Emerging Europe Spring 2019 by Emerging-Europe

Spring 2019

emerging-europe.com

North Macedonia has a name. What's next? Cleaning up Moldova's banking sector Outlook on Bosnia and Herzegovina 19 destinations for 2019 Technology in the construction industry

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J oin the Awards Cer e mony on 2 8 June 2019, EBRD HQ in London Strategic Pa r t n e r

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INBRIEF eastern Poland. The coalition, which includes Client Earth, Greenpeace Poland, WWF Poland, Greenmind Foundation and the Wild Poland Foundation – have called for the urgent suspension of the plans, which are aimed at opening up parts of the UNESCO protected forest for further commercial exploitation. Last year, campaigners fought a legal battle culminating in a ruling from the European Union’s highest court that logging in Białowieża, one of Europe’s last remaining primaeval forests, was illegal.

Salome Zurabishvili, a Frenchborn former foreign minister, was elected Georgia’s first female president. Mrs Zurabishvili comfortably beat rival Grigol Vashadze, taking almost 60 per cent of the vote. Mrs Zurabishvili was backed by the ruling Georgian Dream party while Mr Vashadze was a united opposition candidate. “We have finally and firmly rejected our past,” said Mrs Zurabishvili. “Our choice is a peaceful Georgia, a free country, where citizens have equal rights.”

The Vienna Institute for International Economic Studies (wiiw) warned that Central, Eastern and Southeastern Europe (CESEE) is set for a difficult 2019. EU politics, a packed election calendar, Brexit, migration battles, the US-China trade war and a slower global growth will combine to make 2019 a challenging one for CESEE economies.

Estonia was named as the least corrupt country in emerging Europe in the latest Corruption Perceptions Index, published by Transparency International. The Baltic state improved its score from 71/100 to 73/100 in 2018, and now ranks as the 18th least corrupt country in the world, higher than France, Ireland and Portugal. Azerbaijan, with a score of just 25/100 (down from 31/100 in 2017) is the most corrupt in the region, ranked 152nd globally. Other notable performers in the region are Poland and Slovenia, both ranked 36th globally with a score of 60/100, and Lithuania and the Czech Republic, both ranked 38th with a score of 59/100. A coalition of environmental groups has criticised moves by the Polish state-owned forestry company to restart commercial logging in the Białowieża Forest in

Data from Eurostat, the European Union’s statistics department, revealed that housing prices in Slovenia rose 15.1 per cent yearon-year in the third quarter of 2018, well above the EU average of 4.3 per cent. Elsewhere in emerging Europe, the Czech Republic (8.7 per cent), Latvia (8.6 per cent), Hungary (seven per cent), Croatia (6.8 per cent), Lithuania (6.6 per cent), Poland (6.5 per cent), Bulgaria (6.3 per cent), Romania (5.7 per cent) and Slovakia (4.4 per cent) also saw big increases, above the EU average. Of those emerging Europe countries which are EU members, only Estonia (4.1 per cent) saw a yearon-year increase smaller than the EU average. The Greek parliament voted on January 25 to approve a deal between the country and the Former Yugoslav Republic of Macedonia that will see the latter’s name officially become the Republic of North Macedonia. The vote – narrowly won by 153 votes to 146

– was the last step which needed to be taken by the two countries to formalise the deal, agreed last June. Macedonia’s parliament approved the name change on January 11. Greece had rejected Macedonia’s name ever since the country declared its independence from Yugoslavia in 1991, as it has a region of the same name. North Macedonia is now free to pursue its goals of NATO and EU membership. The European Commission approved a 215 million-euro support grant for the Baltic Gas Pipe project. The project aims at creating of a new gas supply channel on the European market, which will for the first time allow the transmission of gas directly from the deposits in Norway to the Danish and Polish markets, as well as to recipients in neighbouring countries. In response to criticism from the European Commission, Bulgaria announced that it was halting its programme which allows wealthy foreigners to buy citizenship against investment, claiming that the scheme had failed to bring any significant economic benefits for the country. “Data shows that the aim to increase real foreign investment and economic development has not been achieved. As a result new jobs have not been created or economic growth been boosted,” Bulgaria’s justice ministry said in a statement.

Salome Zurabishvil

The mayor of Gdańsk Paweł Adamowicz was murdered in front of thousands of people at a charity event being held in the Polish port when an attacker stormed the stage and stabbed him several times. Mr Adamowicz, who had served as mayor of Gdańsk since 1998, was resuscitated at the scene and rushed to a nearby hospital but died shortly afterwards. His murder has prompted civil society groups to call for an end to the increasingly toxic and divisive nature of rhetoric in Polish politics.

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FROM THE EDITOR B

ulgarian environmental campaigners claimed a major victory in January when a court in the country's capital, Sofia, dealt a fatal blow to plans to extend Bulgaria’s largest ski resort, Bansko. The court overturned controversial changes made by the Bulgarian government in December 2017 to the management plan for Pirin National Park. The changes would have allowed construction of new ski runs and lift s on up to 48 per cent of the park’s 40,000 hectares (almost 100,000 acres). The extension would have made Bansko the largest ski area in emerging Europe, increasing the resort’s size to 333 kilometres of runs served by 113 ski lift s. Currently, there are 70 kilometres of runs and 25 lift s. The court ruling marked the end of a long campaign by environmental groups, which began in November 2016 when WWF launched an international campaign in support of Pirin National Park. More than 125,000 people from all over the world signed a petition handed to Bulgaria’s Prime Minister Boyko Borisov asking for him to protect the Pirin National Park – a UNESCO World Heritage site – and its pristine wildlife. The park is home to bears, chamois, wolves and centuries old pine forests. While welcoming the court's ruling, it is disappointing that protection of emerging Europe's environment remains in most places the job of non-governmental organisations and campaign groups. It betrays the fact that

the region's governments have themselves yet to take the threat to the natural world posed by climate change and pollution seriously. Th is was all too evident in December at the United Nations summit on climate change (COP24), held in Katowice in Poland – one of the continent's most polluted cities. Opening the event, Sir David Attenborough delivered a stern warning of the impending threats climate change poses. “If we don’t take action, the collapse of our civilisations and the extinction of much of the natural world is on the horizon,” said Mr Attenborough in his keynote address. Later the same day, alas, Polish President Andrzej Duda, used his own opening address to defend Poland’s reliance on coal. “Using your own natural resources, which in Poland’s case is coal, and basing energy security on these resources does not contradict protection of the climate. Poland is a good example of a country following the path of sustainable development,” he said. As if trolling delegates to the conference, many were greeted by a coal miners' band, while sponsors included JSW, the EU’s largest coking coal producer, and PGE, which runs the world’s secondlargest fossil-fuel power plant. Once again, it was NGOs who were left to make a point about the health issues coal presents. An innovative art exhibition was installed outside of the conference, which showcased the testimonials of people across Europe affected

by the destructive impacts of coal. The interactive installation, created by Europe Beyond Coal, CEE Bankwatch, and Greenpeace, featured five 3D printed statues, made from scans of people in coal affected communities from Alcudia, Spain; North Rhine-Westphalia, Germany; the Jiu Valley, Romania; and Silesia, Poland – the heart of the coal region in which Katowice is situated. While the striking installation may have raised awareness, real change can only be brought about through committed government action. Even in Bulgaria, the campaigners who managed to bring Bansko's extension to a halt expect the government's push to allow construction in what is a UNESCO-listed World Heritage Site to continue. Protecting the environment, and people's health, should be a goal for all major political forces in our region. Campaign groups can do their bit by continuing to raise awareness, but we can also do ours by ensuring that we give votes only to those political parties as committed to the future of our planet as we are. •

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Craig Turp, Editor-in-Chief

Lublin, the capital city of the Lubelskie Region, is a driving force of Eastern Poland and a growing BPO/SSC/IT hub, boasting more than 60 R&D centres

Lublin has one of the highest office-space growth dynamics in eastern Poland, with a current office stock of 180,000 m2, planned to rise to 300,000 m2 by 2020. Costs are competitive: 8-12 euro per m2

Lublin Airport is only 8 miles form the city centre with flights to many cities including London and Munich

Over 50% of Lublin’s residents are under 40, and almost two-thirds of the 350,000 population is of working age. One in five of Lublin’s population is a student

Lublin was named the “Emerging City of the Year in Poland 2018” at the CEE Shared Services and Outsourcing Awards

Marshal Office of the Lubelskie Region Department of Economy and International Cooperation Trade and Investment Promotion Section Artura Grottgera 4 St., 20-029 Lublin Investors and Exporters Assistance Centre +48 81 537 16 15 / +48 81 537 16 21 coie@lubelskie.pl Find us on: invest.lubelskie.pl/en

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PUBLISHED BY Emerging Europe Limited WeWork Aldgate Tower, 2 Leman Street London E1 8FA, United Kingdom T +44 20 3808 8558 W emerging-europe.com E newsroom@emerging-europe.com Founding Partner, Strategy & Content Andrew Wrobel a.wrobel@emerging-europe.com Editor-in-Chief Craig Turp c.turp@emerging-europe.com Editorial team Claudia Patricolo c.patricolo@emerging-europe.com Shakhil Shah s.shah@emerging-europe.com Tamara Karelidze t.karelidze@emerging-europe.com Nijat Eldarov n.j@eldarov@emerging-europe.com Jerry Cameron j.cameron@emerging-europe.com Contributors Juliette Bretan Linas Jegelevičius Frédéric Schneider Nikodem Chinowski Yoan Stanev Graphic Designer Karolina Antipenko Cover Piotr Wyskok Video Editor Piotr Dobroniak Photographer Sabrina Bouchaala Partner, Growth & Partnership Emiliano Ramos e.ramos@emerging-europe.com

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Food for thought

19 for 2019

Emerging Europe selects 19 off-thebeaten-track destinations across the region well worth visiting in 2019.

Restoring trust in Moldova’s banking sector Sergiu Cioclea, the head of Moldova’s national bank from 2016 until his resignation in November 2018, has been credited with restoring trust in the country’s banking sector. Andrew Wrobel spoke to him about his time in office.

Fortress UK Visitors to the UK from a number of countries in emerging Europe are finding it increasingly difficult to procure visas, harming tourism, business and trade.

Table of contents

Berlin, Washington, Brussels, Vienna

Technology and the changing construction market Drones and 3D printing can radically reduce the cost of construction. But sensible government legislation, as well as a change in the attitudes of the public, are needed before we can all benefit from new technology.

Our quarterly look at some of the region’s most innovative companies.

Will Russia seek to annex Belarus? Is Vladimir Putin seeking to annex neighbouring Belarus and reunite former territories of the Soviet Union under Moscow’s control?

Does it really make sense to build a new coal power plant today?

Media plurality in emerging Europe

North Macedonia has a name. What’s next?

BUSINESS

36 Emerging politicians: Peter Ungar, Ciprian Ciucu

Innovation is one of the key factors that will drive the energy transition process and will help countries to meet their 2050 climate targets, including the decarbonisation of the energy sector trough low-carbon technologies.

Made in emerging Europe

View from the boardroom

Innovation in energy

CURRENT AFFAIRS

16 A view from:

Connecting emerging Europe In many places, getting around emerging Europe remains as difficult today as it did 30 years ago.

Even some of the most developed countries in the region struggle when it comes to securing a free press, primarily because ownership rests in the hands of a few people, almost always with close ties to politicians..

OUTLOOK ON BIH

Investing in Bosnia and Herzegovina Emanuel Salinas, World Bank country manager for Bosnia and Herzegovina (BiH) and Montenegro, and Ian Brown, head of the European Bank for Reconstruction and Development’s (EBRD) office in BiH, speak to Andrew Wrobel about the country’s challenges and opportunities.

It's better than another war: a beginner's guide to Bosnian politics

Tourism now accounts for almost 10 per cent of Bosnia and Herzegovina's GDP, but there is a great deal of room for the sector to develop even further.

Emerging Europe is home to more than a thousand game production studios. Many of their biggest hits focus on the region's troubled history.

