Razočaravajući bilans Njemačko-britanske inicijative za BiH dvije godine nakon njenog početka

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Dosadašnja implementacija reformske agende je pokazala da su vodeći međunarodni akteri u BiH itekako u stanju da zemlju natjeraju da započnu sa održivim reformama. To je prvenstveno dokazao MMF koji je zauzeo striktan stav uslovljavanja. To što je EU inicijativa do sada postigla samo mali broj rezultata nije zbog toga što u BiH politika uslovljavanje nije ili ne može funkcionisati, kako to redovno tvrde zvaničnici EU, nego zato što fali političke volje za konzekventnim i striktnim korištenjem mehanizma uslovljavanja. Ovdje možete pročitati sažetak, kao i kompletnu studiju o Reformskoj agendi, koju je politički analitičar Bodo Weber izradio za hbs (na engleskom jeziku).

Substantial change on the horizon?

A Reform Agenda/ New EU Bosnia-Herzegovina Initiative Monitoring Report

Executive Summary

On September 20 this year, the European Union’s General Affairs Council (GAC) decided to forward Bosnia-Herzegovina’s membership application, handed in beginning of the year, to the European Commission in order to prepare an Opinion. The decision that was hailed both in Brussels and in BiH as the country’s most important progress on its EU-integration path so far, formally presented the third and last step in the EU’s new Bosnia initiative that had been launched end of 2014. The initiative had basically been a joint German-UK initiative presented in November 2014, and inherited by the Union the subsequent month as its new, official policy approach to BiH. 

The new EU-initiative was based on a few core elements: First, the EU would exclude ethno-politically sensitive issues like constitutional reforms from its menu of reform conditions at the current stage of BiH’s EU integration policy by postponing existing key conditions (first and foremost: implementation of the so-called Sejdic-Finci ruling), focusing itself instead on structural socio-economic reforms; second, a policy of strong conditionality would be built on adding the instrument of financial conditionality based on establishing close cooperation with the International Financial Institutions (IFIs - IMF, Worldbank); and third, by linking its policy focused on socio-economic issues to BH citizens’ needs and interests – a reference to the February 2014 social protests – the EU would be able to make use of bottom-up pressure on political elites to give in on serious reforms instead of continuing the simulation of readiness for reforms and support for the country’s EU integration path.

Viewed from the outside, the EU initiative seems to have been a full success: In January-February 2015 a written commitment to comprehensive reforms was agreed by the BH Presidency, signed by the leaders of all parliamentary parties and endorsed by the Parliamentary Assembly of BiH. With the EU entering the long-blocked Stabilisation and Association Agreement (SAA) with Bosnia-Herzegovina into force on June 1, the first step in the initiative was completed. Over the summer the governments on state and entity level agreed with the EU on the so-called Reform Agenda 2015-18, a broad plan for structural economic reforms. Starting to implement the Agenda, in July and December the parliaments of the two entities passed new labor legislation in order to liberalize the labor market, a reform long demanded by the IFIs. On February 15 this year then President of the Presidency of BH, Dragan Covic, in Brussels handed over the country’s application for EU membership – the second step in the initiative. After months of discord over the remaining conditions for the third step, political leaders over the summer this year passed all of these reforms – they agreed with the EU on the adaptation of BiH’s SAA Interim Trade Agreement and compromised over the so-called coordination mechanism. In addition, another “inofficial” condition was met – publication of the results of the 2013 census. Finally, with the EU and the IFIs establishing closest cooperation ever, the IMF beginning of September approved a new credit arrangement with Bosnia-Herzegovina aimed at supporting the structural reforms planned under the Reform Agenda.

However, if these developments are placed under closer scrutiny, caution needs to be taken vis-á-vis the official success story narrative:

Concerning the Reform agenda, implementation seems to be well underway in all segments confirming EU declarations of an unprecedented reform momentum. However, taken the current early stage of implementation, reforms have not yet reached the foundations of the patronage systems that form the power base of the ruling parties in postwar BiH and the core of their reform resistance. Reform of the Labor law in the Federation of BiH was hailed as ending the privileged position of employees in the public sector, first and foremost in public administration; but the law only created the preconditions for such a reform, and the government has yet to demonstrate the will to end this key distortion of the labor market traditionally based on public employment by party affiliation. In the RS, the government did not even make any announcement of its will to end the privileged position of public employees in the context of the adoption of the new RS Labor law. In all other segments of the Reform agenda, planned profound structural reforms – improvement of the business environment, reform of the banking sector, restructuring and consolidation of public enterprises, reform of pension systems, veteran benefits and the health care system, and finally public administration reform incl. drastic cuts in the public wage bill – are still in an early, preparatory phase. Oddly, while in the Federation the Reform Agenda dominates the political and public discourse, the EU is tolerating that the RS government is almost completely avoiding any reference to the Agenda even when implementing measure that form part of it – a kind of tacit gentlemen’s agreement, the rationale of which remains completely inaccessible.

