Volume 2, Issue2 February 1, 2000	SOUTH-EAST EUROPEAN INFORMATION NETWORK
	Stability Pact Watch

Inside this issue:

The Stability Pact: Make It Or Break It!
From the Correspondent's Notebook...
European Institutions Directory
Croatian presidental Elections
An Interview With Mr. Erhard Busek, Coordinator of the SECI
Albania—Greece: Intrigue and Love

The Stability Pact:
Make It Or Break It!

Written by Saso Ordanoski,
Regional co-ordinator of the SEE PIN
(sordan@forum.com.mk)

Everyone agrees: the Stability Pact's financial conference in March this year will be the "make-it-or-break-it" kind of event. Created only months ago as a long-term endeavour, the Pact is already a common subject of criticism from all parties. From the donators' side, it is considered as a new "talk show" opportunity; all have nice words about the Pact's ideas and intentions, but nobody-so far-wants politically and financially to embrace it and make it their own "property". The Pact is a framework of co-operation-that is, its "added value" compared to a number of similar existing separate initiatives-but without a clear role for its co-ordinating Office in Brussels. For some time soon it may be apparent who is to be co-ordinated, but what is the power of the co-ordinator over the participants, that remains quite unclear. Also, because of the competition between the actors and apparently without a clear common political and implementing strategy, the EU and USA are constantly inventing new political complications and complexities around the Pact. For instance, at the beginning, countries involved in the Pact were split into members and facilitators; then monitors were introduced, partly involved on a spending side at the Working Table II (Economy); eventually stabilizers were added, presumably opposite to some de-stabilizing countries already members of the Pact?! So, according to its format, slow procedures, and political content, some people believe that the Pact is evolving into an "OSCE-type" of inefficient and "protocol oriented" international organization - for sure, with the "OSCE-type" of "regional dimension" at the core of its intentions. On the other side are the countries from the SEE region. Officially, being impatient, most of them have nice words for the Pact and most of them have old World Bank/EBRD projects in support of the Pact's intentions. But off-the-record most of them would emphasize substantial reservations toward the Pact. They say that instead of being an extra-commitment for admitting the Balkan countries into the EU, the Pact is now used as a vehicle to make SEE integration into the rest of Europe an even more distant and unreachable perspective. The promotion of the "Western Balkan" separation from the rest of the region is used as just another proof for it. It appears that the EU and the US, not knowing what to do with Kosovo and Serbia anymore, are trying to strengthen the "sanitary cordon" around them, making the whole region a political and economical victim by the lack of ability or means of the "international community" to deal with the crises. In such a context, most of the SEE countries perceive themselves as hostages of the political caprice of the leading international political factors. So the Stability Pact, described with an old Cold War dictionary, is regarded as a "new laboratory" for Western conflicts over the different spheres of interests in the region. But, while criticizing the Pact, none of the Balkan counties are institutionally preparing themselves for what may come as a result of the Pact. Namely, if the money is supposed to start coming tomorrow, it is clear that a substantial portion of it will go like "water in the sand" through corrupted and inefficient Balkan State structures. Because money is what Balkan governments are hoping they will get from the Pact. That is clear if you compare the Pact's activities: the Working Table on economy and reconstruction is disproportionately more occupied by member's interests and activities, compared with the security and democracy Tables. That's why everyone anticipates the March financing conference with great expectations. Mr. Bodo Hombach hopes to see a greater and more concrete commitment from both sides to the Pact. Balkan governments want to see some money by which they will assert whether the whole initiative is really a serious endeavour. Western governments hope that they will find enough efficient implementation and conditionality methods to work on the Balkans… So, it is like in the old saying: whenever in doubt, follow the money! portion of it will go like “water in the sand” through corrupted and inefficient Balkan State structures. Because money is what Balkan governments are hoping they will get from the Pact. That is clear if you compare the Pact’s activities: the Working Table on economy and reconstruction is disproportionately more occupied by member’s interests and activities, compared with the security and democracy Tables. That’s why everyone anticipates the March financing conference with great expectations. Mr. Bodo Hombach hopes to see a greater and more concrete commitment from both sides to the Pact. Balkan governments want to see some money by which they will assert whether the whole initiative is really a serious endeavour. Western governments hope that they will find enough efficient implementation and conditionality methods to work on the Balkans… That is why everyone is looking forward to the financing conference to be held in March. So, it is like in the old saying: whenever in doubt, follow the money!