The Heart-Shaped Land

Cooking with childhood memories

Embracing the seeds of change in Bosnia and Herzegovina

There is a groundswell in Bosnia and Herzegovina as citizens (mostly young people) are beginning to Bosnia has the world's most complicated embrace a vision of hope and change system of government: a gerrymandered mess overseen by an unelected mandarin. in their country—a change that While it pleases almost nobody, the system could lead to democracy and a brighter tomorrow for all. has helped keep the peace since the end of the Bosnian War. It has also, however, stifled the development of genuine democracy. Craig Turp tries to explain how it works..

The search for talent: Bosnia's ICT scene Bosnia and Herzegovina currently appears to be lagging behind neighbouring countries and the region, and one of the primary reasons for that is access to talent.

AFTER HOURS

Arts: Fashion, Book, Comics

Artist Q&A

Nihad Jafarov is a young visual artist from Azerbaijan, who in 2018 founded the ArtChaos group, specialised in digital painting, filmmaking and videography. He spoke to Nijat Eldarov about the role advertising, amongst much else, is playing in the development of the visual arts in Azerbaijan.

Energy: A balancing act As Bosnia looks to phase-out coal and move towards hydropower, environmental groups are concerned by the impact on the delicate Balkan ecosystem.

Gaming emerging Europe

48 hours in Tiraspol It's not the first place that springs to mind when planning a weekend break, but Transnistria's capital rewards the curious traveller with a warm welcome and more than a few fascinating sights.

48 hours in Łódź Born as a result of the Industrial Revolution, Poland’s third-largest city entered has witnessed a remarkable turnaround during which this factory town has evolved into the nation’s undisputed crucible of alternative culture and urban cool.

Life in Estonia

The world turned upside down

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FOOD

FOR

THOUGHT Open society and liberal democracy in Central Europe – mission impossible?

professional and independent he openly declared that he is building an illiberal democracy, and that his model countries are China, Russia and Turkey. Since 2015, when Jarosław Kaczyński took office, the story has (for the present, partially) been repeated in Poland. There are signs (albeit far fewer) that we can expect to see the same in the Czech Republic and Slovakia. There are many characteristics of the illiberal democracy but the most important systemic feature is threatening the rule of law. The best defi nition of the rule of law is John Adam’s famous “a government of laws, not of men.” Illiberal democracy means autocracy.

Photo: Ivan Mikloš

Ivan Mikloš, former deputy prime minister and minister of finance of Slovakia

When authoritarian 'illiberal' democracies developed themselves in Belarus (after 1994) and Russia (after 2000) it was considered a systemic mistake that could only happen in less-advanced, non-EU countries. Then, Viktor Orbán won Hungary's elections in 2010 with a constitutional majority and, a few years later, after taking over institutions that should be

absolutely.” Singapore is the only exception from this rule, because its long-term ruling autocrat (Lee Kuan Yew) respected the importance of the rule of law and enforced it. It is also important to stress that the culture and value patterns of Confucianism play a significant role in this particular case. The link between freedom and prosperity is possible to see not only in the case of Russia and Belarus but also in the most developed illiberal democracy in the EU. In the 1990s Hungary was the third most developed post-communist country after Slovenia and the Czech Republic (by GDP per capita). In 2010, when Orbán fi rst took office, Hungary lagged behind only Slovakia. During the autocratic illiberal regime Hungary has been overtaken by Poland, Estonia and Lithuania. Just for illustration Lithuania's GDP per capita in 1995 was 60.5 per cent of Hungary's. Today it is 109.5 per cent.

The key precondition for freedom and prosperity is free and fair competition and rule of law protecting that free and fair competition. By replacing a government of laws with a government of men autocratic regimes are destroying free and fair competition to the detriment of People need freedom and want their people both as voters as well to have a better life. Th at is why as customers. illiberal democracy will fail in the end. But it will not come easy, The defeat of economic freedom automatically and not without a inevitably follows the destruction fight and great effort. Therefore, as of political freedom, just as Leszek Balcerowicz said, it doesn’t Lord Acton famously pointed matter if you are a pessimist or an out: “power tends to corrupt, optimist, everybody who believes and absolute power corrupts in freedom has to be activist. •

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The importance of Visegrád

Photo: Geopolitical Intelligence Services

Prince Michael of Liechtenstein, founder and chairman of Geopolitical Intelligence Services AG

As the name suggests, Central Europe lies between Western Europe and Russia. Th is geographic situation – including a certain lack of natural borders – makes the region vulnerable to pressures and interventions from both East and West. It is also a fragmented area, comprising smaller and middle-sized states, which offers neighbouring powers the possibility to create dissension and discord. Fortunately, nearly all Central European states are now members of the European Union and many are also members of NATO. Such a multilateral framework provides some protection to small and medium-sized countries and access to markets. It does not, however, guarantee that supranatural structures such as the EU and the EU’s members in the west necessarily understand and respect the interests of Central Europe. Shortly after shedding the Soviet yoke, Poland, Hungary and the then Czechoslovakia founded

the Visegrád Group to further military, cultural, economic and energy cooperation. It was also intended to shield the countries from the east, and to advance membership of the EU. The group still exists, inside the EU and NATO and now comprises four members, since Czechoslovakia split into two republics. In 2016 the Th ree Seas Initiative was launched, comprising 12 countries situated on or between the Baltic, Adriatic and Black seas. The initiative's goal is to further regional cooperation and develop infrastructure, especially in the areas of energy and transportation. The Visegrád countries are the core of the Th ree Seas Initiative. Recent developments make stronger collaboration amongst the Visegrád Group; politically, economically, in trade and in defence, vital. Tensions with Russia prevail. Sanctions are not really effective, but do not only damage the Russian economy, but also that of Central Europe. The Ukrainian confl ict continues, and although we have to recognise that reform efforts were carried out in Ukraine under diificult conditions, the results have not been satisfactory, something which is not wholly the fault of Ukraine itself. The forthcoming elections are unlikely to produce a result that will increase the pace of positive reform and will probably wipe out the government of President Poroshenko. Th is will also affect neighbouring countries. The West is likely to offer litt le assistance. Chancellor Merkel, President Macron and Prime Minister May are all at the moment 'wounded animals' and Brussels will concentrate on the European elections and the new Commission.

capitals to understand and respect central European needs. It is true and has to be appreciated that the European Union has done a lot to support development in these countries and important sums have been transferred via cohesion funds. But a lot came back in added value to the whole Union by allowing more efficient production and services. The money was well invested and the Visegrád countries and the Baltics have been fi scally responsible. It was not a one way street. Lately, the Central European countries have been criticised for democratic deficiencies. Independent from the truth or exaggeration of these accusations it is a fundamental principle of democracy and self-determination that in a democratic system the people can decide how their democracy will best fit their needs. There is a certain amount of hypocrisy in some of the argument that in certain instances, mature democracies (western) are allowed deficiencies whilst institutions (especially in Poland and Hungary) are still not mature enough. Sanctions are threatened if the governance systems are not harmonised to principalist standards. It shows that lessons from Brexit have not been learnt. The people and governments in Central Europe are clearly pro-European Union. However, strong regional cooperation between the Visegrád countries especially is necessary to defend regional interests, freedom and self-determination. The relationship with Russia has a different importance in Central Europe than it does in France, Italy or Spain.

Central Europe needs to be strong within the European Union, and this requires a functioning Even worse, there is litt le ability Visegrád, and the willingness to or willingness in western European fi nd common results. •

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19 for 2019

Lublin, Poland

Emerging Europe selects 19 off-the-beaten-track destinations across the region well worth visiting in 2019. WORDS CRAIG TURP

The beach at Batumi, Georgia

Lublin, Poland

Oradea, Romania

A long-forgotten jewel in eastern Poland's crown, a growing number of direct flights from an increasing roster of major European cities have recently made this charming town more accessible than ever. The streets of the old Lublin are packed with cool bars, great restaurants and gorgeous little cafes, but have until now remained free of the crowds that can make a visit to Kraków such a chore. Don't miss the sublime castle (conveniently located close to the city centre): it's one of the oldest and best-preserved royal residencies in Poland, today home to the excellent Lublin Museum.

Largely untouched by the woes of communism and the erratic urbanism that affected the Romania's bigger cities, Oradea is an open-air Art Nouveaux museum showcasing 3,000 historic buildings, many renovated over the past decade. The 16th-century Italianate fortress, the symbol of the city, had its own makeover in 2015 and today houses a both very cool museum and a fabulously offbeat hotel. Something of a foodies' dream, the best restaurant in town is Meatic, run by the superstar Romanian chef Adi Hadean and famed for its creative use of local produce.

Lviv, Ukraine

Parnu, Estonia

Offering a stark contrast to the brutal architecture which dominates elsewhere in the country, the western Ukrainian city of Lviv offers jaded travellers a chance to rekindle their love of Mitteleuropa. A colourful, lively old town square is the centrepiece of a compact and walkable city centre which abounds with art galleries, monuments, cathedrals and museums. Climb the steep steps to the top of the Town Hall: tough but well worth the glorious views. If you can grab a ticket, the Baroque opera offers world class performances for little more than the price of a beer.

Basking on soft golden sand in glorious sunshine is not what usually springs to mind when Estonia gets mentioned, but Parnu, the country's leading beach resort, is a classy place that offers a very different kind of seaside break. There's a small and yet chocolate box-perfect old town to explore, and the resort is at the cutting edge of the Nordic food revival, boasting a great selection of outstanding restaurants. Classic spas and thermal baths - around which the resort developed in the 19th century - have of late been joined by modern water parks. And

it's all less than two hours from the overcrowded capital Tallinn. Batumi, Georgia Founded by the Ancient Greeks, Batumi is Georgia's summer playground and in recent years has been the scene of a real estate boom, with impressive, high-rise skyscrapers lining the sea front. Look out for the Alphabet Tower, a 130-metre tall twisting DNA helix dedicated to the unique Georgian alphabet. Batumi's nightlife is as hip and lively as anywhere on the Black Sea with a dizzying range of clubs that will suit just about everyone, from those looking for live, local music to glitzy, glamorous places for the rich set. Tirana, Albania Europe's most colourful city? Possibly. Street art covers almost every available space and has become a calling card of this most misunderstood of all European capitals. During the long summer cafes and bars spill out onto the street and at weekends it can feel as if half of all Albania's young people have turned out to party. Friendly locals, cheap prices and the chance to explore wider Albania (the coast is just an hour's drive in one direction, the cooling, forested hills of Dajti an hour the other) make it a perfect spot for a summer break.

The crude oil produced at Naftalan, a small town around 350 kilometres west of the Azerbaijani capital Baku is too thick to be used commercially, but for hundreds of years it has been put to good use as a cure for just about every ailment imaginable. Marco Polo is said to have bathed in the oil, and during the 1930s the Soviet Union built an entire resort based on the oil's healing properties. The resort has seen a revival in recent years, with the construction of new hotels, and more than 15,000 foreign visitors each year now come to find relief for rheumatism, eczema and various bone diseases. As part of its national tourism strategy, Azerbaijan wants to double the numbers over the next five years. Piran, Slovenia In a country not short of pretty little towns, Piran is by common consent the most gorgeous of them all. A Venetian port that was for centuries the centre of the Adriatic salt trade, Piran boasts what is undeniably the country's finest square, the 19thcentury Tartinijev Trg named after the composer Giuseppe Tartini, and what has to be one of the most dramatically situated churches anywhere in Europe, the St George Cathedral. Lovers of

seafood will be in heaven here with a wide range of eateries to suit all pockets. As with just about anywhere in Slovenia, it's only just over an hour from the capital Ljubljana. Klaipeda, Lithuania Klaipeda is the largest of the resorts on what has become known as the Lithuanian Riviera. A busy harbour town most of the year, for the short Baltic summer it becomes a young, party destination where the weather is not always as bad as you may expect. The oft-deserted beaches of the Curonian Spit are amongst the widest, wildest and sandiest in Europe, and include some of the highest sand dunes in Europe. Even during high summer you need not worry about somebody knocking over your sandcastle on the endless stretches of white beach. Nida, a small resort close to the Kaliningrad border famed for its wooden houses was an artists’ colony in the late 19th and early 20th centuries. Nobel Prize-winning writer Thomas Mann had a home here. Ohrid, Macedonia Offering visitors the chance to swim in one of Europe's oldest and deepest lakes, Ohrid is one of those rare places that is UNESCO-listed both for its cultural and natural heritage. Tsar Samuel moved Bulgaria's capital here in 990 and

while little of the fortress he built remains, its worth clambering through the ruins for mid-blowing views of the town and the lake. The well-preserved Roman amphitheatre host concerts during the summer, while the delicatelyperched church of St John at Kaneo is the most instagrammable place in all Macedonia. The recently restored monastery at Plaošnik was once home to one of the first universities in the Balkans.

