[Senate Hearing 117-279]
[From the U.S. Government Publishing Office]
S. Hrg. 117-279
WESTERN BALKANS: SUPPORTING
PEACE AND PROSPERITY
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON EUROPE AND
REGIONAL SECURITY COOPERATION
OF THE
COMMITTEE ON FOREIGN RELATIONS
UNITED STATES SENATE
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
__________
FEBRUARY 16, 2022
__________
Printed for the use of the Committee on Foreign Relations
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available via http://www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
47-757 PDF WASHINGTON : 2022
-----------------------------------------------------------------------------------
COMMITTEE ON FOREIGN RELATIONS
ROBERT MENENDEZ, New Jersey, Chairman
BENJAMIN L. CARDIN, Maryland JAMES E. RISCH, Idaho
JEANNE SHAHEEN, New Hampshire MARCO RUBIO, Florida
CHRISTOPHER A. COONS, Delaware RON JOHNSON, Wisconsin
CHRISTOPHER MURPHY, Connecticut MITT ROMNEY, Utah
TIM KAINE, Virginia ROB PORTMAN, Ohio
EDWARD J. MARKEY, Massachusetts RAND PAUL, Kentucky
JEFF MERKLEY, Oregon TODD YOUNG, Indiana
CORY A. BOOKER, New Jersey JOHN BARRASSO, Wyoming
BRIAN SCHATZ, Hawaii TED CRUZ, Texas
CHRIS VAN HOLLEN, Maryland MIKE ROUNDS, South Dakota
BILL HAGERTY, Tennessee
Damian Murphy, Staff Director
Christopher M. Socha, Republican Staff Director
John Dutton, Chief Clerk
SUBCOMMITTEE ON EUROPE AND
REGIONAL SECURITY COOPERATION
JEANNE SHAHEEN, New Hampshire, Chairman
BENJAMIN L. CARDIN, Maryland RON JOHNSON, Wisconsin
CHRISTOPHER MURPHY, Connecticut JOHN BARRASSO, Wyoming
CHRIS VAN HOLLEN, Maryland MITT ROMNEY, Utah
CHRISTOPHER A. COONS, Delaware ROB PORTMAN, Ohio
TODD YOUNG, Indiana
(ii)
C O N T E N T S
----------
Page
Shaheen, Hon. Jeanne, U.S. Senator From New Hampshire............ 1
Johnson, Hon. Ron, U.S. Senator From Wisconsin................... 3
Prepared Statement........................................... 4
Escobar, Gabriel, Special Representative for the Western Balkans,
Deputy Assistant Secretary of State for Europe and Eurasian
Affairs, U.S. Department of State, Washington, DC.............. 4
Prepared Statement........................................... 6
Lisa Magno, Deputy Assistant Administrator for the Bureau for
Europe and Eurasia, U.S. Agency for International Development,
Washington, DC................................................. 8
Prepared Statement........................................... 9
Additional Material Submitted for the Record
Responses of Mr. Gabriel Escobar to Questions Submitted by
Senator Robert Menendez........................................ 25
Letters From the Embassies of Albania, Bosnia and Herzegovina,
Kosovo, Montenegro, North Macedonia, and Serbia Concerning the
Western
Balkans........................................................ 27
(iii)
WESTERN BALKANS: SUPPORTING
PEACE AND PROSPERITY
----------
WEDNESDAY, FEBRUARY 16, 2022
U.S. Senate,
Subcommittee on Europe and Regional
Security Cooperation,
Committee on Foreign Relations,
Washington, DC.
The subcommittee met, pursuant to notice, at 10:00 a.m., in
room SD-G50, Dirksen Senate Office Building, and via Webex,
Hon. Jeanne Shaheen, chairman of the subcommittee, presiding.
Present: Senators Shaheen [presiding], Menendez, Cardin,
Murphy, Van Hollen, Johnson, Romney, and Young.
OPENING STATEMENT OF HON. JEANNE SHAHEEN,
U.S. SENATOR FROM NEW HAMPSHIRE
Senator Shaheen. Good morning. This meeting of the Senate
Foreign Relations Europe Subcommittee will come to order. I am
pleased to be joined by Ranking Member Senator Johnson from
Wisconsin, as well as Senator Murphy, from Connecticut.
Supporting peace in the Western Balkans remains an
important U.S. priority, and I hope that our discussion today
will address how Congress can best support the efforts that are
already underway.
There should be no question as to why this region matters
for U.S. security. It was not that long ago that we witnessed
the breakup of the former Yugoslav Republic and saw the
horrible and unrepeatable tragedy of war in the region. It has
been a priority in the ensuing decades to repair the damage
from that conflict and build a prosperous and peaceful region
in the heart of Europe.
I had the privilege of visiting the Western Balkans in
2010, and I returned several times, most recently to
commemorate the 20th anniversary of the Srebrenica massacre.
Together, we have witnessed remarkable progress for peace,
democracy, and equality in the region. Montenegro and Serbia
have opened accession negotiations with the EU. Similarly,
Albania and North Macedonia are awaiting the official opening
of EU accession talks. Albania, Montenegro, and North Macedonia
are now members of NATO. We have deep engagement through
diplomatic and defense relations, including a recently
announced forward-based Special Operations Forces headquarters
in Albania.
There are also concerning developments in areas where we
still need to improve the pace of progress. That is why we have
convened this hearing today and very much appreciate our
witnesses joining us.
Bosnia faces an uncertain future, as Bosnian Serb leader
Milorad Dodik wants to undermine the unifying government by
pushing for the secession of the Republika Srpska. His efforts
to withdraw key institutions from the unified state risk the
unity at the heart of the Bosnian state. At the same time,
political power struggles prevent the government from
functioning and corruption stalls economic development, driving
young people to flee the country.
Across the Balkans, improving economic development and
prosperity is a key concern for ensuring a stable and
democratic future. To address a lack of employment and prevent
young people from seeking prosperity elsewhere, we must look
toward better regional economic integration, like that of the
Open Balkans Initiative, which shows promise for building
connections among neighboring economies.
Another sign of a robust democracy is a government that is
transparent and accountable to its people. Here, too, we are
seeing positive developments, as we have seen major reforms,
particularly in the judicial sector take hold in some countries
in the region.
I also want to express, at the outset, my appreciation for
those Balkan states who stepped up to host Afghan refugees who
are awaiting resettlement in the United States and other
countries. It is especially poignant that in a region which has
long known conflict, many are opening their arms to people
fleeing conflict on their own, and here in the United States we
very much appreciate that.
Finally, we have seen years of hard-won peace in the
Western Balkans, but as is often the case, this is a fragile
peace that requires constant attention to maintain. With the
events in Ukraine and with Russia's continued threats to
democratic values there and around the world, it is all the
more important that we stay the course in the Western Balkans.
That is why I have been pleased with the high level of
engagement from this Administration in the past few months, and
I want to acknowledge the efforts of the State Department and
USAID, including Administrator Power's recent visit to the
region.
I also want to recognize the embassies who have submitted
letters for this hearing: Albania, Bosnia and Herzegovina,
Kosovo, Montenegro, North Macedonia, and Serbia. Without
objection, these statements will be entered into the record.
[Editor's note.--The information referred to above can be found
in the ``Additional Material Submitted for the Record'' section
at the end of this hearing.]
Senator Shaheen. Once again, before I introduce the people
testifying today, I just want to take a minute to reiterate the
need for us to act to get U.S. ambassadors in place. Currently,
we are awaiting a vote on nominee Christopher Hill to be
Ambassador to Serbia. Ambassador Hill is a career diplomat, one
with extensive experience in the region, and his expertise is
needed to advance our national security priorities there. So I
am hopeful that we will see Congress move on his appointment as
soon as possible.
We must not underestimate the importance of keeping a
critical eye on issues of concern in the Western Balkans while
working at the same time to build a positive and prosperous
future that is grounded in European integration. I hope this
hearing will help us in that.
Let me just introduce our witnesses who will begin after
Senator Johnson's remarks.
Our first witness today is Deputy Assistant Secretary of
State for the Bureau of European and Eurasian Affairs at the
Department of State, Gabriel Escobar. Mr. Escobar also holds
the title of Special Representative to the Western Balkans,
where he has been numerous times since his appointment last
fall. Mr. Escobar is no stranger to the region, having most
recently served overseas as the Deputy Chief of Mission in
Embassy Belgrade.
His Balkan expertise goes back even farther in his long
career as a diplomat. From 1998 to 2001, Mr. Escobar completed
four consecutive tours in the Balkans, in Banja Luka, Bosnia
and Herzegovina, Podgorica, and Belgrade. We are fortunate to
have someone with such deep and longstanding knowledge of the
region in your position, Mr. Escobar, and we very much look
forward to hearing your testimony.
Ms. Lisa Magno is Deputy Assistant Administrator in the
Bureau for Europe and Eurasia at the U.S. Agency for
International Development. Ms. Magno also comes from a recent
tour in the region. She was the USAID Mission Director in
Kosovo for 3 years. Her experience with USAID over the last 30
years has taken her all over East Asia and Latin America, where
she has worked closely with civil society and local partners
implementing USAID programs. We are grateful to have Ms. Magno
here representing USAID and the work they do in the region,
which we know is very important for Administrator Power.
So with that I will turn to the Ranking Member, Senator
Johnson, and when he is finished ask our witnesses to testify.
Senator Johnson.
