Serbia, the Balkans and the European Union

Dr Robin Niblett CMG

So, ladies and gentlemen, welcome to – somebody’s put this up here, I suppose this is okay. Welcome to Chatham House. I’m Robin Niblett, the Director of the institute. My pleasure to welcome you all here today. We are delighted to have this conversation on Serbia, the Balkans and the European Union. I suspect that’s one of those catch-all titles to allow both our speaker and you the opportunity to range widely, and, obviously, I think an opportunity for Chatham House to talk about Serbia. One of the most significant pivotal, I think, countries, in terms of Europe’s future, in the context of a stable Balkans, in the context of a part of the world that we hope will be fully integrated into European institutions and structures over time, but, obviously, which comes from a pained recent history, and still a very complex environment today. We were just discussing the process of EU accession, and that is always a painful process, for any acceding member, and for departing members, but it is especially complex now.

So, in that context, I’m delighted to be hosting Ana Brnabić, the Prime Minister of Serbia, to Chatham House, a position she’s held for pretty much exactly two years, after Aleksandr Vučić gave that position and became President of Serbia. And she brings to this role less, if I’m right in saying this, Ana, less of a political experience and much more somebody who brings experience in business and in the private sector, in infrastructure investment, all critical areas for Serbia’s development, and which were reflected in her role in the Government when she was Minister for Public Administration. And any of you who look through the EU’s list of requirements for closing those chapters, the dimensions of the administration of its member states, like Serbia, is absolutely central to that. So, we’ll have an opportunity to discuss with her after her remarks, as I said, developments in Serbia, its relationships more broadly with the EU and in the region, and if we want to go more broadly, we will see where we take it, but for the moment, Prime Minister, welcome to Chatham House. As I said, we’re very pleased to have this opportunity and look forward to your remarks. Thank you [applause].

Ana Brnabić

Thank you very much. It’s a pleasure for me to be here today, and to actually cover some of the issues under this very general title of Serbia and the EU and the Balkans. Actually, the title captures the two of our key priorities, in terms of foreign policy. One, an absolute key strategic focus is the EU accession of Serbia, Serbia eventually becoming the member of the European Union, and the second one is regional stability, better connected, better integrated region. Also, more predictable region, I would say, as well. So, these are the two key areas, the two – the key focus of our foreign policy, and I will try to actually cover some general issues, perhaps, you know, questions that I found were some of the questions that, throughout these past two years, since I became the Prime Minister, people usually ask me about – and with regards to our EU accession, and then allow for more time for questions, which I think is generally something that is much more useful to people, and more interesting.

So, in terms of, you know, the first question that people usually ask me, and especially when I’m here in Britain, is why EU? You know, EU is facing its own internal challenges. Britain is leaving. You know, some people feel that, you know, EU is going through such a difficult challenges that it’s almost falling apart, and what will be the future of the Union, and at a time that all of these things are going on, why is Serbia wanting to join the European Union? And for that matter, I think why is Balkans, or as we – you know, the new term is ‘Western Balkans’, why do we all want to join the EU? And I think that, really, the most straightforward answer, for me, is that, for me, the European Union is first and foremost a peace project, and I think many, many people in Europe have actually forgot about that, and I think that, you know, thanks to the European Union, actually, Europe had the longest peace thus far. And I think that people actually took peace for granted, or take peace for granted, and forgot about that, that EU was a peace project, and started talking more and focusing more about, you know, the economic side of it, the labour, the free movement of labour, goods, services, competitiveness, rather than peace, and, for me, Europe, if you ask me today, for me, Europe will always be a successful project because of that peace. And so, I think that the, you know, the – if you think of the EU as the peace project, then you think that project is not complete without Balkans, the entire Balkans being part of the EU. And I think this is exactly the biggest quality that EU accession will take, or bring to the Balkans, and that’s peace. Peace that is much, much needed, peace and stability much needed for the Balkans. So, that, really, is my first answer.

Obviously, I also feel that EU is, again, before the economy, is the – and the Single Market, is also a family of nations with shared values, and I feel that Serbia shares those values, and that our natural place is in the EU, in the European family of nations, and then, lastly, obviously, you know, it’s the economy, it’s the larger market. You know, we also, in that respect, basically, entirely, you know, our place, also, is entirely in the EU. More than 70% of our investments, FDI inflow, is from the EU, from the EU member countries. Approximately 70% of our trade is with the EU member countries. So, our exports are into the EU. So, economically, that is where it belongs. So, to me, there is no questions asked, you know, politically. You know, I would, you know – we do not have plan B, as some people might think, and I’m sure that question will come up, or some of the Western Balkans’ leaders, kind of, say, almost trying to blackmail the EU, “Unless you tell us the exact date when we will join, we’ll turn and join this or that, or, you know, our foreign policy will change.” That’s not the case with Serbia. As the Prime Minister, I can say that. You know, we do not have plan B. European accession is our strategic focus, it is our strategic goal, and regardless of who’s in the Government now, who’s in the ruling coalition, if you look at the Serbian Parliament, more than 80% of MPs in the Parliament come from political parties or political groups that are pro-EU, and that has been one thing that has been stable run throughout all of the governments since the changes in 2000, and that’s been the fact that all were pro-EU.