FROM THE CORRESPONDENT's NOTEBOOK...

Kosovo: How To Develop a Macro-Policy?

Mr. Veton Surroi, a publisher of Pristina’s daily "Koha Ditore" -(redaksia@kohaditore.com), recently spoke at the WEU Institute for Security Studies in Paris, during the conference "Assessing South-Eastern Europe: Developments and Prospects".
Excerpts:

Kosovo refugees: Little Agim Shala (2) goes home

In the law of physics, you can't change one force by stopping it, and then continue with the same dynamics later on. You cannot change one type of administration (in Kosovo), Milosevic's, and then tear-off the page of the calendar and start tomorrow with a totally new form of administration. You could not do this in the best of cases. In colonial terms, this would mean that once Milosevic disappeared and the UK ran the place with its own tradition of colonialism, and then immediately installed a colonial administration.
However, under the UN's terms it is even more difficult. The UN administration in Kosovo started with 6 white jeeps and 12 personnel headed by Mr. Viera de Merlo. At the same time, General Mike Jackson had already been rolling around 30.000 troops into Kosovo. Those discrepancies between the aptitude of a military in trying to fulfil its mission, and the inaptitude of a civilian side to do the same, will create an institutional vacuum in Kosovo, that is felt until this day. The side effects of this vacuum are insecurity, especially insecurity of those citizens that are in a minority position: Serbs, Roma, Turks etc.
But, there are other negative side effects as well: a total lack of awareness of administration, which has brought the ability of crime to identify its own way of living; and the complete lack of any court system which, favors criminality. Out of a total number of 4.000 people that NATO arrested red-handedly in criminal acts in the last six months, 3.750 had to be released because of the lack of courts. Once you have sent that kind of message to criminals, you are basically saying that the door is open for them. This is totally disassociated with the general context or, the general prejudice that has been created abroad; that one sort of intolerant society in Kosovo has been succeeded by another sort of intolerant society and that Milosevic's dictatorial system has now been replaced by Albanian vengeance. What we are speaking of are very serious structural deficiencies that cannot be overcome simply by good will.

Three Challenges
In the past seven months, and we are now basically facing the first stage after the vacuum, we have three characteristics. The first is internal cohabitation. Political negotiations have gone between Mr. Kouchner and political parties and they have created the IAC (Internal Administrative Council). It is based a little bit on a Rambouillet formula, but include the main pillars of political life in a joint administration. This means that there will be one international co-head of department and one Kosovar Albanian. Furthermore, there are negotiations for the inclusion of Kosovar Serb representation within the IAC, which will make IAC completely multi ethnic, since there are already one Turk and one Bosniak present. This is one part of the problem: how to create an inclusive process by which the international administration will be felt as a joint responsibility? The second problem is the expanded cohabitation. This is a problem we will be confronting in the following years, and it is not a Kosovar, but UN problem. It means that having UN Resolution 1244 as the constitution, and as the basic law in Kosovo, the UN lawyers in New York become a kind of a Constitutional Court of Kosovo. They finally have a veto power over whatever decision-making procedure is being supported. Knowing that the UN, and especially the Security Council, is a body of compromise, one can see a problem in which the Chinese, Russians or another country may have a different interpretation on what the constitution is. Kouchner spends a whole day working, and then must spend a whole night over the phone with the lawyers in New York.
The third problem is a crisis driven international focus, and this again creates clichés. For instance, the guy from the World Bank says that money is not a problem, there are already two billion dollars on the table. But, then you go to Kouchner's office and you see the people responsible for the budget who say we are missing 35 million dollars and cannot pay teachers salaries who have not been paid for the last nine months! It is a very big discrepancy. So, there is a very big and evident problem with the budget. The deficit will approximately be worth two days of bombing. This first phase of trying to build some common administrational structure, trying to have at least municipal elections some time in September or October this year will not necessarily mean that this society is being transformed. As in the case of Bosnia, we are speaking of an enormous challenge, a total restructuring of a society, not of maintaining a status quo. This challenge will be decided this year.