STATEMENT OF HON. RON JOHNSON,
U.S. SENATOR FROM WISCONSIN
Senator Johnson. Well thank you, Madam Chair. I would also
like to welcome our witnesses. I am looking forward to your
testimony and our discussion regarding the Western Balkans.
I think it was kind of noteworthy about this hearing. By
the way, I would just ask my written opening statement be
entered into the record, because I would be repeating an awful
lot of things that you just stated, and I think that is what is
noteworthy. I have been a member of this committee and
subcommittee for a number of years, and we certainly have begun
focusing more on the Western Balkans. I know the countries of
the region want U.S. involvement. I think it is obviously
interesting. It seems like they want our involvement in their
disputes, and they want us to side with them, impose a
solution. We are just not going to do that. We are not going to
do it on a bipartisan basis.
Whether it was this Administration or the previous
Administration, or the Administration before that, we have been
paying attention to the region because we realize stability in
the Western Balkans is important. We want to be supportive of
stability. We are concerned about China's initiative. We want
them to embrace the rule of law, reduce corruption, so that
foreign investment can flow in there, the right kind of foreign
investment.
So I think the fact that we are holding this hearing should
send a very strong signal that we are paying attention, we want
to be supportive, we are not going to impose solutions, and on
a bipartisan basis. Regardless of Administration, regardless of
Republican or Democrat, we want to see peace and stability in
the region, and we are going to be supportive of it.
So with that I will enter my remarks into the record and
look forward to the testimony.
[The prepared statement of Senator Ron Johnson follows:]
Prepared Statement of Senator Ron Johnson
Thank you Senator Shaheen.
Today's hearing will examine recent developments in Southeast
Europe, specifically in the Western Balkans, and U.S. policy options
for the region. Many Western Balkan countries are still seeking greater
European and transatlantic integration, and U.S. interests would be
well served by helping them achieve it.
There has been significant progress in the Balkans over the last
decade. Yes, considerable challenges remain, but solving them does not
require any great U.S. expenditure; it requires U.S. patience and
leadership. Again and again, we have seen consistent U.S. diplomatic
engagement help overcome intractable disputes in the Western Balkans.
Our goal here today is to examine the Administration's plans for
furthering that record.
NATO and EU integration remain critical incentives for Western
Balkan countries to make the difficult reforms needed to combat
corruption and strengthen the rule of law. Building transparent and
impartial legal systems is essential for attracting the foreign
investment needed for growth and to offer young people enough economic
opportunity to stay in their home countries. And there is real progress
on many fronts. In Albania, North Macedonia, and last month in Serbia,
major judicial reforms have brought these countries closer to EU
standards and boosted their EU aspirations.
In 2017 and 2019, I had the honor of presiding over the Senate as
we voted overwhelmingly to welcome Montenegro and North Macedonia into
NATO. Four of the seven Western Balkan nations are now in the alliance,
Albania and Croatia having joined in 2009. Last year, I was at the
White House for the signing of the Washington Agreement between Kosovo
and Serbia. Albania and North Macedonia are well on their way to being
welcomed as the next EU members. While Serbia, Kosovo, and Bosnia and
Herzegovina still have a ways to go, their transatlantic trajectory is
clear. We must build on the progress made already, prioritize Serbia
and Kosovo normalization, and continue to push Bosnia and Herzegovina
to enact needed electoral and constitutional reforms.
We have only to look to the crisis unfolding on Ukraine's borders
to grasp the importance of European and transatlantic integration for
all of the Western Balkan nations. The United States wants peace,
prosperity, security, and freedom for the people of the region. There
should be a sense of urgency to ensure that progress on European
integration in the Western Balkans continues, and U.S. leadership will
continue to be vital.
I look forward to hearing from our witnesses today about the Biden
administration's strategy for promoting progress and prosperity in the
region.
Senator Shaheen. Thank you very much, Senator Johnson. DAS
Escobar, we will ask you to begin.
STATEMENT OF GABRIEL ESCOBAR, SPECIAL REPRESENTATIVE FOR THE
WESTERN BALKANS, DEPUTY ASSISTANT SECRETARY OF STATE FOR EUROPE
AND EURASIAN AFFAIRS, U.S. DEPARTMENT OF STATE, WASHINGTON, DC
Mr. Escobar. Chairwoman Shaheen, Ranking Member Johnson,
distinguished members of the subcommittee, thank you for
inviting me to discuss engagement in the Western Balkans. A
Europe free, whole, and at peace remains in the United States'
vital interest and at the core of our policy. The Western
Balkans is central to this vision, although its potential
remains unfulfilled. The Biden administration recognizes this
challenge and remains committed to this region, which is an
indivisible part of Europe. Our longstanding diplomatic
engagement supports the Western Balkans' full integration into
Euro-Atlantic structures. A stronger Balkans, integrated in a
stronger Europe, means a stronger transatlantic community.
The United States continues to deepen our partnerships in
the region. In the past few months, we celebrated 140 years of
diplomatic relations with Serbia and held our first bilateral
defense consultations in 5 years. We announced a forward-based
Special Operations Forces headquarters in Albania, welcomed
Croatia into the visa waiver program, and relied heavily on our
partners in Kosovo, Albania, and North Macedonia in an hour of
need to temporarily host thousands of Afghan evacuees.
We continue to build America's economic ties to the region.
In the past year, we launched the inaugural U.S.-Montenegro
economic dialogue, bolstered European energy security through
projects in Albania and Croatia, and celebrated significant
investments by U.S. firms in Serbia.
Our partners are set on integrating with the European
Union. Single market and regional initiatives such as the EU
Common Regional Market, Open Balkan, and Green Agenda show that
deeper economic cooperation is indispensable for growth and EU
membership. There are vast opportunities for U.S. businesses,
and we encourage countries to strengthen the rule of law, fight
corruption, and increase transparency to expand investment
opportunities. These reforms will increase prosperity,
prioritize clean energy, and stem the brain drain.
Indicators of progress toward EU integration include deeper
regional cooperation and growing democratic and economic
development. We have seen earnest efforts to strengthen
democratic institutions and counter corruption in the region,
but there have also been setbacks. In Bosnia and Herzegovina,
the ongoing political crisis and endemic corruption hurts its
citizens and jeopardizes regional stability, Euro-Atlantic
integration, and progress achieved since the Dayton Peace
Accords.
We continue to make clear to all leaders that de-escalation
of rhetoric and resolution of differences through
constitutional processes are the only paths in democracy. Along
with our European partners, we are vigorously engaged with
local actors to find ways forward on the path from Dayton to
Brussels, including through step-by-step reforms that will
benefit all of the citizens.
The need for dialogue, compromise, and reform applies
across the region. We strongly back the EU-facilitated dialogue
to normalize relationships between Kosovo and Serbia. The
dialogue is the forum in which both sides, as equals, must work
together to resolve their differences and find a comprehensive
agreement, which both countries need for the European futures.
We believe this effort should be centered on mutual
recognition.
We continue to work with our EU partners to advance EU
integration in the region and reinforce the importance of
keeping Europe's doors open as the most important incentive for
reforms. North Macedonia and Albania have made significant
reforms and sacrifice, and deserve to advance in the accession
process. Forward momentum would be important proof for the
entire region that difficult compromises enable a better
future.
Conversely, our warning to actors who engage in corrupt,
destabilizing, or anti-democratic behavior is clear: there will
be consequences. In December, we utilized Global Magnitsky
authorities against an organized criminal group operating in
the region. In January, the Treasury Department designated
Milorad Dodik and a television station under his control using
new Western Balkans sanctions authority. The State Department
also imposed visa restrictions under our Section 7031(c)
authorities against corrupt officials. We will use all
available tools to hold accountable those who block the
region's progress for their own financial and political gain.
Regional progress is also threatened by foreign political
and economic influences from Russia and China. Russia
weaponizes its energy supply to coerce politicians, foster
corruption, and stunt growth potential. It also fans ethno-
nationalism and divides and distracts from a brighter future.
The People's Republic of China is expanding its presence by
building critical infrastructure through opaque and predatory
loans and so-called investments. Promoting transparent
governance, human rights, and a rules-based international order
will remain the core of our engagement against these
destabilizing activities.
In closing, the Western Balkans have been the focus of
sustained U.S. engagement, investment, and bipartisan support
for three decades. The results are clear: the countries of the
former Yugoslavia now include four NATO allies and two EU
member states. Among the countries of the Western Balkans, four
are NATO allies and all are either EU aspirants or EU member
states.
Our job is not over. Our continued leadership, including
here in the Senate, remains essential to completing the
transformation of the Western Balkans into stronger partners,
able to contribute to global peace and prosperity. We continue
to stress the need for a fully confirmed slate of ambassadors
in the Western Balkans, most notably our nominee to Serbia, who
is awaiting confirmation by the full Senate. I will continue to
work with Congress on this effort and welcome your questions.
Thank you.
[The prepared statement of Mr. Escobar follows:]
Prepared Statement of Mr. Gabriel Escobar
Chairwoman Shaheen, Ranking Member Johnson, distinguished Members
of the Subcommittee, thank you for inviting me to discuss engagement in
the Western Balkans. A Europe free, whole, prosperous, and at peace
remains in the United States' vital interest and at the core of our
policy. The Western Balkans is central to this vision, although its
potential remains unfulfilled. The Biden administration recognizes this
challenge and remains committed to this region, which is historically,
politically, culturally, and geographically an indivisible part of
Europe. Our longstanding diplomatic engagement supports the Western
Balkans' full integration into Euro-Atlantic structures. A stronger
Balkans, integrated in a stronger Europe, makes a stronger
Transatlantic Partnership.