At the same time, Bosnia-Herzegovina’s successful passing of the three steps in EU-integration foreseen in the Union’s Bosnia initiative has been based in one part on the EU falling back to its previous practice of compromising over its own conditionality, and in another part on accepting the formal fulfillment of conditions in complete ignorance of the substance of these very fulfilled conditions:

In February this year, the EU accepted to receive a membership application that was clearly not credible, after weeks and months in which diplomats from leading EU member states had unsuccessfully warned party leaders to first fulfill all conditions. In the end, leading EU officials nevertheless waved the application through. An invitation by the European Council to BH authorities to hand in their application, as originally foreseen in the German-UK initiative, never took place. During spring 2016 Commission officials set deadlines for BiH to meet the necessary conditions for the European Council to decide to send the membership application to the Commission – presented as the ultimate deadline in order for the Council to deal with the issue in 2016 still – only to come up with new deadlines after the previously set one wasn’t met. When party leaders agreed with the EU on a modus for adapting the SAA Interim trade agreement to the entry of Croatia into the EU, they did so by backing down on the previous defense of BH state interests – a positive shift from the promotion of the interests of Serbia and Croatia by Bosnian Serb and Croat political elites in bilateral trade liberalization – under pressure from the EU that insisted on the adaptation done in the “traditional” way. Equally, an agreement on the coordination mechanism was found after years due to the Bosniak political parties giving up resistance against the push by Banja Luka and Mostar to introduce the principle of consent of all layers of governance (state, entities and cantons) in BiH’s relationship with the EU, despite the fact that the constitution and laws assign this role to state-level institutions – vis-á vis an EU that signaled that any agreement would be acceptable. Concerning the census, after failed attempts by EU officials to broker a, legally questionable, agreement among the parties on the conflict over how to count BH citizens temporarily residing abroad into the overall number of population, Brussels ticked the box when the State statistics agency took a decision and published the census results despite the RS government and parliament rejecting to accept the decision. However, given the RS veto enshrined in the coordination mechanism, once BH receives the Questionnaire from the Commission, the first question of which reads “how many citizens does BiH have?,” it is most likely that Bosnia-Herzegovina’s EU integration process will immediately stall at the very next step. Finally, when the GAC took its positive decision on BiH’s application on September 20, it became clear that the EU back in 2014 had already substantially watered down conditionality for this third and last step in the initiative – while the German-British initiative had originally insisted on “full implementation“ of an “initial agenda for reform,” the EU’s Foreign Affairs Council (FAC) in December 2014 lowered the bar to “meaningful progress.” This substantial alteration to date has neither been publicly noticed nor explained, its background remains unclear.

One segment of reform conditions needs to be singled out, as it will determine success or failure of reforms in all other segments of the EU’s initiative, and thus of the initiative as a whole – the rule of law. From that perspective, the prospects of the Reform Agenda and wider EU initiative are more than grim. Strengthening the rule of law is part of the Agenda but with the measures included, BH authorities and the EU already aim much lower than in the other reforms areas. Meanwhile the undermining of the judiciary by the RS authorities is continuing without serious resistance from the EU. Within the Structured Dialogue on judicial reform the EU over the last two years has unsuccessfully tried to compromise over RS demands related to a new Law on Courts of BiH that alter between entirely taking competencies to try high-level cases of organized crime and corruption away  from state-level judiciary and a de facto general amnesty for such crimes. With a new draft RS Law on public prosecutions the entity’s government has launched a new attempt to usurp state-level competencies that is not only illegal, but also deals a death blow to BiH’s new judicial reform strategy - adopted as part of the Reform agenda. In the Federation, the lacking implementation of a law that created organized crimes and corruption panels at the entity’s Supreme Court has led to the de facto suspension of the work of the judiciary in these sensitive sectors of criminal judiciary. In both cases any serious reaction or action by the EU has been missing. Finally, the organization of a referendum in the RS against a binding decision of the Constitutional Court of BiH and despite the Court suspending the organization of the vote presented the most serious undermining of the country’s constitutional order and rule of law. Despite the EU as other international actors clearly identifying the referendum as an unconstitutional act, the Union has refused to decide on any consequences for the organizers.

On that whole background, the question of the drivers of real social change becomes crucial. The authors of the initiative had rightly identified the combination of external, conditionality-based and internal, bottom-up pressure on the political elites as the way forward. But while the EU has already demonstrated weakness on conditionality, it so far has totally failed on utilizing, let alone promoting bottom-up pressure. So far the whole initiative, starting with the drafting of the Reform Agenda and action plans, its implementation and assessment of reforms have been conducted in an entirely intransparent way, largely excluding not only BH citizens, but also civil society, social interest groups and even parliamentary opposition.

On that background it is even more worrying that the next steps in the EU’s policy towards BiH at this point in time remain completely undefined. As the GAC sent the country’s membership application to the European Commission based on “meaningful progress,” and not “full implementation” of the Reform Agenda, a concept for how to define further progress up to complete implementation of the agenda and how to link those to the next steps in the EU-integration process (Questionnaire, avis, membership status) is needed. However, no such concept has been defined so far by the EU, leaving its further policy completely in limbo.

 

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