UN Mission
How to determine what the UN mission is? As we have seen with the military, with KFOR, sometimes it is easier to define the mission, than to fulfil the mission. In KFOR's case, 50.000 soldiers were put in, after some weeks we hear that their commander is saying: "We are not here to police"... On the other side, you have the UN Resolution that says it is KFOR's duty to create a secure and safe environment - that means policing as well, and if you have to do it - you have to take troops out. The UN resolution and the international structure as such could also be interpreted as "we are here to keep things running". We did not have electric power for a month in Kosovo; you can say that they have kept the place "running" with about 10% of electricity, but that is not necessarily a well run place! In the physical re-building, there will be an enormous challenge with basic housing. We sometimes go from cliché to cliché - people say: "Roads and bridges will be built, but how can you rebuild the society, morally and..?!" Well, first build the bridges and roads! Because the roads and bridges have not been built. There are 110.000 houses that have been destroyed by the Serb offensives, of which more that 50.000 have been destroyed beyond repair. 700.000 people inhabit them, who suffer because of the lack of roofs. Furthermore, there are 800.000 people who subsist on aid. It is a very big problem for all of them to get through the spring and to go into the fields because there are mines in the fields... How to build the institutions and what kinds of institutions should be built? However you want to define the mandate it is, actually, one of state building. To sum up, the question that needs to be answered in the following two to three months is how to devise a macro-policy toward Kosovo? This question will have to be answered soon.

European Institutions Directory

Croatia: Tight Fight for the New President

The season of elections in Croatia is not over yet. After parliamentary elections, held January 3, 2000, Croats voted for a new president on January 24th, 2000. The second round of voting is on Febryary 7.

The Stability Pact is Not Allowed to Fail

Mr. Erhard Busek, co-ordinator of South European Co-operation Initiative (SECI) and member of the Stability Pact Business Advisory Council (seci1@osce.or.at)

Money, money, money, but also rules concerning financing!

How do you assess the present situation with the Stability Pact, and what are the main problems in its functioning?
By the fact that a big number of states and international organizations are looking here together, we have to be patient concerning the functioning of the Pact. The Stability Pact started as a conference machine, but there was no other possibility to get things moving. For SECI it was an opportunity to bring forth all the projects which concern us. Mainly in the Working Table II (infrastructure, electricity, environment) and Working Table III (cross-border crime fighting). Now it is necessary to get decisions from the donor countries to make monies available. It is quite necessary that the international financial institutions are undertaking quicker procedures than in the past, because we are focusing on the fact that the unemployment rate in SEE is extremely high. If we can start with projects immediately in the year 2000, it shows that the Stability Pact is working.
How do you see the role of the Business Advisory Council (BAC) to the Stability Pact?
BAC to the Stability Pact has recently started in Berlin and is working in close cooperation with the BAC to SECI to avoid duplication. I think it is quite necessary that the BAC put pressure on the national governments concerning financing and also market the region of SEE to the EU, USA and Japan. Also, it should bring forward existing experiences concerning investment in the region. The role will develop in a very pragmatic way because businessmen are looking for results, bottom-up and hands-on.
Do you think that countries in the region are responding to the Pact in a good manner?
There are many high expectations in the region, which is understandable, but sometimes connected with impatience and illusions. I think it is quite necessary that within the region nobody is going it alone because it would be wrong competition. There must be cross-border co-operation and also the capacity to formulate priorities. One cannot do all the projects at the same time. It is necessary that countries in the region sit together on the different problem areas, like economy, security, transport, and specifically on the development of human rights and democracy.
What do you expect from the Pact's financing conference in March this year?
Money, money, money, but also rules concerning financing! It makes no sense to give grants on different projects because it is quite necessary to develop a system of continuous financing; therefore, I am quite in favor of soft loans with low interest rates, provided by the World Bank, EBRD, and EIB for the governments, infrastructure and private business. It will be the best way to established revolving loan funds, for example for environmental problems, because on the one hand, the country of the region knows that everyone must earn their monies, while on the other hand, it must be under conditions that make it possible. Also, I am expecting that the richer countries are prepared to act on the national level because this is someway quicker. Greece, for example, made a very good decision, as well as the Hungarians and the Czechs, and the Italians are prepared to do something.
If the Stability Pact fails in its good intentions, what is the perspective of the European relation to the Balkans?
The Stability Pact is not allowed to fail; it must be a success, otherwise we will not be able to stabilize the situation and we can expect the next war. The alternative might be that countries of the Balkans are then looking to the USA, the Islamic world or elsewhere, and this would be a harmful development for Europe. Beside all the economic and diplomatic relations, we have to consider that the Balkans are a part of Europe and very important for the general development of the continent