To these ends, the United States continues to deepen our
longstanding partnerships in the region. In the past few months alone,
we: celebrated 140 years of diplomatic relations with Serbia and held
our first bilateral defense consultations in 5 years; announced a
forward-based special operations forces headquarters in Albania;
welcomed Croatia into the visa waiver program to expand bilateral
travel and commerce; and relied heavily on our partners in Kosovo,
Albania, and North Macedonia in an hour of need to temporarily host
thousands of Afghan evacuees.
We also continue to build America's economic ties to the region. In
the past year, we launched the inaugural U.S.-Montenegro economic
dialogue, bolstered European energy security through projects in
Albania and Croatia, and celebrated significant investments by U.S.
firms in Serbia. Our partners in the Western Balkans are set on
integrating more closely with the EU single market, and we continue to
support them. Regional initiatives such as the EU Common Regional
Market, Open Balkan, and Green Agenda show that deeper economic
integration and cooperation are indispensable for sustainable growth
and EU membership. There are vast opportunities for U.S. businesses,
and we continue to encourage countries to strengthen rule of law, fight
corruption, and increase transparency to expand investment
opportunities. The necessary reforms will increase prosperity,
prioritize sustainable investments and clean energy, and stem brain
drain. They will also reduce politically driven investment from outside
actors and build the foundations for good neighborly relations and
stable governance.
Indicators of progress toward EU integration of the Western Balkans
include deeper regional cooperation and growing democratic and economic
development. In some countries of the region, we have seen earnest
efforts to strengthen democratic institutions and counter corruption.
This is not the case in all countries of the Western Balkans, and there
have been setbacks. In Bosnia and Herzegovina, the ongoing political
crisis and endemic corruption hurts its citizens, and jeopardizes
regional stability, its Euro-Atlantic trajectory, and the progress
achieved since the Dayton Peace Accords. We continue to make clear to
all leaders that de-escalation of rhetoric and the resolution of
differences through established constitutional processes are the only
viable paths to a democratic, European future. Along with our European
partners, we are vigorously engaged with local actors to find ways
forward and advance along the path from Dayton to Brussels, including
through step-by-step reforms that will benefit all citizens.
The need for dialogue, compromise, and reform applies across the
region. We strongly back the EU-facilitated Dialogue to normalize
relations between Kosovo and Serbia. The Dialogue is the forum in which
both sides, as equals, must work to resolve their differences and find
a comprehensive agreement, which both countries need for their European
futures. We believe this effort should be centered on mutual
recognition.
The United States continues to work with our EU partners to advance
EU integration for all countries in the region and to reinforce that
the reforms that are part of the accession process bring their own
benefits. At the same time, we stress to our EU partners the importance
of keeping Europe's doors open, as this is the most important incentive
generating political will for critical but sometimes-difficult reforms.
North Macedonia and Albania have made significant reforms and
sacrifices, and both countries deserve to advance in the accession
process. Forward momentum would be important proof for the entire
region that difficult compromises enable a better future.
Conversely, our warning to actors in the region who engage in
corrupt, destabilizing, or anti-democratic behavior is clear: there
will be consequences. In December, we utilized Global Magnitsky
authorities against an organized criminal group operating in the
region. In January, the Treasury Department designated Milorad Dodik
for his corrupt and destabilizing behavior and a television station
under his control using the new Western Balkans sanctions authority.
The State Department also imposed visa restrictions under our Section
7031(c) authorities against corrupt officials in Bosnia and
Herzegovina. The United States will continue to use all available tools
to hold accountable those who block the region's progress for their own
financial or political gain.
Regional progress is also threatened by the harmful foreign
political and economic influences of Russia and China. Russia
weaponizes its energy supply to coerce politicians, foster corruption,
and stunt growth potential. It also fans ethno-nationalism that divides
and distracts from a brighter future. The People's Republic of China
(PRC) is expanding its presence by building critical infrastructure
through opaque and predatory loans and ``investments.'' Promoting
transparent governance, human rights, and a rules-based international
order will remain the core tenet of our engagement against these
destabilizing activities in the Western Balkans.
In closing, for the past three decades, the Western Balkans have
been the focus of sustained U.S. engagement, investment, and bipartisan
support. The results are clear: the countries of the former Yugoslavia
now include four NATO Allies and two EU member states. Among the
countries of the Western Balkans, four are NATO allies and all either
share the strategic goal of deeper Western integration as EU aspirants
or are EU members. Our job is not over. Continued leadership from the
United States, including here in the Senate, remains essential to
completing the transformation of the Western Balkans into stronger
allies, Transatlantic partners and contributors to global peace and
prosperity. We continue to stress the need for a fully confirmed Slate
of Ambassadors in the Western Balkans, most notably our nominee to
Serbia, who is still awaiting confirmation by the full Senate. I will
continue to work with Congress on this effort and welcome your
questions.
Senator Shaheen. Thank you very much. Ms. Magno.
STATEMENT OF LISA MAGNO, DEPUTY ASSISTANT ADMINISTRATOR FOR THE
BUREAU FOR EUROPE AND EURASIA, U.S. AGENCY FOR INTERNATIONAL
DEVELOPMENT, WASHINGTON, DC
Ms. Magno. Thank you. Chairperson Shaheen, Ranking Member
Johnson, distinguished members of the subcommittee, thank you
for inviting me to discuss the U.S. Agency for International
Development's work in the Western Balkans. Thanks to generous
bipartisan support from Congress, USAID has partnered with
citizens and governments of the region to support their
aspirations for a democratic and economically prosperous
future. Starting with Bosnia and Herzegovina, during USAID
Administrator Samantha Power's recent trip, she made clear that
the peaceful and prosperous future for BiH depends on all
political leaders and citizens working together to advance the
reforms necessary to achieve BiH's democratic and economic
aspirations.
In Serbia and Kosovo, USAID continues to support the
European Union-led dialogue and its goal of comprehensive
normalization of relations, including initiatives to promote
regional economic operation. In Kosovo, where I recently serve
as USAID's Mission Director, USAID is increasing citizen demand
for accountable institutions and promoting democratic and
economic opportunities for all of Kosovo's citizens. USAID will
also continue to assess the Serbian people and the Serbian
Government to advance democratic and economic reforms.
In Albania, USAID assistance is addressing corruption, one
of its toughest remaining development challenges. Similarly, in
North Macedonia, USAID assistance is countering corruption,
enhancing business competitiveness, and increasing
opportunities for young people to contribute to the economy and
their communities.
From the pandemic to youth brain drain, USAID recognizes
that many of the barriers to further economic and democratic
progress are regional in nature and therefore require a
regional response. USAID assists countries in confronting
common challenges such as support the independent media and
cross-border economic linkages.
Beyond corruption, the pandemic is one of the most urgent
regional challenges which has wrought damage on the health and
economies of the Western Balkans. USAID is part of the overall
U.S. Government response to COVID-19 in the region. In
addition, USAID is also assisting enterprises to survive the
pandemic and prepare for an increasingly digital economy.
Whether it is the Kremlin's efforts to subvert the region's
fledgling democracies or the People's Republic of China's
intention to capture partner economies, foreign malign
influence is capable of reversing progress. USAID's Countering
Malign Kremlin Influence Development Framework informs our
programming, which supports democracy and political processes,
enables the media environment to resist disinformation, and
diversifies economic relationships to minimize reliance on
Moscow.
A key tenet to countering the PRC's efforts to gain
political and economic leverage in the region is ensuring
partner countries are able to make informed choices and
identify viable investment alternatives that do not require
them to sacrifice their long-term interests in favor of short-
term gains.
USAID, in coordination with interagency partners, is
developing a program to help partner governments understand
investment flows, identify beneficial ownership, assess risk
and opportunities, and analyze transaction terms to ensure
transparent, beneficial investments consistent with national
interests.
This winter's acute energy crisis across the European
continent has underscored the importance of USAID's energy
programming. USAID is enabling partner countries to build and
expand regional energy markets, diversify energy supplies, and
build resilience in the system. This foundational work will
strengthen the region's energy security and advance a
sustainable and just clean energy transition.
As we discuss the remaining significant challenges it is
equally important to highlight the strength of our partnership
with countries in the region. This year, our partners stepped
up to support at-risk Afghans who were evacuated or fled from
Afghanistan in August 2021. North Macedonia, Kosovo, and
Albania provided refuge to approximately 4,500 at-risk
individuals. We are tremendously grateful for the refuge our
partners continue to provide.
In closing, I want to underscore that the Western Balkans
region holds tremendous potential to demonstrate that democracy
delivers. Ensuring that the region continues on this path will
require a united front with partner governments committed to
reform, citizens who continue to advocate for democracy,
transparency, and rule of law, and coordinated assistance
between the European Union and USAID. Assistance must also
continue to be responsive to external threats to the region's
Euro-Atlantic future.
I look forward to continuing to work with Congress and
welcome your questions. Thank you.
[The prepared statement of Ms. Magno follows:]
Prepared Statement of Ms. Lisa Magno
Chairperson Shaheen, Ranking Member Johnson, distinguished Members
of the Subcommittee, thank you for inviting me to discuss the U.S.
Agency for International Development's (USAID) work in the Western
Balkans.