Now, the EU, for some of you that don’t know, the EU accession process is quite administrative. I think they’re, kind of, getting countries used to the administration in Brussels, in terms of, you know, there’s these 35 chapters and you almost go through, if it was a videogame, you go through the chapters of the exercise of opening and closing the chapters, and you have to fulfil some standards to open chapters, and then fulfil additional standards to close the chapters, and, basically, you know, I think that the champion is one who fulfils all of the 35 levels, as soon as possible, and joins the EU. But it’s fairly administrative. So, you know, not even citizens of Serbia understand what are the chapters all about. So, in my view, they’re basically – they’re, all of the 35 chapters, apart from Chapter 35, which is – which was – which is the easiest for all other accession countries, because Chapter 35 is other issues. Chapter 35 for Serbia is the relationship with Pristina, and the long-term normalisation agreement with Kosovo. So, for us, Chapter 35 is the most difficult one, politically speaking, but all other issues, basically, can be really put down to three groups, three key pillars. That’s the economic stability and economic strength, so economic reforms. The second pillar is, kind of, public administration reforms, efficient transparent public administration, and the third key group, or the third key pillar is the rule of law.

Again, as the EU was learning from its mistakes, rule of law is also one of the most complex, if not the com – the most complex one. So, I would tell you, you know, my vision. The most complex one, the rule of law, chapter 23. The most expensive one, environmental protection, if I’m not mistaken, Chapter 27. By far the most expensive one. And the most difficult one, politically the most difficult one for us is Chapter 35, the normalisation with Kosovo. Everything else are basically the reforms, and that’s why I’m saying that, you know, in – if you are a, I would say, pragmatic Prime Minister as I am, in my view, and we spoke a little bit about this today at the Financial Times Conference, I had there with me colleagues from Albania, Prime Minister Edi Rama, and a colleague from North Macedonia, now Prime Minister Zoran Zaev, in my view, most of the time, for countries like ours, I think that the journey is almost more important than the destination itself. That accession process, that journey to the EU is more important for our citizens, I think, because of the reforms that that journey entails, and so I also think that, you know, if you are being very honest and responsible, as the Prime Minister, you would say that, you know, we don’t want to, kind of, cut corners and really just open and close chapters for the sake of opening and closing chapters. You really want to actually implement reforms that are entailed with those chapters, because if you implement reforms, then at the end of that road, you will be ready for the EU, and if you don’t, you can become member of the EU, but you won’t be ready for the EU, and we’ve seen this too often, I think, in the past with some of the later entrants, and I think that is probably the worst scenario you can have.

It’s a lose-lose scenario, in which EU is becoming weaker, and we’ve seen that as well, but, also, in my view, the country who accedes to the EU, also becomes weaker, and why? Because people, citizens of those countries, are really, really happy that their country has became the member of the European Union, but for all the wrong reasons. Basically, because it’s much easier for them to leave. I don’t want that. I think that is really the biggest disadvantage, the biggest potential threat to Serbia, if we join the EU too soon. We already have a brain drain issue, but do you know who has the biggest issue in brain drain in the whole Balkans? Croatia, EU member country, because people find it easier to leave, and then you lose all capacity, all brain capacity to actually implement reforms that you did not implement, and change your society and your economy and your rule of law, and once you’re part of the EU, also, you join too soon. Your agriculture cannot compete. We’ve seen this in some of the countries that join the EU later. I’m not going to talk about names, but, you know, we’ve, kind of, if you’re smart you learn from mistakes of those countries. Your companies cannot compete, because they’re not ready. So, if you ask me and I said that was a little bit, you know, issue of – a little bit of controversy, even in Serbia, as the Prime Minister, I’m completely committed to Serbia in the EU, but if you ask me, “Would you join if EU said, “Serbia can join tomorrow morning,” would you join?” I would say no, because we are not ready, and then it would be a lose-lose.

So, on that, kind of, European part, and that journey, that’s why I say, you know, journey is more important than the destination right now, is that we really need to reform our economy, our society, our administration, the rule of law, and the whole legislative framework, in order to be fit for the EU. And so, I hear, you know, another question that comes very often now, faced with these internal challenges of the EU is that, “Are you worried about the timing of the accession?” You know, thus far, out of 35 chapters, we have opened 16, provisionally closed two. We are currently ready to open, administratively ready, to open five more chapters. It is likely that we will open, now, hopefully, in June, I don’t know, anywhere from, I think, zero to three. So, we will see, but the opening of the chapters right now really depends mostly on the willingness of the EU member states to actually provide a signal that they are either pro-enlargement or against enlargement, and there are many, many countries that are against enlargement. So, it doesn’t really depend too much on the country itself or the pace of reforms, rather than the, really, the challenges that EU is facing.

So, I say, you know, my – I’m not worried about the timing, and I’m not worried because, at the end of the day, my job is European Serbia. Serbia in the EU is really just completely out of my control. It really is – it is down to the EU member states, and so the – so – and so, my job is, you know, European Serbia, as soon as possible. The sooner the better. I can’t afford to be worried about the timing. I really need to be, kind of, focused completely on our own internal reforms, and that’s already hard work and complex enough, and the sooner we become European Serbia, the sooner we will start reaping the benefits of that, even though we are not part of the EU, and then we can, kind of, sit back and reap those benefits and wait for the EU member states to decide whether, you know, they’re – whether EU as such is pro-enlargement or against enlargement.

