Serbia, EU sign 1 billion-euro aid agreement

30/11/2007

Under an agreement signed on Thursday, Serbia will receive 1 billion euros in non-refundable pre-accession assistance from the EU over the next five years.

(Blic - 30/11/07; Reuters, Beta, B92, BIRN, Serbian Government - 29/11/07)

Serbian Deputy Prime Minister Bozidar Djelic (centre, with Serbian President Boris Tadic (left) and EU Enlargement Commissioner Olli Rehn) initialed the Stabilisation and Association Agreement in Brussels on November 7th. [Getty Images]

Serbia will receive non-refundable EU assistance worth 1 billion euros during the next five years, under an agreement signed in Belgrade on Thursday (November 29th).

The funds, which will be made available in the framework of the 27-nation bloc's Instrument for Pre-Accession Assistance (IPA), will underpin Serbia's reform efforts on its European integration path.

Deputy Prime Minister Bozidar Djelic and European Commission (EC) Director for the Western Balkans Pierre Mirel signed it less than a month after Serbia initialed a Stabilisation and Association Agreement (SAA) with the EU.

"We are going towards Europe because it is our goal, but also because it's the way to improve our system and the lives of our citizens," Djelic said after the ceremony, stressing that the assistance envisioned in the agreement is the most his country has ever received.

The bulk of the money, he explained, will support measures aimed at boosting Serbia's social and economic development. The rest will be used for institution building, public administration, judiciary and police reforms, as well as for regional co-operation initiatives.

The amount is "not negligible", the Balkan Investigative Reporting Network (BIRN) quoted Mirel as telling reporters. He noted that Serbia "will not have to pay it back".

"It is an indication the EU wants to see Serbia as its member, that we are helping it and we will be helping it in the years to come," he said. Thursday's agreement, he added, was the third step Serbia has taken towards building closer ties with the EU since the initialling of the SAA on November 7th and the signing of an agreement on visa relaxations.

Belgrade hopes to have the SAA signed early next year and thus complete its first major step towards eventual membership in the bloc.

But the EU has made clear this is unlikely to happen before Belgrade has arrested former Bosnian Serb military commander Ratko Mladic, one of the remaining four indictees still sought by the UN war crimes tribunal in The Hague.

"Full co-operation with the International Criminal Tribunal for the Former Yugoslavia remains a necessary condition for the signature of this SAA," EU Enlargement Commissioner Olli Rehn said on November 7th.

Speaking after the signing of the aid agreement at the Third National Conference on Poverty Reduction in Belgrade on Thursday, Djelic stressed that the assistance was not politically conditioned, nor was it linked to Kosovo's future status.

The IPA covers EU candidates Croatia, Macedonia and Turkey and potential candidates Albania, Bosnia and Herzegovina, Montenegro and Serbia, including Kosovo. The pre-accession aid the Union has set aside for all those countries for the period 2007-2013 totals about 11.5 billion euros.

During the past seven years, following the ouster of Slobodan Milosevic's regime in October 2000, Serbia has received more than 5 billion euros in aid and preferential credits from EU member nations, some of which has been used for social sector programmes and reforms.

Poverty and unemployment are among the main social challenges Serbia faces today. Close to half a million Serbs are still living below the absolute poverty line, while the unemployment rate is among the highest in Europe, at 21.6%, Djelic said on Thursday.