PAINFUL EUROPEAN TRUTHS

On my way to Brussels. Together with my colleague Rafuna, President of Kosovo Chamber of Commerce, to meet with our friend Commissioner Olivér Várhelyi,?EU Neighborhood & Enlargement, I am facing some painful truths:?

#1?We live in a divided world economy led by the USA and China.

#2?Europe was left behind in almost all strategic areas. Rare-materials mininig and processing, supply chains security, AI develpomement, production of EV batteries, e-mobility (6 of top 10 battery makers are Chinese, other 4 are not European)….?

#3?Europe relies on China for 98 percent of its rare earth supplies.

#4?Europe has vulnerable security issues on almost all borders: The War in Ukraine, the Migration Crisis on southern and Mediterranean borders, and high-security risk in the middle of Europe leaving Western Balkan countries out of the European structures (Single-Market, 4 Freedoms, Structural development funds..)

That is an even more painful truth because risk awareness by the European administration and EU member states is in a very early stage (caused mainly by the war in Ukraine). Let's say some ten years too late. As an approach to mentioned challenges, we (Europeans) are using mechanisms more than two decades old (decision-making process, EU enlargement process, foreign policy, and economic strategy policy forming …).?

Facing turbulent times in our region, uncertainty on our continent, and global disruptions in the world economy, we can’t do much without a new perspective and vision of the European future. However, we (Europeans) are learning slowly.?

We are not ready to commit to the Western Balkans, Ukraine, and Moldavia's fast inclusion in the EU structures, such as Single Market and 4 Freedoms, before full membership. By helping these countries to gain new momentum in reforming themselves through achieving step-by-step transparent goal/benefit systems within a reasonable time frame we are avoiding a power vacuum and third parties influence, which is already strong., By doing that actually, we are securing European industrial future, fostering economic consolidation and building our resilience and independence as much as possible.?

We are investing billions in production facilities in China (BASF - 10 bn EUR, VW 2,4 bn EUR) without having a clear European political vision of how our geopolitical ties with China could look like in the future (and we are not the ones that lead this process). A few days ago, we saw German exports to China drop 11.3 percent (BASF dropped 29% quarter to quarter, VW 15% in the same period).

Looking to the other side of the globe, the Inflation Reduction Act offers significant subsidies to American-made EVS with batteries that use rare materials sourced in America or from close allies.?

At the same time, just looking at the Western Balkans, European potentials are unused without having a clear inclusion perspective. Serbia, Bosnia and Hercegovina, Albania, Kosovo, Montenegro, and North Macedonia have rare earth materials already existing or close to finish mines with far more reserves than any other European region. The region has lithium deposits in the world with significant amounts of boron. There are also enormous reserves with already existing mining facilities and permits of calcite (purity 99%), Graphite, Cobalt, Nickel.

Paradox of Situation is that European green deal, as our (European) own kind of securing the market, is fully dependent on China which controls almost all of the worlds solar power supply chain and much of global processing capacity for minerals crucial to the green transition.?

Painful truths request painful decissions and political vision. Hope together we are able to build one.

Marko Cadez