The Western Balkan countries on the road to the European Union

The main components of the Stabilisation and Association process

The Stabilisation and Association Process (SAP) is a long-term commitment to the region both in terms of political effort and financial and human resources. The SAP is the route to progressively closer relationship with the EU – based on incentives and obligations – and has three main components:

Stabilisation and Association Agreements

The centrepiece of the Stabilisation and Association Process is the conclusion of a Stabilisation and Association Agreement which represents a far-reaching contractual relationship between the EU and each Western Balkan country, entailing mutual rights and obligations. Such an association has high political value. It is based on the gradual implementation of a free trade area and reforms designed to achieve the adoption of EU standards with the aim of moving closer to the EU. A Stabilisation and Association Agreement embodies the choice for Europe made by the Western Balkan countries and the membership perspective offered to them by the EU.

The EU’s political strategy towards the Western Balkan relies on a realistic expectation that the contract it enters into with individual countries will be fulfilled satisfactorily. Careful preparation with each country before the EU offers such a contract has been and remains a vital component of the Stabilisation and Association Process.

The Stabilisation and Association Agreements are tools which provide, much as the Europe Agreements did for the candidate countries in Central Europe, the formal mechanisms and agreed benchmarks which allow the EU to work with each country to bring them closer to the standards which apply in the EU.

The Stabilisation and Association Agreements focus on respect for key democratic principles and the core elements at the heart of the EU single market. Through a free trade area with the EU and the associated disciplines (competition and state aid rules, intellectual property etc) and benefits (e.g. rights of establishment), this process will allow the economies of the region to begin to integrate with that of the European Union. For those areas where the agreements do not impose specific obligations relating to the EU acquis, there are provisions for detailed co-operation and discussion with the EU which again have the purpose of helping each country move closer to EU standards. The Stabilisation and Asociation Agreements encourage the active development of regional co-operation and good neighbourly relations.

The Stabilisation and Association Agreements are tailored to the circumstances of each country. However, each agreement is intended to have the common purpose of achieving the sort of formal association with the EU described above. The destination for all countries is expected to be the same: the full realisation of association after a transitional period through implementation of the same core obligations.

The Stabilisation and Association Agreements with the EU are the means necessary to encourage these countries to adopt real reforms towards the immediate objectives of the agreements (full realisation of the association) and beyond. The mechanisms of the Stabilisation and Association Agreements themselves (from specialist sub-committees to political level meetings such as the Stabilisation and Association Council) will allow the EU to help prioritise reforms, shape them according to EU models, solve problems and monitor their implementation. Effective implementation of the Stabilisation and Association Agreements is a prerequisite for any further assessment by the EU of the country’s prospects of accession. Each will need time, help and encouragement to implement such obligations properly.

Financial assistance

The EU's CARDS (Community Assistance for Reconstruction, Development and Stabilisation) programme brings a more strategic approach to assistance to the Stabilisation and Association Process countries. It underpins the objectives and mechanisms of the Stabilisation and Association Process, i.e. the new Stabilisation and Association Agreements, including the preparation for them.

EU assistance to the Western Balkan is adapted as needs and political situation evolve. Initially, the focus was on humanitarian and emergency assistance. Later on, it concentrated on rebuilding infrastructure, and fostering reconciliation and the return of refugees. As each country moves deeper into the Stabilisation and Association Process, assistance focus increasingly on support for developing government institutions and legislation, and approximation with European norms and eventually harmonisation with EU acquis (EU law). Help is directed at reinforcing democracy and the rule of law, human rights, civil society and the media, and the operation of a free market economy. In addition, assistance is offered to help generate sustainable economic recovery, and promote social development and structural reform. The reforms and institution building necessary to implement the obligations in the Stabilisation and Association Agreements. Promoting regional co-operation between the Western Balkan countries as well as between the region and EU member states and candidate countries is a further major objective of CARDS. Country strategies and multi-annual programmes are being drafted accordingly.

Overall EU financial grant assistance to the Western Balkan countries (including CARDS and macro-financial assistance) amounts to over € 5 billion (€ 5.117 billion) for the period 2000-2006.