For over three decades, USAID has partnered with the citizens and
governments of the region to support their aspirations for a
democratic, economically prosperous future firmly grounded in European
institutions. Thanks to generous bipartisan support from Congress,
USAID assistance is helping our partners to tackle both the internal
and external challenges slowing their path towards Euro-Atlantic
integration. Your support also allows the agency to remain agile and to
adjust to the shifting political dynamics of the region, including
responding to foreign malign actors who seek to disrupt democratic
progress, undermine institutions, exercise economic and political
leverage, and ultimately reverse the hard won democratic and economic
gains of the past 30 years.
During USAID Administrator Samantha Power's recent trip to Bosnia
and Herzegovina (BiH) she made clear that a peaceful and prosperous
future for BiH depends on all political leaders and citizens working
together to advance the reforms necessary to achieve BiH's democratic
and economic aspirations. She further underscored throughout her visit
that USAID will continue to support all those working to build a more
stable, inclusive, democratic future for BiH. USAID's focus is on
fighting corruption, strengthening rule of law, fostering
entrepreneurship, promoting reconciliation, and creating a transparent
business environment which attracts investment and ensures young people
have a reason to stay and build their lives in BiH.
In Serbia and Kosovo, USAID continues to support the European Union
(EU)-led Dialogue and its goal of comprehensive normalization of
relations, which the United States believes must be based on mutual
recognition. We also support any initiatives to promote regional
economic cooperation that will help prepare the countries of the region
to meet their requirements for EU accession, and we believe these
initiatives should be broadly open to all countries of the region. In
addition, USAID is launching a regional reconciliation program that
will focus on cross-border people-to-people activities between Serbia,
BiH, and Kosovo. Bilaterally, USAID's strategy in Kosovo seeks to
strengthen and increase citizen demand for accountable institutions and
promote democratic and economic opportunities for all of Kosovo's
citizens. USAID will also continue to assist the Serbian people and the
Serbian government to advance democratic and economic reforms and meet
the challenge of malign influence. In both countries, USAID is working
with our partners to enhance the accountability of government
institutions and build a business enabling environment which attracts
investment and fosters small and medium sized enterprises (SME) growth
and innovation.
USAID assistance in Albania takes a targeted approach to address
one of Albania's toughest remaining development challenges, countering
corruption. USAID has also been a ready partner with Albania in times
of crisis, from providing firefighting expertise during the 2021
wildfires to responding to COVID-19. Similarly in North Macedonia,
USAID assistance is countering corruption, enhancing the
competitiveness of SMEs, supporting North Macedonia's response to the
pandemic, and increasing opportunities for young people to contribute
to the economy and their communities.
From the pandemic to youth brain drain, USAID recognizes that many
of the barriers to further economic and democratic progress are
regional in nature and therefore require a regional response. USAID
funds a range of regional initiatives that reinforce and coordinate
with bilateral programs and engage on issues that are inherently
regional in nature, such as programs that promote trade facilitation
and regional energy security. USAID also invests in areas where there
is the opportunity to achieve economies of scale to assist countries
confronting common challenges, such as support to independent media and
cross-border economic linkages. For example, through our regional media
programs, we are helping journalists to produce high quality content,
enhance their digital security, and build sustainable financial models
so that they can continue to produce independent, fact-based journalism
and keep communities informed. This work includes support for
investigative journalists committed to uncovering systemic corruption
in the region. USAID's regional civil society program increases the
capacity of civil society to promote local, national and regional
reforms in the Balkans. Our flagship regional economic growth
activities are working across borders, and in concert with our
bilateral activities, to improve the region's business enabling
environment, reduce barriers to trade, enhance the competitiveness of
businesses in the region, and increase access to finance.
Beyond corruption, one of the most urgent regional challenges in
the past 2 years to furthering prosperity in the region is the damage
wrought by the pandemic on the health and economies of the Western
Balkans. USAID has supported the response to COVID-19 in all of our
partner countries in the Western Balkans. Through USAID, the U.S.
Government has provided vaccines and medical, testing and laboratory
equipment, helped schools adapt to online and hybrid learning,
supported social entrepreneurship, upgraded sanitation and hygiene in
medical facilities, provided critical hygiene supplies, helped to
combat vaccine mis- and dis-information, and put shots into arms.
Further, USAID is assisting enterprises to pivot to domestic tourism,
engage in e-commerce, and enable access to capital through the creation
of alternative financing mechanisms and by assisting businesses to
negotiate bank loans. All of this work will not only help SMEs to
survive the pandemic but will prepare them to engage in an increasingly
digital economy as the pandemic subsides.
Whether it is the Kremlin's efforts to subvert the region's
fledgling democracies and shape political decisions abroad, or the
People's Republic of China's (PRC) intention to capture partner
economies and undermine sovereign decision-making, foreign malign
influence is capable of reversing the tremendous progress that has been
made in over 30 years. USAID targets its efforts to address these
external challenges to regional stability. USAID's Countering Malign
Kremlin Influence (CMKI) Development Framework in the Western Balkans
informs programming that is strengthening vulnerable sectors in each
country, including support for democracy and political processes,
enabling the media environment to resist disinformation, and
diversifying economic relationships to minimize reliance on Moscow. To
address the PRC's efforts in the region, our programs seek to limit the
PRC's economic and political influence gained through debt dependency,
opportunistic economic engagements and trade imbalances; to counter its
export of corruption, disinformation and pro-authoritarian narratives;
and to reduce partner countries' technological and energy
vulnerabilities to PRC influence. A key tenet to countering the PRC's
efforts to gain political and economic leverage in the region is
ensuring partner countries are able to make informed choices and
identifying viable investment alternatives that do not require them to
sacrifice their long-term interests in favor of short-term gains. In
addition to new programming on cyber security and investigative
journalism, USAID, in coordination with interagency partners, is
developing a program to help partner governments understand investment
flows, identify beneficial ownership, assess risks and opportunities,
and analyze transaction terms to ensure transparent, beneficial
investments consistent with national interests.
This winter's acute energy crisis across the European continent,
leading multiple countries in the Western Balkans to declare national
emergencies, has underscored the importance of USAID's efforts to
enable partner countries to build and expand regional energy markets,
diversify energy supplies, and build resilience in the system. This
foundational work will strengthen the region's energy security and
advance a sustainable and just energy transition to a clean energy
future. USAID's support for long-term planning, policy reforms, and
market integration has enabled Southeast Europe to invest more than $10
billion in the electricity network and new generation, expand solar and
wind generation, and lay the groundwork for stronger, more diversified
markets connected with the EU.
As we discuss the significant challenges that remain, it is equally
important to highlight the strength of our partnership with countries
in the region. This year, our partners in the Western Balkans stepped
up to support at risk Afghans who were evacuated or fled from
Afghanistan in August 2021. North Macedonia, Kosovo, and Albania
provided refuge to approximately 4,500 at risk Afghans. In Albania,
USAID is providing support to the government of Albania to strengthen
the resilience of national systems and improve quality and access to
needed services by vulnerable populations, including those relocated
from Afghanistan, during times of disruption or shock. In North
Macedonia, USAID is planning new programming which will ensure Afghan
children have access to education and that evacuees have access to
legal support and essential health services. We are tremendously
grateful for the refuge our partners continue to provide for the
evacuees.
In closing, I want to underscore that the Western Balkans region
holds tremendous potential to illustrate to the world that democracy
delivers. Ensuring that the region continues on this path will require
a united front with partner governments committed to reform, citizens
who continue to advocate for democracy, transparency, and rule of law,
and coordinated assistance between the EU and USAID which targets the
fundamental challenges which are holding these nations back. Assistance
must also continue to be responsive to external threats to the region's
Euro-Atlantic future. USAID will continue to support our partners who
have been working for over 30 years to build a democratic and
economically prosperous future for their countries and for the region.
I look forward to continuing to work with Congress in this effort
and welcome your questions.
Senator Shaheen. Thank you very much. As you all can
probably tell there is a little bit of an echo. I think it is
because we also have some people coming virtually, so I
apologize for that and hope that people will just try and get
close to the microphone as they are asking questions.
I would like to begin with you, Mr. Escobar, because I
think it is important for us to have a sense of what the
strategy is for the Balkans region. So maybe you could begin
with talking in more detail than your statement about what the
vision is for the region, what are the key elements of our
strategy there, and how we are expecting to accomplish that.
Mr. Escobar. Thank you very much for that question. Our
policy rests on three pillars: Europe, NATO, and regional
integration. So beginning with the first, it is our belief that
these countries should be part of the European Union. They are
culturally, historically, and increasingly economically part of
Europe, and we believe that they should be members. Our history
of European integration for our partners has been one of
unqualified success. Every country that has entered the
European Union is more democratic, more stable, and more
prosperous at almost no cost to the rest. So that is the
central feature of our policy in the Balkans.
Our second is NATO for those who qualify, and those who are
not interested yet in NATO, more NATO engagement, and nowhere
is this more visible than in Serbia, which is politically
neutral, but has increased its engagement with the United
States and with NATO dramatically over the last 2 years.
Finally, regional political and economic integration. That
is why we support Open Balkans, the Common Regional Market, and
every other element and every other program that creates strong
institutions and greater interoperability with the European
Common Market as a way of creating opportunities for multi-
ethnic reconciliation and inter-party dialogue, inter-country
dialogue.
So those are the three policies, and we are pursuing all
three very aggressively.
