan economic initiatives. So I turned to Demush Shasha, Executive Director of the Pristina-based thinktank EPIK and former Secretary General of the Ministry for European Integration, for answers. While I think Demush has done an admirable job of analyzing the situation, I’d be glad to hear from others who may have different views of the merits and demerits of the initiatives discussed. Demush writes:

First let’s try and delineate the discussion surrounding these issues. So, these are two separate, though related, conversations.

1.       CEFTA vs SEFTA;

2.       Mini-Schengen vs Berlin process.

Former is more specific and economic discussion, later is more general and political discussion. To put it differently, the former is about “free movement of goods” – so almost exclusively a trade discussion.  Later is about more than trade, it is about ALL types of freedoms in Western Balkans – people, capital, goods, establishment of companies, recognition of academic and professional qualifications, etc.

With that out of the way, a few words on differences between competing proposals.

CEFTA vs SEFTA

Kosovo proposed that CEFTA is succeeded by SEFTA. There are two reasons for this: (1) When CEFTA was launched Czechoslovakia was part of it 😊. So, the first argument is that agreement was designed for a different time and place, and it needs simply an update to new realities. (2) Kosovo is not a party to CEFTA as a sovereign country, but through UNMIK. This is because of Serbian veto within CEFTA mechanisms and procedures. So, Kosovo believes that with the launch of SEFTA, as a new mechanism, this issue can be addressed. Serbia on the other hand, for obvious reasons is against the proposal.

Mini-Schengen vs Berlin process

The Berlin process was launched in 2014 by the EU as a political mechanism to spur political cooperation in the region, allocate funds for important infrastructure investment, and ensure that the region gradually increases its competitiveness and prepares itself for EU Single Market. Since the launch, all 6 WB [Western Balkan] countries + 10 EU countries have been part of the process. So no brainer, everything was running great and smooth, until…

Mini-Schengen was launched in 2019 by three WB countries, without serious international political support, it failed to ensure inclusiveness of all WB countries and without any financial resources. Immediately, after a few first meetings it was obvious that this is not a serious undertaking, but rather a platform from which frustrated WB countries can get together and communicate their displeasure with the EU. Albania and North Macedonia were not being allowed to start accession talks, and Serbia’s accession process practically stalled, without any new negotiating chapter being opened.

In this light, Kosovo decided that it will continue to support Berlin process initiative and stay out of the Mini-Schengen. This decision is based on several factors:

1. Berlin process goal is regional cooperation in view of EU accession. Mini-Schengen goal is to create a mechanism that “will take the fate of the Balkans in our own hands”. You can imagine why in the Balkans, and in particular countries like Kosovo and BiH [Bosnia and Herzegovina], this kind of language makes people edgy.

2. The Berlin process is led by Germany, and supported by its key EU member states. Mini-Schengen is led by Serbia.

3. Mini-Schengen goal is to undermine the Berlin process and EU influence in the region, since it is a duplication of the Berlin process. Mini-Schengen would create a political forum where out of all participating countries, Serbia would be a natural leader of the group. This raises eyebrows with regard to creating an opening for Russian influence in the region through Serbia and Mini-Schengen.

4. The Berlin process has at its disposal 9 billion EURO funding, for 2021-2027, allocated by the EU in the forms of grants, which the EU has assessed will generate additional 20 billion investments in loans.  Mini-Schengen has zero.

On US position: No high level US official ever took part in Mini-Schengen meetings. Mini-Schengen is mentioned in Washington KS [Kosovo]-SRB [Serbia] letters of intent, but it was never followed-up in any serious and structural manner by US administration. My reading is that the US supports any initiative that contributes to regional cooperation, and additionally on Mini-Schengen I think they understand the politics of it and they are simply allowing those 3 countries (Srb, Alb, NM) for the moment to vent some (justified to an extent) displeasure with the EU.

On EU position: Despite that the initiative in its title had the word “Schengen”, and aimed to transpose four fundamental freedoms of the EU, the EU never supported the initiative. They have continuously communicated that the Berlin process is the way forward. However, noting the current lack of enlargement momentum they really had little moral capital to be more aggressive publicly.
In a nutshell, I think it is one of those things that is not on the priority list of the US/EU, so they refrained from going publicly against it. They recognize that the initiative has no teeth, nor future. However, I believe that behind the public eye, they have strongly advised Kosovo, Montenegro and BiH to stay outside of the initiative.

PS: At this event earlier this week, Jim O’Brien of Albright-Stonebridge gave a vigorous and detailed defense of “Open Balkans,” which is a rebranding of mini-Schengen: