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Serbia remains `on track´ in quest for EU membership

A key figure in Serbia´s efforts to reform its economy has pledged to implement the “tough” measures deemed necessary for eventual EU membership.  Speaking at a high level event in Brussels, Zeljko Sertic,Serbia´s Economy Minister, pledged that Belgrade would “not compromise” on the “tough” series of policies it is putting in place.

He told the event, “The reforms are vitally important and I can tell you there will be no compromise on this.”

Sertic was speaking in a debate in the European Parliament on Wednesday on Serbia´s EU accession. The lively debate was particularly timely as it comes as Serbia prepares for the opening of its first negotiating chapters.

It also comes on the eve of a meeting next week of Parliament’s EU-Serbia Stabilisation and Association Parliamentary Committee (SAPC).

It featured a number of high profile, senior speakers, including Dusko Lopandic, head of the Serbian mission to the EU, and Prof Tanja Miscevic, who is head of the negotiating team for Serbia´s EU accession.

Each spoke on the challenges and opportunities facing Serbia as it moves ever closer towards EU membership.

The discussion was hosted by Slovakian MEP Eduard Kukan, who chairs Parliament’s EU-SerbiaStabilisation and Association Parliamentary Committee (SAPC) and is a former UN special envoy to the Balkans.

The conference addressed topics such as regional security and relations, anti-corruption initiatives, investment/foreign direct investment and improving the country’s business climate, and a variety of social and human rights issues.

Serbia is one of seven countries are currently waiting to become part of the EU. The others are Macedonia, Albania, Turkey, Montenegro, Iceland, and Kosovo.

Leaders of Serbia, a nation of 7.2 million, began talks in January on accession to the 28-member bloc, in which it agreed to gradually bring its policies into line with EU norms. Memberships are not expected until 2020.

A recent report by the European Commission’s shows that the country is more than on track to become part of the EU and that  implementing tough reforms are paying off.

Outlining recent economic developments in Serbia, Sertic, who is a former chair of the country´s Chamber of Commerce, pledged that the government led by Aleksandar Vucic would stick to the policies and reforms designed to strengthen the Serbian economy.

Measures include a new “flexible” labour law, a “one stop shop” for formerly hard-to-get administration permits and a revised bankruptcy code and “generous” tax exemptions for businesses hiring new workers.

Another recently introduced measure is a fund worth €1.2bn of subsidised loans for SMEs, of which €460bn had been loaned in recent months.

Data shows that Serbia’s economy grew 2.5% in 2013 as exports rose and The Economist Intelligence Unit forecasts an average annual economic growth of 3.6% in 2014 to 2018. But Serbia still has a bloated budget deficit and poor domestic demand is holding back further growth.

Sertic, though, pointed out that over the last year, the country had “radically” overhauled its economy by cracking down on corruption, tax evasion, the imbalance of the private sector, as well as cutting down public sector salaries and pensions.

Tackling the budget deficit was the “first priority”, said Sertic, pointing out that the “complex” measures in order to achieve this had included cutting public sector pay and state aid.

The EU is Serbia´s biggest trading partner and figures show that over the last two years, the EU accounted for more than 61 per cent of Serbia´s exports and imports. This compares with 7.3 per cent (exports) and 9.2 per cent (imports) with Russia.

On aim, said Sertic, was to ensure that trade between the two sides continues to grow.

But he said that improving the country´s business climate and stimulating foreign investment would need “political will” and the participation of “all relevant actors.”

He also said that the fight against corruption, another area of concern regarding Serbia´s accession credentials, had been “at the heart” of Serbia´s reform process and includes the National Anti-Corruption strategy which is designed to dictate the conduct of public officials.

In response to a question from Slovenian EPP deputy Franc Bogovic on how Serbia will convince its citizens on the need for the sometimes painful reforms, Sertic cited a recent opinion poll showing that some 64 per cent of the public supporting the government changes as well as closer EU integration.

“These reforms are vitally important and we will not compromise on them. The ambition is to change the industrial picture of Serbia,” he said.

In her presentation, Miscevic accepted that Serbia faces “tough challenges” before it is ready for EU membership.

But the official, a former head of Serbia´s European Integration Office, also promised that Serbia would be a “good student” in meeting the strict conditions for EU accession.

She said, “Not only will Serbia be the best student in school but I want us to be an  `over achiever´ in meeting the membership criteria.”

Reforms which need to be implemented presented a “demanding” challenge for Serbia and its people but that there was a “great preparedness” for this, she said.

While overhauling its economy was the biggest challenge, she said there are other key issues, such as the rule of law, including the judiciary, police and public administration.

Aligning Serbian legislation in these and other areas with the EU´s acquis communautaire was necessary not only for eventual EU membership but also for the “development” of Serbia itself, she told the packed audience.

“The reform process started back in 2004 and is designed to build a strong Serbia,” she declared.

Further contribution came from Kukan, a centre right MEP who has twice served as foreign minister of Slovakia.

He said, “Serbian people have confirmed their support for a pro-European course for the country. Thus, in facing this new reality, we have a responsibility to deliver. We have a same goal and I hope we also share the same determination to fulfil the promise.”

Kukan, a former Permanent Representative to the UN and an MEP since 2009,said the launch of Serbia´s accession negotiations had marked a “turning point” in the EU´s relations with the Balkan state.

“At the same time this is the road where Serbia will have to deal with new responsibilities. Starting the negotiating process needs vast preparations, commitment to reforms and delivering.”

He went on, “Therefore, we expect that Serbia will continue delivering on its reform priorities such as the rule of law and economic governance.”

With an eye on relations with Kosovo, Kukan cautioned, “It will be equally important  (for Serbia) to continue its commitment to regional cooperation and normalisation of relations with Kosovo.”

He said, “Once Serbia has chosen to proceed on its European path it will have to also align with our policies and values in external relations.”

His comments were largely echoed by Lopandic, Serbia´s experienced ambassador to the EU, who told the 90-minute conference that his country “shares the same values and objectives” as the EU and the large turnout at the conference “shows the constant interest in Serbia and the EU enlargement process.”

Stating that Serbia’s passage towards EU membership was on track, he said, “My fervent hope is that we will eventually become a fully-fledged EU member.”

By Martin Banks