A window of opportunity

13 Jan 2015

These are the final days of an eventful year. The temptation to sum up and to look ahead is difficult to resist. But I will leave that to the professional reviewers and to the political clairvoyants. Still, on the threshold of a new year, a few personal observations, mainly on the EU’s renewed approach towards Bosnia:

A window of opportunity?

In 2014 many in the international community finally woke up to the fact that ‘strategic patience’ and the belief in a sense of responsibility of the political elite of this country have proved to be both risky and erroneous. Now, almost everybody agrees that a small window of opportunity has opened up, thanks to a by now well-known combination of events. That is why the initiative by London and Berlin, adopted by the EU during of the Foreign Affairs Council (FAC) of 15 December, is so well-timed. The file ‘What To Do With Bosnia-Herzegovina?’ is back on the list of political priorities – for a while, I hasten to add. A step in the right direction can now be made.

Everybody likes to believe it will succeed this time. But, for me, the proposal raises serious questions: some consequences of the offer seem not well thought-out. Many crucial elements, like conditions, deadlines and the details of monitoring the progress, remain vague, also in the recent FAC conclusions. Moreover, I think that, once again, the EU is relying too much on the bona fides of Bosnia’s political leaders. Obviously, this is not an offer that comes without engagement. The resistance of the Bosnian political establishment against this fourth (!) reform initiative in a row by the international community should not be underestimated. That is why the EU can’t afford to be naive or gullible for the fourth time.

But in spite of these question marks, it makes good sense to pursue this initiative constructively. Like I said, the timing is perfect and Bosnia should make good use of this ‘Winter of Opportunity’. This might well be Bosnia’s last chance in a long time.

Is it different this time?

An important question has not been sufficiently answered: why should it be different this time? Are there motives, incentives and circumstances that will make the same political leaders, who are responsible for eight years of stagnation, fulfill their ‘‘long-term, irrevocable written commitments”? Again: this is the fourth effort of the international community to dislodge the logjam of empty promises and half-hearted reforms after the April Package (2006), the Butmir Process (2009) and the Road Map of June 2012.

For sure, the political and societal landscape has changed, in particular by the after-effect of the protests and the floods. Politicians readily agree to that. But several of them have an acknowledged personal interest in maintaining the current, very costly status-quo. For them a “Sanader Scenario” is not totally fictitious. Also, they have a dubious track record when it comes to the keeping of promises. One example: two years ago, the leader of the SDA has, together with HDZ strong man Covic, signed up to the EU Road Map. As you will recall, not a single condition from that to-do list has been fulfilled.

Many observers expect the SDA and HDZ to dominate the new Council of Ministers. The HDZ demands related to the ‘Croat question’ are still on the table. Consequently, the long-term chances for the implementation of the Sejdic-Finci verdict and the establishment of an EU coordinating mechanism remain uncertain. The reform-minded parties, like DF, SBB, HDZ 1990 and parts of the SDP, seem divided and are no match for these two parties very adept at playing the games of power. In the Republika Srpska, meanwhile, Milorad Dodik has been re-elected, be it less convincingly than last time. Still, as RS president, he is able to block efforts to reform; certainly, if he acts in tandem with his good friend Covic.

Also true: in addition to a change in the political environment, there is a new element in the dynamics – the fear of the political establishment for a second ‘7^th of February’. It remains imperative, however, to mobilize the citizens of Bosnia for this EU initiative, in order to create positive pressure from the bottom up. If not, this project will be rejected as ‘imposed from above by outsiders’. Already, public opinion reacts with the usual cynicism: 72% gives the initiative no chance to succeed, because they think the political will is – again – just not there.

So, is it different this time? Frankly, the lack of an answer to that question surprises and worries me: we all know that in the political culture of this country there is no place for gullibility where the redeeming of promises is at stake. Yet, the aspect of supervising and enforcing these ‘irrevocable commitments’ remains sketchy.

Conditionality

Because the basic assumptions and the environmental factors are not favorable, for this new approach to succeed extra strict monitoring of progress and strict conditionality are essential. That applies also to existing obligations, like launching a coordination mechanism and implementing the Sejdic-Finci and Zornic judgments. Experience shows that only financial conditionality makes an impression – in particular, withholding payments from the IMF Standby Arrangement.

That is why, now more than ever, full cooperation and coordination between the EU and the international financial institutions (IFIs) is the conditio sine qua non. For me, the key phrase in all the deliberations on the renewed approach during the last FAC meeting was Commissioner Hahn’s statement that: “the recent Anglo-German proposal for a readjusted conditionality for Bosnia-Herzegovina should bring about the strengthening of the relation between the financial assistance and concrete reforms in BiH. Those processes should be mutually tightly conditioned.”

As a ‘common and identical recipe’, it should be made clear by the EU member states, but also by the US, Norway, Japan, Switzerland and the IFIs, that noncompliance with these irrevocable commitments will lead to irrevocable financial consequences.