And I would say that, again, we come – we – there we get to my last point, and that’s, kind of, our second key priority, and that’s, you know, regional stability. Regional stability, right now, if you look at our region and my job, is perhaps, today, more important than EU integration, because without regional stability, without stable, predictable region, we will not be able to think about EU integration at all in the first place, and, again, what’s really needed for and not just citizens of Serbia, but citizens everywhere and in the region, kind of, the better quality of life for us, you know, more dynamic, stronger, sustainable GDP growth that will allow for that kind of a better quality of life, regional stability is instrumental. Serbia is the biggest country and the biggest market in the region, but it’s only the country of seven million people. So, it’s not large enough that whatever happens in the region will not impact us. Even if we have the best, strongest political stability, the best business environment in the world, if something happens anywhere in our region, investors will be deterred from investing, or the financial institutions will land at higher interest rates because they will build that inherent instability in those interest rates. So, in general, I think, you know, what we need to work on, and it’s very difficult right now, for various reasons, is really to go back to that, kind of, regional connectivity, regional integration, regional stability and regional perspective.

And what I say to my fellow Prime Ministers is that, you know, we have two jobs and two challenges there. First, is to be, actually, stable, predictable region, but the even bigger challenge than that is to be perceived as stable and predictable, and it will take a long time after we are actually stable and predictable for people to start perceiving us as such, and only then we can reap all the benefits ourselves. Serbia has done a lot. Serbia, and if you think about these three groups that I said: economic stability, public administration, rule of law, we have done the most, in terms of the economic stability, structural reforms, we are reaping the benefits of it. So, there you go, you can have all the benefits, if you implement reforms, even though you’re not a member of the EU yet. You know, we’ve more than halved the unemployment from 2012 to today. It was about 25%, today it’s about 11%, between 11 and 12%. We have drastically reduced our public debt. Public debt to GDP ratio, currently, is about 50%. So, we are better than most of the EU member countries. Our goal is to go below, kind of, the safety line of 45%. We are absolute leader in the region in FDI attraction, and we are actually get – we are – we do have some of the record numbers, in terms of the FDI attraction in 2017. We had €2.6 billion of direct FDI, of direct foreign investment in Serbia. Last year, it was a little bit over €3.5 billion. This year, for first five months of this year, we had 1.2 billion, which is 17% better than 2018, which was our absolute record year so far.

So, the economy is doing good. We need to actually implement structural – continue implementing structural reforms for our economic growth to remain sustainable, and we need more dynamic GDP growth. Public administration, I think we’ve done very well, but still a lot of things to do, and rule of law, as I said, the most complex one, and that is basically what our – 80% of our focus is. I have to say that, you know, EU had a very good point, in terms of the dialogue with Pristina, to raise the dialogue on the Presidential level. So, right now, I can focus, you know, 80% of my time on the economy, EU integration, changes, in terms of reforms, in terms of the rule of law. The President is basically 80/85% of his time is about, you know, dialogue with Pristina and how to get dialogue going on, and so, to conclude, and really to conclude, you know, how the – what – you know, Serbia is firmly on the EU path. Whether I’m worried about timing, I’m not. We still have a lot of homework ourselves to do, and we must do it, and first and foremost, for our citizens and our businesses, and that will naturally take us to the EU.

The only thing I’m worried about, regional stability. The only thing I’m worried about, and that really should be the focus of not just my work, but the work of all the Prime Ministers in the region. Thank you very much [applause].

Dr Robin Niblett CMG

Thank you very much, Prime Minister, for those remarks and for taking us around, also, the division of labour between the work you’re undertaking, and that the President is undertaking, and so on. We’ll have plenty of opportunity for questions, and I’m just going to put one, maybe, on the agenda to start with, and then I’ll see if others pick up other items here, and you might expect me to go here, because I was struck by your remarks. I thought it was a very perceptive remark, it’s not just that Serbia and the region need to be stable and predictable, they need to be perceived as stable and predictable. But I think I’m right in saying that Serbia’s going through, currently, a good five or six month period of considerable domestic instability with, certainly in terms of protest, and I know the ruling Progressive Party has a strong majority, as you were discussing earlier in Parliament, but there’s obviously quite a bit of concern about the weakness of opposition parties, and this was noted, the sense that those opposition parties were not being given sufficient space for – to be able to express their views, was reflected in the May 2019 European Commission report, amongst others. And I wondered if you could just say a word or two about the political situation within Serbia, from your perspective, given that that is part of the perception that people have on the outside. In other words, you’ve got great economic numbers. There are other countries that may be facing greater challenges of stability within the region, but this fear that could emerge, within amongst certain EU member states that there might be a, kind of, strong man tilt to Serbia, which, you know, it wouldn’t be the first country, there’s some EU members going in that direction as well. That this may then actually affect your ability to follow through on the accession process. I just wanted – just say whatever you want to say about that, it may come up in the Q&A, but I thought I’d give you a chance to put that on the table as well.

Ana Brnabić

Sure. Well, I think that, you know, there is absolutely no political instability in Serbia. I think that is what really frustrates and worries part of the opposition in Serbia. You know, the Serbian Progressive Party that is basically the backbone of the basis of the ruling coalition has a really large majority and enjoys a very significant popularity amongst the citizens. So, I – you know, my view is that, you know, I certainly don’t think it’s because of the control or, you know, the criticism that part of the opposition is saying about, you know, lack of media freedom or lack of rule of law. And so, I 100% disagree with that. I really think it’s because, you know, people are, you know, they’re – the unemploy – we’ve provided jobs to 700,000 people. 700,000 more jobs were opened in the past five years. People feel that, families feel that. You know, we’ve – I remember, you know, I was in the private sector, but I remember, prior to some 2013, and certainly prior to when Aleksandr Vučić became the Prime Minister, you know, everyone used to say that Serbia needs about €3 billion of FDI annually for sustainable growth. It was inconceivable, even with all the privatisation at the time, it was inconceivable, just governments, you know, there was no business environment. The governments weren’t really focused on it, you know, and, you know, I think that people now feel that, actually, there’s, you know, just in the past five years, Serbia has improved more or less 50, 5-0, 50 places on the World Bank Doing Business list. That required changes to numerous laws, changes in the public administration, increased efficiency, increased transparency, and I think, again, both investors feel that, there are jobs opened.

