Speech by Mr Jukka Valtasaari, Secretary of State: Stability Pact for South-Eastern Europe, the inaugural meeting of the Regional Table, Brussels 16th September 1999

Stability Pact for South-Eastern Europe
Inaugural meeting of the Regional Table,
16 September 1999

EU-Presidency Intervention
by Mr. Jukka Valtasaari,
Secretary of State,
Ministry for Foreign Affairs of Finland

On behalf of the European Union, I would like to thank Special Coordinator Hombach for providing a draft workplan as a basis for today´s discussion. This workplan, which is a living and flexible document, will provide general guidance for the work of the Stability Pact. It is particularly important that the document remains open to the expertise that the countries of the region can bring to it. In this context, the EU also welcomes the Special Coordinator´s proposal to highlight the ownership of the process by the countries of the region through extending to them co-chairmanship of the Working Tables.

The launching of the Stability Pact at the highest political level in Sarajevo gave us an orientation within which we need to work. Here at this inaugural meeting of the Regional Table the European Union and other participating states and organisations are confronted with the task of laying down concretely what it is that we are seeking to do in South-Eastern Europe and in what order of priority. Equally we need to indicate what is expected of the countries of the region.

The broad outline of our aims is clear: in the context of the Stability Pact process we have promised to bind the region into European and international structures through wider integration processes. The countries of the region are in turn committed to observing the underlying principles of such structures and working towards regional cooperation. The challenges in doing so need to be spelled out today.

We need to strike a balance between the demand for projects that will have a short-term effect in boosting the economies of the beneficiary countries and the need to think in terms of the medium and long-term goals of the overall Stability Pact process. In the framework of the Workplan, presently under discussion, I would urge us not to get too tied up with outstanding infrastructural projects. Given limited donor resources available, investment will be key to the realisation of most of the infrastructure needs. The improvement of the climate for investment and increasing investor confidence throughout the region are therefore critical to the success of the Stability Pact process. European standards need to be met in areas such as property legislation, the functioning of the banking system and judiciary, as well as border controls and the levying of customs.

The subject matter of the three Working Tables is interrelated. Deep-rooted democratic habits and a functioning civil society form the basis for achieving the aims of the Stability Pact. Stable, open and pluralistic democracies governed by the rule of law, and the respect for human rights and rights of persons belonging to minorities, serve to underpin vibrant market economies. The overall work of the Working Tables should be focussed towards assessing the needs for institutional development and reform of the countries of the region to enable them progressively to fulfil the criteria required for drawing closer towards European Union structures. The common values that bind the European Union countries together are those of stability, democratic accountability, good governance, free trade and market economies based on sound macro-economic policies. These are also the elements of the Stabilisation and Association Process, which offers countries of the Western Balkans the possibility to develop a new kind of contractual relationship with the European Union.

The European Union already plays a leading role in providing financial support to the region. As the work of the Stability Pact process advances, the Union will actively review the means through which it can further assist the process and provide support to the countries of the region in their transition. Among the beneficiaries are included the democratically governed Republic of Montenegro, and hopefully in time also Serbia. In return for compliance with relevant conditions, standards and criteria, the Union is ready to extend concrete incentives. Among the measures to be employed by the Stabilisation and Association Process that covers the Western Balkan countries are, inter alia, the possibility of extending economic and trade relations to countries of the region, and supporting progress in reforming key political and economic institutions. Both are conditioned by the commitment of beneficiary countries to meet existing criteria, including their contribution to the development of regional cooperation. Particular priority will be given to joint initiatives put forward jointly by countries in the region.

In speaking about resources it is good to bear in mind their limited nature. We need to find ways in which to focus our activities so that the resources we make available are used in the most effective possible way. This requires us to define clearly a vision for the medium and long-term development of the region, and to derive priorities for our activities from such a broader vision. In setting a framework for the activities of the Working Tables, we need to be explicit about the criteria against which the value of approaches and initiatives are to be judged. How, for example, are we to determine the relative merits of directing resources towards the building of a highway and the establishment of a network of ombudsmen or setting up a civil service academy?

This is why the European Union would hope that the Stability Pact be used effectively as a clearing house among the actors in the region. We should now make the most of the instruments and mechanisms available. The Stability Pact should not become another actor among other implementing agencies, but should seek to make the most of existing instruments and mechanisms. The Special Coordinator can most effectively add value by acting as a catalyst and charting the direction for the processes underway in the region.

A central observation in the workplan provided by the Special Coordinator is that the Working Tables will start off by establishing an inventory of existing initiatives and projects within areas of their competence. This is sorely needed in the wide field of actors and activities. By the same token, the European Union encourages the Special Coordinator to make maximum use of review and progress reports to draw attention to successful initiatives already under way and to promote these as models for projects within the region.

The main strength of the Special Coordinator of the Stability Pact is the high profile of his position which will help keep South-Eastern Europe on the policy-making agenda and see to it that Stability Pact participants stand behind their promises in the donor field. The Special Coordinator is tasked by the Stability Pact to provide periodic progress reports on behalf of the Regional Table. This can be used as an important tool in drawing attention to successful initiatives already under way and in promoting these as models for projects within the region. The European Union encourages the Special Coordinator to make maximum use of this tool.

In summation, the European Union considers that the workplan provides a good framework that should be developed further to provide clear guidelines and criteria for setting priorities among initiatives and projects, as well as to articulate a broader strategic vision. The Union submits in writing a joint set of comments for the further development of the workplan. While prepared to make a substantial contribution to the reconstruction and development of the region, the European Union stresses the need for fair burden sharing, and underscores that the workplan does not imply any automatic commitments on the part of the Union.