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Budva, Montenegro The last outpost of the Venetian Empire, Budva is one of the oldest settlements on the Adriatic coast. Its superblypreserved walled old town is a gem, while its sandy beaches are amongst the finest in Europe. Nightlife is sensational. Bars and clubs are packed with beautiful party people from sundown to sunset, making this is not the best choice for anyone looking for a quiet getaway. Nearby is the unmistakable fortified island city of Sveti Stefan, perhaps the most exclusive destination in all of emerging Europe, a playground for the rich and famous from across the world. Both Budva and Sveti Stefan are about an hour's drive from the Montenegrin capital, Podgorica. Silba, Croatia Car-free Silba is as about offthe-beaten-track as it is possible

Lviv, Ukraine

Naftalan, Azerbaijan

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Oradea, Romania

to get in Croatia. Long a retreat for hedonists, artists and anyone seeking an alternative lifestyle it packs a punch for those looking for unique sights too. The 16th century fortress is a gem, topped with a hexagonal watchtower whose narrow spiral steps can be climbed by the fit. There’s a gallery featuring the work of sculptor Marija UjevićGaletović, a contemporary artist who does fantastic things with the human form, and throughout the summer the island hosts quirky cultural events. A ferry from Zadar will get you here.

Debrecen, Hungary

Plovdiv, Bulgaria

Now served by a number of flights from major European capitals, the largest city in eastern Hungary is an elegant place longfamed for its healing thermal waters, set in majestic forested surroundings. Home to one of the best aquaparks in Europe, it is a cultural centre of some renown. Debrecen’s defining landmark is the elegant Great Reformed Church (Nagytemplom), the most important protestant church in Hungary (Debrecen was the heart and soul of the Hungarian Reformation). In 1849, Lajos Kossuth proclaimed the country’s independence from the Habsburg Empire here. There are great views of the city from the top of the western tower.

Bulgaria’s second-largest city is one of the oldest in Europe: people have lived here since at least 6000 BCE. It is also one of the most contemporary: a pedestrianfriendly city with a cultural scene as cutting edge as anywhere in the Balkans. During the warmer months the sight of what can often appear to be the entire city taking its evening constitutional promenade can make the city feel positively Mediterranean. This multicultural city is a European City of Culture for 2019 and has seldom looked better. Street art covers every vacant wall and a host of major concerts, events and exhibitions will take place throughout the year.

Mostar, Bosnia The old bridge at Mostar, built in the 16th century and infamously destroyed in 1993 by Croat forces during the Bosnian War, was rebuilt in 2004 and has become something of a symbol of the new Bosnia: it is the country's mostvisited sight. Each July the brave compete in a diving competition off the bridge into the freezing waters of the Neretva river below. The equally iconic Koski Mehmed Paša Mosque, built in 1617, is open to visitors who can climb to the top of its minaret. Below, the Tepa market is one of the loudest and most colourful in the Balkans.

Tatranska Lomnica, Slovakia Just an hour from the city of Košice – served by flights from across Europe – the little resort of Tatranska Lomnica sits in the foothills of the dramatic Tatra mountains and is the perfect base for exploring some of the finest hiking country on the continent (and there is some decent skiing in the winter). Thousands of kilometres of well-marked walking routes – some of which are tough - snake their way across the mountains, and many are accessible by a good network of cable cars for those who want to scale the mountains the easy way. The active can also get busy on mountain bike trails, while if you are looking for more leisurely pursuits, nature trails offer a great opportunity to discover the unique mountain flora and fauna.

Yerevan, Armenia

Prishtina, Kosovo The youngest country in Europe has enormous potential to become a fabulous travel hotspot, not least its bustling capital which is increasingly accessible thanks to the arrival of Wizz Air flights from the UK, Germany, France and Hungary. The live music scene is fanstastic – as you would expect from a country that has of late produced more pop stars than anywhere else in the region – and the city centre has all the energy

Budva, Montenegro

and immediacy you could want from a country playing catch-up with the rest of the continent. And before you ask: Prishtina is safe. In fact, it's safer than most European capitals. Get there now before the world finds out. Yerevan, Armenia One of the world’s oldest continuously inhabited cities, which celebrated its 2,800th anniversary only last year, Yerevan couldn’t be more diverse. The city’s history can be traced back to the Biblical Noah and his descendants. The nonoperating mosques in Kond are evidence to the city’s occupation by the Persian Empire while the Soviet-style architecture reflects the USSR’s impact on the country in the 20th century. On top of that come old-fashioned teahouses placed next to chic European-style wine bars and trendy cafes. And the food, a mix of European and Levantine (or Eastern Mediterranean) cuisines. For now only French tourists can enjoy direct flights to Armenia — in April 2018 Air Company Armenia launched regular connections with Lyon. Tourists can also opt for connecting flights via Warsaw, Kyiv or Istanbul. Grodno, Belarus Once the residence of the Grand Duke of Lithuania, this most fabulous and most medieval among all Belarusian cities embodied the multi-ethnic and multi-confessional state, with great diversity in languages, religion and cultural heritage, which the Grand Duchy of Lithuania was. Today, there are dozens of churches, both Catholic and Orthodox, synagogues and castles, as well as the oldest operating Pharmacy Museum in the country. It could be a fantastic add-on for visitors to Lithuania’s Vilnius as it is about 170 kilometres away, except crossing the border requires a visa. A 30-day visa free visit is only an option for those who fly to Minsk International Airport. With or without, across the border from Lithuania or Poland, or as a day outing from Minsk, Grodno is a must-see destination. •

FOR STARTERS

Current Affairs

A coalition of environmental groups has criticised moves by the Polish state-owned forestry company to restart commercial logging in the Białowieża Forest in eastern Poland. The coalition, which includes Client Earth, Greenpeace Poland, WWF Poland, Greenmind Foundation and the Wild Poland Foundation – have called for the urgent suspension of the plans, which are aimed at opening up parts of the UNESCO protected forest for further commercial exploitation.

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A VIEW FROM... Berlin

Berlin has recently made headlines with vague announcements of its intention to take on more international responsibility. One way it has tried to do this is by being the bridge that connects Europe in the face of evolving challenges: from competing powers like China and a more inward-looking US Sarah Bressan, administration on the outside, and Global Public Policy Institute (GPPi). from the rise of right-wing populism and divisions over Brexit and the There is no description. future of the Eurozone on the inside. And indeed, with its history of division in the centre of Europe, Germany is ideally placed for a nuanced view on its neighbours’ opportunities and challenges as well as the need to navigate the spaces in between: Ukraine, for example, is a country that is both on the move toward more democracy and caught in violent conflict; Hungary has great

economic potential, whilst it is also experiencing a rollback of liberal democracy under Viktor Orbán; and Poland is a country of close friendship with Germany as well as one whose government undermines fundamental European values. But Berlin has not lived up to the expectations of many European partners. French president Emmanuel Macron’s proposals for greater Eurozone integration received only lukewarm responses from Berlin, and heavily indebted Southern European countries still bear the brunt of the unresolved crisis of European migration policy. Meanwhile, Berlin has failed to acknowledge any responsibility for the widespread approval of populists like Matteo Salvini or Orbán. While a pick-and-choose approach to Europe as a continent

of multiple speeds would appeal to pro-Europeans as a way to get things done, it is exactly Germany’s bridging role between East and West that explains its hesitation on the reform front. The risk of deepening the divide between countries governed – at times by a wafer-thin margin – by pro-Europeans and those that have already started to turn their backs on Europe weighs heavily on German decision-makers. For emerging Europe this could be good news. Investing in a better understanding of its eastern neighbourhood, advocating for its interests, and staying open to the prospect of deeper cooperation with the Western Balkans, Moldova, Georgia and Ukraine is the only way for Berlin to confront the challenge of illiberalism – and be the bridge it aims to be.

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Washington

Anthony Kim, Research Manager and the Editor of the Index of Economic Freedom, The Heritage Foundation.

2019 is poised to be yet another critical year for Europe, with implications for Washington’s engagement with many capital cities in the region gett ing far more vital and elevated. Undoubtedly, Europe is important to the United States economically, diplomatically, militarily, and politically. Halfway through its current term in office, the Trump Administration will likely look to solidify implementation of its strategy for Europe. The latest US National Security Strategy identifies three key pillars for America’s strategic interaction with Europe. First, deepening collaboration with allies to advance shared principles and counter outside aggression and subversion; second, eliminating barriers to trade growth; and last but not least, fulfi lling defense commitments, including bolstering deterrence in Eastern Europe. America’s voice and presence are crucial for continuing to advance these key priorities throughout 2019, particularly in an important year for Europe when a number of potentially game changing developments may take place. Just to name a few of those critical potentials, European Union parliamentary elections in May will surely colour the continent’s

political discourse, and important national elections are scheduled throughout the year, including in Greece, Moldova, Poland, and Ukraine. More immediately, going through the ongoing political turbulence, America’s closest ally in Europe, the United Kingdom, is heading toward its scheduled departure from the European Union on March 29, 2019 will be surely a year of inflection in Europe, with its political calendar packed and changing quite quickly too. On the economic front, challenges are not hidden either, and so are untapped opportunities. From a longer term perspective, although the authoritarian political impulse is manifesting itself anew in Europe, the economic rivalries of the Cold War have been eclipsed to a great extent by a new, technology-driven globalisation, and submerged throughout much of Europe under the evolving umbrella of the European Union. It is notable that in recent years, many of the large economies in Europe that were built on a quasi-market welfare state model are struggling and looking for ways to improve their competitiveness, and small and (re)emerging European countries such as Switzerland, Ireland, Poland,

Georgia and Baltic countries are showing them the path towards economic competitiveness and dynamic growth. Reflecting such a trend, according to the Heritage Foundation’s 2019 Index of Economic Freedom which is a data-driven policy guide that measures entrepreneurial environments of countries around the globe, a notable realignment of European countries in terms of economic freedom and overall competiveness has been underway. One thing that is unambiguously clear is that a stable, secure, and economically viable Europe is in America’s economic interest. The economies of the 28 member states of the European Union, along with the United States, account for approximately half of the global economy. The US and the members of the EU continue to be each other’s principal trading partners. Equally important is that Europe and the United States share the desire for dynamic economic expansion, and much more can be accomplished as they have a lot to offer to each other. While turbulent, 2019 will not be the year of chaos for Europe. It should be the year of embracing challenges proactively and seizing the momentum for renewed growth.

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Brussels

Danuta Hübner, member of the European Parliament.

Since the last elections to the European Parliament (EP) more than 100 new political parties have been created in the EU. Most of them a result of the populist surge. If the parties of an anti-Europe, nationalistic bent gain a substantial number of seats as a result of the May election, we will face a heavy and disruptive challenge of dealing with conflicting demands of different populist groups, national ambitions, and the politics of rage and revenge on the EU elites, rather than constructive dialogue for common European interests. This possible replacement of consensual politics by antagonistic and incoherent politics as a reflection of national or local grievances and the lowering of the EP’s standing may tilt the balance towards the Council, cementing the intergovernmental method as the primary mechanism of setting political goals in the Union.

