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The fragmentation of Yugoslavia has wrought extensive political and social changes in the Balkans and Europe more generally. After the collapse of communism and the breakup of Yugoslavia, many Balkan countries have transformed their political system and have begun to forge new foreign and security policy. Some of them have already joined the EU and NATO, and some are about to access these organizations. But the Western Balkan states seem to be farther in the future. In regard to the former Yugoslavia, the United States, European states and international organizations, such as the EU, NATO and UN, have attempted to engage and manage this breakup on an individual and collective basis. They have greatly influenced the process of the post-conflict nation building of this region. From this viewpoint, the paper discusses the political and social transformation of the Balkans after the breakup of the Yugoslav conflict, and the role of the EU and NATO in the process of the democratization and nation building in the former Yugoslavia. Moreover, attention is paid to the features of the involvement of the EU and NATO in the former Yugoslav conflict. In the process of Yugoslav fragmentation one can see the ‘Eastern Question’ revisited and the ‘Powder keg of Europe’ once again rising to its brim.

This review article focuses on a wide canvas of issues relating to the EU's engagement with western Balkans countries. Putting current policies into the perspective of the recent history of the western Balkans region, the author develops a number of theses about the nature of the EU's engagement including among them the extension of the modernisation agenda and the difficulties that this is causing the EU's own internal capacities. The author cites the destruction of Yugoslavia during the 90s, a process in which a European Community preoccupied with its own economic and monetary union appeared powerless to react, as being key in the problematic development of a foreign and security policy at the EU level, where the EU is still 'between globalisation and fragmentation'. The author explores EU initiatives in the integration of western Balkans states, including the Stability Pact, and concludes that integration offers a difficult challenge to dreams of European unity in which the experience of the US in the application of its foreign policy offers a key lesson as to the likely weighting of the challenges that matter most of all to ordinary people. [ABSTRACT FROM AUTHOR]

Copyright of Bulletin of the 'Carol I' National Defence University / Buletinul Universitatii Nationale de Aparare 'Carol I' is the property of Carol I National Defence University and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The essay starts from the assumption that the efforts to cure Europe's democracy deficits will also have to address the social proble matique of the Europeanisation process. This is a challenge with new dimensions. Europe had started its integrationist path as a mere economic community. In its formative era, the constitutional perspectives of German Ordoliberalism were attractive. In the ordo-liberal account, the European polity has a twofold structure: At supranational level, it is committed to economic rationality and a system of undistorted competition. Redistributive (social) policies could-and should-be left to the Member States. This edifice was refined in the 1970s and 1980s. Monetary union and the stability pact completed it. The German Constitutional Court's Maastricht judgment endorsed its constitutional validity. However, the new dynamics and the strive for an «ever closer Union» in the Maastricht Treaty has led to a strengthening of European regulatory policies and a broadening of their scope, which were incompatible with the ordo-liberal legacy. The erosion of the economic constitution has not paved the way to a cure for Europe's social deficit. Neither the open method of co-ordination nor the commitment to a «social market economy» in the Constitutional Treaty nor the new «social rights» provide a conceptually sufficient and politically credible basis for this end. [ABSTRACT FROM AUTHOR]

Copyright of Bulletin of the 'Carol I' National Defence University / Buletinul Universitatii Nationale de Aparare 'Carol I' is the property of Carol I National Defence University and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

In the discussions on the need for fiscal rules and their usefulness in a monetary union, researchers have not agreed if financial markets have a sufficiently disciplining effect on governments, which would mean that the fiscal rules are not necessary. This paper investigates whether the European Union's main fiscal rule, the Stability and Growth Pact, could be substituted by financial markets, taking into account the effects of the latest financial and economic crisis. The findings presented in this paper suggest that there is certain interaction between financial markets and government' decisions on fiscal policies and that this reaction has become stronger after the beginning of the crisis. However, the institutional setup and market conditions in the European Union are such that this interaction is biased and thus the paper concludes that the Union needs to have fiscal rules. [ABSTRACT FROM AUTHOR]

Copyright of Foro Internacional is the property of El Colegio de Mexico AC and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Abstract: This paper begins by discussing the inherent conflict between the simultaneous existence of a single currency for the countries of the European Economic and Monetary Union (EMU) and the independent fiscal policies of those countries. The Stability and Growth Pact was an attempt to reconcile that conflict. I describe how EMU governments have chosen to ignore the Stability Pact''s constraint on budget deficits and how they sought to undermine it by changing the rules themselves. The final part of the paper describes the actual resolution of the issue by the agreement reached at the end of March 2005 by the European Council. The new policy effectively abandons the Stability Pact and leaves the way open to much larger sustained deficits. [Copyright &y& Elsevier]

The highly formalized Stability and Growth Pact gives ECOFIN power to impose sanctions on states that breach the Pact's budgetary targets. As the ECOFIN meeting in November 2003 showed, it has considerable but not unlimited discretion. The Commission has called for a more flexible interpretation of the Pact, the strengthening of sanctions against non-compliant member states and successfully litigated the legality of the ECOFIN decision. We argue that the predominance of soft law in EMU's fiscal framework is functionally suited to the uncertainty that surrounds economic co-ordination over the medium term. This suggests an inherent tension in the Commission's proposals: although a more flexible interpretation of the Pact gives more room for fiscal manoeuvre to states that start from healthy budgetary positions, it also makes it more difficult for ECOFIN to measure compliance. This uncertainty re-emphasizes the soft law elements of the Pact, rather than bolstering the efficacy of its sanction mechanisms. [ABSTRACT FROM AUTHOR]

We study the prospective operation of the Stability Pact by stochastic simulation. Using a forward-looking multi-country macroeconometric model, National Institute Global Econometric Model (NiGEM), comprising individual blocks for 10 Euroland economies, the Pact’s provisions are formalised in detail, and alternative monetary and fiscal rules are compared. Rules are simple and credible, but a fiscal feedback parameter is made conditional on the stages of the excessive deficit procedure. Under a baseline broadly consistent with Stability Programmes, excessive deficits are overall rare; pecuniary sanctions only happen when “fiscal fatigue” delays corrective action; and monetary policy is found to be of secondary importance to the results. [Copyright &y& Elsevier]

This article challenges the conventional result according to which an instrument-independent central bank able to strictly commit to price stability makes fiscal constraints unnecessary. We present a model of a monetary union with heterogeneous members where the inefficient policy mix resulting from the lack of coordination between the common monetary policy and national fiscal policies incites the governments to appoint excessively “liberal” delegates to the central bank's board. We characterize the fiscal restraints necessary to restore the central bank's ability to deliver the most desirable degree of price stability. It appears that even country-specific and state-contingent restraints may be counterproductive for some member states. [ABSTRACT FROM AUTHOR]

The EU's Stability and Growth Pact tries to strike a delicate balance: it imposes the constraints on national fiscal policy that were deemed necessary to protect the new European Central Bank from outside pressures; at the same time, it allows flexibility for a counter-cyclical policy. First, we review official institutions' studies of the flexibility embedded in the Pact and find a rather strong consensus: the Pact seems likely to constrain counter-cyclical fiscal efforts in the years ahead, or at least until EU governments bring their structural deficits into balance. Then, we review conventional academic arguments that suggest a new central bank might need to be protected from external pressures, and we ask if the constraints that were actually written into the Pact are likely to be helpful in this regard. We conclude that the Pact is closer to an albatross than a delicately balanced package of necessary fiscal constraints. [ABSTRACT FROM AUTHOR]