French President Emmanuel Macron’s veto of the start of EU accession talks with Albania and North Macedonia at the EU Summit has caused massive disappointment with the European Union among the Western Balkan states as it eroded Brussels’ credibility and opened the region to unwanted outside influence from Russia, Turkey, and China, analysts and MEPs claim.

  The US State Department’s  Special Envoy to the Western Balkans, Deputy Assistant Secretary Matthew Palmer, said the decision sent a very bad message to Serbia and Kosovo that no matter how much you sacrifice and compromise to reach an agreement, it does not automatically open doors to EU integration.

For the Americans, this carrot – EU membership – is now more important than ever since it has again engaged in resolving the more than two decade-long impasse between Belgrade and Pristina. But this is a carrot that, up to a point, Washington does not control.  US President Donald J. Trump has dispatched his trusted friend Richard Grenell as his Special Envoy for the Belgrade-Pristina talks with the goal of reaching an agreement between the historic foes by offering a massive investment package and EU membership as the ultimate prize.

Palmer said the US and EU share the same goals regarding the Kosovo issue, but certain EU countries are sending a contradictory messages and which explains why the European Council’s decision not to open accession talks with Albania and North Macedonia is so discouraging.

  “This will not scupper the (Belgrade-Pristina) talks, but it will certainly disrupt the desired timeline” a Western diplomat said following the French veto. Washington has vowed to press ahead with its efforts to stabilise the Western Balkans and there has been some talk on the Hill that another Special Envoy could be sent to resolve the stalled political situation in Bosnia and Herzegovina.

Serbian President Aleksandar Vucic (C) with North Macedonian Prime Minister Zoran Zaev (R) and Edi Rama (L), the prime minister of Albania.

Macron has explained that there cannot be any EU Enlargement without prior consolidation and reform in light of Brexit and other deep institutional problems that currently plague the 28-member bloc and that he will table his own proposals for a way ahead in January 2020.

North Macedonia’s Prime Minister Zoran Zaev called  snap elections for next April. Despite its assured fast-track into NATO, possibly by the end of this year, few analysts doubt that the land-locked country’s nationalists, allegedly backed by Russian President Vladimir Putin during the last election cycle, will not put up a strong challenge.

The Serbian government shrugged off the European Council’s decision and said it will pursue its EU membership course no matter what. “We will continue, undaunted, with our reforms,” a cabinet minister said.

The Analytic Center of the European Parliament fears that Serbia is frustrated with the slow pace of negotiations with Brussels and that this might open the doors to further political and economic influence from Russia and China, which would bring doubts about Belgrade’s commitment to its European trajectory.

Brussels has already expressed its disapproval of the trade agreement that Serbia plans to sign with the Kremlin-led Eurasian Economic Union. The EU noted that any such agreement must be dissolved upon entry into the EU. The Serbian government has repeatedly said it will bring its foreign policy into line with that of the EU the moment its bound as a member.

Rasim Ljajic, a Serbian cabinet minister, downplayed the fears of the deal with the Eurasian Economic Union, saying Belgrade already has a similar deal with Turkey and with Russia.

Pundits agree that the latest pact is mere posturing on the part of the Serbian government, with one pundit saying, “There is no reason for the EU to doubt Serbia’s commitment  – Europe is by far our biggest trade partner. It seems its coming to the point with Brexit and all that Serbia needs to worry more about EU’s commitment to itself…This is a pacifier for Putin, nothing more.”

Economic experts note that the current trade volume between Serbia and Russia of $1 billion is less than with neighboring Bosnia and Herzegovina, which totals some $1.3 billion. 

Is a mini-Schengen in the Balkans just a halfway house?

The latest decision by the European Commission, however, highlighted a recent agreement signed by Serbian President Aleksandar Vucic and North Macedonia’s Zaev and his counterpart in Albania, Prime Minister Edi Rama, to form a mini Schengen zone known as the CEFTA+, or (Central European Free Trade Agreement, between the three countries that would allow for the free flow of people, goods, capital, and services. The declaration was signed in Serbia’s second city, Novi Sad, and calls on other countries in the region to join the initiative which would create a common market for 12 million people.

“Previously, some of Serbia’s neighbours were not interested because they expected more from the EU. Now they see that we must rely more on each other, but naturally staying on the road to the EU,” Vucic said. “We cannot rely on scraps from anyone.”

As a first step, the leaders envisage the lifting of customs and border barriers to free movement by no later than 2021. The World Bank has estimated that trucks lose 26 million hours each year waiting to cross the borders and Washington has long pushed the countries in the region to remove trade barriers, including providing technical assistance.

The initiative was welcomed by many in Europe, and in the rest of the Balkans, especially by businessmen.

“Some 20 million companies, members of the Eurochambres, already see the Western Balkans business community as an integral part of the European economy” Marko Cadez, President of the Serbian Chamber of Commerce said. “They want the Western Balkan economies to formally join as soon as possible”.

Professor George Pagoulatos, Vice-President of the Board of Directors of the Hellenic Foundation for European and Foreign Policy also welcomed the agreement. “Opening up borders between countries for the free movement of trade, capital, and people not only promotes economic growth, it also helps economies become mutually interdependent in a positive way. Economies that trade with each other are inclined to appreciate the benefits of peaceful cooperation rather than reliving ethnic nationalistic animosities of the past. So where borders have divided, free trade flows can unite. In addition, cross-border “internal” mobility in the Western Balkans can help improve state capacities in better protecting “external” borders. All of the above are facilitators (rather than substitutes) of the Western Balkans accession path to the European Union.” 

However, the Kosovo-born Albanian Foreign Minister Gent Cakaj said that unless Pristina is involved in the mini-Schengen, Albania will withdraw. The paradox of this ultimatum is that Pristina already imposed 100% duties on goods from Serbia in violation of the existing CEFTA and remained deaf to all calls from the EU and US to lift the illegal tariffs, which begs the question “who is in charge in Tirana?”