You know, in the past, since 2012, the minimum wage was increased 42%. From 2009 to 2012, when some of the opposition – current opposition leaders, who are protesting, were in power, the minimum wage was increased in, all in all, 2%. People feel those things, and then, also, politically, you know, you can say, you know, there is a strong man, and, certainly, you know, I can, you know, I cannot but agree that there is a strong man in Serbia, who’s, you know, it used to be Prime Minister, is currently President, but without that strong man and, actually, you know, the courage of that strong man, you wouldn’t have dialogue with Pristina. It was a complete taboo before he came, when those opposition leaders, who are currently protesting, they were, kind of, Democratic opposition leaders, you know, Democratic Party, the Democratic Government, which has done absolutely nothing to actually tackle the issue of long-term normalisation with Pristina, which is key to – not to our EU integration, but to our economic stability, to our economic prosperity, to our political stability, you know, and I just, you know, I just feel that people feel and think that, you know, that that strong man, along with the ruling coalition, is ready to actually take on challenges, both economically and politically, and that’s why, you know, there is that – the, you know, the support coming from the people, but – and finally, you know, on the protest, obviously, you know, there were protests, they’re almost non-existent today. There are protests across Europe. I mean, you’ve seen violent protests in Paris. You know, it didn’t seem that rule of law is in question in Paris. Fortunately, to the greatest extent, those protests were not violent in Serbia, only at the time when the – that that part of the opposition chose to actually storm into the national broadcasting company. Again, I think that really shows the level of their rule of law and desperation to – aspirations to hear the criticism, or democracy, but, you know, certainly, there are challenges. But it’s also worthwhile noting that the Parliament speaker has invited all the opposition parties for dialogue, and they didn’t, they chose not to show up. So, again, it’s a complex situation, but…

Dr Robin Niblett CMG

No, thank you, and you’ve taken it on and addressed it, and, I think, given an opportunity for others then, to base questions on the back of yours, and I would note that, at least, as I look at it, I don’t see EU leaders putting as much focus properly here, because maybe there is a calculation going on at EU capitals about, what Serbia maybe needs today versus what it needs tomorrow versus what the instability might be. So, I think it’s quite interesting to see how you leaders have been supporting other directions. So, let me open up and give an opportunity for people to ask questions. Please introduce yourselves a little bit. I’ll start with the lady here, and I’ll come to the front here. We’ve got lots of hands. We’ll go one at a time to start with. There’s a microphone coming, and, just, if you want to let people know who you are, that would be great.

Member

Thank you, Prime Minister, for this very insightful lecture. My name is [inaudible – 32:40], I’m the Head of the Political Department of the Greek Embassy. Greece has been a staunch supporter of Serbia’s EU accession. I would like to ask you the following, picking it – taking it from the very interesting comparison or metaphor that you made, accession process like a race, like a videogame, to fulfil the benchmarks of the 35 chapters. I would like to ask you, do you feel that the other, let’s say, players of the game, your neighbouring countries, are – to what degree are they competitive? Are you – do you stand by each other? Do they – do you perceive each other like enemies? First part.

Second part, I would like, also, you to comment on the elephant in the room. Whenever we speak about Western Balkans in third capitals, we always speak about the role of third countries, major players in the Western Balkans area, like Russia, with its role in the region, like China, with the trade interests, the well-known trade interests, like Turkey with its own peculiar agenda. How do you perceive, on the ground, the role of these countries? Thank you.

Dr Robin Niblett CMG

A couple of big questions there, so I’ll think I’ll let you address those first, please, and lots more.

Ana Brnabić

So, in terms of the competitiveness between countries in the region, and, first of all, I have to say that I do not think that we really stand behind each other, in terms of supporting each other enough. I think we should be supporting each other enough. I mean, there’s so many regional initiatives, and, obviously, they do contribute to a better integrated region, but, really, honestly, you – we need to be more honest about it as Politicians, rather than do things just for the sake of saying that we do things. And especially because I think that, again, whatever instability there is, and my country will suffer the most, and I’ve seen this, and especially in the past eight months or so, and I’ll tell you why.

Firstly, with regards to the imposition of 100% taxes by Pristina, on the goods from Central Serbia and Bosnia and Herzegovina, I think this was really down to, actually, Pristina’s frustration because of visa liberalisation, and the fact that they were promised visa liberalisation by the EU, once they completed demarcation with Montenegro and didn’t get it. I mean, there are other things as well, but I think this is, kind of, the key reason and so, that’s, you know, and so, that really, kind of, that broke on our back, you know.

Today you have Prime Minster of Albania, and I spoke to him this morning a little bit about that, Prime Minster of Albania, Mr Edi Rama, saying, “Listen, if you – if the EU doesn’t give us, finally, the date when we are going to open the negotiations, we are going to announce the unification with Kosovo.” Again, you know, they can’t do anything to the EU, so they break our back. You know, what do we have to do with the opening of the negotiations? It’s ridiculous. And so, to be honest, I think that the negotiations should be opened, both with North Macedonia and with Albania, because it’s a positive signal for those citizens. It doesn’t mean enlargement. I mean, from opening of negotiations to actual EU accession, decades can pass. It’s just, you know, to incentivise these citizens, but also, the Politicians to continue with the reforms, and, again, the chapters are almost like a toolkit of what you need to do, in terms of reforms. So, why not give this to them to start those reforms, and then the journey is complex and difficult and timely enough that there is really not avoided. I don’t think that EU citizen will feel, “Okay, if they open negotiations tomorrow, they will become member of the EU,” and that will contribute, also, to the political stability.