Senator Shaheen. Thank you. Obviously, one of the countries
I have been following closely is Bosnia-Herzegovina and right
now a continuing disruptive actor, Mr. Dodik, is attempting to
secede the Republika Srpska from the larger country. I was
pleased to see the Administration announce sanctions on Mr.
Dodik and his activities, but what more can we do as we think
about how to address his behavior and support more integration
in Bosnia among the ethnic groups there?
Mr. Escobar. Well, I do have to state that even though
Milorad Dodik is a very difficult actor, he is not the only
one. Our actions against Milorad Dodik are directed at him as
an individual and not against Serbs and not against Republika
Srpska. That is very important.
The fundamental problem in Bosnia is not ethno-nationalism.
It is corruption. It is deep-seated corruption that prevents
Bosnia from joining the success stories of the rest of the
Western Balkans. It is the third-most corrupt country in
Europe. It is the primary cause of youth brain drain, and it is
the largest block to Euro-Atlantic aspirations.
So our policy really is about creating a more functional
state through step-by-step reforms--that my colleague, Matt
Palmer, is undertaking, along with his European Union
colleagues--to make the relationship between Croats and
Bosniaks in the federation more effective, to implement
election integrity measures, and to make the central state more
functional.
At the same time, our hope is that Serbs will return to the
central institutions, but until they do, our goal is either
political dialogue with opposition figures and other leaders to
bring Serbs back to the table and to prevent Dodik, either
through political engagement or through sanctions, from
inflicting any more damage to the central institutions.
Senator Shaheen. Well thank you. I appreciate that.
Ms. Magno, how is USAID supporting those efforts?
Ms. Magno. Through USAID assistance and close coordination
with stakeholders in Bosnia-Herzegovina we are, for example,
providing specialized training to prosecutors' offices to
harmonize practices and processes for high-profile corruption
cases. As an example, USAID has helped develop the checklist of
quality indicators for investigative actions and criminal
reports of law enforcement agencies. This checklist will help
ensure the legality of evidence collected and improve the
quality of criminal reports submitted to prosecutors' offices.
We have also helped the Judicial and Prosecutorial Council
adopt the guide to crisis communications for courts and
prosecutors' offices.
A third and also equally important approach that we have
taken is to help independent media, particularly investigative
journalists, and we have just supported a state-of-the-art
digital newsroom which will allow local journalists to better
cover and expose corruption.
Senator Shaheen. Thank you. My time is up so I will turn to
Senator Johnson, but I still have lots of questions and I am
sure my colleagues do. Senator Johnson.
Senator Johnson. Thank you, Madam Chair.
Assistant Secretary Escobar, let us go back to Bosnia, that
region. I think we are at 27 years after the signing of the
Dayton Accords. I do not think anybody envisioned we would be
kind of operating in that region. That is their basic
constitution still. Can you just give me, from your
perspective, the history, from the signing of the accords to
the where we are today, why is that really the governing
document still in place?
Mr. Escobar. Well, Senator, the idea behind Dayton really
was about European Union integration. It was about a promise of
being a member of a larger organization that protects people's
freedoms and civil and democratic rights. That is still our
goal. Unfortunately, because of the dysfunction of the country
and, in part, because of enlargement fatigue, that promise has
not been met, but it is still our intention. It is still our
policy that these countries should be integrated into the
European Union.
So Dayton has been very successful in keeping the peace for
over 25 years, so it is an important document and it is the
basis of our policy. We believe that we can help them improve
their governing processes and help them meet some of the
requirements for European Union membership through step-by-step
constitutional reform and limited constitutional reform and
electoral reform that would create the ability for the country
to reach political consensus better. So it is still our goal to
get them into the European Union. By the way, that sentiment is
shared by our partners as well.
In the meantime, our engagement is still absolutely
critical. Our leadership is absolutely critical in the region,
and this Administration will continue to show that leadership.
Senator Johnson. I think the thrust of my question was what
has gone wrong. I understand what you want to do to try to make
it right, but why is the Dayton Accord still in place? Why have
we not moved on? What have been the problems? What has
prevented progress?
Mr. Escobar. I would say that the primary problem is
corruption. It is true that Dayton allows a tremendous amount
of opportunity for obstruction and political delay, and those
opportunities have been capitalized by some of the more
powerful parties to further corruption and to capture the
state. That has had a very, very detrimental effect on the
country. It has a detrimental effect on the investment climate
and on the capacity to behave as a state.
Now that is not necessarily because of Dayton. That blame
can be laid almost entirely at the feet of certain political
actors, but we are confident that we can fix what is wrong with
Bosnia through both American engagement, limited reform, and a
clear path to Europe.
Senator Johnson. So what would you say are the greatest
threats or dangers to the basic three pillars of our approach
toward the region?
Mr. Escobar. Well, I would say that they are three-fold.
One is the lack of a clear vision for European integration. The
second is endemic corruption and the lack of rule of law, and
that is something that we all agree on, and that is our
European partners and United States. Third, there is an
increasing amount of malign foreign influence, both from China
and particularly from Russia. So we have to have a plan, and we
do have a plan, for countering all of that.
Senator Johnson. So you just transitioned to my next
question. Can you describe China's involvement in the region?
Mr. Escobar. China's involvement in the region is mostly
economic for now, but it does have political costs. So China
provides seemingly attractive infrastructure projects, loans,
and so-called investments. Most of the time those investments
are non-transparent. They rely on government-to-government
agreements; not open tender. They rely on keeping the details
of those deals as state secret and therefore not accessible to
the taxpayers, or the voters. Third, it involves frequently not
respecting the environmental and social standards of the
countries. I should add it almost never involves hiring local
people to work on these infrastructure projects.
So what seemingly is an attractive investment frequently
becomes a debt trap, and nowhere is that more visible than
Montenegro.
Senator Johnson. Just a real quick follow-up. So these are
primarily infrastructure types of projects. Do we have a sense
of the total dollar value of their--I will put quotation marks
around it--``investments'' in the Western Balkans? Do we have
some kind of sense, an estimate?
Mr. Escobar. It is in the tens of billions, and in some
cases it is a significant portion. The debt represents a
significant portion of the countries' GDPs.
Senator Johnson. Okay. Thank you.
Senator Shaheen. Thank you, Senator Johnson. We now have
Senator Cardin, who is coming to us on Webex.
Senator Cardin. Thank you, Madam Chair, and let me thank
both of our witnesses. I am going to follow up on Senator
Johnson's questioning, because, Mr. Escobar, I think you are
giving a much more rosy scenario as to the likelihood of
progress. It has been since 1995 we have been following the
same path in regard to the Dayton Accords, and the Dayton
Accords was only supposed to be a transitional type of an
arrangement. It was not supposed to be the final word in regard
to the constitutional authority for Bosnia. Now you are
mentioning that we have had systemic corruption there that is
blocking integration into Europe. So the problems seem to be
getting worse rather than better.
So to my question to you, you say you have a game plan in
regard to China. You have a game plan in regard to Russia. I
assume you have a game plan in regard to constitutional reform.
You have imposed sanctions against Mr. Dodik, and I agree with
Chair Shaheen that that is the right thing to do.
So how do we intend to engage the parties to really move
forward to the type of constitutional change, to the type of
dealing with corruption? It seems to me, how do you deal with
the malign influence of Russia and China, and how do you engage
Serbia more in regard to bringing about a more permanent reform
in Bosnia that could lead to emigration to Europe?
Mr. Escobar. Well, thank you for that question. Before I
talk about Bosnia and Herzegovina, I have to tell you a little
bit about the context the neighborhood in which Bosnia and
Herzegovina lives. The story of the Western Balkans is
overwhelmingly a positive story. Of the seven countries of the
ex-Yugoslavia, two are members of the European Union and four
are members of NATO.
Senator Cardin. Let me just stop you for a second, because
I agree with you on that. I agree with you that is a positive.
So how are we engaging the other partners that have made a lot
more progress in that region, whereas Bosnia, if you would have
gone back a decade ago I think we would have thought Bosnia
would be one of the first countries to emerge. It is now
lagging behind.
Mr. Escobar. I would say it is true that Bosnia is the most
concerning country in the Western Balkans. So it does not share
in the prosperity of the other five, it is not on a solid
integration track, and the corruption is the worst anywhere
else. By the way, that corruption is causing a brain drain and
a net emigration that is ten times that of Serbia. So it is at
the top of our priorities.
Now it is true, also, that there is nothing inherent about
Dayton that prevents Bosnia-Herzegovina from moving forward as
a democratic and prosperous state. So it really is a lot of
about the entrenched corruption, which we hope through
engagement, through development, through capacity building, and
through sanctions that we can address.
Senator Cardin. That does not--I agree with you on the
corruption issue. You are absolutely correct, and I hope we can
do everything we possibly can. I remember the briefings we got
during the Dayton Accords, and it was very clear that it was
aimed at resolving the conflict that was occurring, the
violence that was occurring in Bosnia, but it was never meant
to be the final word in regard to governance that they knew
that additional constitutional reform was going to be needed.
It dealt with the practical problems of the ethnic communities,
not so much as a final way of resolving the governance of
Bosnia. It seems to me you are saying you think that could be
the final solution.
Mr. Escobar. I do not think so. I think the final solution
is European Union membership, and that is why we need to
encourage our European colleagues to show a clear path to
Europe for Bosnia-Herzegovina. We have seen, alongside with
this Administration, you have seen a new UN Special
Representative, a more engaged European Union external action
service, and a more invigorated, bilateral relationship between
a lot of the countries and Bosnia-Herzegovina, because the
crisis that has emerged with Milorad Dodik has brought into
stark relief the problems of Bosnia-Herzegovina.