Albania-Greece: Intrigue And Love

Officially the present relationship between Albania and Greece is very good. In fact, they seem too fragile and frail.  Ironically, it can be said that they are paradoxical. Schiler's play title "Intrigue and Love" seems to better suit the complex relationship between the two Balkan neighbors.
Both countries have signed the Treaty of Friendship and Cooperation four years ago, but paradoxically, de jure they are in a state of war. Greece has not fully abrogated the Law of War with Albania, which is in force since 1940. The experts of the international right say that the decision of Papandreou's Cabinet in August 1987 is not juridical enough to invalidate the State of War, because Greek Parliament has never approved the act.
This story is not an obstacle, however, for a company of 200 Greek soldiers to be stationed for two years now, in the outskirts of Tirana and Greece assisting the rebuilding of dilapidated Albanian Army.

Both countries declare that do not have territorial claims against each other, but nevertheless, there is no border pyramid between Greece and Albania for reasons that in Tirana are still unclear.
A question made on a press conference during Albania's Premier Ilir Meta visit in Athens was enough for the bilateral relationship to enter an icy period. Asked in relation with the Greek government's attitude on Tcham's issue, Simitis answered briefly and flat: "This issue doesn't exist."
Albanian Premier has fiercely reacted and has demanded that Greece should solve out the Tchams people property issue in accordance with the international Convents, where Greece adheres. While the reaction from the Tscham community in Albania was more than harsh. The Tcham issue, an Albanian population expelled from Greece shortly after the Second World War on charges of collaboration with Germans has stirred up time and again the Greek-Albanian relationship. Tchams have rejected the collective gilt and at the same time insist on the solution of their property issue in Greece. The association "Tschameria" is trying to sensibilize the local and international opinion asking for a global solution of their problem through an agreement between the two countries. Till now there is not a single case that a member from the Tcham community to turn to the European Court for Human Rights to demand the restitution of their property from the Greek state.

Albanians are suspicious on the Greek neighbor especially because of their relations with the Serbs. Still under the influence of the Kosovo War emotions, there are many the people in Albania that their judgment for the neighbors passes through the Kosovo prism. Some organs of the mass media maintain a hostile attitude towards Greece and further more speak of the Greek planes to colonize Albania. But stripped off emotions, Albania greatly needs its southern neighbor: currently, 400-500 thousand Albanians work in Greece. They send the money that are earned in Greece to Albania thus keeping alive not only their poor families, but also the Governments, which change one after. That's where we should search for the reason, why in general Tirana keeps quiet when the powerful and capricious neighbor behaves arrogantly. Of course, Athens knows about this, and when the need comes, does not hesitate to forewarn by filling up some buses with immigrants and sending them back to Albania. In fact, this story resembles more or less the cat and the mouse story. At present, Greece benefits from the Albanian immigrants to the same extent Albania does. They work on second hand jobs that the Greeks have forgotten by now and are paid much less than the Greek workers. Greek economy greatly depends on the Albanian immigration. In Tirana they know it already and each time the loaded bus with immigrants reach the border, Albanian authorities pretend to look worried, because it is clear that the expelled immigrants will head back for Greece after several days.

The tendency manifested by Tirana to play the role of the first violin in the Stability Pact,doesn't look good in Athens. According to some experts, the Stability Pact gives more importance to the axe Albania-Macedonia-Bulgaria-Turkey, countries known as pro Americans and shadows the vertical axe Greece-Macedonia-Serbia, which demonstrated problems. But, there are some arguments that run contrary to this idea. A strong and stable Albania would be less dependable on the Greek market and would try for a greater role of the Albanian factor in the Balkan, which is not favored by the Athens. Or could be orientated more openly towards Italy, which the bulk of the Albanians sympathizes, more than Greece. The rivalry between Greece and Italy regarding Albania is not a secret, or better, the rivalry for the EU projects funding in Albania. Berisha preferred Italy, but during the last period of his reign, the relations with both neighbors reached low levels. Nano preferred Greece to Italy, which faced him with the Italian criticism on one side and Turkish on the other side. Majko neglected both sides during the Kosovo crisis, dedicating to the relationship with the US. While Meta with the new post-war situation seems to have leaned the steering wheel more towards Rome, thus causing dissatisfaction in Athens. History pushes Greeks and Albanians towards intrigues, and the present towards love.

Remzi Lani
rlani@institutemedia.org

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