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Yanukovych ‘Intends’ to Sign EU Deal, Bosnia Probes Loss of EU Funds

Plus, economies in Southeastern Europe show signs of renewed health, and Latvia foresees a smooth euro adoption despite political uncertainty.

by S. Adam Cardais, Karlo Marinovic, and Alexander Silady 12 December 2013

1. EU slashes Bosnian aid over minority rights concerns


Bosnia and Herzegovina's prosecutor is investigating who is to blame after the European Union cut 45 million euros ($62 million) in funding because the country has failed to improve political representation for minorities, the Associated Press reports.


This week the EU cut more than half of the pre-accession funding allocated to Bosnia this year because the country has still not implemented the so-called Sejdic-Finci ruling. In 2009, the European Court of Human Rights ruled that Bosnia's constitution violates a key European human rights convention by restricting minorities such as Jews and Roma from seeking political office. That's because it stipulates that Bosnia's tripartite presidency and seats in the upper chamber of parliament be equally distributed among representatives of the three main ethnic groups: Bosniaks, Croats, and Serbs.


Despite demands from Brussels, Bosnia's fractious political leadership has repeatedly failed amend the constitution. On 11 December, the prosecutor's office said the inability to implement the court ruling “is causing unforeseeable damage to the European path of Bosnia and Herzegovina,” Balkan Insight reports.


The EU redistributed the 45 million euros in funding to Kosovo and regional housing projects, Balkan Insight reports.


EU Deputy Director General for Enlargement Joost Korte warned that Bosnia also risked being cut off from as much as half a billion euros available in the 2014-2020 budget cycle unless it implements the ruling, Reuters reports.


Bosnia received 547 million euros ($750 million) in pre-accession funding between 2007 and 2012 and had been allocated 108.8 million euros this year.


2. In Georgian parliament, fists fly over Ukraine


Catherine AshtonCatherine Ashton
Debate over the escalating political crisis in Ukraine has brought Georgian lawmakers to fisticuffs, Radio Free Europe reports.


Parliament was temporarily suspended 11 December after a scuffle broke out between members of the ruling Georgian Dream coalition and the opposition United National Movement. The fight started after Giorgi Baramidze of the United National Movement urged the government to express Georgia's support for the pro-European protesters in Ukraine and condemn recent police action against them.


But Georgian Dream lawmaker Soso Jachvliani fired back that Baramidze should also "officially condemn" violence against opposition protests in Tbilisi in 2007 and 2011, when the United National Movement held power. The two men briefly came to blows in a fight that drew in several other lawmakers, RFE reports.


Mass public protests erupted in Ukraine after President Viktor Yanukovych folded to pressure from Moscow in deciding not to sign an agreement increasing ties with the EU last month as planned. Yanukovych has now told EU foreign policy chief Catherine Ashton that he “intends” to sign the agreement, Ashton said today.


On 11 December opposition groups rejected  Yanukovych’s offer to hold talks on resolving the crisis and insisted that the government resign, Reuters reports.


3. Latvia likely to join euro zone without a government, president says


Latvia's changeover to the euro currency next month should go smoothly despite the likelihood that the country will not have a new government by then, President Andris Berzins said 11 December, Reuters reports.


Andris BerzinsAndris Berzins
"Everything that was needed [for entering the euro zone] has been done," Berzins said at a press conference after talks failed to produce a new prime minister. "Of course, there can be some surprises."


Latvia will become the euro zone's 18th member on 1 January. Stores are already displaying prices in both lats and euros, and the post office released the first euro coins this week, AFP reports.


The economic and political milestone comes in the wake of Prime Minister Valdis Dombrovskis’ resignation last month after a fatal supermarket collapse in Riga. He is currently serving as acting head of the government.


On 10 December, Berzins rejected for a second time the nomination of Defense Minister Artis Pabriks as Dombrovskis' successor, The Baltic Times reports.


Berzins said he wanted a candidate with expertise in economics. If a suitable candidate isn't put forward by year's end, the president said, he would name his own by 7 January.


4. World Bank recognizes Balkan economic gains, warns of challenges ahead


Six Southeast European countries recorded significant increases in exports to lead them out of recession in the first half of 2013, the World Bank says in its regular economic survey of the region.


Average economic growth in Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro, and Serbia currently stands at 1.8 percent, an increase on the negative 0.7 percent figure in 2012, the latest edition of the twice-yearly report stated. The report was presented 9 December in Tirana.


The report specifically noted the contributions to growth of the energy sector, rising exports to euro zone countries, strong agricultural output, and Serbia’s car industry.


The report forecasts Kosovo’s economy to grow the fastest in 2013, at 3 percent, Balkan Insight reports. Macedonia is also predicted to show healthy growth this year of around 2.5 percent.


Zoran StavreskiZoran Stavreski
“Low taxes, improving the business climate, and the implementation of major capital projects ... [helped] Macedonia to achieve high rates of growth,” Deputy Prime Minister and Finance Minister Zoran Stavreski said, according to Macedonia’s Kurir news agency.


The World Bank noted downsides as well, such as high unemployment and a difficult investment climate in all six countries. The bank also lowered its economic growth estimate for 2014 by about one point, setting it to 1.8 percent.


Unemployment in the region averages about 24 percent on average, and industry continued to shed jobs this year, World Bank economist and report co-author Abebe Adugna said.


“Near-term economic growth will still not be strong enough to support substantial gains in employment in the short run,” Adugna added.


Workers assemble Fiat cars at a plant in Kragujevac, Serbia. Image from a video by TheM2Creative/YouTube


5. Armenian judges reject ombudsman’s claim of systematic bribery


Corruption is so widespread in Armenia’s court system that there is a unofficial “price list” for judges to fix outcomes of different types of cases, according to findings by the country’s human rights ombudsman, RFE reports.


Karen Andreasian and his office issued the report after speaking to more than a hundred judges and attorneys, as well as examining the rulings of the Court of Cassation and the oversight body called the Council of Justice from 2006 through 2013. The investigators said they found double standards between cases of the same type, and cronyism and manipulation as Court of Cassation judges give orders to lower-court judges dependent on their patronage.


"The data obtained through our interviews shows that the bribe amounts to 10 percent of the cost of the lawsuit," Andreasian’s assistant Genya Petrosian said.


The interviewees said bribes in courts of first instance and the Court of Appeals ranged from a few hundred dollars to $15,000 and could reach $50,000 at the Court of Cassation, Petrosian told a 9 December news conference.


Judicial officials have not taken the accusations sitting down. Judicial Department public relations head Arsen Babayan called the report a “stunt” and said Andreasian should have notified the authorities if he had evidence of specific judicial corruption. Justice Minister Hrair Tovmasyan also said the report was lacking in specifics.


About 200 Armenian lawyers held a two-day protest at the Court of Cassation in June against what they called the court’s arbitrariness and use of double standards, Caucasian Knot reported.

S. Adam Cardais is a TOL contributing editor. Karlo Marinovic and Alexander Silady are TOL editorial interns.
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