Friday, May 27, 2011

Mladić arrest "opens door" to EU membership

The announcement yesterday of the apprehension of Ratko Mladić was broadly welcomed around the world. While there were a few of his supporters protesting in parts of former Yugoslavia, they were in a minority. A fugitive of some 16 years, Mladić was wanted for war crimes, in particular the Srebrenica massacre which saw 8,000 men, women and children killed in a campaign of 'ethnic cleansing' perpetrated during the Balkan conflict in the early 1990s.

Following the split of Yugoslavia into independent states, Serbia was refused any offer of joining the European Union until Mladić was handed over to the Hague to stand trial for genocide.

With Serbian President Boris Tadic talking of closing "one chapter of our recent history" he was evidently hoping of opening a new chapter with possible accession to the European Union.

Step towards EU membership

EU leaders have praised his decision to hand of the accused war criminal. UK Foreign Secretary William Hague hailed the arrest as a "historic moment" while French President Nicolas Sarkozy said it was "a very courageous decision by the Serbian presidency".

"It hasn't been an easy choice," Sarkozy said. But he was generally positive as he spoke at the G8 in Deauville, France. "It's one more step towards Serbia's integration one day into the European Union."

Bloomberg reporter Elliott Gotkine Bloomberg said Serbia was likely to become an official EU member candidate, joining a list of other hopefuls Iceland, Turkey, Macedonia and Croatia. Amongst other countries wanting to join the EU are Bosnia and Kosovo.

However, while the handing over of Mladić is certainly a step forward, Serbia will have to fulfill other criteria. Any potential member state should prove it has a functioning market economy, something the current member states are finding difficult to maintain [BBC / Guardian].

The so-called PIGS [Portugal, Italy, Greece and Spain] are still on an economic rollercoaster ride. At the G8 the main focus has been the economy, though the crisis in Libya has also featured strongly [Reuters].

Europe's debt crisis remained the buzz word, with Japan and the US also suffering from heavy debts. While such issues were not officially on the agenda, it was difficult to get delegates off the subject.

Looking to China for help

America has been bailed by China to the tune of billions of dollars. And now there is even talk of some European countries looking to the east for financial help. Already there appears to be some interest on China's part in bailing out those with an empty trough. On Sunday President Hu Jintao said China would back Portugal's efforts to deal with fallout from the world financial crisis, but he stopped short of promising to buy Portuguese bonds as the debt-ridden country had hoped [Reuters]. In December last year Portugal's minister of finance, Fernando Teixeira dos Santos, had flown to China to make an appeal for help [BBC].

But China is certainly will to pick up some of the tab. In April, Premier Wen Jiabao promised to buy Greek government bonds when Athens returns to markets, in a show of support for the country whose debt burden pushed the eurozone into crisis and required an international bailout.

Nonetheless China has remained cautious in putting all its cards on the table. While Beijing has acknowledged it remains a significant holder in Portuguese and Greek sovereign bonds, Chinese officials have been reluctant to disclose where in Europe it will make investments [FT].

Pessimistic outlook

The big fly in the ointment at present is Greece and the IMF. There have been many outspoken voices  saying further bailouts of the Greek economy would be foolhardy.

Peer Steinbrueck, former German finance minister and possible contender for Germany's next Chancellor he insisted the problems pertaining to Greece could only be tackled by cutting back. It is "necessary to have haircut," Steinbrueck said, edging towards a theory of default followed by a working out of contagion risks. Steinbrueck was not the only one to raise his voice. Jean-Claude Juncker, who chairs meetings of eurozone finance ministers, took it upon himself to come out in public and say just how bad the Greece situation had become.

And he was pessimistic concerning how the financial problems might be solved. He said the "troika" [the IMF, the ECB, and the EU] had to agree all of Greece's funding needs for the next 12 months and their being covered or guaranteed by someone, something they had failed to do. "I'm not the spokesman of the International Monetary Fund, but the rules say they can only disburse if there is a financing guarantee for the 12-month period," Juncker said, "I don't think that the troika will come to this result." [Reuters]

With such an unclear economic future riding on Greece, and the EU as a whole, it is a little perplexing why other nations would wish to join the party when the drink is running out.

tvnewswatch, Beijing, China

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