I agree with you that Dayton was compromises laid upon
compromises as a way of stopping the war, but in that regard it
was very successful. There has not been any conflict in Bosnia
in almost three decades, and there will not be.
So we need to work closer with our European partners to
give them a vision of what they need to do and how they need to
function as a government to be able to be a successful member
of the European Union.
Senator Cardin. Just one last question. Would not that also
include constitutional reform?
Mr. Escobar. It does. Now we are starting with limited
constitutional reform as a way of creating opportunities on the
ground for greater interethnic reconciliation and greater
institutional functionality. I do think that at least the core
of that plan will be successful.
Senator Cardin. Thank you, Madam Chair.
Senator Shaheen. Thank you, Senator Cardin. Senator Murphy
Senator Murphy. Thank you, Madam Chair. Thank you both for
being here today. I thank the Chair and the Ranking Member for
convening this hearing.
Mr. Escobar, I wanted to ask you about the current role of
the high representative in Bosnia. You served in the OHR office
back in the 1990s. This is a position that does have the
authority to impose binding decisions, although the use of that
tool is relatively rare.
I met with a group of Bosnian Americans in Connecticut
earlier this week who were asking questions about why we do not
press harder on the high representative to step in and be more
forceful in some of these developments inside Bosnia as the
country threatens disintegration. It does not seem like it
makes much sense for the high representative to stand on the
sidelines.
What is our current position as to the role of the high
representative? Do we think that the high representative can be
more forceful than the position has been? I understand the
Russians' position here that they want to the whole thing to go
away, but what is the role here to try to solve the ongoing
stalemate in Bosnia?
Mr. Escobar. Well, I think, first of all, that it should be
clear that the high representative is just one of the tools
that the international community has to exert influence in
Bosnia and Herzegovina. Now we strongly support the high
representative and his role as a mediator.
I understand the concern of people who would like to see
imposed solutions, but imposed solutions are not a democratic
answer to democratic challenges. So we hope to be able to
partner with European-minded, democratically focused political
parties and leaders to be able to resolve for themselves the
problems of their own country.
Now that does not mean that we do not support the bond
powers of the high representative, but we think that is a last
resort, a nuclear resort, and one which then puts the onus on
the international community to implement. We think that the
political system and the political leaders--most of the
political leaders--of Bosnia-Herzegovina are mature enough and
democratically focused enough to be able to resolve the
difference through their own processes, and that is the way it
should be.
Senator Murphy. I do not mind referring to it as a last
resort. I maybe wish we did not refer to it as a nuclear
resort. This is a legitimate power of the high representative.
I understand the difficulty in imposing it, but if the choice
eventually becomes the disintegration of the country and the
region into civil war versus a difficult decision made by the
high representative, I think we will have to carefully weigh
the equities on both sides.
I wanted to turn to the----
Mr. Escobar. Well if I can, Senator, on that issue.
Senator Murphy. Sure.
Mr. Escobar. --first of all, this situation is not
analogous to 1991. We have a European peacekeeping force. We
have a high representative. Neither Croatia nor Serbia are
interested in seeing a war on their borders. We have a NATO
presence. So there are a lot of checks and balances to prevent
conflict.
So the fundamental issue is that the high representative
is, and always has been, on a path to being phased out after
certain conditions are met. We want to make sure that those
conditions are met. So we do not see the situation as
destabilizing, as some of the most drastic commentators see it.
Senator Murphy. Okay. I agree with you that so long as the
impression remains that the path to the EU is difficult and
rocky, it is really hard to press our friends in the region to
continue reform, and it is not coincidental that you have seen
the doors shutting to the EU at the same time that we have seen
democratic backsliding in the region.
So let me ask you about the news last month that there will
be a renewed discussion between Bulgaria and North Macedonia.
That was welcomed. It has been a year or more since Bulgaria
vetoed the ability for talks between North Macedonia and Europe
to continue. Do you see hope that those talks can bear fruit,
and what leverage is there for the United States with Bulgaria?
To me this is a disaster if we cannot show progress towards
Europe, and why on earth would we let one country stand in the
way. What more can the United States--what more can we be
doing? What hopes do you have for these discussions with two
new leaders?
Mr. Escobar. Well, both Bulgaria and North Macedonia are
valued NATO allies. So it has always been our hope that they
could resolve their differences through constructive dialogue
and good faith negotiation. Both of these new governments have
given us assurances that that is happening. So we support that
and we hope that that can come to a conclusion within a
reasonable period.
Senator Murphy. That is fine. That is a very diplomatic
answer, but these discussions are not going to come to a
conclusion unless the United States plays an active role and
unless we make clear to the Bulgarians that it is in their
interest, as a Balkan nation, to make sure that there is a path
into the European Union. So I appreciate the answer, but I will
still press for increased U.S. involvement at the highest
level, to try to resolve this, given that we have an
opportunity to do it with new leadership.
Thank you, Madam Chair.
Senator Shaheen. Thank you, Senator Murphy. We have Senator
Van Hollen on Webex.
Senator Van Hollen. Thank you, Madam Chair. Let me thank
both of the witnesses here. Much of the ground I wanted to
cover has been asked about, including a lot on Bosnia.
I do want to ask both of you, starting with Deputy
Assistant Administrator Magno, about the Russia and Chinese
disinformation campaigns in the Western Balkans. There was a
poll conducted I believe last July by the National Democratic
Institute that found that these disinformation campaigns were
having an impact. In fact, the majority of the respondents
across the region agree with the statement that, ``Democracy is
a failed governing system used by the West to impose on
countries in transition certain values aimed to masquerade
their geopolitical interests.''
We have seen a rise in e-liberal thinking, in
authoritarianism in the overall region. Can you talk a little
bit about these disinformation campaigns and whether we have
any strategy to try to counter them?
Ms. Magno. Thank you, Senator. In terms of disinformation,
a big component of what we are doing in our partner countries
is to help independent media in several ways. One is to help
them provide quality content, and second also to make sure that
they are on the path to financial viability, because without
needed resources it is much easier for media outlets to be
either captured or essentially to go out of business.
Another component of our efforts is also to raise media
literacy among the public and making sure that there is
discernment about the sources of information, whether it is
through traditional outlets or through social media.
Senator Van Hollen. Well, I appreciate that. I mean,
clearly we need to bolster our strategy, because the ability of
leaders in these countries to pursue policies of freedom, human
rights, democracy obviously depend on their standing with the
public and how the public perceives those ideas.
Turning again to Bosnia, and Mr. Escobar, I know you
testified quite a bit on this topic. As you indicated and as we
know, we have imposed sanctions on the Bosnian Serb leader
Dodik. Are we encouraging our European partners to do the same,
and would that unity prove to be more effective in trying to
accomplish our goals?
Mr. Escobar. Absolutely, and yes, we are in constant
discussions with our European partners on their ability to use
sanctions, their ability to track money, and their ability to
impose visa bans on some of the corrupt officials in Bosnia-
Herzegovina.
Additionally, we have had, in the last couple of days, here
in Washington, some very productive discussions with our UK
colleagues, who also are very interested in modeling their
sanctions regime closely with ours and coordinating closely on
targeting. That is a very important one because the UK is a
very important financial hub for Europe, and a lot of money
that comes out, a lot of the corrupt funds that come out of the
Western Balkans transit through London or through New York. So
the sanctions regimes are very, very important, and we hope to
see more from our European partners as well.
Senator Van Hollen. Thank you, and thank you, Madam Chair.
Senator Shaheen. Thank you, Senator Van Hollen.
Ms. Magno, I would like to pick up on his questions about
the disinformation and what we are doing to respond to that. To
what extent is USAID coordinating with the Global Engagement
Center at the State Department and also with working with RFE
and Radio Liberty on their efforts in the region? Or are there
any efforts in the region?
Ms. Magno. We are closely coordinating with both the Global
Engagement Center as well as having regular conversations with
colleagues at RFE, and we share information, analytics, trends
that we see, especially those coming from our partners on the
ground. We also ensure that our tactics or our approaches are
consistent with each other.
Senator Shaheen. Do you have any evidence that what we are
doing is working?
Ms. Magno. I have to admit the challenges are huge, and we
are trying to get our story, our own narratives out there to
the maximum extent possible. I will take your question into
consideration and provide more information at a later time.
Senator Shaheen. Thank you. I would appreciate that. Also,
when I was in Bosnia back in 2010--so it has been a long time
ago--but I was there with former Senator Voinovich, and we had
a lunch with a number of young people. It was probably the most
impactful session I had in our week in the region, because the
young people that we talked to felt like there was no hope for
a future in Bosnia-Herzegovina. So can you talk about some of
the programs that you are working on in the region for young
people, and are there examples of successful efforts that you
can point to, that you think we should be modeling in other
places?
Ms. Magno. Thank you for your question, and I totally
agree. That sense of desperation among the youth was also
illustrated during the recent visit of our administrator to
Bosnia-Herzegovina and as well as my almost 4 years in Kosovo,
I have had many conversations with young people in the region.
One of the things that we are doing, for example, in
Bosnia, in several of these countries we are able to identify
sectors in the private sector which have high potential, and in
Bosnia it is tourism, in Kosovo it is agribusiness, as well as
information, communications, and technology.
