Representatives of 47 countries and 36 international institutions met yesterday and today in Brussels, on the occasion of the Regional Funding Conference for South Eastern Europe. The Conference was organized by the European Commission and the World Bank, in close association with the Special Coordinator of the Stability Pact, to support the goals of the Stability Pact and to promote reform and cooperation in the region.

The first day of the conference was held at ministerial level, and was co-chaired by Mr. Christopher Patten, European Commissioner for External Relations, and by Mr. James Wolfensohn, President of the World Bank. The Stability Pact was represented by the Special Coordinator Mr. Bodo Hombach. Mr. Javier Solana, Secretary General of the European Union Council and High Representative for the Common Foreign and Security Policy, also participated. Mr. Seixas da Costa, Minister of State for European Affairs of Portugal represented the European Union Presidency, and Mr. Elmar Brok, Chairman of the Committee on Foreign Affairs addressed the Conference on behalf of Ms. Fontaine, President of the European Parliament. Representatives of the beneficiary countries included Mr. Paskai Milo, Minister of Foreign Affairs of Albania; Mr. Jadranko Prlic, Minister of Foreign Affairs of Bosnia and Herzegovina; Mr. Muravey Radev, Minister of Finance of Bulgaria; Mr. Tonino Picula, Minister of Foreign Affairs of Croatia; Mr. Alexandar Dimitrov, Minister of Foreign Affairs of the Former Yugoslav Republic of Macedonia; and Mr. Eugen Dijmarescu, State Secretary for Foreign Affairs of Romania. Mr. Branko Lukovac, Minister of Foreign Affairs of Montenegro, and Mr. Bernard Kouchner, Special Representative of the Secretary General of the United Nations in Kosovo, were also in attendance. The second day was at technical level, and was co-chaired by Ms. Catherine Day, Deputy Director General for External Relations in the European Commission, and Mr. Johannes Linn, Vice President for Europe and Central Asia in the World Bank.

The Conference reaffirmed the commitment of the countries of the region and the partners of the Stability Pact to work together for peace, stability and prosperity in South Eastern Europe. It was noted that progress in this direction has already been made, but that achieving success will require a long-term commitment, on the part of the countries of the region, to reform and cooperation and, on the part of the international community, to establish a clear path for integration in European and global structures, and to provide financial and technical assistance in support of reforms.

The Conference discussed a comprehensive quick start package of regional projects and initiatives developed within the framework of the Stability Pact, and additional to country-specific donor programs. These regional projects and initiatives – whose implementation will start during the next twelve months – aim at developing infrastructure, promoting private sector development, supporting policy and institutional reforms, encouraging democratization, reconciliation and security, and supporting the return of refugees and internally displaced persons. Donors and financial institutions pledged or committed more than EURO 2.4 billion, thereby fully financing the quick start package of EURO 1.8 billion presented to the Conference, as well as providing financing to accelerate the preparation and implementation of projects and initiatives in the near term package (i.e. that can be implemented over the next two to three years).

Mr. Patten, in his opening remarks, stressed the importance for the people of South Eastern Europe to learn again to live together in peace, as the people of Western Europe had done fifty years ago. He also reiterated the commitment of the European Union to integrate the countries of South Eastern Europe into the European mainstream through the European Union’s Stabilization and Association process. Mr. Patten noted that the commitment of the European Union to support South Eastern Europe was directly linked to their commitment to implement reform.

Mr. Wolfensohn emphasized the need for rapid action – both on reform and on implementation of regional projects and initiatives – to make a visible difference in the lives of the people of South Eastern Europe. He noted also that – as stressed in the Regional Strategy Paper prepared by the World Bank – progress toward trade liberalization and private sector development, improving governance and fighting corruption, and strengthening social cohesion will be necessary together with the development of infrastructure. Mr. Wolfensohn also stressed that the countries of the region cannot overcome alone the great challenges they face, and that strong international partnership was necessary to support their endeavors.

Mr. Hombach stressed that the Stability Pact is a partnership for long-term development, and that the quick start package of regional projects and initiatives presented to the Conference was a first step toward this objective. He stressed that the preparation of the regional projects and initiatives had already led to increased cooperation among the countries of South Eastern Europe, and that their implementation would further this objective.

The representatives of the countries of South Eastern Europe reported on progress with their reforms since the Sarajevo summit, and reaffirmed specific commitments to consolidate the rule of law, fight corruption, create the enabling environment for private sector development, reduce trade barriers, and promote democracy, human rights, and free media.

Many participants echoed these views, emphasizing again that the Stability Pact is a long-term partnership for peace and prosperity, which requires that both the countries of South Eastern Europe and their partners live up to their commitments. Numerous speakers underlined that the development of infrastructure and a vibrant private sector must be accompanied by the consolidation of democratic institutions, the firm establishment of the rule of law, and the strengthening of social cohesion. Many participants also stressed the importance to overcome the underlying causes of tension and consolidate stability, by addressing the issues of war-displaced persons, minorities, and unemployed in the region. The need for the Stability Pact to monitor progress and report on achievements was also emphasized.

The importance of rapid implementation of the many projects and initiatives prepared within the framework of the Stability Pact was stressed by many participants. In particular, the adoption of the Investment Compact and the Anti-Corruption Initiative was welcomed, and the adoption of the Media Charter by the countries of South Eastern Europe was encouraged by participants. The Conference welcomed the work done by the European Investment Bank and the European Bank for Reconstruction and Development to prepare the quick start packages of regional infrastructure and private sector development projects respectively. They noted that their implementation will produce important benefits beyond national borders, and will be an important contribution toward integration – in transport, energy, telecommunication – among the countries of the region and with Europe.

The Conference expressed particular appreciation for the regional approach taken toward the special challenges of South Eastern Europe, which are regional in nature and need to be addressed in a concerted fashion.

Speakers also emphasized the importance of liberalization and facilitation of trade between the countries of South Eastern Europe and with the European Union. Participants indicated that deepening of international trade should replace over time reliance on foreign aid, and welcomed the intention of the European Commission to develop specific proposals for trade liberalization vis-ŕ-vis South Eastern Europe in the near future. The Conference also welcomed the work initiated by the Working Group of Regional Trade Cooperation established under Stability Pact Working Table II.

Participants noted the importance of consolidating stability in Kosovo and supporting the development of Montenegro, and welcomed their inclusion in the quick start packages. Participants also expressed the hope that conditions will soon be fulfilled allowing Serbia to participate in the regional development process and to receive the full support of the donor community.

Recognizing that the achievement of peace, stability and prosperity in South Eastern Europe requires a long-term partnership, participants discussed the need for effective follow up to the Conference. It was agreed that progress in the implementation of regional projects and initiatives will be monitored, and that additional projects and initiatives with strong regional benefits will be developed, within the framework of the Stability Pact, through its Working Tables in cooperation with the international financial institutions and the European Commission, and with the continued involvement of the High Level Steering Group in view of its role in donor coordination.