Readout of the college meeting and press conference by Commissioner Olivér Várhelyi on the Enlargement Package 2020 and the Economic and Investment Plan for the Western Balkans

Met dank overgenomen van Europese Commissie (EC) i, gepubliceerd op dinsdag 6 oktober 2020.

Thank you very much.

As you heard, the Commission has now accomplished the renewal of the Enlargement policy of the Commission and the European Union by providing the last missing element, which is the Economic and Investment Plan for the entire Western Balkans region.

When this Commission took office, it was its priority from the first day to increase our engagement with the Western Balkans countries and to engage directly with them, not only when it comes to enlargement, but also on how to speed up the reforms and how to speed up the economic catch up with the region.

This has been even more important because of the COVID-19 crisis. It is a major challenge for the region to recover economically after that. But since it is our neighbourhood, it is also a priority for us to design together the economic recovery with them as much as we can. Not only that, but during the Zagreb Summit earlier this year we had a very clear assignment from the leaders that the European Council wants us to move ahead and provide a meaningful plan for the Western Balkans.

What you see today is a plan that should spur long-term economic recovery, strengthen regional cooperation and speed up the convergence with the European Union. This is a plan of €9 billion composed of 10 flagship initiatives plus other areas of economic investment. This should bring about a major change in the Western Balkans, not only for the economy but also for the people of the Western Balkans, in a very touchable and seeable way in the next coming 4 to 5 years.

We are also establishing a new Western Balkans Guarantee Facility, which should further enhance investment capacity in the region and it should mobilise up to €20 billion in public and private investments. This, all together should bring about at least €28 billion in terms of investment to the region. If I want to translate this, we are talking more or less about 30% of the GDP of the entire region. And if you ask me what is the impact of such a plan, we hope to see at least 3.6% of GDP growth coming out of this plan only.

What are the key areas? We have, first, the sustainable transport system. As you see in any investment climate, the first thing is always having the right infrastructure. If you look at the Western Balkans you will see that the major infrastructure is still missing. We need to link the region with Europe much better, but also we need to link the region within. So, we decided to provide plans to link up all the capitals with road and rail. And these connections should serve to accelerate the economic development through trade, but also through attracting investment into the region. Of course, this transport corridors will have to be done in accordance with our standards and in line with the TEN-T network, but this can boost economic growth immediately.

The second area which I would like to highlight is clean energy. As you know, the region is still largely dependent on the use of coal and lignite. If you look at the winter months, the pollution is becoming a major health hazard in the region. We decided to help the region to phase out coal as quickly as possible to reduce this health hazard, and only by replacing coal with gas as a transitional fuel, which is to be followed by hydrogen, we can decrease their emissions by over 60% immediately. And we can of course do away with the health hazard that I have been talking about.

The third is the green transition. We need to clear the air, we need to help them establish renewable energy sources. We are working with them on hydroelectricity generation projects, but also on photovoltaic and wind. We are also devoting huge attention to waste water management and waste management, which is a major challenge in the region. And one should not forget the biggest potential, which is the reduction of emissions through energy efficiency measures, basically by retrofitting buildings. If you look at the Balkans, you see that 40% of all the emissions are coming from buildings.

The fourth big element of our offer to the Balkans is related to the digital economy. We need to create the right conditions for future strong and resilient economy, and on that digital is key. We need the right skills, which means that we need to invest into the education system, because we have a clear skill mismatch in the region. But we also have to invest into the basic infrastructure, which is the availability of broadband internet connections in the region. Again, this is something that we would like to promote.

And finally, of course we are ready and eager to invest in the human capital, be it education or be it the social area. We are ready to engage with our Western Balkans partners and in that I would like to remind you all that we have a social challenge related to the Roma population of this region, who should also be made part of the economy and of the society. So far attempts have been made unsuccessfully to integrate them fully into the labour market, but we will help now our partners to make that a reality, so that we can increase the workforce available in the region.

The whole plan is based on a regional approach. Regional approach meaning regional participation, regional impact and regional contribution. Everything that you see in our flagships will be defined on a regional scale and on a regional basis and this should bring together the region. If I look at the figures, I see that only from intensifying the economic cooperation within the region we can boost the economy by 7% of their GDP.

Of course this plan goes hand in hand with the implementation of the reforms, because without the reforms it is impossible to create the right business environment for European companies now considering cutting shorter their value chains. This means that they need a proper functioning rule of law system, independent judiciary and a reliable tax system that will make it interesting for them to come and invest in the region.

We also adopted today the Enlargement Package. I think you have seen the assessments we gave. I do not want to dwell on this too long. We are hopeful that these reports will be well received and I am happy to answer any questions on those.

Link to the video:

For More Information on the Economic and Investment Plan for the Western Balkans

Commission's Communication on an Economic and Investment Plan for the Western Balkans

Press release: Western Balkans: An Economic and Investment Plan to support the economic recovery and convergence

Questions and Answers: the Economic and Investment Plan for the Western Balkans

Factsheet on Economic and Investment plan

For More Information on the Enlargement Package

Commission's Communication on the EU enlargement Policy

Press release including individual partners reports and factographs: Commission assesses and sets out reform priorities for the countries aiming to join the EU

Factsheet - The EU accession process of the Western Balkans

Factsheet - EU Engagement in the Western Balkans