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EU Strategy for the Danube Region and the Western Balkans: Development of Trans-European Transportation Networks – Challenges and Opportunities

On the 27th of June, the Institute for Foreign Affairs and Trade (IFAT) and the Ministry of Foreign Affairs and Trade of Hungary organised the second Danube Region Strategy Conference entitled "EU Strategy for the Danube Region and the Western Balkans: Development of Trans-European Transportation Networks – Challenges and Opportunities” at IFAT. The program of the conference involved a closed panel session in the morning and a public roundtable discussion during the afternoon.

During the closed morning panel session, transport experts from the Danube region and the Western Balkans discussed the current challenges affecting this region. Apart from technical issues, the emphasis was more on the external and institutional factors affecting economic developments and the deepening of transport interconnectivity. The importance of coordinating national strategies, the effective use of EU cohesion funds, and the need to integrate academic research into policy-making were all elaborated in detail, as was the need for a longer term perspective on these matters. In a more global view, the economic and social consequences of increasing Chinese and Turkish investment into the Western Balkans were also on the agenda.

The roundtable discussion was opened by Ambassador Márton Schőberl, Director of IFAT, who in his welcome speech highlighted that Hungary assumed the presidency of the EU’s Danube Region Strategy in November 2016, and pledged to host a high-level Annual Forum on 18th-19th October 2017 in Budapest. To prepare for this, the Institute for Foreign Affairs and Trade (IFAT), with the support of the Ministry of Foreign Affairs and Trade of Hungary, is currently organising a series of conferences covering current issues of mutual interest to Member States of the Danube Region Strategy, namely energy, transport, and clean connectivity. The first conference, entitled “DRS Energy Prospects Post-2020”, was held at IFAT on 31st May 2017. Now, the second conference focused on the transportation aspect of the Danube Region.

On the behalf of the presidency of EU’s Danube Strategy, Head of Cabinet Katalin Bihari transmitted the welcoming wishes of István Joó, Ministerial Commissioner for Water Diplomacy, Export and the Danube Region Strategy, Ministry of Foreign Affairs and Trade of Hungary. Ms Bihari argued that three transnational projects have entered the implementation phase with around 8 million EUR worth of EU funding. She asserted that the Hungarian presidency encourages cooperation with Western Balkan countries, Ukraine and Moldova in order to establish a regular dialogue and to share best practices. Strengthening the cooperation and increasing the amount of dialogue among macro-regional strategies is another priority. She further elaborated that the goal of the Danube Strategy is to create a secure, connected and prosperous region which has three pillars: energy security, infrastructural development and clean connectivity. Therefore, this conference played a vital role in discussing how to increase the region’s connectivity with the countries of the Western Balkans.

A keynote speech was also delivered by Cesare Bernabei, active senior advisor and former representative of the European Commission’s urban development strategies. He expressed that it is worth reminding that the Balkans is a very important region for Europe because it represents the connection to the East. As it is a transit region, we have to create an effective transport system. The Danube Strategy shall not only focus on the European Union’s member states, but on trans-European networks as well which cover countries of the Western Balkans. Another aspect that Mr Bernabei touched upon was the importance of sustainable transportation systems which is very important from the perspective of civil society.

The keynote speeches were followed by a roundtable discussion with the participation of Dušan Proroković, associate researcher, Institute for International Politics and Economics, Serbia, Szabolcs Vágvölgyi, scientific associate, Századvég Economic Research Institute, Hungary and Ion Voicu Sucala, associate professor, Department of Management and Economic Engineering, Technical University of Cluj-Napoca, Romania. The panel was moderated by Diána Szőke, senior analyst, Institute for Foreign Affairs and Trade, Hungary.

Dušan Proroković introduced the recent EU plans regarding corridors that shall pass the Balkan region and emphasised the geo-economic aspects of transportation by highlighting that these corridors shall not compete with each other. At the moment, strategies are not compatible at all and there are parallel constructions for example of Corridor 4 and Corridor 10 which shall connect Europe with Asia. In addition, numerous contradictions can be found between pan-European projects and national projects of the Balkan states residing outside of EU portfolios. Regarding transportation, Proroković claimed that the economic - and sometimes the political - life of the Balkans is not optimal for development. He concluded with the thoughts that other dimensions of the Danube Strategy shall be considered. In order to stimulate development, we need a new vision, a new political initiative since transportation is an issue of European security as well.

In his presentation, Szabolcs Vágvölgyi introduced his ongoing research regarding the alternative road fuels infrastructure in the Danube Region, the development pathway to interoperability and why alternative subsidisation shall take place. While some branches of the sectors are already fully compatible, differences between operational costs and technical knowledge co-exist. He argued that in order to overcome these challenges, a social and technical transition is needed from the fossil fuel sector to alternative fuel vehicles. Vágvölgyi also presented several case studies on different countries. While Brazil has a developed biofuel sector based on bioethanol, China has the largest electric vehicle market and Japan is known from the advanced use of hydrogen fuel cells. He also compared the infrastructure capabilities of Austria and Serbia.

Ion Voicu Sucala talked about the challenges of economic development in Eastern Europe around the Danube including the Balkan countries and about the importance of transportation strategies with a special focus on the Trans-European Transport Network (TEN-T). According to him, the biggest challenge is to overcome the middle-income trap. He raised the question whether development leads to good transportation routes or vice versa. He argued that the Western Balkan is a region full of conflicts and for these countries EU integration is the biggest opportunity to develop in a peaceful manner. However, a number of competitive strategies can be found in the region with different interests stemming from the EU, China, Turkey and Russia. If a country does not have the vision regarding the long-term development of transportation, regardless how much EU money is allocated, the success rate will be very low, especially in a country which is trapped in middle-income trap. Therefore, a new model for sustainable economic development is needed.