€6 billion extra aid for the Western Balkans needs better protection

The proposed €6 billion Reform and Growth Facility for Western Balkan countries is supposed to help them fulfil the conditions for EU accession. In an opinion published today, the European Court of Auditors suggests that this additional EU money should be better protected. 

Economic convergence between the six Western Balkan countries (Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia) and the EU has been considered insufficient for many years. In response, last November the European Commission proposed establishing a specific financing instrument, the Reform and Growth Facility for the Western Balkans, as part of a new growth plan for the region. The facility is meant to boost economic growth, increase socio-economic convergence with EU countries, and accelerate alignment with EU values and laws with a view to future EU accession.

The EU auditors welcome the introduction of more stringent conditions for funding by linking payments to the fulfilment of conditions to be set in the Reform Agendas for the various countries. “There is, however, a risk that the disbursement conditions are not ambitious enough and that indicators are not sufficiently clear and measurable. It also remains difficult to ensure that reforms will be sustainable, particularly in view of the region’s weak administrative capacity”, said Laima Liucija Andrikiene, the ECA member in charge of the opinion. “In addition, the European Commission should not only make observations, but also be able to require Western Balkan governments to review and modify their Reform Agendas accordingly.” The EU auditors also suggest developing relevant guidance for assessing the satisfactory fulfilment of the payment conditions stipulated in the Reform Agendas.

Support of up to €6 billion (€2 billion in non-repayable support and €4 billion in loans) is envisaged under the facility for the 2024-2027 period. Considering that over €14 billion has already been made available to pre-accession countries (including Turkey) in the current EU budget, the auditors underline that amounts to be provided through the facility represent a substantial increase (over 40%) in the funding envisaged for the Western Balkan countries until 2027. The auditors note that both the proposal for establishing the facility and the growth plan explain why the Western Balkan economies need to converge further with the EU. The plan also highlights various benefits that the proposed measures would bring to the region. However, in the absence of an impact assessment or an analytical document, the EU auditors were unable to assess the extent to which the intended €6 billion in support is likely to contribute to achieving the facility’s main objectives. Lastly, the auditors suggest clarifying certain provisions of the proposal relating to the European Court of Auditors’ audit rights, and access to data and documentation in order to ensure proper oversight.