The consequence of that could be that the voice of citizens, instead of being strengthened, will be marginalised. That would be the most unwelcome development, from my perspective. The populists, unable to achieve any long-term coherent goals together, will be concentrating on the politics of values, with the fully-fledged strategy of replacing the values of liberal democracy and rule of law with sovereign impulses, not often ready to translate into the legislative agenda, but very good in mobilising their national support bases against something, not for something. Our task now is thus two-fold: we need to combat fear and rebuild trust. European citizens can be re-engaged in the European project only if they become convinced that a real and salient alternative to populist politics is possible. Paradoxically, perhaps there is, after all, a silver lining in

the populists’ rise. They actually form – albeit incoherently - a panEuropean politics. As such they are giving us the opportunity to create a supranational public space, where we should be able to counter thenarrative of Euro-negativism with our own. Only by acting through a transnational dimension and outperforming them at their game can we combat the populists’ drive to occupy the public space in the EU. I think herein lies the challenge for the established political families in the EP. We should learn some tools from the populists’ playbook. We need to become truly transnational parties, 'poaching', so to speak, the best people with the political instinct, social sensitivity and cultural capital to become the new leaders for the EU in the coming decades. In other words, we need to create a truly pan-European, anti-populist, pro-citizen and pro-European alliance before the May elections.

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Vienna

Richard Grieveson, an economist at the Vienna Institute for International Economic Studies — wiiw.

The Viennese are known for their pessimism. However, even by Viennese standards, 2019 began with a lot of worries about the outlook for CEE. This is surprising considering how good the last two years have been on the macro front, with regional economic activity at its best level since at least 2011. There are several reasons for the less positive 2019 outlook. First, there is the politics. It is too simple to say that authoritarianism is on the rise in CEE, but it is clear that in many countries (and not only the usual suspects), things are going in the wrong direction. In addition, some conflicts in the Western Balkans and that between Russia and Ukraine could be heating up. The latter could be complicated further this year by presidential and parliamentary elections in Ukraine. Second, and linked to increasing authoritarianism and state capture, institutional de-convergence is increasingly evident in CEE. For at least the first two decades

after the start of transition, clear improvements were visible in much of CEE, in terms of both the quality and independence of bodies such as central banks, the judiciary, parliaments and the media. At least in some parts of the region—and, it should be stressed, not only in Turkey, Poland and Hungary—this has gone into reverse over the past decade. Arresting such a trend will be difficult and the negative implications could be far-reaching. Third, East-West splits in the EU could well intensify further in 2019. On migration policy and the postBrexit EU budget in particular, the battle lines are clearly drawn, and run East-West to a fairly large degree. The outcome of the European Parliament election and new Commission could also have important implications for CEE. Romania’s EU presidency, and the negative reactions to it in parts of Western Europe and Brussels, have shown rather brutally the extent to which the newer member states are still often seen in the continent’s wealthier half.

Finally, the macroeconomic backdrop is set to deteriorate. Although aggregate CEE growth rates will still be decent in 2019, this year is likely to be notably worse than 2017-18 for most. A big challenge will be the external slowdown, both in the eurozone and at the global level. The Chinese economy has already weakened,, and the US-China trade war could deliver a further hefty blow to global trade and sentiment. CEE is highly exposed to this, both directly and via Germany, which sits at the centre of cross-border supply chains stretching deep into Eastern Europe, and for which the eventual market is often the US or China. Seen from Vienna, these things are particularly concerning. Austria is an open economy reliant on trade with its neighbours, and its firms are heavily engaged in CEE. Political and economic disruption in the region this year would certainly prove the typical Viennese pessimism well-founded.

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View from the boardroom Does it really make sense to build a new coal power plant today? WORDS ANDREAS LUSCH

Andreas Lusch, CEO, GE Steam Power.

n December 28, 2018, GE Steam Power was granted what we call “Notice to Proceed” by the Polish utility Elektrownia Ostrołęka to build Block C, a 1,000MW coal power plant. This is an important step in the life of a project of this size, marking the full commitment of the main stakeholder, the government and state-owned utilities in this case, to building the project. For us, this is obviously good news. But beyond our own interest, what I see is a government deciding on what’s right for them with respect to delivering dependable, reliable, economical and (more) sustainable energy and as a result fuel the development of the country. And this is also a good thing. GE supplies technology for all types of power generation so it is not our role to comment on any country’s energy plans including their mix of fuels. We are here to deliver the best and the most sustainable solution. So, let me quickly address the elephant in

the room. Why would anyone build a new coal plant today? Poland, as other countries around the world, is facing an increasing demand for power and a need to stabilise its grid while introducing more renewable energies. The intermittency of renewables has created an emerging need for more flexible, reliable, dependable baseload which new generation plants like Ostrołęka C will deliver. Now let me address the second elephant in the room. No, I’m not oblivious to what we read about coal in the media. Some would have us believe coal has no role to play in our energy future. And maybe in some countries, we have the luxury to make such statements. But that’s not the case everywhere. When there is no access to other fuels like gas, locally available coal provides reliable, affordable power. And when we support this with the cleanest possible solutions it helps the economy grow and supports the development of renewables. To put this in context, Ostrołęka C is equipped with the latest ultra-

supercritical technology and will reach up to 13 per cent points higher efficiency than the global average. That means 26 per cent less CO2 per megawatt-hour of energy produced. Plants like Ostrołęka C are also fitted with modern emission control systems which bring the local emissions like particulates, sulphur or nitrogen oxides to levels on par with modern gas plants and below the most stringent regulations. Let’s face it, even in developed economies coal will continue to play a vital role to keep the lights on. In the US today coal represents almost 30 per cent of electricity production, in Germany, my home country, nearly 35 per cent and even if the government has just announced a plan to move away from coal, the reality is that this plan will take decades to implement. So, back to my original question. Does it make sense to build a new coal power plant today? If countries need it and do it responsibly, my answer is a resounding “Yes.” •

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North Macedonia has a name. What’s next? Now that one of the silliest international disputes of recent decades has been resolved, Greece will no longer veto Macedonia's (now officially North Macedonia) membership of international organisations. But while NATO will happen relatively quickly, nobody should expect EU membership anytime soon. WORDS CRAIG TURP

ATO, when it wants to, can act very quickly. Less than a week after the Greek parliament voted to sign off on the deal that will see the Republic of Macedonia officially become the Republic of North Macedonia, NATO approved the newlyrenamed country's accession protocol. Once the protocol is signed by NATO's existing 29 members, North Macedonia will be able to take part in the organisation's activities as an invitee. Full membership should be possible by the end of 2020. The markets have reacted positively. North Macedonia's 2025 sovereign bond hit a oneyear high as NATO Secretary General Jens Stoltenberg welcomed the final confirmation

of the so-called Prespa Agreement as "an important contribution to the stability and prosperity of the whole region." Ancient heritage The name Republic of Macedonia was adopted immediately after the country declared independence from the former Yugoslavia in 1991. It had been recognised as such by more than 130 countries, but not by the United Nations, NATO or the European Union, in all three cases because of the objections of Greece, which claimed that the term 'Macedonia' usurped its own ancient heritage and implied territorial ambitions on its northern province of the same name, the birthplace of Alexander the Great.

The 27-year-long dispute was finally resolved in June 2018 when, after months of often delicate negotiations, Macedonian Prime Minister Zoran Zaev and his Greek counterpart Alexis Tsipras signed an agreement in the town of Prespa, which sits on the border between the two countries. “This agreement preserves the Macedonian ethnic and cultural identity,” said Mr Zaev at the time. “Both our language and our people will continue to be known as Macedonian.” While there was broad popular support in Macedonia for the Prespa deal, not everyone was happy. The opponents of the agreement were led by the country's president, Gjorge Ivanov, who went so far as to call for a boycott of a referendum on the deal from the pulpit of the UN General Assembly in New York, claiming that it was “a flagrant violation of sovereignty.” Russia was also less than pleased. Prespa has unquestionably raised tensions between Russia and the West, exacerbated by Montenegro joining NATO in 2017 and leaving, once and for all, Russia's circle of influence. "Moscow now sees Macedonia as crucial," says Blerim Reka, a professor at the South East European University. Russia invested heavily in the referendum. "The Russian propaganda machine was running at full steam," says Mr Reka,

"mostly through Serbian media, including the Belgrade offices of the Sputnik news service and the RT (formerly Russia Today) television network. Hundreds of anti-referendum websites popped up and began disseminating misinformation. Such activity did not go unnoticed: the US Congress allocated eight million US dollars for Macedonia to fight Russian disinformation campaigns."

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At what cost? Mr Ivanov's calls for a boycott and Russia's interference in the referendum did not, ultimately, matter. While turnout was low – below the threshold that would have made its result binding Mr Zaev was over the following months able to push the name change through a fractured parliament despite the opposition of nationalist parties and the president. The biggest question now, however, is at what cost did he do so? Mr Zaev was forced to make a number of concessions to opposition MPs, some of which could place new obstacles on North Macedonia's path towards the EU, freshly cleared of a Greek veto. "North Macedonia's EU accession will take far longer than NATO membership," Maximilien Lamberston, a leading analyst at the Economist Intelligence Unit, told Emerging Europe. "While Greece will remove its veto on opening accession talks, there is still a risk that the European Commission does not recommend opening talks with North Macedonia in June this year. This could either be due to anti-enlargement sentiment deepened by eurosceptic parties performing well in the May European parliamentary elections or due to concerns that North Macedonia has made insufficient progress on improving the rule of law. Paradoxically, the political bargaining involved in passing the constitutional amendments to change Macedonia's name (which it did to unlock EU accession), included granting amnesty to opposition MPs facing trial, which critics say undermined the rule of law and judicial independence, key requirements for EU membership. However, it would be a blow to

For all Russia's anger at the deal – indeed, perhaps because of Russia's anger – Prespa needs to be viewed as a major win for the West. Not that it will not have time to congratulate itself. North Macedonia needs more than just A major win for the West vague promises from its allies over the next few months. There are also concerns that An Open Society Foundations Russia, whose opposition to report, published shortly before Macedonia's NATO membership the Greek vote, outlined the remains, may make one final potential for disaster: "If the EU is attempt to throw North reluctant to unblock Macedonia’s Macedonia's plans off course by using its UN Security Council veto EU accession path, even after the Prespa deal, then we return to to torpedo the new name. the situation before the European Russian Foreign Minister political re-engagement of Sergei Lavrov implied that it 2017 - where the Kremlin was would do just that shortly after free to spread its influence in the referendum last year, when he the Western Balkans unhindered." stated that the new name would North Macedonia will hold a have to be reviewed by the Security presidential election in April, and Council under Resolution 845. an early parliamentary election It has yet to comment on the will almost certainly follow later Greek vote, but as the American in the summer. Should ordinary analyst Janusz Bugajski has noted, Macedonians see no immediate “Moscow sees its stronghold in benefit from the name change Macedonia in [the context of] its – which many supported with a fight against the EU and NATO” heavy heart - they may turn against and wants to turn it into “another Mr Zaev and his pro-European Republika Srpska entity” – the autonomous, pro-Russian region agenda in large numbers, ushering in a nationalist government that could of Bosnia and Herzegovina, which has worked to keep that country out halt the country's progress towards the EU before it has even begun. • of Euro-Atlantic structures. Zoran Zaev if the EU were to demand more reforms before even opening negotiations, given the political capital Mr Zaev spent in changing his country's name."