So, Serbia supports the opening of the chapters, and, again, I think that we should support each other more, and more honestly. But at the end of the day, also, when you say, you know, “Is there a competitiveness?” There will always be a competitiveness, but it’s not a bad thing, because it will make all of us, kind of, compete and thus, implement those reforms faster. And, on the third countries, I know that’s a big issue, and I know that, you know, they’re increasingly, you know, Chinese investments in the region, and especially in Serbia, are becoming questioned, and there is some concern from the EU. I have to say, to me, I told that this morning and yesterday as well. You know, that, to me, is a little bit dishonest, because if you look at the total Chinese investments in Europe, 90% of those investments, in mining, in energy, in financial sector, in infrastructure, and 90% is in Western Europe. Those, kind of, founding EU member states. If you look at the UK, Chinese investments in the UK amount to 70, 7-0, €70 billion. Well, those countries can’t turn and say, you know, to North Macedonia or Serbia, “Wow, you know, I’m very concerned about the Chinese investments in your country.” What do you mean? It’s – you know, all of us combined is 9% of the total investments.

So, no, I think, you know, and, you know, we are, you know, we are – I talked this morning at the Financial Times, I was asked, “Are you targeting Chinese investments, so that you balance out EU investors?” Absolutely not. We are targeting all the investors. We need all the investments we can get. So, I certainly don’t think that, you know, that that should be of any concern. At the end of the day, you know, investments in new jobs or infrastructure, once we hopefully become part of the EU, will become part of the EU as well, especially in terms of infrastructure. And finally, you know, I saw, you know, there’s – well, there’s now even Chinese investors in this refrigerator manufacturing. So, it’s not just mining or steel or, you know, it’s now, you know, goods for people, and I said, “Well, you know, that is actually Slovenian company, EU company that was acquired by Chinese.” So, they reached Serbia through EU. Swiss Board is a Chinese company. You know, if – and it’s counted in Serbia, I guess, as Chinese investment. So, no, I think it’s overstated.

Dr Robin Niblett CMG

Okay, let me keep going, ‘cause we’ve got lots of hands going up and lots of questions to ask. First John, and then coming here, and going there, yeah. Question coming here, got you at the back.

John Birch

My name’s John Birch, a former Member of the Diplomatic Service. I’d like to probe you a bit more about Russia, the last question, and you didn’t mention Russia. Historically, you’ve had a very close relationship, despite the break between Tito and Stalin, and I think that in Russian minds you always have a special place, partly through the church. How do you see, on your journey towards the European Union, the influence and your relations with Russia? And, incidentally, I’d like to say this week that I wish you were a candidate to be our Prime Minister [applause].

Ana Brnabić

Thank you. I’m thinking whether Brexit is – it’s certainly less complex than normalisation with Pristina. So, okay.

Dr Robin Niblett CMG

And you don’t have to do that bit.

Ana Brnabić

On Russia, again, the question that comes up quite often, and I think, you know, we, as you said, we have traditionally a good and close relationship with Russia, you know, based in, kind of, the language and religion and culture, but, you know, also, today, in terms of the economy, it’s mostly about energy. I think 95% is the energy deal, and, you know, the reliance on gas supply, but that also. is not unlike many of the European countries or EU member countries. I think we should be open and honest about it, and say that, again, I don’t think that interferes with our EU integration. We’ve always been very, very clear and open, both in Brussels and in Moscow about our strategic focus and our strategic goal, and that’s the European – EU integration.

Now, also, I mean, as long as you have a complex issue of Kosovo and normalisation with Kosovo, that always puts a leverage on who’s friend of Pristina and who’s friend of Belgrade. Hopefully, once that will be resolved, and it must, and I hope sooner rather than later, because of the younger generations, that leverage will also disappear, and the relationships will be, I think, much more balanced and easier. But if you look at the Russian investment, there’s not many Russian investments in Serbia. There is really only Niš. So, you know, I think that it’s a good relationship, and people feel close to Russia, but if you, you know – we, unfortunately, we have quite a considerable brain drain, but people are not going to Russia, they’re going to Western Europe, so…

Dr Robin Niblett CMG

Great, thank you. Please, Cathy, a question coming down here.

Cathy Ashton

Prime Minister, my name’s Cathy Ashton. I was, as you know, involved as – and with your country. It’s the second time I’ve heard you speak, and I think it’s fair to say that you can forget the strong men, it’s nice to see a strong woman. I’m not going to ask you about Belgrade and Pristina. I saw both President Vučić and President Thaçi two weeks ago in Bratislava. So, I’ve had my latest conversations, and I will be continuing to engage with both of them, but I was very struck by your points about the economy and the issues across the region of the Western Balkans, because while it is blindingly obvious to me that all the countries of the Western Balkans need to make their way into the EU, and to do so, at a good pace, but be ready to join, having completed all of the preparation. There is also a lot to be done, I think, between the Prime Ministers of the region, on the economic issues that challenge each country, and all the region together. Unemployment, especially among young people, continuing issues that affect the stability of the countries, and I just wondered if you could say more about how you think, not just yourself in a leading role, but all the Prime Ministers working together, could do more to really try and address those issues internally, as part of that continuing pursuit of membership of the EU?