Maybe just to elaborate, in Bosnia what we are doing right
now is to provide support to young potential entrepreneurs who
can start future enterprises in the tourism sector. We did a
needs assessment and forecast and we estimated that the tourism
industry in Bosnia will actually require something like 18,500
jobs, if things go in the right direction. So we are working
with both young potential entrepreneurs as well as institutions
of higher education to make sure that they understand
international standards, they have the skills and capacities
that will meet the demands of international tourists.
Senator Shaheen. Thank you. Senator Menendez.
Senator Menendez. Thank you, Madam Chair, to you and the
Ranking Member.
Deputy Assistant Secretary Escobar, I understand that you
and your EU counterparts have recently urged Kosovo to
establish an association of Serb municipalities. While this
concept has its basis in the 2013 Brussels Agreement, I am
concerned that this would lead to a Republika Srpska within
Kosovo. Moreover, Kosovo's Constitutional Court has found the
association concept, ``not entirely in compliance with the
spirit of the constitution.''
Are you concerned that such an association could lead to
the destabilization of Kosovo and take away powers reserved for
a possible central government?
Mr. Escobar. I do not. We support the formation of an
association for many reasons. One is it is already agreed to.
Even though the Constitutional Court ruled that some parts of
the proposal were inconsistent with a constitution, it did not
say that the association itself is unconstitutional. So in the
dialogue, within the context of the dialogue, it is up to
Kosovo and Serbia to decide how that would look. So it does not
have to be, and we certainly do not want it to be similar to
Republika Srpska, but we have urged, and my counterpart,
Miroslav Lajcak, has urged the Kosovar Government to look at
models that they believe would be compatible with them that
would not undermine their sovereignty or their functionality as
a way of allowing Serbs to continue to receive health care,
certain benefits and education in Serbian language.
Personally, I think that this effort, which would unwind
Belgrade's engagement in Serbian communities and offshore it to
a domestic, transparent institution under the control of the
government of Kosovo, would actually enhance Kosovo
sovereignty, not detract from it.
Senator Menendez. Let me ask you, I am concerned that the
state of talks, or lack thereof, is more due to Serbia's
reticence to recognize Kosovo's sovereignty. What concessions
are you seeking from Serbia to justify pressuring Kosovo in
this way?
Mr. Escobar. Well, first of all, the purpose of the
dialogue is to move everything in Kosovo's direction, to be
quite honest, with the end result of mutual recognition and
normalized relations, something that they do not have already.
So it is not about Kosovo's status, but about the recognition
that they are a sovereign and independent country.
So the dialogue is the mechanism, and it has proven itself
to be an effective mechanism in resolving differences between
the two countries, most recently in September, when the EU
negotiated a successful resolution to the license plate dispute
with our support.
So with our backing--and our backing to Kosovo is
resolute--we want to make sure that the dialogue helps them
move through all the difficult challenges of unwinding the two
countries' engagement, difficult engagement, to have a common
European future together.
Senator Menendez. Well, I hope that our commitment to
Kosovo is resolute.
Let me ask you, I have heard from many in the Serbian
diaspora here in the United States about the elections that are
underway there and the lack of legitimacy, the use of the
government in extraordinary powers as it relates to the
elections, the resources that they are using that are not just
their private political resources. What are your insights into
that?
Mr. Escobar. That is something that we openly express our
concern about and privately engage with the government about.
There are three elements to this. One is the treatment of the
opposition. So we believe the opposition should have free and
fair conditions to participate in the elections. Second, the
media environment. It is true that much of the government-
controlled and private media in Serbia is very favorable to the
current government. Thirdly, the treatment of civil society,
those people who engage in democratic activities, to monitor
elections, to monitor media freedom, and to support citizen
engagement. Those organizations must be treated fairly by the
Serbian Government. It is not just the United States who has
made this clear, but also the European Union, the OSCE, and
other international organizations that have been very clear
about our expectations for the April elections in Serbia.
Senator Menendez. As of now that is not the case?
Mr. Escobar. As of now there are definitely concerns about
all of that.
Senator Menendez. One final question if I may, Madam Chair.
You know, Vucic traveled to Moscow in December seeking cheap
gas, which he got. In return, the Russians got some contracts
inside of Serbia. He was also in Beijing not too long ago to
discuss a free trade agreement that he is now touting in his
re-election campaign.
It seems to me that both Russia and China are making
significant inroads in the Western Balkans. What are we doing
to combat malign Russian and Chinese influences in this regard?
Mr. Escobar. Well, first of all, it is true that the
influence of Russia and China is maligned in the Western
Balkans. In the case of Russia, Russia is not even in the top
ten biggest trade partners for the Western Balkans. It is
mostly about energy. So on the energy security front, we have
encouraged Serbia to look at alternatives to Russian gas,
including renewables and liquid natural gas, and we have made
some progress there.
With regard to the political influence, over the last year
Serbia has become more aligned with European Union foreign
policy, including not recognizing Crimea. So we are making
inroads politically on that.
In the case of China, we have encouraged reforms and
greater transparency in the procurement process that gives
Chinese firms and the Chinese Communist Party a leg up over
American and European countries, but one of the reasons that we
support a more integrated market for the Western Balkans is
that if it is more integrated and more integrated with Europe,
with institutional standards that match those of Europe, it
will create opportunities for greater transparency, greater
openness in procurement, and requirements for environmental and
social impact easement that will give American and European
firms the advantage over Chinese in the region.
Senator Menendez. I look forward to following up with you
on some of these issues.
Thank you, Madam Chair.
Senator Shaheen. Thank you, Senator Menendez. Senator
Johnson.
Senator Johnson. Thank you, Madam Chair.
Assistant Secretary Escobar, I want to return to Serbia and
Kosovo. I spent a fair amount of time traveling back and forth
between Serbia and Kosovo during the previous Administration,
trying to help facilitate agreements. I really thought
Ambassador Grenell did a really good job, and I thought it was
an excellent strategy to forge an agreement really based on
economics. There are so many areas that they disagree on, but I
think one thing they definitely agreed on was how can they
improve the lot of life for their citizens.
I always felt every additional agreement, success builds on
success, the agreement between Kosovo and Montenegro in their
border dispute, and the agreement between Greece and North
Macedonia on the name, and then the economic agreement between
Kosovo and Serbia, can you give me your perspective of what is
the current status of that agreement? I know it has not been
fully taken advantage of--let us put it that way.
Mr. Escobar. Secretary Blinken said, in his confirmation
hearings, that it is our intention to build upon the successes
of the previous Administration, and the Washington commitments
are part of that. I particularly like the idea of a moratorium
on recognitions and de-recognitions to allow diplomatic space
for the dialogue, to make progress.
On economic issues I agree with you, Senator, that the
greater the integration is in the region the more easily we can
tackle the political problems. That integration is happening,
and it is happening both organically, through European-led
processes, and increasingly through the Open Balkans
Initiative. All of these promote greater business ties between
the regions, greater ease of movement and travel, the mutual
recognition of diplomas and certificates.
So it is one of the reasons why we believe that regional
economic integration is a winner, and we will continue to
pursue that.
Senator Johnson. In my opening remarks I mentioned that it
seems like these countries do want the U.S. fully engaged and
involved in the region, but oftentimes to impose the U.S. will
on the other side to reach agreement. It has always been my
viewpoint, as well as, I think, my understanding of every
Administration's viewpoint, that we are there to facilitate, to
help the parties come to agreement between themselves. We are
not going to impose anything on anybody, but at the same time
every now and again we do need to apply some pressure.
I have been concerned, in my dealing with both Serbia and
Kosovo, that Kosovo has obviously recognized strong support for
the U.S., and I think we all agree on that, but I am a little
concerned that they rely on that so heavily that they do not
really feel that they have to provide the give in the give-and-
take. I do not know how many times, on both sides, they say
negotiation is really give and take. I have oftentimes heard a
lot of the take, not a whole lot of give. Can you just kind of
comment on that?
Mr. Escobar. Well, we have been very clear with the
government of Kosovo that our expectation is that they engage
fully in the EU-led dialogue, that they look at that as a true
negotiation in achieving their ultimate goal, which is mutual
recognition between Serbia and Kosovo, recognition by the five
remaining European Union members who are currently not
recognizing Kosovo, and membership in all of the international
organizations that they would like to be members of.
So that will require compromise, and we have been very
clear. Our recently arrived ambassador, Jeff Hovenier, has made
that very clear, beginning with his opening meetings with the
Kurti Government, and he will continue to press that, and we
will continue to support him as he moves in that direction.
Senator Johnson. My concern is in Kosovo I often heard that
they were more than willing to forgive if a proper apology was
provided, and that was pretty much their give. I think they
probably need to do a little bit more in terms of compromise
and good faith. Would you agree?
Mr. Escobar. Well, I would leave that to my European
colleagues, because there is truly a plan to move forward in
the dialogue in a way that ends up with normalizing
relationships, and it is more complicated than--I can
respectfully disagree--than just a simple apology. There are
property issues. There are missing persons issues. There are
energy issues and a host of other issues that we have to work
through, in good faith, to achieve what we want to achieve,
which is a European future for both Serbia and Kosovo.
Senator Johnson. So just talk--this will be my last
question--just talk in a little bit greater detail, Russia's
influence, not just in Serbia or Kosovo, but within the Western
Balkans in total. Can you just kind of speak in general, what
they are doing, what they are trying to accomplish?
