EU integration of the Western Balkans has been progressing, albeit slowly: five of the six states have gained candidate status in recent years, while the state of Kosovo still remains as a potential candidate. In 2023, the European Union introduced New Growth Plan for the Western Balkans. The plan was formed with the idea of fostering an increase in socioeconomic convergence of Western Balkan states. At least three states – Albania, Montenegro and Macedonia – have expressed desires to join the EU by 2028. However, the real challenge lies in translating this potential into tangible progress, especially in a politically fragmented country like Bosnia and Herzegovina.
What Can the Growth Plan Do?
On paper, the Growth Plan has the potential to double the Western Balkan economies in size. States in the Western Balkans are invited to prepare Reform Agendas consistent with EU recommendations based on enlargement packages and the country’s economic reform programs. Once these documents are assessed and approved by the Commission, they open the door for the WB countries to access funding from the proposed Reform and Growth Facility for the Western Balkans: a €6 billion financial mechanism. If concerning states fulfil the conditions of the Commission (such as budget transparency, or macro-financial stability), they will receive payment via the RGF. Otherwise, payment can be suspended. Most importantly, the Western Balkan partners have a limited time to fulfil conditions of both the Commission and their Reform Agendas – meaning that it is not easy to stall progress and still get paid. Funding is issued out twice yearly in the form of concessional loans and grants to be spent on service and infrastructure improvement. The main goal of the Growth Plan, other than supporting the enlargement process and decreasing economic disparity between the EU and the Western Balkans, is to introduce them into EU single market integration through initiatives such as joint alliances, agencies and other EU programmes during the pre-accession period.
The reason that this mechanism is so essential and necessary for EU integration of the Western Balkans is that it provides incentives to prepare the states for EU membership and introduce reforms at an accelerated pace. In turn, this means that citizens themselves will stand to benefit – by bolstering Western Balkan economies and encouraging reforms, quality of life for citizens will be improved through increased regional stability and a sustainable economy.
Bosnia and Herzegovina: Changes Since Growth Plan Implementation
While Bosnia was one of the last partner states to propose their Reform Agenda, missing the deadline of April 26th, they still managed to finish the agenda proposal before the end of the month after receiving an extension. As of April 30th, 2024, Bosnia and Herzegovina proposed its Reform Agenda, potentially enabling the state to receive approximately €1 billion in the 2024-2027 period to facilitate reforms in areas such as the rule of law, sustainable green energy, human capital and private sector development and improved IT infrastructure. This draft was prepared by the work team, chaired over by the chairwoman of the BiH Council of Ministers Borjana Krišto. Interestingly, the draft is not publicly available to view. However, due to a lack of political consensus from the side of Republika Srpska, Bosnia and Herzegovina lost out on the initial round of funding, losing €70,000,000 in potential financial aid from the Growth Plan. This was because of three points in the Reform Agenda that the entity considered unacceptable: a single phone number for emergencies across the entire country regardless of entity, the abolition of the entity veto on state fund aid allocation and complying with the Constitutional Court of Bosnia and Herzegovina, as well as filling its vacant seats. Because of such disagreements between the entities, the state lost out on the essential pre-financing that the Growth Plan would have provided them with after summer 2024. This was announced in mid-July: since then, Republika Srpska has agreed to adopt the EU emergency number 112. Other than this, cooperation on the rest of the drafted Reform Agenda points seems to be up in the air.
When it comes to Bosnia and Herzegovina’s internal politics, however, blame is being shifted from one group to another. Instead of working to compromise and cooperate on the draft, political parties seem to be pointing fingers at one another – after losing the first round of funding.
In more recent events, Bosnia and Herzegovina had developed a document (not their Reform Agenda) that ‘showed compliance to reforms necessary’ in regards to the Growth Plan, according to Borjana Krišto, chairwoman of the BiH Council of Ministers. It was directed to the European Commission as of September 17th, 2024 – this document, however, is considered incomplete due to a lack of total support for all the European Commission’s recommendations for the country in accordance with the Growth Plan. This includes aspects such as contribution to visa alignment, agreement on the BiH Constitutional Court, and State Aid control authority. The lack of an accepted Reform Agenda for Bosnia and Herzegovina has had a larger external impact on the Growth Plan’s execution: the Instrument for Pre-accession Assistance (IPA) has postponed the original date of their committee meeting for October because of this. The purpose of the committee meeting is to analyze and grade the Reform Agendas of all involved Western Balkan countries. The five states that submitted successful Reform Agenda will potentially receive payment by the end of 2024: Bosnia and Herzegovina will hopefully be able to finalize the Reform Agenda after the local elections.
What must be done to make the Growth Plan succeed in Bosnia and Herzegovina?
The Reform Agenda, like many other potential sources of improvement for BiH, has become yet another victim of the blame game present amongst the political parties within the state. This behavior does not set the state on a common EU path – it sets them away from it, returning them to the political infighting that the public has grown apathetic towards over the decades since Bosnia and Herzegovina’s independence. The EU is not interested in which politicians blocked each other – they most likely see the simple facts instead: the state missed the original deadline, proposed the draft to the political voters two days beforehand, likely giving them little time to read or understand the 113 points of the constructed draft: was the lack of consensus due to political disagreements, or because there wasn’t enough time to accept the Reform Agenda with confidence? Cooperation isn’t easy – but it is happening. The acceptance of the single EU emergency number in Republika Srpska is a good first step: Bosnia and Herzegovina must find agreement about abolishment over entity vetoes and compliance with Constitutional Court if they wish to proceed with the original version of the Reform Agenda. More importantly, Bosnian politicians must stop pointing fingers at one another – but this is easier said than done.