Ana Brnabić

Firstly, I have to say that there is, you know – Baroness Ashton is, in my view, one brave and very persistent woman. You know, you actually brokered the first, and it’s probably the only agreement between Belgrade and Pristina, and I just have to say that I’m very, very sorry that the agreement wasn’t fully implemented, because today, we would have a very different situation on the ground. You know, I think that Pristina, the leaders in – and political leaders in Pristina should have been much more brave in implementing that agreement, and, again, that would contribute to the stability.

On the economic issues, you’re 100% right. We all suffer from considerably high unemployment still. I’m hoping that by the end of this year, Serbia will get below 10%. So, finally, single digit, but, still, our youth unemployment, we have, still, youth unemployment is about 25%. It’s similar and larger in the region. So, for that, we need to have – we need to give a very different signal to youth in the region than we’ve been giving thus far, and I think that the whole – that the Berlin process, which was initiated, actually, was a very good starting point. It was also much more, it seems to me, at least in the beginning, pragmatic than any of the other regional initiatives. We’ve implemented the – we’ve established a chamber investment forum as the, basically, the regional Chamber of Commerce, and that worked really well. And we were really going in the right direction with this, the infrastructure project, the connectivity project, the, you know, the highways between the entire region, you know, Serbia and North Macedonia, Serbia-Albania, through Kosovo, you know, Niš to Pristina highway, to Bosnia and Herzegovina, you know, to Montenegro, really, really good projects and, you know, there is this vision of we’ve just signed the Regional Roaming Agreement to allow roaming in the region.

And then these 100% taxes were introduced by Pristina, and that was, just – that put almost everything to a halt. Why? Because 100% taxes are not just, you know, they’re just a thing that says, “No regional co-operation,” but it says that, you know, we are – CEFTA, the Central European Free Trade Agreement is the agreement that I said that, to Ramush Haradinaj, is the agreement that preceded all of us there, all of us, and everyone respected the CEFT Agreement, even at the most difficult of times. You know, it was signed in 2006. In 2008, when Pristina announced the – declared the unilaterally declared independence, we still, Serbia, Belgrade, Central Serbia, still respected the Central European Free Trade Agreement. Pristina signed, as [inaudible – 49:13] Kosovo, CEFTA and respected it. So, to come to a point in 20 – end of 2018, where you are breaking the CEFT Agreement is so ridiculous, that it says that we are going pre-2006. I mean, what – where does that leave us? And second thing is that, surely, the only thing that we had going on for us, between Belgrade and Pristina, not to mention the entire region was trade and commerce, again, even at the most difficult of times, that channel of co-operation, that channel of communication remained always open. And I remember, you know, the most challenging time for me was when our Chief Negotiator, Mr Marko Đurich was arrested in Kosovska Mitrovica, almost abducted, taken, humiliated, taken to Pristina, paraded across the streets, and the day after that day, there was a big business fair in Pristina, and, actually, Aleksandr Vučić actually went out publicly and said, “Our companies need to be in Pristina, because that communication needs to continue.”

So, by introducing 100% taxes, what you – what they’ve effectively done is that they cut all communication, and that really – and you can see that, then, you have, you know, then that led to a consequence of the consequence of worsening relationships and endangering stability in the region. But I feel that I – and again, I spoke to Prime Minister Rama about it today, we need to be much more honest about our regional relationships, and especially economic relationships, because I truly believe, but, again, perhaps as someone who came from the private sector, and I – and is in politics for just now three years, is that when there is politically tough times, complex times, difficult times, when politics cannot lead anymore, those – at exactly those times, businesses should lead and politics should follow, and that will then enable us, as Politicians, to actually establish communication. So, I can guarantee you that I will personally try to be, again, not much more engaged. I was very, very engaged, but I will try to reset myself, in order to try and see what else we can do to initiate the discussion on how we can go back and actually give a clear signal that economic collaboration cannot stop.

Dr Robin Niblett CMG

Okay, very important points. I’ve got a lot of hands waiting and a limited amount of time. I’m going to jump to taking three questions and three questions, and I’ll let you come in on your answers. Please, Euripides first, then here, you, yeah, and then I’m going to this bit.

Euripides

Madame Prime Minister, thank you very much for the talk, you’ve done brilliant, and for your passion for the EU, unlike some countries that want to leave, which brings me to my question, how does Brexit really affect your two strategic goals, i.e., accession to the EU and stability in the Balkans? Thank you.

Dr Robin Niblett CMG

And a microphone down at the front, here, and then to the lady in white, there. Put your hand up, please, madam. Your hand, yeah. Yeah, please.

Archibald Prempeh

Archibald Prempeh, Member of Chatham House, and, basically, I want to find out from you, both Serbia and Kosovo are wanting to join the EU, but Serbia hasn’t recognised Kosovo as an independent state. How are you trying to deal with some of the confusion that may arise, should both of you be in the EU, regarding regional stability? Thank you.

Dr Robin Niblett CMG

Well, I think the imposition of the 100 tariffs did coincide, didn’t it, with the refusal to allow Kosovo to join UNESCO, Interpol and so on? So, it may not only have been as effective on the parts of the regions, yeah.