EMERGING POLITICIANS

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On these pages we provide a channel for young politicians from across emerging Europe to share their vision of the kind of Europe they want to create. All of the young people whose voices we feature are unblemished by their countries’ communist-era pasts. Where the current generation of older politicians has often failed, it is our hope that this young, free and enlightened generation will succeed. Emerging Europe is delighted to be able to offer them a platform from which they can communicate with a wider audience outside of their home countries.

and led to a shattering of the ideal that democracy and free market together mean western wages. This led to 2010, the first constitutional majority of Fidesz, the entrance of the far-right as a major force in Hungary, the end of political liberalism and for the first time the Greens became a major political force. We have been tackling the climate crisis intervention, and commitment affecting all of us globally, as well to European integration has been as the radical neoliberal politics superceded by a commitment to become the EU’s internal opposition. of the Orbán-government (such as the flat tax, the Russian-built I became a member of nuclear power plant in Paks, parliament just half a year ago, and the two-faced politics of having been elected in the 2018 the government towards the EU, general election on the national which at once is a member of list of LMP, the Hungarian Green the EU’s leadership in the EPP, but Party. I became the first MP to is also its opposition). be born after the system-change It is now impossible to discuss of 1989, and have spent all my life Hungarian politics without living in a democratic Hungary. mentioning the migration crisis of I am a member of the national security committee in parliament, 2015 and the fact that this has been the central issue in Hungarian and also work on matters of politics over the past few years. It is foreign policy, EU relations and Peter Ungar is an MP my strong belief that we have to be energy policy. Increasing Russian for the Hungarian Green Party. He is influence in Hungary has been one understanding of why people vote the first MP born after based on this issue. Labelling those of my fundamental concerns. the fall of communism The fact that the aforementioned who do not agree with migration as in 1989. liberal consensus in my homeland racist is both unhelpful politically and goes against the fundamental has come to an end warrants a response. Ideally, we would return values of representative ungarian politics, from democracy. The fear that voters to the pre-2010 world and our the system change of have about a lack of control idealised version of the West. 1989 until 2010 - the over the political and economic This will not and cannot happen. first time Viktor Orbán achieved process that shape their lives, and As such, my job and goal in a constitutional majority – was parliament is to identify and tackle the widening gap between the characterised by a fundamental people who make decisions and why millions of Hungarians felt consensus of constitutional betrayed by that idealised West and the people who have to live with democracy, a neoliberal-leaning a decision’s consequences have all the Hungarian political process. market economy and accession to contributed to a new ethnicallyNATO and the EU. This consensus, The economic system in 1989 centred anti-migration political however, was firmly rejected by the promised that with the arrival landscape. This can only be tackled second Orbán government in 2010 of a western-style free market, with controls over capital, with western style-standards of living and the elections that followed retaking decisions in ways that would arrive too and Hungarians in 2014 and 2018. Constitutional the people who are affected by would live the way they always government has now been the consequences have a say in dreamed of: like the Austrians. replaced by ‘illiberal democracy’, the process. This can be an antidote neoliberal market economics have This remained an unfulfilled to what you read in the western promise, exacerbated by the 2008 been replaced with a mixture of press about Hungary. • crisis and the cuts that followed, radical neoliberalism and state

Peter Ungar

CURRENT AFFAIRS

nurture knowledge and where people have access to the best public services: education, health, cultural activities, transport. People in the 21st century have chosen to live in cities. But they need opportunities, they need the country currently holds the EU's freedom to develop professionally, rotating presidency) and it seems to raise their children and to unreal, almost inconceivable, grow old in safety alongside that the kind of society in which I their families and loved ones, hoped both I and my child would in one large community or in live is already under attack from authoritarianism, bad government an integrated network of smaller communities. and corruption. It is too fast, too If we, the democratic and civic early, and I do not accept the idea opposition takeover the running of that all that is good is already in Bucharest in 2020, we will inspire the past. It is not over. the whole country and we will also I have therefore decided that win the parliamentary elections, my place is in local politics and I want to stand as a candidate for the forming the next government. And this is crucial. We will strengthen mayor of Bucharest in next year's Romania's European integration elections. Bucharest is a large city with essential democratic reforms. of 2.5 million people, the seventh largest European capital. Bucharest We will prepare for entry into the eurozone and we will finally has enormous potential but it is Ciprian Ciucu is an become part of the Schengen area. badly run, and public services are opposition councillor at Bucharest City Hall. poor as a result of bad governance Comprehensive integration is the He hopes to become only solution to the authoritarian and corruption. Those who run the city's mayor in next Bucharest have not kept pace with threats coming from the east. year's local elections. Bucharest City Hall is the key the city's effervescent business environment and the aspirations of to our success in the elections, and I want to hand the key of came of age during Romania's the people who live here. my city to my generation. It is post-communist transition, at I already have a great deal of the key which unlocks the door the end of the 1990s and the experience in working at the through which others would allow beginning of the 2000s. I had lived, highest level, as a consultant and authoritarianism to enter. As such, as a child, in totalitarianism, and advisor to governments and city while I experienced how tough it is better off in our hands! • halls across Eastern Europe, as the transition was I was also able well as some of the most important to rejoice in the transormation international development of my country into a democratic organisations. I can claim – and society, albeit an imperfect one, the proof is my professional as Romania has been for the past CV – that I know how public 15 years. Our country's entry into administrations should operate. the European family meant a great I have the know-how to to put deal to my generation: it was our Bucharest on a solid footing, to country's goal. And it was worth it, ensure economic growth and a from all points of view. quality of life deserving of a major For me there is no alternative to European capital. Euro-atlantism, to Europeanism. Cities are the future. Across Putinism, Erdoganism and Europe, for more than 30 years we illiberalism are backward political have witnessed a steady shift from shifts towards an authoritarian rural to urban development. Cities, past: I recognise them well. And not governments, are the new at the present time these shifts are laboratories of public policy threatening to make themselves which have a direct impact on the felt in Romania. Barely 12 years quality of life of all citizens. It is have passed since Romania joined in the cities that new technology the European Union (and my is developed, where universities

Ciprian Ciucu

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Photo NBM

WORDS ANDREW WROBEL

ratio decreased from 18.4 per cent in 2017 to 12.5 per cent in December 2018. The temporary moratorium on dividend distribution in problematic banks helped to boost the system’s overall capitalisation to over 27 per cent CAR. After a credit crunch in the aftermath of the banking crisis, lending activity started to pick up, recording steady growth in 2018.” Nevertheless, Moldova’s creditto-GDP and loan-to-deposit ratios are low even by regional standards, says Mr Cioclea. “The access of oldova’s banking crisis SME’s and private individuals to of 2014, when more than credit remains complicated, despite one billion US dollars recent progress. It is evident that the disappeared from three commercial Moldovan banking industry does banks (Banca de Economii, not entirely fulfil its role of financial Unibank and Banca Socială) led intermediator and contributor to the to the collapse of the three banks development of the real economy. and created a hole amounting The biggest challenge now is to to more than 25 per cent of the Foreign investors consolidate the lending recovery country’s total banking assets, or so that domestic banks channel around 12 per cent of GDP. When The results have been impressive, their large deposit base into healthy Sergiu Cioclea took over at the and in just two years, the reform credits to the economy and diversify National Bank of Moldova (NBM) programme has yielded substantial their clientele. The objective of the in April 2016, his most urgent and benefits. central bank was to accelerate this challenging task was to contain “It helped to restore public transformation process by attracting the crisis and restore credibility for confidence and settle down the experienced international investors Moldovans, the financial markets financial markets,” Mr Cioclea tells in the domestic banking sector.” and for the country’s international Emerging Europe. “The Moldovan One of the most positive partners. currency stabilised and even signs of a return to something “The authorities of the time appreciated. International reserves resembling normality was the decided to plug the gap by doubled to reach more than successful sale of three Moldovan guaranteeing and reimbursing six months of import coverage. banks in 2018. Romania’s Banca in full the deposits of the three Consumer inflation declined Transilvania purchased - together insolvent institutions,” says from almost 14 per cent in early with the EBRD - a controlling Mr Cioclea. “Following the political 2016 to less than one per cent in stake in Moldova’s third turbulence and the ensuing halt of December 2018. Domestic interest largest lender – Victoriabank; external financing from the IFIs, rates reached historically low levels. Intesa San Paolo took over Veneto the yields on government debt After a peak at around 30 per cent in Banca’s subsidiary in Moldova, surged to almost 30 per cent and early 2016, yields on treasury bills Eximbank – the fifth largest maturities fell against the backdrop decreased to around 4-5 per cent at bank in the country – as part of of growing budgetary arrears. All the end of 2018.” a deal with the Italian treasury; the ingredients for a second wave The situation in the banking sector and an international consortium of financial turmoil – through has also improved. Following the comprising Horizon Capital (a US a public debt crisis – were in place, NBM’s implementation of expanded private equity fund), Invalda which would have undoubtedly inspections, all losses and NPLs (a Lithuanian asset manager) and hit the rest of the banking sector, have been fully recognised across the the EBRD purchased a 40 per cent gorged as it was on treasury bills. system and duly provisioned. stake in the biggest domestic bank, This would have led to another “The total non-performing loan Moldova-Agroindbank.

currency devaluation and all the repercussions that entails.” In such circumstances, reaching an agreement with the IMF was crucial, says Mr Cioclea. “The NBM and the Ministry of Finance, led at the time by Octavian Armasu, played a pivotal role in securing the IMF programme. The three-year deal, which runs until November 2019, is very ambitious and complex. Its numerous actions focused on stabilising the banking sector, restoring shareholding transparency and corporate governance in all banks, promoting key legislative reforms such as Basel-III regulation, bank recovery and resolution legislation, but also strengthening the deposit guarantee fund and financial market infrastructure.”

“Back in 2016, the proportion of domestic banking assets managed by international investors was 26 per cent – a figure comparable to the share of foreign banks in Ukraine and in Russia. In 2018, this coefficient rose to 71 per cent, closer to the proportions observed in neighbouring EU countries, such as Romania or Bulgaria,” said Mr Cioclea. “This is to a large extent the result of the central bank’s decisive actions to promote shareholding transparency in a sector marked for too long by ownership opacity.”

supervision, the deficiency of which was one of the reasons behind the 2014 bank fraud. As far as the EBRD is concerned, the institution showed strong support to banking reforms by co-investing together with reference shareholders in two systemic banks this year – Victoriabank and MoldovaAgroindbank. Given our country risk profile, the EBRD equity commitment played an anchor role in building and securing investor demand for Moldovan banking assets. Excellent cooperation with the EBRD helped to structure these deals and get them done.”

signed in 2014 and in effect since 2016. The EU has also supplanted the CIS as the main area of origin of the Moldovan diaspora’s remittances. Less dependence of more volatile CIS markets, including Russia and Ukraine, should make the Moldovan currency more resilient to regional instability.” Multiplying wealth

Mr Cioclea believes that despite Moldova’s reputation as being one of the poorest countries in Europe, it has great potential, but needs to learn how to multiply its wealth. Deeper structural reform “Moldovan commercial banks are Moldova’s currency full of money,” he says. “The money Without doubt, the IMF support keeps flooding from the high was crucial in 2016 in pulling The Moldovan leu (MDL) level of remittances sent by our Moldova back from the financial celebrated its 25th anniversary expatriates. However, less than half precipice to which the banking in 2018. Mr Cioclea believes of these deposits are converted into crisis had led the country. that the currency is in as strong a credits. The rest of the liquidity, “The IMF support, supplemented position as it ever has been. which is not invested in government by funds from the World Bank, “The leu’s history was marked paper, is being sterilised by the the EU and Romania, helped keep by three turbulent episodes in central bank in one way or another. the budget afloat that year and 1998, 2008 and 2015, following This represents an impressive sum calm the financial market,” says international or domestic financial Mr Cioclea. “Resolute reforms crises,” he says. “After losing around by Moldovan standards, about 1.5 billion euros or 20 per cent of implemented under IMF auspices in 30 per cent of its value in 2015, GDP, which could be channelled the banking sector and tax-collection the leu regained about two-thirds into productive or infrastructure systems produced remarkable results of the lost ground in 2016-2018, and started to generate modest, but making it one of the best-performing investments to create value and tangible virtuous circle effects on currencies in emerging Europe over modernise the country, instead of 'sleeping’ at the National Bank.” the macroeconomic environment the period. Such a trend favourably Mr Cioclea believes that there and fiscal performance. However, differentiated MDL-denominated is a good chance of transforming these achievements remain fragile assets and, along with other Moldova from a consumptionand require deeper structural measures, supported the reduction driven economy to an exportreform. In this respect, the IMF and of interest rates in the financial and oriented investment-intensive theWorld Bank provide high-quality credit markets, which achieved country by attracting foreign technical assistance and advice. historical lows.” The EU has also supported Moldova’s flight to hard currency investors and encouraging domestic investment. the national bank’s reforms by - which peaked during the 2015 “The experience of the sofinancing a twinning project crisis - has now been reversed, called free economic zones, that aimed at designing a new Baselwith around 60 per cent of total concentrate a large number of III-inspired legislative framework. banking loans and deposits being automotive and other industrial A new banking law was prepared now denominated in MDL. “This producers, is very positive,” he says. with the help of specialists from the is a creditable level compared to central banks of Romania and the many countries in the region,” says “The main challenge is to scaleup successful business models Netherlands, and the entered into Mr Cioclea. “The Moldovan leu to the entire country, without force in January 2018. gained its first international relying too heavily on fiscal “The twinning project recognition this year, being sweeteners. This implies inter alia was instrumental in helping accepted for the first time in its investing in infrastructure, but the National Bank of Moldova history on a large scale basis in also human capital to cut down overcome a know-how shortage foreign exchange and banking the immigration phenomenon, and benefit from peer advice,” adds operations outside its borders, in Mr Cioclea. “Much more regrettable Romania, Moldova’s largest foreign which took worrying proportions. Such measures are amongst has been the recent decision trade partner. If we add other EU the government’s strategic of the EU Commission to halt countries, the European Union priorities. The National Bank’s technical assistance programmes absorbs almost 70 per cent of role is to ensure a predictable for Moldova against the backdrop Moldovan exports and represents of political problems with the more than half of its imports. Such and stable macro-financial authorities. As a result, they stopped a profound reorientation of foreign environment and also to fully fix the crediting mechanism of the another twinning project, dedicated trade to the EU is a remarkable to the reinforcement of banking outcome of the DCFTA agreement banking sector.” •