If that lever of financial conditionality, rigidly coordinated and applied by the EU and by the IFI’s involved, is not explicitly mentioned in the preconditions of the ‘written commitments’, than this initiative too will founder on the aversion of Bosnia’s political leaders to act against their own personal interests. The only conclusion can be that a stepped-up and nonstop commitment of the international community is inevitable. However, this implies a degree of direct and consistent involvement that went out of fashion years ago. And I am wondering if we are ready to go back to that hands-on attitude. But this time, at least, the international community, and in particular the EU, should have – in the words of a high-ranking US diplomat – ‘a true commitment to have a successful end to a meaningful process’.

Readjusted sequencing

The main feature of the new approach is ‘readjusted sequencing’: postponing the implementation of the S-F verdict as a temporarily ‘intractable issue’ to a later phase in the accession negotiations. This, to allow supposedly less stubborn ‘bread and butter issues’ to be solved first. But maybe as relevant and valid is the consideration that it is just not done to give this democratic abomination a new lease on life. Mind you: the implementing of the Sejdic-Finci ruling was the dominant condition of the 2012 Road Map.

One could argue that on pragmatic, practical or tactical grounds yet another lifting of the bar could be overlooked. And, according to the FAC conclusions, this is already fait accompli. After all, BiH officially meets the Copenhagen Political Criteria, but several hundreds of thousand citizens – the Others and Bosnians of Jewish and Roma descent – are not supposed to have access to the House of Peoples or to the Presidency, we have declared the elections of October legitimate and BiH is allowed to chair the Council of Europe for part of 2015. Implementing the EU Initiative will stretch European values and principles to the limit. I sincerely hope it is worth it.

‘Low hanging fruit?’

In their letter of 4 November, ministers Steinmeier and Hammond urge political parties to put “first and foremost” the points from the ‘EU Compact for Growth’ on their agenda for reform, now that they don’t have to worry about the intractable problem of ‘Sejdic-Finci’ for a while. However, one should be warned that these reforms from the Compact are anything but ‘low hanging fruit’. Everybody knows that the easy reforms have been realized. What is left will hit the Bosnian citizens directly and it will hit them hard. For example: reducing the public sector implies dismissal of many, among them the clients of the political parties. A reform of the social system will mean that veterans will see their benefits reduced. Improved tax collection, downsizing the exorbitant redundancy payments, these are not the measures a politician likes to take, especially not a Bosnian politician, who needs to keep his grassroots support happy with patronage and clientelism.

So, implementation of these most painful, and, therefore politically sensitive, reforms may prove to be more “intractable” than implementing the Sejdic-Finci ruling. Another reason to exert pressure through strict financial leverage. HDZ, SDA et al. will not do it of their own accord.

Activating the Stabilization and Association Agreement: what does it really mean?

Finally, a word or two on the Stabilization and Association Agreement (SAA): as a reward for the politicians’ signatures under the ‘written commitments’ and the promise to adopt a reform oriented agenda, the EU will activate the SAA. To be clear: this is an important step for BiH in the accession process. Six years after the signing of the Agreement, the country will finally move up a notch – from potential to full candidate member state.

Further liberalization and alignment with EU guidelines and practices under the SAA will lead to a safer and more stable business and investment climate. This will obviously help meeting the challenges set out in the ‘Compact for Growth’. That may be true, but the implementation of the much simpler Interim Agreement of July 2008 has already proven to be problematic: Bosnia’s inability to interact productively with the Brussels bureaucracy was at times painful to watch. Still, parties managed to tackle some trade and trade related issues successfully. I am afraid that, SAA or no SAA, finding a solution to more complicated questions, like the export of dairy products, seems to be a cut above Bosnia’s’ current capabilities. More in general, there are no guarantees that, when the SAA is in force, the powers that be are indeed able and willing to overcome the obstacles in the field of the Rule of Law and to set up a functioning market economy, as the new EU Initiative demands.

Under the SAA BiH can count on very substantial economic, technical and financial assistance from Brussels. However, formally (see Art. 2 of the SAA) that support depends on further progress in meeting the Copenhagen Political Criteria and specific reform priorities, as set out by the Council seven years ago in the European Partnership Document for BiH. But wasn’t it a political issue – i.c. the non-implementation of the S-F verdict – that stood in the way of activating the SAA? So, this major concession involving the SAA does not score very high on my consistency scale. Come to think of it: how much of a ‘carrot’ for Bosnia is this major concession by the EU, activating the Agreement, really? I have the feeling that many a clever politician is asking himself or herself this very same question.

Conclusion: coherence, consistency and coordination – and a sense of urgency

The renewed EU approach is a potentially promising, well-timed initiative. Provided it improves in coherence, consistency and in coordination among the key players, this EU initiative may be the only chance in a long time to rescue BiH from the quagmire of unremitting stagnation. But, its flaws need to be addressed quickly in order to make full use of the current positive momentum. Yet, on 10 December we heard from two members of the Presidency that the end of February is the moment the written commitment is confirmed and approved by other political leaders and by parliament. And this sounded very much like a best-case-scenario. That means that – almost imperceptibly – three months of this ‘Winter of Opportunity’ are lost in finding a way out of the political, economic and administrative deadlock that is holding Bosnia and its citizens back, while the neighboring countries move on.

Why not have a true commitment to have a successful end to a meaningful process? For all involved, that should be both a wish and a good intention for 2015.

• 13 Jan 2015, 8:00
• Posted in Democracy, Development
• No comments yet