Vol 1, No 1, 28 June 1999

M I O R I T A:
A 'New Marshall Plan' for Europe
Is a fifty-two-year-old idea really the best solution for the Balkans today?

By Catherine Lovatt

The end of the NATO bombings in Yugoslavia and the withdrawal of Serb troops from Kosova have opened the door to the promised 'Balkan plan'. Bill Clinton, Tony Blair and leaders of the European Union have already begun discussions with the purpose of safeguarding the security and development of Central and Eastern Europe. A 'new' Marshall Plan for Europe is regarded as the safest way forward for all parties. The modification of a fifty-two year old plan, however, poses some problems.

At the close of World War Two, the Marshall Plan (1947) was implemented to rebuild Western Europe. Today, the G8 countries have already agreed to a 'new' Marshall Plan, a stability pact aimed at bringing prosperity and democracy to the Balkans. The conflict in Kosova has highlighted the tensions in the Balkan region and provided a new urgency in efforts to eliminate political, economic and social problems. Although the focal point will be Yugoslavia, the plan aims to encompass development in the surrounding countries - Bulgaria, Romania, Hungary and Albania. In this respect, the new programme goes a step further than the Bosnian reconstruction plan, which failed to recognise the difficulties the Bosnian conflict created for Bosnia's neighbours.

It is clear that a 'new' Marshall Plan could be extremely beneficial for those countries wishing to gain quick entry into the EU and NATO. The plan has its sceptics, however.

Peter Ludlow, director of the Centre for European Policy Studies in Brussels, argues that many of the region's economies are in no shape for fast-track accession to the EU. The Kosovan conflict has also hindered economic development in the region, particularly in Romania and Bulgaria, where strong Danube trade links were severely damaged as a direct result of NATO bombing. Romania has estimated the cost to her ailing economy from lost trade in Danube shipping at USD 850 million. It is unlikely that these trade links will be re-established rapidly, thus further losses are expected. Ludlow does admit that the Balkan region will see increased economic aid and assistance which could help to remedy the problem, but he notes this will be useful only if the institutional infrastructure is there to support it. At present, the Romanian infrastructure is riddled with flaws.

A detailed programme of development is essential if the Balkan region is to make any progress in the next century, but the rapid agreement of the G8, EU and NATO upon a development programme could actually be detrimental. Rushing to find a solution to the 'Balkan Crisis' could give rise to further tensions: co-operation between the Balkan states will have to be forged rapidly, and disagreements may ensue. Here the main concern is Yugoslavia: although the bombing has stopped and the Serbs have pulled out of Kosova, NATO troops are struggling to maintain peace in a region where ethnic hatreds are rife.

Bilateral efforts

In contrast, Romania is already working towards promoting stability in the Balkans. A recent meeting between the Romanian and Greek presidents resulted in a pledge to pool forces in order to alter the image of the Balkans. Emil Constantinescu said that 'the old image of the Balkans as the powderkeg of Europe needs to be replaced with a new one - that of Europe's freight container' (Reuters, 16 June 1999).

Constantinescu and Stephanopoulos both agreed that the European Union and the United States should play a major role in Balkan development. Economically the Balkan countries are too unstable to bear the brunt of any major reform task. However, the Romanian and Greek governments are encouraging their businesspeople and entrepreneurs to co-operate with the stability plan put forward by the G8 countries. Romanian Foreign Minister, Andrei Plesu commented that: 'this pact opens a different prospect for the entire region. It is not about distributing money, but about setting up long-lasting co-operation for everyone's benefit' (Reuters, 13 June 1999). Some analysts have gone one step further, arguing that by binding Eastern and Western Europe closely, future conflict could be avoided.

The Romanian and Greek presidents have taken the first step in developing a stable, democratic and secure region, but for them to succeed, co-operation between all the Balkan countries is vital. Inter-ethnic disagreements within all countries of the Balkans and the political, economic and social climate in Yugoslavia may prevent the 'new Balkan image' from being realised.

Old solution, new problem

In theory the 'new' Marshall Plan is promising, but in reality the situation may be quite different. The original Marshall Plan was introduced in 1947, and although modified, the Balkan 'Stability Pact' is a reworking of that programme introduced fifty-two years ago to rebuild Western Europe after World War Two.

In 1999, things are very different. The Balkan region has far more national, ethnic and religious groups than Western Europe in the 1940s. The situations are distinct, and to apply similar tactics as in 1947 could prove to be disastrous.

Some might say that calling the 'Stability Pact' the 'new' Marshall Plan is misleading. Many Western leaders, including American Secretary of State Madeleine Albright, see the whole stream of European developments since 1947 as a part of the original Marshall Plan. In 1997, Albright commented that NATO expansion would continue the process of integration begun after World War Two and lead finally to the creation of an undivided, democratic and free Europe. She also recalled the spirit and relevance of the Marshall Plan in a statement about the need for economic and political stability in Central and Eastern Europe (Radio Free Europe, May 1997).

However, this opinion seems far-fetched: European development since 1947 has been much more multi-faceted and complex and is not simply the natural extension of one master plan.

The end of the Kosovan conflict offers many opportunities; a 'new' Marshall Plan is only one of them. All the Balkan countries, including Yugoslavia, now have a chance to make significant progress at the start of a new millennium. The key will be to reject traditions of ethnic violence and seek multi-lateral co-operation to create the strong, interdependent relations necessary for successful political, economic and social development in the region.

Catherine Lovatt, 24 June 1999





Baltic States
Czech Republic


Hungary Counts
the Costs of War

Schuster's Slovakia

The Great
Czech Malaise

The Rise of
Tartu, Estonia

NATO Will Crack
in Kosova

Serb Proposals for
Partitioning Kosova

Faults in the Balkan
Stability Pact

Hope for Russia's
Capital Markets


Central Europe

Lateral Thinking on
Central Europe


Book Shop


Crushed by Stalin

Music Shop


Central European
Culture in the UK


Festival Report:
Karlovy Vary

The Russian Soul:
Lutsik's Okraina


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