EU expected to relock funds for Western Balkans in favour of countries leading the membership process

The European Commission is ready to redistribute funds under the tool designed to financially promote Western Balkan countries to carry out EU membership required reforms in favour of the <x0 priority” countries, two EU officials said about Euronews.

The Reform and Growth Tool for the Western Balkans was established in 2024 to provide candidate countries in the region with tough financial support, mainly implementation of reforms needed to join the bloc.

The instrument covers the period 2024-2027, with the ambition of doubling the size of Western Balkan economies within the next decade.

However, according to the Commission's own data, only about 673m euros have been issued under this instrument, down from 6 billion euros available. Almost all this funding has gone to only three of the six candidate countries.

Montenegro, Albania and Northern Macedonia are the most advanced in the accession process, thanks to their internal reform agendas. Bosnia and Herzegovina, Kosovo and Serbia, in contrast, are generally viewed as backlogs.

The instrument requires that reforms be completed within agreed terms if one is lost, the Commission could retain a portion or all funds corresponding to that condition.

The beneficiaries have one year to meet the conditions before the funds are re-launched, in addition to the first year when the deadline is extended to two years. That means that the end of June was the first such deadline.

“Sic underlines the regulation, where reform steps have not been met and expired during the ash period, the relevant funds can be re-entered among other beneficiaries”, a Commission spokesman for Euronews said.

“Linked to steps that should be taken on June 30th 2026, the Commission will now conduct a comprehensive and objective assessment of all beneficiaries”, the spokesman added.

In other words, the Commission is determined to redistribute unexpensed money to countries deemed to be making the greatest progress in reforms. These are Montenegro and Albania, the so-called leaders, and North Macedonia, which also has a good record of reforms.

The biggest losers are expected to be Bosnia and Herzegovina, which has received no funding from this instrument so far, as it has failed to implement any of the required reforms mainly because of its complex institutional structure. Kosovo and Serbia are also expected to be at a disadvantage, even though they have already received some dissources.

This situation was already certified in April, when Enlargement Commissioner Marta Kos wrote to all Western Balkan countries, urging them to speed up reforms or risk losing the money offered by the instrument.

EU officials stress that this instrument offers promotional financing: The commission is not making money, they say, as countries were never eligible for them unless they implemented the reforms in question.

“It's like working hours,” said an EU official, seeking to remain anonymous to speak up. You only get paid for your job. ”

The commission is expected to give member states more details on the issue later this month, including the amount of funds to be re-regarded.

Other potential opportunities include sharing additional money equally among all Western Balkan countries for technical assistance, transferring money to other candidate countries outside the region, or even transferring money back to the EU budget.

“Reforms should remain a priority for beneficiaries, so that they can make the most of what the Growth Plan offers”, the Commission spokesman said.