Member

My name is [inaudible – 53:44], from which I’m from the company Metropoliz in the Balkans, including Serbia. My question is, and I hope it was a political intention to show good picture of our country, rather than oversight, but EU report was pretty serious, on several issues, that related to the level playing field for business, private and public, related to the media freedom, is related to the rule of law. From our own experience, I can tell you that several independent institutions like competition, tax authority, and regulators for media, regulators for telecom, have slammed back in their knowledge and criteria as they were upgraded slowly by the EU behaviour. How is Government going to make a level playing field and better institutions than they are today?

Dr Robin Niblett CMG

Yeah, I was thinking these are very good, specific questions. Shall I just take the lot and then you can just, kind of – is that okay, or do you want…?

Ana Brnabić

Sure, yeah, yeah, yeah. Yeah.

Dr Robin Niblett CMG

Yeah? Why don’t we just do that? Right there, yeah, please, a hand up there. Got you, and there’s somebody at the back, yeah.

Robert Moreland

And Robert Moreland, I’m a former Member of the European Parliament. Could I go back to your comments on migration? Are you saying you would be happy for the EU to take a quite tough line on the amount of migration, the openness of the rest of the EU, in terms of freedom of movement for a long time? In other words, beyond the seven years, and, equally, your own approach to external migration, I remember going to Serbia five or six years ago, and public opinion was not happy about the migration obviously coming from North Africa.

Dr Robin Niblett CMG

Okay and we’re going to put it here, and then to the person at the back. So, maybe we could take the other microphone. Who’s got the other microphone? Yeah, at the back, put your hand up. Hand up.

Dominic Dudley

Dominic Dudley, a Freelance Journalist. I wanted to ask you about your relationships with the UAE, which has been quite a big investor in Serbia in the airline, in agriculture, and there’s been arms deals and so on, as well. How would you, kind of, characterise that relationship at the moment, and where do you see it moving forward into the future? Thanks.

Dr Robin Niblett CMG

Last question at the back. Who had their microphone – hand up? Where were you? Yeah, yeah, and you, I’ll let you use your time. We can go five minutes over, I’m sure.

George Surly

George Surly, student at the University of Reading. Just to bring it back to Russia, do you think that the relationship with Russia will pose problems when it comes to closing Chapter 35?

Dr Robin Niblett CMG

The menu, and yeah, I’ll let you organise that menu in the order you wish, and if you don’t get to them all, I think people would understand.

Ana Brnabić

Okay. So, Brexit, how does it affect us? It affects us, absolutely, because, I mean, you know, they’re – basically, if nothing else, it poses the challenges for the EU, so that, you know, they need to focus on Brexit, rather than the EU accession, and als – but, you know, on the positive side, I have to say that, thanks to Brexit, I was, for the first time in my life, in Brussels, and they told me, “You’re boring and predictable.” So that’s nice.

Dr Robin Niblett CMG

Boring and predictable, that’s so good, yeah.

Ana Brnabić

Yes, but not just Serbia, but Western Balkans, meaning that Brexit is a really tough thing for them. So, yeah, absolutely, it affects us.

Serbia didn’t recognise Kosovo as independent state, and how to reconcile that, compare – you know, considering that what we call temporary institutions in Pristina also have EU accession goals? I have to remind you that, you know, that five EU member states did not recognise independent Kosovo. Greece, Spain, Slovakia, Cyprus and Romania. So, to be honest, that’s why the European Commission has to be status neutral, because the European Commission is basically the Government of the EU member states. Since there is no consensus of the EU, whether Kosovo is independent or not, European Commission needs to be status neutral. So, you know, I hope that, you know, because of the, you know, all of the issues, in terms of the quality of life of citizens in the territory of Kosovo and Metohija, I hope that the reforms take place, and that we have European society there, as well under the temporary institutions. I have to say that, you know, Pristina needs to understand, and, unfortunately, I don’t know, it doesn’t seem to me right now that their political leaders understand that without a compromise with Serbia, other countries will not let them, at any point in time, in the EU, because other countries are not going to recognise them, to the point of – to the point that Spain, for example, even said that even if Serbia one day decides, which is, to me, impossible, to recognise independent Kosovo, we won’t. So, there is – there are much larger issues there, but again, the status quo is slowing us down, but it stops Pristina completely, which is why I don’t understand, for the life of me, why are we the only ones who are asking for compromise, begging for compromise? You know, because, I mean, compromise is more – you know, Pristina needs this compromise much more than we do, it seems to me, but, again, I hope that they will recognise that.

Dr Robin Niblett CMG

I don’t think logic these days, it’s not always going with everything else, yeah.

Ana Brnabić

The EU report, a level playing, field, listen, I’m not portraying a, you know, just a positive picture of Serbia here. There – as I said, there are so many things that we still need to work on, and I think I was pretty clear to say that, yeah, that, you know, we’ve done the least, in terms of the rule of law, and the most needs to be done, in the terms of rule of law. We’ve done the most in the economic reforms. The progress report was, and I think you will agree, overall, very positive, and, you know, certainly, there, you know, there are things that it was critical about, and then things that they’ve pointed out that we need to change. But, listen, if there is nothing to point out that we need to change, I guess we would be EU member country, you know? And obviously, it needs to be critical about something, and we still have a long way to go.

On the level playing field, private versus public, we’re – we’ve entered the, kind of, the reform of the public enterprises, and I think that’s what you’re referring to, and, as you know, we’ve, you know, after fulfilling, completing the three year arrangement with IMF with flying colours as one of the best countries, we’ve actually decided to go into another arrangement with IMF, so that we can have an objective observer, in addition to the EU, for our structural reforms, and one of the – one big part of it is public enterprise reforms. So, we’re going to continue doing that.