Autonomous Trade Measures

The Autonomous Trade Measures applied to the whole of the Western Balkan allow duty free access to the EU market for practically all products originating from the region. The Autonomous Trade Measures, together with the relevant provisions of the Stabilisation and Association Agreements, and other trade arrangements, provide a favourable framework for the development of trade between the EU and the region, thus stimulating foreign direct investment in the region and economic development in general.

These trade preferences have proved successful, contributing to the average annual increase of 8% in the Western Balkan’ exports to the EU (2000-2004). In 2005, they were renewed until the end of 2010. An extensive evaluation of the impact of the EU’s trade measures for the Western Balkan countries is annexed to the SAP Report 2004.

The regional dimension

The Stabilisation and Association Process is not simply a bilateral process with each country. The Zagreb Summit placed considerable emphasis on the central need for regional co-operation as part of the EU’s "contract" with the Stabilisation and Association Process countries. Similarly, enhanced regional co-operation is one of the major objectives set down in the Thessaloniki Agenda. The Stabilisation and Association Agreements include a clear commitment to regional co-operation. CARDS has an important regional component. The EU’s policy objectives are principally:

  • to encourage the countries of the region to behave towards each other and work with each other in a manner comparable to the relationships that now exist between EU Member States.
  • the creation of a network of compatible bilateral free trade agreements which means that there are no barriers to goods moving between the countries of the regions themselves nor with the EU and, in effect, neighbouring candidate countries;
  • the gradual re-integration of the Western Balkan region into the infrastructure networks (TENS) of wider Europe (transport, energy, border management);
  • to persuade the authorities in the countries of the region to work together to respond effectively to the common threats to the region’s and the EU’s security which come from organised crime, illegal immigration and other forms of trafficking. In many cases, e.g. on visa policy, a common approach by all the countries will be needed to deal with the threat effectively.

Regional co-operation in the Western Balkan is an essential factor for political stability and economic prosperity and the only way for the counties of the region to successfully address key common challenges (such as energy shortages, pollution, transport infrastructure, cross-border criminal activities etc.)

The Thessaloniki Agenda and beyond

With a view to enhancing the Stabilisation and Association Process, so that it can better meet the new challenges, the EU-Western Balkan Summit of June 2003 endorsed the Thessaloniki Agenda, thereby enriching the Stabilisation and Association Process with elements inspired by the pre-accession process that led to 10 new Member States joining the Union in May 2004.

The enhanced Stabilisation and Association process has proved an effective policy framework from EU action in the Western Balkan. Its implementation in a number of areas needs further work, in the light of recent experience and the challenges ahead. Those areas and the suggested next steps are set out in the Communication from the Commission “The Western Balkan on the road to the EU: consolidating stability and raising prosperity”, approved in January 2006.

As part of the enlargement process, the Stabilisation and Association Process will remain the framework of the EU perspective on the Western Balkan countries, all the way to their future accession.

From Regional Approach to the Stabilisation & Association process

After a period of conflicts in the Western Balkan the EU Regional Approach sought to underpin the implementation of the Dayton/Paris and Erdut agreements and bring basic stability and prosperity to the region. In May 1999 the European Commission set out the rationale for moving to a more ambitious vision for the region’s development. This was based on:

  • a recognition that the main impetus for reform - including the establishment of a dependable rule of law, democratic and stable institutions and a free economy - in these countries is a relationship with the EU that is based on a credible prospect of membership once the relevant conditions have been met. This prospect was offered explicitly at the Feira European Council in June 2000.
  • the need for the countries to establish bilateral relationships between themselves which would allow greater economic and political stability in the region to develop
  • the need for a more flexible approach which, although anchored to a common set of political and economic conditions, allows each country to move ahead at its own pace. Assistance programmes and contractual relations have to be flexible enough to accommodate a range of situations from post-conflict reconstruction and stabilisation to technical help with matters such as the approximation of legislation to the core elements of the EU acquis.

The Zagreb Summit

The 24 November 2000 Zagreb Summit set the seal on the Stabilisation and Association Process by gaining the region’s agreement to a clear set of objectives and conditions. In return for the EU’s offer of a prospect of accession on the basis of the Treaty on European Union (TEU) and the 1993 Copenhagen criteria and an assistance programme to support that ambition, the countries of the region undertook to abide by the EU’s conditionality and use the Stabilisation and Association Process, and in particular the Stabilisation and Association Agreements when signed, as the means to begin to prepare themselves for the demands of the perspective on accession to the EU.