CURRENT AFFAIRS

30 CURRENT AFFAIRS

Fortress UK

tank on migration and visa issues, Europe Without Barriers. The piece drew attention to the fact that in Visitors to the UK from a number of countries in emerging Europe 13 per cent of cases, Ukrainians are finding it increasingly difficult to procure visas, harming tourism, were refused a UK visa, a similar business and trade. refusal rate to Cambodia. Moreover, even when visas are issued, it is WORDS NIJAT ELDAROV often too late for their recipients, resulting in missed planes, disrupted travel plans and business hen the United Kingdom a major hindrance for the access of meetings and prevention of athletes attempted to Moldovan citizens, and economic secure a deal with suppliers, to the public procurement from competing in competitions. A prominent Ukrainian economist the World Trade Organisation for market in the UK, outlining the and former deputy finance minister, its re-entry to the Government need for visa simplification. Olena Makeieva, received her Procurement Agreement, it visas after her plane had left on came up against an unexpected Brexit's latest obstacle each of the three occasions she objection, from Moldova. Yet the objection had little to Moldovan concerns do appear to had applied over the past 10 years. “A two-minute Google search do with trade. Instead, it centred have driven the FCO to consider on the fact that Corina Cojocaru, the issue of visa simplification, and could have verified her identity. Moldova's economic counsellor a number of meetings have already But the British needed over a month to grant her a visa,” noted to the WTO and the wife of the produced effective results. the news portal Euromaidanpress. country's foreign minister, was – As such, in November 2018, Similarly, Ukrainian journalist along with her team - denied Moldova announced that it was Ekaterina Sergatskova could a UK entry visa and was unable to now supporting the UK’s renot travel to the UK to receive attend discussions regarding the entry to the WTO’s Government the Kurt Shock Award she had won, future of Moldova - UK economic Procurement Agreement, and as the UK Home Office claimed relations post-Brexit. that the two countries were it could not clarify the purpose “Nobody listened to us for developing mutually beneficial of her trip. six to seven months,” she said relations, “including the creation in a telephone interview with of favourable conditions for Bloomberg. For Mrs Cojocaru, economic players and the Moldovan Not cheap and not fast the visa issue represents a bigger community in the UK, in the Then there is the cost. The problem: if her delegation could not context of the new migrational fee for processing a UK visitor get a visa for crucial negotiations, policies which will be adopted by visa for Ukrainians ranges from then Moldovan suppliers aiming to London post-Brexit.” bid for projects in the UK cannot And yet Moldova, described by the 110 euros for short-term trips hope to compete with companies Economist last year as “Brexit’s latest to 946 euros for a stay of up to 10 years. Furthermore, Ukrainian from nations with much easier obstacle” is not the only emerging applications are processed in access to the country. European country whose citizens Warsaw, prolonging the issuance of In the aftermath of the encounter substantial problems the travel document. An accelerated controversy, Moldova's Minister when applying for UK visas. of Foreign Affairs and European In June 2018, a leading Ukrainian service is available (which allows the Integration Tudor Ulianovschi website, European Pravda, launched decision to be taken in five days), but costs an extra 251 euros. However, held talks with the Director for a campaign to re-introduce visa the five-day timeframe is not Eastern Europe and Central Asia requirements for UK citizens, who guaranteed, and some applicants in the Foreign and Commonwealth have enjoyed visa-free travel to requesting the "urgent" service Office (FCO) in London, Martin Ukraine since 2005. have had to wait two weeks or Harris – a former UK ambassador to “Ukraine is not Cambodia” read more, again disrupting travel plans. Romania – to discuss various issues a headline criticising the UK's visa “The British visa procedure can be of mutual interest. Mr Ulianovschi policies towards Ukraine on the characterised as not cheap and not made clear that the visa process was website of the Ukrainian think fast,” says Ms Kateryna Kulchytska of Europe Without Barriers. A closer look to the visa refusal rates of emerging Europe countries whose nationals need to be in possession of visas in order to enter the UK legally confirms that Ukraine, along with Albania, Kosovo, Moldova and Georgia had higher percentages of visa denials compared to the global average in 2017. Figures for the first three quarters of 2018 are much the same.

Country Albania

39.3%

11,248

Kosovo

32.4%

5,006

Moldova

24.0%

2,170

Georgia

16.5%

5,816

Ukraine

12.4%

44,342

Global

10.9%

3,061,106

Azerbaijan

10.5%

8,016

7.9%

3,429

FYR Macedonia

7.7%

3,847

Montenegro

7.4%

1,356

Bosnia and Herzegovina

6.4%

2,833

Belarus

5.1%

11,364

Serbia

4.1%

14,288

Armenia

Visa Visa refusal applications rate 2017 2017

“The main problem is not complicated requirements, rather the approach of UK Visas and Immigration - which is not clear,” Sergei Aleinik, Belarusian ambassador to the UK and a former deputy foreign minister, tells Emerging Europe. While refusals for Belarusian citizens are below the global average, Mr Aleinik is looking forward to a flexible stance towards sports delegations, cultural representatives, charity organisations and children. In the past, the rejection of visa applications for the Belarus women's national football team hindered their participation in an international competition in the UK. “The cultural and humanitarian dimension of mobility should be more favourable,” Ambassador Aleinik adds. One victim of an unexpected visa rejection was Nadza Dzinalija, a University of Amsterdam student originally from Bosnia and Herzegovina, who intended to participate in an academic conference organised by Glasgow University. Immigration officials were doubtful about her intention to return home after the event even though she had already booked return flights. Although the decision was later overturned because of a vast amount of media coverage of her case, such instances demonstrate procedural flaws even in countries where the overwhelming majority of applicants receive visas.

What risk? The United Kingdom has steadfastly refused to simplify its visa criteria with non-EU emerging European countries based on rather arbitrary "migratory and security risks." Few people are aware of what these “migratory and security risks” actually are. The latest figures (for 2017) for emerging European citizens illegally found to be present in the UK are very low, exceeding 100 only in the case of Albania (3,760) and Ukraine (555). However, the number of Ukrainians illegally present in the UK is lower than that of Ukrainians in many of the Schengen states. As for Albania, the country has signed a readmission agreement with the United Kingdom, meaning that there is an institutional framework addressing the return and readmission of Albanian citizens from the UK found to be living in the country illegally. While it could be argued that a more simplified or liberalised visa regime would increase migratory pressures on the UK, the extent of illegal immigration is not expected to be significant. The UK authorities can prepare an impact assessment for particular countries, scrutinising current migratory risks (if any) and the situation of marginalised groups, before reaching an agreement on visa facilitation or liberalisation. Moreover, declaring even the holders of diplomatic passports

CURRENT AFFAIRS

from specific countries (such as Ukraine) as “security threats” raises serious questions. Instead, an impact assessment for emerging European states covering the fight against terrorism, trafficking in human beings, drug trafficking, organised crime and corruption would provide a better understanding of whether or not there are any security issues which could appear if visa processing was simplified. The way forward In order to solve the problem of the high number of visa rejections, the UK should take a simplified, less restrictive approach. Indeed, research in the field of migration studies has concluded that more migrants move irregularly to those countries with restrictive migration policies. In light of the UK's migratory and security concerns, a gradual visa liberalisation model similar to that of the EU could be adopted. Before fully liberalising the visa regime, an agreement on visa facilitation may be signed, in order to simplify the legal migration for certain categories of people (such as holders of service and diplomatic passports, sports and cultural representatives, charity organisations, academics), reduce the costs of visas and accelerate procedures. At the same time, the United Kingdom may conclude readmission agreements with particular emerging Europe countries and tie the simplification of visa processing to the successful implementation of these agreements. •

From Our Correspendent The arrival of Uber in Romania's capital Bucharest came as a relief to just about anyone who has ever travelled in one of the city's dreadful taxis. The company's business model - which in most cities is based on being cheaper than taxis – is different in Romania. Uber is in fact a little bit dearer than the average taxi, but the friendliness of the drivers, cleanliness of the cars and convenience of not having to pay in cash is worth the little extra. One day in early January, I had left my phone at home when going to a meeting, and needed transport. I had no option but to find a taxi on the street. At journey's end, as I was getting out of the car the driver started shouting: Aren't you going to pay me? So used have I become to just getting out of an Uber without worrying about payment (all done automatically in the background) that I had forgotten taxi drivers want paying on the spot. Luckily I had just enough cash on me. CRAIG TURP

CURRENT AFFAIRS

Will Russia seek to annex Belarus?

Lukashenka remarked that the city could be considered Russian since it was located close to the Russian border. He has also commented that the economic relationship is mutually beneficial and that Belarus has made an equal contribution Is Vladimir Putin seeking to annex neighbouring Belarus and reunite through its exports of tractors and former territories of the Soviet Union under Moscow’s control? Is development of companies that Belarusian leader Aleksandr Lukashenka defending his nation against contribute to the Russian market. another potential intervention by Russian forces? In 2017, the two states continued their military exercises known as WORDS DAVID R.MARPLES Zapad (the West), and Russian maintains two military bases in Belarus, though it has been unable hese questions have been to a Union (RBU), and a formal to secure an air force base. Belarus at the forefront of media treaty was signed in December 1999, is also a member of several Russianfocus over the past month. but its main benefit was to provide led integrationist projects such In particular the flurry of bilateral most-favoured nation status to as the Eurasian Economic Union meetings between the Russian Belarus in terms of oil and gas prices and the Collective Security Treaty and Belarusian heads of state in and subsidies. The two sides failed Organization, and has observer December and January has fueled on several occasions to establish a status in the Shanghai Cooperation speculation that Belarus may be common currency. Once Yeltsin Organisation. These are in addition the next ‘Crimea’, ripe for plucking retired, to be succeeded by Putin, to the RBU and the original by Mother Russia, which does not the agreement became largely a Commonwealth of Independent regard its inhabitants as foreigners. paper declaration. States, initially headquartered To provide context, one needs Its initiation owed much to the in Minsk. to go back almost a quarter of outlook of the Belarusian president, Under Lukashenka’s strict a century. In the early years of who made no secret of his regret over authoritarian regime, Russian Belarusian independence there the collapse of the Soviet Union, media and social media have were possibilities that independent supported closer security and wielded overwhelming and Belarus could follow its own military ties with Russia, and unlimited influence whereas route, but Lukashenka’s power regarded Russians and Belarusians opposition outlets have been grab—in 1996, not during the as one nation. In his early presidency targeted for harassment and fines. presidential elections of 1994—was he spoke Russian exclusively and As a result, most of the population engineered by Russia to circumvent regarded the Belarusian Popular is fully supportive of Russia’s his impeachment for violating Front and Belarusian speakers, as a annexation of Ukraine’s Crimea the Constitution. From that point he dangerous Fifth Column. and interventions in the Donbas. became the sole authority in Belarus If we fast forward to 2019 we Though Belarusians do not support In April of that same year, Belarus find a very different situation, but a Russian invasion or being part of and Russia signed an agreement to for economic rather than political Russia, they would be unlikely to establish a Commonwealth between reasons. The Lukashenka-Putin resist actively a Russian invasion. the two states. relationship has foundered badly, Thus, it is ironic that Lukashenka That agreement had little impact and Russia has finally withdrawn all now poses as the defender of at the time other than perhaps to the privileges accorded Belarus. Belarus, and has switched poses contribute toward Russian president Yet Lukashenka’s world outlook to one of ‘soft’ nationalism while Boris Yeltsin’s somewhat surprising has not changed fundamentally. enhancing ties with an enthusiastic reelection two months later. In When meeting Putin in Mogilev Europe with a visa-free regime, April 1997, the pact was deepened (Mahiliou) last October, and the release of known political prisoners. Some analysts even perceive him as a bulwark between the EU and an aggressive Russia. What is true is that Putin has removed all Belarus’ economic privileges to emphasise the inequality of the partnership and the reality of the relationship, namely that Lukashenka is essentially a vassal of Putin who can be brought to heel as needed. Russia will not invade Belarus because it is unnecessary. Lukashenka’s rhetoric may be heated but he has never strayed too far and remains the best alternative from the Kremlin’s perspective. •

T David R.Marples is a Canadian historian and distinguished University Professor at the Department of History & Classics, University of Alberta.

www.electrogrup.ro

Business

Despite the European Union making the issue a priority, infrastructure in emerging Europe lags behind the western part of the continent and remains an obstacle to continued growth. We take an extensive look at the problems facing the development of regional infrastructure, from a lack of political will to concerns that Chinese finance could offer the Asian giant a backdoor into the day-today governance of emerging European countries.