On the media freedom, again, I think there is media freedom in Serbia. I think I, you know, and I think that, if I’m not mistaken, that is – the testimony of that is that I can, you know, I don’t know any Journalist in Serbia that is afraid to say anything, in terms of critical thinking and about myself, the President, the Government, and I read about this and listen about it every single day in the media. You know, we can – you represent, you know, one of the investor in one of the media that holds 51% of the media distribution market, if I’m not mistaken, and is also, basically saying that, you know, Channel 1 is the media that we want to select and want, Channel 2 is the media that we want to select [inaudible – 62:34]. Independent regulators said, “No, actually, the Channel 1 needs to be RTS, as the national broadcaster, which, you know, you choose to ignore. So, I think there is a lot of media freedom.

Should we do more? Absolutely, as long as there is one person, Journalist, media that feels threatened, we should do more, and, as you know, you know, my Cabinet is working together with the media representatives, Journalist associations on the new media strategy, and this has been the first time that we actually – and Serbia had a working group where you had nine members of the media and Journalist associations and nine members of the Government. People, again, who are protesting and who are part of the media who’s criticising us, supporting, those people had the working group for the media strategy, which had one person representing all the media and Journalist associations. So, again, I think that, you know, we did not do enough, but it’s a step in the right direction, as well as with the rule of law.

This is the first time in Serbia that we had a public discussion on the constitutional changes. The Constitution in Serbia was changed in 2006, and much more extensively than the constitutions that we are – the constitutional changes that we are working on right now, that consider only the judiciary. There was not one single public meeting, public debate on the constitutional amendments. The Government at the time did not even ask for the opinion from the Venice Commission. So, again, is it, you know, fabulous, fantastic, perfect? No, but it’s such a step, big step forward in the right direction, compared to where we were in 2006, 2008, 2009, 2011, 2012. So, definitely, we are planning, and I said, and I say this every time, absolutely, you know, the comments from the report, progress report are important to us, the recommendations are even more important. So, we are going to continue doing our jobs.

Tough line on migration, in terms of, I guess, brain drain that you’ve asked. Is that – was that the…?

Dr Robin Niblett CMG

Sorry, yeah.

Member

[inaudible – 65:06].

Ana Brnabić

Free movement? Oh, no, no, no, no, no, no, absolutely not, they’ve – I think that free movement is, kind of, this civilisation norm, the standard. I’m all for free movement. I’m not – and, you know, I don’t intend to resolve brain drain problem by closing the borders, you know, I’m not – and I don’t think you can stop people. I intend to close it by making Serbia the country where people will not just want to stay, will want to come back to, and some, you know, and people from other countries will want to come to Serbia. And, perhaps, it seems like utopia to many people right now. I think it’s not, and I think we will be able to do it, but that means having a European Serbia. So, no, I intend to tackle and we are tackling brain drain and very different issues. I want Serbia to be a country that people – once it joins the EU, people will be happy because we joined the EU, not because they can leave.

So – and migration from North Africa, to be honest, Serbia is – I’m very proud with how Serbia handled migration crises in 2015/2016. We never raised borders or by wires. We were very welcoming. I’m very proud that we are one of the very, very few countries that opened schools to migrant children, and they still go to our schools. We’ve also been very smart, at the very early stages of the whole migration crisis, which I can, if, you know, I can testify we’re not very smart always, but this time we were very smart, and we recognised that there are many, many migrants who can contribute to our – through the betterment of our society. We’ve offered citizenship. Unfortunately, many of these people, most all of these people, mostly, did not – do not want to stay in Serbia. They want to go, again, towards Western Europe. So, we provided all of the conditions, the schooling, and, you know, and again, I don’t think that we did not have any Police brutality, quite on the contrary. I think that Serbia has faced so many migration crises in past, from the wars that we understand that people are not just fleeing homes because they like to live somewhere else, and…

Dr Robin Niblett CMG

I’m conscious of the time, so I don’t want to keep you.

Ana Brnabić

Okay, I’ll just…

Dr Robin Niblett CMG

A quick comment on UAE, if you wish, on closing line on Russia.

Ana Brnabić

UAE, it was, again, very open, honest relationship. We had significant investments coming in from UAE. Those contributed significantly to the recovery of our GDP and sustainable GDP growth. I hope we’ll have more and we’ll keep that kind of a close relationship with UAE, to be very honest.

And Russia, Chapter 35, I don’t think it will pose a problem. I think that, again, if there is, and we are far from it, today, unfortunately. Perhaps [inaudible– 68:29] can help us again, you know, in the dialogue in Pristina, but if there is a compromise, there is mutual acceptable, and mutually acceptable compromise to me, means only that both sides lose some, but both sides actually win a lot. Then, I don’t think that, you know, we – and I’m sure that from our point of view, we won’t let anyone interfere in that compromise, because we need it.

Dr Robin Niblett CMG

Ana Brnabić, there’s an expression in British, being a master of your brief, and I think we heard today a Prime Minister who is master of her brief, and I think, therefore, all of those who wish Serbia the very best, which I think is everyone here in this room, and our members who joined us for this meeting as well online, we wish Serbia every success in the future, and, as I said, they’ve got a Prime Minister who’s mastered her brief. We appreciate you taking so many questions, answered them very clearly. I look forward to welcoming you back. Thank you very much.

Ana Brnabić

Thank you.

Dr Robin Niblett CMG

A strong hand, please [applause].