The European Commission presented a nine billion Euro economic and investment plan for the Western Balkans which is intended to help the region move forward on its path to the Union and forge closer links between its economies.
According to the plan, six of the nine million Euro will be directed towards the transport, energy, digitalization, agriculture, health care and education sectors in all the countries of the region. Another 1.5 billion is earmarked for the private sector and the remaining 1.5 billion for education.
The Commission said that the coronavirus pandemic had a massive disruptive effect on the economies of the region which were already lagging behind in terms of economic convergence with the EU and added that the plan was intended to spur long-term recovery which would lead to sustained economic growth.
It said that the countries of the region had to implement reforms in order to move forward and draw closer to the EU Single Market. The plan is intended to unleash the untapped economic potential of the region and the significant scope for increased intra-regional economic cooperation and trade.
The Commission said that it would mobilize up to nine billion Euro from IPA funds for the 2021-2027 period to support economic convergence with the EU primarily through investments and support to competitiveness and inclusive growth, sustainable connectivity, and the twin green and digital transition. It added that a new Western Balkans Guarantee facility should be put in place which could potentially raise investments of up to EUR 20 billion.
“There is much we agree with in today’s package for the Western Balkans, including the lack of progress on tackling corruption and the need for investments in sustainable renewable energy and a circular economy. But the European Commission’s blatant lobbying to expand fossil gas use in the region is utterly unacceptable and in conflict with the EU’s own 2050 decarbonization goals”, said Ioana Ciuta, Energy Coordinator for CEE Bank watch Network. “The predominance of hydropower in the flagship renewable energy projects is also worrying, given its environmental impacts and climate vulnerability”, added Pippa Gallop, Bank watch’s Southeast Europe Energy Advisor. “The region needs support to concentrate on energy savings, solar and appropriately-sited wind, not to be further distracted by 20th Century technologies.”
According to the Commission, better links between the economies of the region are a priority which requires a strong commitment to implementing fundamental reforms, deepening regional economic integration and developing a common regional market on the basis of the EU acquis. The priorities also include waste water management and moving from coal-based to renewable energy.
The commission warned of poor governance and limited progress in dealing with shortcomings in rule of law and the fight against corruption. It said that regional cooperation with the EU is essential in addressing fraud, corruption, money laundering, terrorism, extremism, trafficking in arms and people and smuggling migrants.