Mr. Escobar. What Russia is trying to accomplish really is
to create a vulnerability within the Euro-Atlantic space. That
is fundamentally what it is. They have found partners within
certain countries that are willing to help advance those goals,
to keep us distracted from other issues, including Russia-
Ukraine. Those parties are more likely than not to try to
create ethnic division, and they use misinformation,
corruption, and in some cases attempted assassination to
achieve their goals.
Senator Johnson. Okay. Thank you, Madam Chair.
Senator Shaheen. Thank you, Senator Johnson. I want to
pursue that a little bit, because Russia has a long history in
the Balkans, and their attempts to court Serbia through
military equipment, sales of military equipment, through energy
obviously gives them really undue influence in the region.
So can you talk about--and this is for Ms. Magno as well--
talk about the energy connections between Russia and the
Western Balkans. Senator Menendez, I think, referenced the trip
to Russia where Putin pledged cheaper energy for Serbia, but
what are we doing to counter some of those influences,
particularly around energy?
Mr. Escobar. Well, the question of dependence on Russian
energy is not solely a problem for the Western Balkans.
Senator Shaheen. Right.
Mr. Escobar. It is a problem for a good portion of Europe,
but the Balkans have an additional problem in that they are
heavily dependent on coal energy. So we have a comprehensive
energy security strategy that stresses renewables, liquid
natural gas, and alternative suppliers and routes for energy
supplies. We are close to unwinding some countries from full
dependence on Russian gas.
I would add that in that process there are tremendous
opportunities for American companies to help these countries
both free themselves from their dependence on Russian gas and
to move forward to a cleaner, more renewable energy mixture.
Senator Shaheen. Well, I would certainly agree with that.
Are we getting any takers from the United States in terms of
companies who are looking at the region as opportunities?
Mr. Escobar. We are. We have several.
Senator Shaheen. Ms. Magno, can you add to that in terms of
what USAID is doing?
Ms. Magno. What USAID is doing in the energy sector is
really to help the governments make informed choices and
decisions. So a lot of the work that we do is support for the
government's long-term planning, market integration, as well as
helping them with legal and regulatory forms. So for example,
in Kosovo right now we are assisting the ministry in helping
draft legislation that is around renewable energy.
We are also providing technical advice to ensure that our
partner countries--and many of them have made or set ambitious
targets in relation to what the European Union requires with
regard to clean energy. Through our analysis and technical
counsel we are helping them meet those targets.
Senator Shaheen. Thank you. That is good to hear.
Mr. Escobar, what is going to be the impact in the Western
Balkans if Russia does invade Ukraine?
Mr. Escobar. Well, as you know, Senator, some of these
countries are quite vulnerable, and they are quite vulnerable
to Russian malign influence. It is our hope, however, that we
can ensure that these countries remain stable and protected
against any efforts by Russia to use the Western Balkans as a
distraction for the Euro-Atlantic community from Russia and
Ukraine. So we are watching very closely, and we do have the
bandwidth to watch both regions at the same time and make sure
that we try to insulate them.
I would also say that in the region, the Western Balkans,
three of the countries are NATO allies, so not only are they
participating in the discussions that NATO is having on that,
but they are also contributing, both to our efforts and to our
messaging.
Senator Shaheen. Have we heard from any of the other
countries who are not NATO members about concerns about
Russia's activities?
Mr. Escobar. Every country in the region has expressed
their desire to see a peaceful, diplomatic resolution to the
crisis.
Senator Shaheen. Good. I just have one other area that I
would like to explore a little bit, and as we are thinking
about the challenges in Bosnia-Herzegovina and looking at what
is happening with Russia and Ukraine, EUFOR is increasingly
important, I think, and yet its size has steadily decreased
over the years.
So can you talk, Mr. Escobar, about how we are preparing
for the next round of the UN authorization of EUFOR and how
concerned we are about Russia's efforts to undermine the
mission there?
Mr. Escobar. Well, Russia was not opposed to the renewal of
the EUFOR mandate, and I believe they will not be. It is in
everybody's interest that the region remains stable, at least
free from conflict.
Additionally, we are working with our European colleagues
to enhance their capabilities, to enhance their capacity, to
address various scenarios that could arise, and I should
mention that they also have an over-the-horizon reserve
capacity to surge, should they need it. So I am confident that
EUFOR is capable of doing the job it was intended to do, which
is keep the peace in Bosnia and Herzegovina.
Senator Shaheen. So you are not advocating that the size of
the forces should be increased?
Mr. Escobar. We are advocating that the size of the force
match the challenges and the requirements, and we are confident
that it does.
Senator Shaheen. Good. When is the UN authorization going
to happen?
Mr. Escobar. I believe it will happen again in the fall,
late fall.
Senator Shaheen. Do you know how long that will last?
Mr. Escobar. They usually last a year.
Senator Shaheen. Okay. Well, thank you both very much. I
very much appreciate your responses to all of the questions and
your continued commitment to the region, and I hope that you
will engage with this subcommittee and also with the full
committee in terms of how we might be more helpful as we are
looking at the challenges ahead for the region.
So with that, I will conclude the hearing, and again, thank
you both.
[Whereupon, at 11:22 a.m., the hearing was adjourned.]
----------
Additional Material Submitted for the Record
Responses of Mr. Gabriel Escobar to Questions
Submitted by Senator Robert Menendez
Question. Much like in the 1990's, Bosnia and Herzegovina's
neighbors are stepping up attacks on the country's legitimacy,
sovereignty, and unity. Of particular concern are recent statements by
Croatian President Zoran Milanovic regarding NATO expansion, and his
persistent attacks on the legitimacy and viability of Bosnia and
Herzegovina. Aleksander Vucic also continues to promote and reward
secessionist rhetoric by Bosnian-Serb politicians. What is the
Department's engagement strategy Bosnia and Herzegovina's neighbors,
particularly Croatia, to reiterate that meddling in Bosnia and
Herzegovina's internal affairs is unacceptable, given that it risks
extreme instability and return to conflict?
Answer. Bosnia and Herzegovina's (BiH) sovereignty and territorial
integrity are unquestionable, and no third country can dictate its
chosen Euro-Atlantic trajectory. Croatia and Serbia have enduring
interests in BiH, and we engage both to advance regional stability and
common goals for BiH, including its EU path. We look to Croatia to
encourage reforms by BiH officials to advance democratic growth, the
rule of law, human rights, and prosperity for all citizens. Croatia's
constructive advocacy within the EU could lead the bloc towards
meaningful action to advance BiH's EU perspective. In Serbia, President
Vucic has reiterated, on multiple occasions, Serbia's support for the
Dayton Peace Accords and BiH's sovereignty and territorial integrity.
Question. While the Dayton Accords ended the war in Bosnia, they
also installed a flawed ethno-nationalist political system rife with
kleptocracy. Many citizens have lost faith in their leadership and are
leaving the country, and ethno-nationalist parties have led to
gerrymandered voting districts along ethnic lines. How is the
Department seeking to re-think and reform the current flawed government
design? What is the Department's plan to engage with civil society and
opposition groups as part of such a process?
Answer. The reforms necessary to move Bosnia and Herzegovina (BiH)
from Dayton to Brussels are clear and achievable with political courage
and building on the Dayton Peace Accords. We regularly engage all BiH's
leaders--in civil society, government and from across the political
spectrum--to focus on reform and advancement within the Dayton
framework, such as the EU's Key Priorities and the 5+2 Agenda for the
closure of the Office of the High Representative. Step-by-step reforms
will increase prosperity for citizens, advance BiH's Euro-Atlantic
trajectory, and permanently enhance the democratic integrity,
stability, and functionality of the state.
Question. Russia continues to meddle in the Balkans as part of its
effort to expand its influence and reach. Kremlin officials have
perpetuated unfounded narratives about the region, even claiming they
have links to the conflict in the Donbas, indicating the Russians are
laying the groundwork for future destabilizing actions in the Balkans.
Is the Department planning to re-double efforts to counter Russian
aggression in the Balkans, particularly given Russia's willingness to
engage in such tactics?
Answer. The United States and Russia have very different visions
for the future of the Western Balkans. Moscow actively opposes the
region's Euro-Atlantic integration and sows division, distrust, and
inter-ethnic and inter-religious tension. U.S. interests align with
those of the people of the Western Balkans and are best served by
cementing democratic norms, rule of law, and deepening cooperation
based on common values and a shared future. We engage our partners in
BiH to advance our shared priorities. This includes pushing back
against Russia's destabilizing narratives and behavior, including
through our bilateral foreign assistance, which in FY 2021 totaled more
than $145 million.
Question. The Sejdic-Finci ruling demonstrates that the structure
of the Bosnia and Herzegovina political system violates key rights of
minority groups. Will the Department ensure that any future electoral
reforms address the issue of minority and ``other'' rights as a key
tenant of agreements?
Answer. Electoral and limited constitutional reforms are required
to improve election integrity and implement key European Court of Human
Rights and Bosnian Constitutional Court rulings to ensure equal
opportunities and representation for all citizens of Bosnia and
Herzegovina (BiH). These measures will strengthen democracy, bring BiH
in line with European standards, and further its European Union (EU)
path. We encourage compromise and constructive dialogue by all sides to
reach a deal that furthers these objectives as soon as possible in
advance of the upcoming elections. The United States, along with our EU
partners, meets regularly with key interlocutors from all political
parties to inform solutions that work for all.
______
Letters From the Embassies of Albania, Bosnia and Herzegovina, Kosovo,
Montenegro, North Macedonia, and Serbia Concerning the Western Balkans
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