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C O V E R

S T O R Y

Connecting emerging Europe In many places, getting around emerging Europe remains as difficult today as it did 30 years ago. WORDS CRAIG TURP

transport networks, remove bottlenecks that impede the smooth functioning of the internal market and overcome technical barriers such as incompatible standards for rail traffic. Its specific focus is on modal integration (developing all transport modes and connections between them, as well as traffic and information management systems), interoperability and coordinated infrastructure development. In 2013, the European Commission established a network of nine core transport corridors that links all EU member states. Plans for a second generation of TEN-T corridor works were approved in December 2016, laying the foundation for completion of the network by 2030. In many places, that looks like a highly optimistic target. The scale of the problem is huge. Try driving, or taking a train, from Warsaw to Bratislava. Planes remain the only viable option for most travellers. Goods have to meander slowly along what are often single carriageway routes. The same goes for goods being shipped from Sofia to Bucharest, or from Tallinn to Vilnius. The projects included in the European Commission and World Bank's latest investment plan were identified together with the Eastern TEN-T Partnership countries with the assistance of the international First launched in 1994, TEN-T has for 25 years been the European financial institutions. Along with infrastructural investments, Union's flagship infrastructure programme. Its primary objective is the plan aims to bring forward key to close the gaps between countries’ reforms for the transport sector and n January, in a bid to boost connectivity and economic growth in emerging Europe's Eastern Partnership (EaP) countries (Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine), the European Commission and the World Bank co-authored a Trans-European Transport Network (TEN-T) Investment Action Plan that identifies a number of priority projects. Together, the projects will require estimated investment of almost 13 billion euros and foresee a total of 4,800 kilometres of road and rail, six ports, and 11 logistics centres. European Commissioner Johannes Hahn, responsible for European neighbourhood policy and enlargement negotiations, said at the time: “The completion of the Indicative TEN-T Investment Action Plan is a joint commitment to deliver tangible results for citizens across the region. The plan will assist decision-makers in prioritising strategic investments in transport infrastructure with the aim of completing the TEN-T network defined as one of the 20 deliverables for 2020 in the Joint Declaration of the last Eastern Partnership Summit in Brussels.”

improve road safety in the region. The development of project on the TEN-T is expected to foster regional development by improving access to economic opportunities, harnessing the benefits of industrial agglomeration and increasing market competition. “Enhanced transport connectivity both within the Eastern Partnership region, and between the EaP region and the EU has the potential to bolster economic growth," said European Commissioner for Transport Violeta Bulc. Breaking down While these are encouraging words, the track record of emerging Europe's contribution to the TEN-T programme – even amongst those countries which are members of the European Union (the EU-11) - is modest at best. This is especially relevant in terms of intra-regional infrastructure. For much of the past 15 years investment has been concentrated on connecting emerging Europe to the western part of the continent. The need to create viable networks linking the countries of the region with each other has been, while not entirely forgotten, far less important than facilitating east-west trade. A number of years ago, on a trip to the Baltics, I needed to travel from Riga in Latvia to the Estonian capital of Tallinn. A seven-hour bus ride was the only real option. But what a bus it was. Luxurious

BUSINESS

seats, free coffee, WiFi - long before WiFi was standard in hotels and cafés - and admirable punctuality. I remember arriving in Tallinn and asking a colleague, an Estonian native, why the buses in the region were (although painfully slow) so comfortable. "Because the trains are crap," came the rather blunt reply. Despite the progress achieved since then, there is still a great need in Central and Eastern Europe countries for a more efficient and modern transport infrastructure to support the region’s growth. There are exceptions (particularly Slovenia, Hungary and the Czech Republic) but road, maritime and particularly rail infrastructure remain considerably less well-developed than most analysts expected by this stage of the region's transition. Indeed, in some countries things appear to be moving in entirely the wrong direction. "[Rail] routes between Serbia and Bulgaria (or Bulgaria and almost anywhere) seem to be breaking down completely," says Mark Smith, a travel writer and author of the authoritative train travel website seat61.com.

stretch for almost 1,000 kilometres and is expected to run from Tallinn via Pärnu in Estonia to Riga in Latvia, Kaunas in Lithuania and on to Warsaw in Poland. The line will connect Estonia, Latvia, Lithuania and Poland with a faster, interoperable, direct rail line for both freight and passengers, and offer an alternative to the predominant traffic flows with Russia and Belarus. It will encompass three multimodal freight terminals and three airport connections. The first phase of the project (Rail Baltica I), from the Polish border to the Lithuanian city of Kaunas, was completed in October 2015. The second phase (Rail Baltica II) will complete the project, connecting Kaunas, Riga and Tallinn with an electrified doubletrack line. "Hopefully, Rail Baltica will sort international travel out in this corridor, but the current pitiful weekends-only train between Poland and Kaunas isn't the stunning start I'd hoped for," Mark Smith tells Emerging Europe. The total cost of the rail line has been estimated at more than six billion euros, with the European Rail Baltica Union footing a maximum of Rail Baltica may indeed one day 85 per cent of the bill as part of the TEN-T programme. mean that those of us travelling That still leaves a large amount from Riga to Tallinn can leave the bus behind. We should not hold of the total cost to be met by our breath. the Baltic States themselves, and in When complete, Rail Baltica – Estonia especially there is a great deal of opposition to the project. the largest infrastructure project A recent poll put public opposition ever carried out in the Baltics - will

to the project at 40 per cent. Priit Humal, an Estonian activist, has described the enterprise as "costly and economically unfeasible." Estonia's share of the bill is around 300 million euros. Other opponents of the project are also concerned about its potential environmental impact, as it will traverse important forested areas and wetlands. Nevertheless, in January, Arenijus Jackus, director of the Rail Baltica Coordination Department at Lietuvos Gelezinkeliai (Lithuanian Railways) said that all land purchases and technical designing work will be finished in 2023, with construction being carried out between 2023 and 2025. Limiting growth The EU has an average infrastructure rank of 5.65. No CEE country exceeds five, while the average for the region is 4.02, and some countries, such as Albania, Romania and Moldova, score as low as 3.5. In the latest WEF Executive Opinion Survey, business leaders noted that inadequate infrastructure is a substantial barrier to business growth in CEE. It is ranked as one of the most significant barriers in all CEE countries (for example, fourth in Bulgaria, seventh in Poland and Romania). There is little doubt that better infrastructure could help all CEE countries improve their

38 BUSINESS

competitiveness, including those that already score relatively high. For example, Poland ranks high in global competitiveness at 36, yet its infrastructure rank is only 53, with a score of 4.34. Over the period from 1995-2015, there was clear progress in the trend of CEE transport infrastructure investments. They began to grow rapidly after 2001, totalling almost 210 billion euros over the 20 years. Thanks to these investments, the EU members in CEE managed to catch up on their infrastructure backlog from previous years. The road network, in particular, has seen substantial improvements, with more than 5,600 kilometres of new motorways built throughout CEE since 1995. However, there is still considerable disparity in both availability and quality of road, rail, air and port infrastructure across CEE; gaps within and between the networks cause bottlenecks in the movement of both people and goods, particularly across borders. “The shape of supply chains is evolving and changing fast. Traditional long-haul transport is reaching breaking point and it’s crucial that all parties work together to ensure the seamless flow of goods into, out of, and across Europe is maintained. Brexit and other external factors are adding pressure on logistics stakeholders to come up with long-term solutions. This is partly why we are seeing an emergence of new logistics corridors, as the EU invests in Europe-wide infrastructure and new technology to reduce costs and improve efficiency,” claims Lisa Graham, the head of EMEA logistics and industrial research and insight at Cushman & Wakefield.

Rhine-Danube

growth, which means opportunities throughout old and new EU member states and the development The Rhine-Danube Corridor is the transport backbone of emerging of trade and business relationships Europe, connecting the entry ports with Asian countries and globally. The Baltic-Adriatic Corridor is at the Black Sea with southern one of the most important transGermany along the Rhine and European road and railway axes, Danube. The other branch links connecting the Baltic ports in Poland the Ukrainian-Slovakian border with the Adriatic Sea. The corridor to the Rhine ports and central links the major intersections (urban European regions. The corridor is the main east-west nodes, ports, airports and other transport terminals) through rail, link between European countries, road, maritime and air transport connecting France, Germany, connections from north to south, Austria, the Czech Republic, for example from Poland through Slovakia, Hungary, Croatia, the Czech Republic, Slovakia Romania and Bulgaria along and Austria, to Slovenia and the Rhine, Main and Danube rivers Italy. It includes priority railway to the Black Sea. It also touches projects, such as new crossfour non-EU States: Serbia, border sections and the GdanskBosnia and Herzegovina, Moldova Ravenna rail freight project. At and Ukraine. 2,400 kilometres and carrying more The corridor focuses to a great extent on rail and inland waterway than 24 million tonnes of freight a year, this initiative provides better interconnections. The main access to both Baltic and Adriatic inland connection between seaports for economic centres across the Rhine, Main and the Danube CEE. Such a network significantly represents the backbone of inland strengthens the efficiency, safety navigation between the northand quality of the infrastructure western European basins and base through multimodal transport the southeastern Black Sea. chains for freight and passengers. A major step forward in The North Sea – Baltic Corridor developing the corridor came is the northernmost corridor in in January when a consortium TEN-T. Not only does it play comprising Turkish companies a critical role in creating improved Alsim Alarko and Makyol was connections between Central, awarded a 682.8 million US dollar Northern and Eastern Europe; contract to upgrade the Apata – Cata section of the Brasov – Simeria it also links some of the most important ports in Europe. This railway line in Romania, a key corridor is therefore crucial for bottleneck. The European Union the region’s integration into global is providing 82 per cent of the funding for the project through transport routes. The Baltic States serve as a vital commercial hub the Connecting Europe Facility for connections to the eastern (CEF), with the remaining and northern markets of Russia, 18 per cent being funded by China and the rest of Asia, while the Romanian government. the North Sea ports provide maritime access to global trading Five critical corridors routes, including to the Americas. Increasing capacities and In all, there are five TEN-T bridging missing links in the rail corridors which are critical to network – given a fragmented the development of Central and and outdated rail network along Eastern Europe. Besides the the corridor, rail projects account North Sea-Baltic and Rhinefor the highest share of planned Danube corridors, the Balticinvestments. Adriatic, Orient/East-Med and The Orient / East-Med Corridor Mediterranean corridors play connects the maritime interfaces a significant role in the region's of the North, Baltic, Black and development. From the emerging economies of Mediterranean Seas. It links the German ports of Bremen, Hamburg Eastern Europe to the established and Rostock to the Czech Republic centres of Western European commerce, they open up significant and Slovakia, with a branch through Austria, extending further through potential for sustainable economic

