The Night-Owl Session addressed the question of business opportunities and trade cooperation among Western Balkan countries as well as increased economic cooperation with other European countries (EU, EFTA and Turkey). Prof. Dr Andrej Kumar of the Faculty of Economics, University of Ljubljana was a chair to the debate among Dr Besim Beqaj, President of the Kosova Chamber of Commerce, Dr Jelica Minić, Deputy Secretary General and Head of Expert Pool at Regional Cooperation Council in Sarajevo, Dr Višnja Samardžija, Head of Department for European Integration at the Institute for International Relations from Zagreb and Mr Marko Voljč, Chief Executive Officer of K&H Bank Ltd. from Budapest as well as the other participants of the late session, which took place in a very relaxed atmosphere.

The participants discussed obstacles to trade and cooperation as well as various mechanisms needed to support trade cooperation and promote greater interest for foreign direct investments in the region. Dr Kumar mentioned at the beginning that if the GDP from 1989 is compared to the GDP per capita in 2006 in the countries of the Western Balkans, only two countries have actually been able to exceed the level of 1989, Albania and Croatia. All others countries are far below. The EU support therefore did not produce the actual positive effect in the region, where Kosovo holds the last position with 64% percent compared to 1989. He also stressed the outside environment affecting the Western Balkan region, where new membership in the EU is not really very clear at the moment. There is also the question of the quality of national policies and the lack of business reactions in the region. The trade flows are mainly oriented towards EU, but regional cooperation is too small. As one of the options for economic progress in the region Dr Kumar mentioned the introduction of the system of diagonal cumulation of origin (so-called SAP+, which means the inclusion of the Western Balkan countries in the Pan-European cumulation system).

Dr Minić spoke about regional integration and recovery. In her opinion, time factor is very important for the region. The region witnessed some recovery after 2000 but the situation is now getting more difficult. In her opinion there are plenty existing and emerging structures and regional networks in the field of trade in the Western Balkans. Some of them are autonomous, whereas most of them are supported from outside and are growing. There is also the network, which tries to provide some synergy among them. She stressed that at the sectoral level there is great readiness for cooperation in the region and the overall sectoral cooperation is very good.

Dr Samardžija believes that the state of crisis is different in different countries. It is most visible in the countries more open to trade. In 2008 there was the strongest flow of FDIs in the region, Albania was the least attractive for FDIs, whereas Croatia was the most successful and also Montenegro. The problem in her opinion is that FDIs are not oriented to the export-oriented projects and that greenfield investments are marginal. Measures should therefore be taken to attract FDIs. She also mentioned the issue of trade and the importance of projects like SAP+ cumulation, which should be speeded up since free trade area is an opportunity for the region.

Dr Beqaj feels that the economic progress is slow and the situation in the region is bad. He believes that CEFTA is a very good written document, which is not functioning in the field, since it is not giving results. He believes that regionalism is the key issue of how to go ahead and thinks the Western Balkan countries should not look into the EU as their main trading partner but look into their neighbours.

Mr Voljč believes that the banking sector is either the cause of the crisis or the victim of it. However, this time the situation in the Western Balkans is different. Most of the banks are foreign owned and the monitoring of the banking sector has improved in the recent years. We are momentarily well into the crisis, but the banks are not leaving the region and this is a very encouraging sign, because it means that they still believe in the future of these markets. Mr Voljč stressed that countries should strive to be open and welcome the foreign players. This will of course not happen overnight but we can be cautiously optimistic at the moment.

Mr Blaž Golob, Director of the Centre for eGovernance Development for SEE mentioned that there is more than evident good will to cooperate on different topics in the region. Information society development is one of the areas, which has a prospect even during the crisis. This area could also apply to other areas, but the initiative should come from the inside, not outside of the region. The region has in his opinion great prosperity.

Dr Gordana Djurović, Minister for European Integration in the Government of Montenegro underlined the Instrument for pre-accession assistance (IPA) as a good model. She also stressed the importance of the cooperation with the EIB and EBRD and suggested the solution, which should consist of a mix of the EU grants, co-financing and better linked financial institutions. She stressed that countries of the region have a strategy and a clear plan, but respect the Thessaloniki agenda at the same time. In this very early stage of integration it is important to motivate each country individually.

Ms Renata Vitez, Director of the CEFTA Secretariat believes that CEFTA is functioning, but is nevertheless burdened with the unclear status of Kosovo. The CEFTA countries were very successful at negotiating the agriculture reform in 6 months and now the problem appeared who will be the signator of the additional protocol for Kosovo. However, Ms Vitez believes that CEFTA is functioning well and that it h a good future.

Ms Minić stressed that after establishing CEFTA, the trade in the region increased and she does not think that it is bad to cooperate among each other. She does not think that the regional initiatives are meaningless. The problem in her opinion is not in trade but in the labour market gaps and the infrastructure. If there was free movement of people many labour market gaps could be fulfilled.