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Balkans: Eight Countries Move Ahead With Electricity-Sharing Agreement

Eight Balkan countries will soon share a region-wide common electricity market. Erhard Busek, the special coordinator of the Stability Pact for South Eastern Europe, has hailed the plan -- which aims to replace spending on new electricity generation with cooperative use of existing sources -- as a "breakthrough."

Tirana, 15 October 2002 (RFE/RL) -- Erhard Busek, the special coordinator of the Stability Pact for South Eastern Europe, is welcoming a step toward the creation of a liberalized regional electricity market in the region.

Busek, speaking yesterday in Tirana, said an eight-country agreement -- comprising Albania, Bosnia-Herzegovina, Bulgaria, Croatia, Greece, Romania, Macedonia, and Yugoslavia -- will eventually help bring the region's electricity legislation in line with EU standards.

"With the South East Electricity Regulatory Forum initiative, the European Commission, in close cooperation with the Stability Pact, has proposed a coherent vision regarding the development of a competitive regional electricity market. In mid-November, ministers are meeting and a memorandum of understanding will be signed. And then the work is starting in every country of the region in close cooperation with the European Union."

The memorandum, to be signed in Athens on 15 November, will obligate regional governments to transform their production and transmission entities into legally independent units. Stability Pact officials have praised the Regional Electricity Market project as ultimately bringing lower costs and better service to consumers, as well as reducing the need for future industry investments.

Busek says: "By opening up the various economies, a common market of 55 million consumers will become reality next year. If you compare that to the economic development of elsewhere in Europe, then we all know that free trade is in many ways just as important as infrastructure developments."

Last month, Busek praised Stability Pact governments for their advancements toward target goals for 2002. Busek cited progress on refugees, cross-border cooperation, small arms and light weapons, and organized crime. He said the remaining two goals -- pushing ahead with the electricity market and free trade -- have shown overall progress but that much work remains.

Albanian President Alfred Moisiu said the international presence in the Balkans had increased regional awareness about the importance of working together to lay the groundwork for future cooperation: "Now it is clear that the region in its entirety appears much more attractive and productive as any one of our countries alone. A region of interethnic wars, conflicts, and great clashes is becoming an area where exchanges, bilateral projects, and the quick pace of cooperation remind me of the time of the Marshall Plan after World War II."

The Stability Pact focuses primarily on regional infrastructure needs. These include the construction of roads, railways, ports, waterways, and airports; the energy sector; water and environmental management; and cross-border trade facilitation. To date, some 46 projects have been financed by the Stability Pact, at a total cost of some 3.46 billion euros.