Hungary and Romania towards Sofia, with links to the port of Burgas and to Turkey, then to the Greek ports with a ‘Motorway of the Sea’ link from Greece to Cyprus. Meantime, the Mediterranean Corridor links the ports in the south-western Mediterranean region to the centre of the EU, following the coastlines of Spain and France, and crossing the Alps towards the east. Only the easternmost part of the Corridor crosses the emerging Europe region, but through a crucial area: Slovenia, Croatia and Hungary up to the Ukrainian border. It will facilitate connections with non-EU countries, in particular the Western Balkan countries and Ukraine. Belt and Road Initiative In December, a truck carrying goods travelled from the Chinese border town of Khorgos, through Kazakhstan, Russia and Belarus to Poland in just 13 days. It is hoped that the new route will contribute to the success of China’s Belt and Road Initiative. “This first TIR journey by road from China to Europe is a winwin-win model for business, trade and governments. It will be a game changer for cross border transportation in China,” said Umberto de Pretto, the general secretary of the International Road Transportation Union. “This trial demonstrated that the system is secure and highly competitive in terms of cost and time relative to other modes of transport on similar routes. It will boost trade between China and Europe, which will help China and the countries along the Belt and Road route reap the economic and development rewards of international road transport.” The Belt and Road (BRI) is a development programme to

that leaders in the CEE region are willing to cede political concessions for a roadway or utilities. So we’ll need to see how it plays itself out. The real interesting question I think is, does China displace Russia as the perceived guarantor of some countries of the region (for example Serbia)? Time will tell." Amat Adarov, an economist at the Vienna Institute for International Economic Studies (wiiw, is also sceptical about Chinese financing. promote Eurasian trade and "Besides the benefits BRI will integration which China hopes will have an impact not just on CEE and bring to CEE countries in the form the rest of Europe, but on the entire of better cross-border connectivity, trade and employment prospects, world. Its two main components indeed, there are a number of risks are the land-based Silk Road attached," he tells Emerging Europe. Economic Belt, and the Maritime "Greater integration intensifies Silk Road, which will create a vast infrastructure network connecting mutual impacts and exposures, and BRI will lead to higher economic China to Europe via South and and political dependence on Central Asia and the Middle East. China; there are some concerns The routes will run through more that it may also dilute the guiding than 60 countries, which today represent 65 per cent of the world’s role of the core EU values in some countries, depending on their population, 30 per cent of global specific political contexts. Of great GDP and more than 35 per cent of concern in the EU is also the related the world’s trade. issue of China’s improved access Flagship Chinese-backed to strategic infrastructure and infrastructure projects in CEE sensitive technologies in Europe currently include a bridge to unite as a result of BRI, which is a matter Croatia, a high-speed railway of national strategic and security connecting Hungary and Serbia considerations, also reflected and a motorway in Montenegro. in the recent Huawei scandal in However, the Budapest and Poland. Secondly, large-scale Belgrade rail link – which will BRI projects, mostly financed cost 10 billion euros – has twice via loans, may jeopardise debt been rejected by the European sustainability in some countries Commission on the grounds with already high debt levels. that the tender process was not Third, a lack of transparency and transparent and violated EU rules. compliance with EU regulations, The arrest in January of a now particularly, regarding proper former Huawei employee on public procurement procedures and espionage charges in Poland has technical standards. Finally, there also focused minds on the wisdom is a risk that active engagement of accepting Chinese funding. of China in Europe may trigger "China’s money offers both adverse protectionist policy opportunities and dangers in responses in the EU." the region," Christopher Hartwell, What is clear is that CEE needs a fellow at CASE , the Centre for Social and Economic Research, tells further investments to reach the EU15’s level of competitiveness. Emerging Europe. After decades of under-investment, "In the first instance, any flows ploughing money into new routes of investment are welcomed and and modernising and maintaining can help countries struggling with tapping international capital markets the existing transport system across the region remains crucial or those with small populations for achieving sustainable economic to really see some impressive growth and maximising the region’s infrastructure needs fulfilled. On competitive potential. Commercially the other hand, the involvement attractive, revenue-generating of the Chinese government in the projects, with a sound financial and whole venture means that much of this money is coming with political rationale will be key. • strings attached, and it’s doubtful

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Innovation in energy Innovation is one of the key factors that will drive the energy transition process and will help countries to meet their 2050 climate targets, including the decarbonisation of the energy sector trough low-carbon technologies. WORDS CLAUDIA PATRICOLO

imiting climate change to below 2°C implies a reduction of energy related carbon dioxide emissions of nearly 70 per cent from their 2015 levels. According to the International Renewable Energy Agency (IRENA), the decarbonisation of the energy system will only happen if there is a growth in breakthrough technologies. Innovation can reduce the cost of technologies to economically viable levels. A holistic innovation framework can also help to overcome other barriers that have hampered deployment of decarbonised energy approaches, such as the lack of infrastructure to deploy the technologies and the access to capital for the buildup of industrial capacity. According to IRENA, innovation includes, among other things, technology breakthroughs that provide renewable solutions to sectors where at present no cost- effective alternatives to conventional energy technologies exist; improvements to the existing renewable technologies,

Reduced energy bills

At the same time, digitalisation favours consumers by reducing energy bills for citizens and enterprises, through energy efficiency and participation in mechanisms of flexible demand. Energy consumers can be at the centre and contribute to a new design for the energy markets. “I am young, digital, millennial: this means that something is changing in the industry,” said Dacil Borges, the 29-year-old CEO of Totum Innova, during the Budapest Energy Summit held last December. “Millennials are the new customers of the energy sector, so important players need to focus on big data now, linking the tradition to modern technologies.” Digitalisation of the energy sector can also boost a country’s competitiveness and open new global markets for components, like ICT or electronics, and services. “In recent years, EU-funded research in energy systems has put lots of focus on synergies. As a result, many R&D projects are which reduce cost and stimulate under way. For instance, improved deployment and new business forecasting tools lead to more models and engagement of new efficient operation of the grid, in actors across energy systems, combination with demand-side allowing for a profitable scale-up of management, reactive power renewable technologies. injection and dynamic line “Improved digital options rating. In this field, for example, can also allow the network the SWIFT project has shown to be operated smartly, using that it is possible to connect a information technology wind farm without a costly grid and operational technology upgrade,” Mr Hatziargyriou added. integration, Big Data and According to Peeter Pikk, Predictive Services,” said founding partner of Baltic Energy Nikos D. Hatziargyriou, chairman Partners, an independent energy of the European Technology and trader in the Baltics since 2006, Innovation Platform for Smart the most important applications of Network for the Energy Transition digitalisation in the energy sector (ETIP SNET). vary depending on where people “There are also new models for live, and while today the system transmission and distribution provides a balance, in the future networks and power generators’ we will need much more clean assets with data-driven business electricity and in large amounts. models and technology-driven “We need to solve three customer engagement. Benefits challenges: invest in affordable are manifold, including: increased CO2-free base-load, add flexibility reliability of supply, reduced cost of demand and storage of of operations, improved quality of electricity and electrify the energy service; isolation and restoration system as a whole,” Mr Pikk tells reducing the number and duration Emerging Europe. of outages; deferred grid upgrades “We need to figure out how and increased renewable energy to produce electricity without penetration.” emitting CO2. Many countries

have decided to phase out nuclear from their energy mix. Sun and wind are good sources when they are available. Digitalisation will play a vital role in demand side flexibility. We are still in the early stage of digitalisation of the energy sector. Transmission Systems Operators (TSOs), especially here in the Nordics, are the catalysts for that digitalisation. Central data hubs, together with smart metre roll-out provide efficient access to energy and related data. However, that is not enough as data hubs deliver only yesterday's news at best. The true demand-side flexibility needs co-ordination based on (close to) real-time data,” he continues. Not only technologies For Larry E. Glover, senior partner at the strategic marketing consultancy firm Breakthrough Marketing Technologies, we cannot forget about what happens on the human side. “Our goal is to connect customers,” he said at the Budapest Energy Summit. “If we do not use technology for connecting, and only for business goals, it is useless. We need to understand what digitalisation is and how it affects the way we do things; how do we take this world which has been reduced to its basic elements and integrate them. We need to use those data for behavioural changes.” “The most innovative thing I experienced is not about technology but the state of mind that needs to be changed,” Mrs Borges adds. “The energy sector has to innovate the mindset

that data comes from different sources, not only inside the economy. It is a big ecosystem. The way we interact with data makes the difference. We can learn more from customers, how are they using utilities at home.” Peeter Pikk’s Baltic Energy Partners participated in an EU funded project called Peakapp, where they looked into ways how digital technologies could make people more aware of their energy usage and costs. By just making their energy data readily available 40 per cent of people said that they started to pay more attention to their energy usage, 22 per cent said they changed their consumption habits and 14 per cent claimed that they replaced inefficient appliances. “With better awareness, you can change your habits. Much of the digital innovation is about helping people to make better energy decisions and form sound energy habits. For example, enabling electricity sharing among friends increases the awareness of possible solutions and nudging everybody towards better investment or usage decisions,” Mr Pikk says. The energy sector in 10 years “Everyone is talking about smart: smart cars, smart cities, smart behaviour. When we talk about the legal side we do not talk about smart legislation, but that is what it takes to make these things happen. We need to legislate for the future, not for the things we are using today, and that's a challenge,” Mr Glover commented. Countries such as Bulgaria, as well as non-EU member states

including Albania, Bosnia and Ukraine still do not meet the requirements of the Third Energy Package for the liberalisation of the electricity and gas market. As a result, the Energy Community has started a dispute settlement against these countries which continue to keep their energy markets closed, as opposed to opening themselves up to increased integration with the European Union, harming competition and potential investment. “I want energy companies to be more transparent, to stop customers from making mistakes,” said Mohamed Anis, head of energy and services Europe at IT consultancy company Infosys. “But I am aware that they will reduce their revenues. Is there anyone willing to cannibalise its business for the customer?” “More support-free investments into renewable energy need to be the norm. A lot of innovation will go into integrating energy production into buildings. We see many investments into the electrification of the transport system. Energy will become cheap and capacity expensive,” comments Mr Pikk. “I am following the blockchain scene quite closely, trying to figure out what is innovation and what is just marketing. I have not seen any 'killer apps' yet, but that does not mean there will not be any. TSOs with an efficient data hub can create trust and transparency at least as much as blockchain. Probably even faster and more effectively,” Mr Pikk says. But together with new technologies come new challenges, making it difficult for governments to control and legislate. In the past, for example, physical access to a substation was required in order to disrupt the energy flow and seriously impact society. Today the same damage can be achieved with a single keystroke from anywhere in the world. An attack on the Ukraine power grid in 2015 illustrated the impact of cyber-attacks on the electricity sub-sector. This attack resulted in several outages that caused approximately 225,000 customers to lose power across the country. •

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From Our Correspendent What time are you leaving? I ask the driver of the 106 bus line going from Wrocław airport to the centre as he is starting the engine. In a minute! I hear back. Well, there’s no way I can make it. A young grandmother with two unbelievably noisy kids has been trying to get her tickets for a few minutes now. I turn around and the bus is gone. By the time the next one comes, I have already got my ticket. I sit down and it turns out I could have got the previous bus and paid for my ride using contactless or my phone, like back in London. I am now about to leave Deák tér onboard bus 100E and head to Budapest Airport. I have bought my ticket in a machine at the bus stop. The young driver wearing a shirt and a tie, and a short moustache is taking ages to clean every square inch of the windscreen, side windows, wing mirror and the steering wheel and not really bothered by the long line of passengers holding tickets and waiting to board. Then a Canadian guy turns up asking if if the driver sells tickets. Only cash! the driver responds indolently. Go to the bus stop and get a ticket at the machine, I tell the Canadian. A piece of advice for emerging Europe's cities: some foreign tourists like to take public transport when they visit. Make it easier for them — inform them about the options they have in English. Or hire more helpful drivers. ANDREW WROBEL

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rowth remains the predominant trend in the construction industry throughout Europe, with consulting company Deloitte forecasting growth at 2.5 per cent a year on average between 2018 and 2021. Having left the economic crisis behind them, construction companies in Central and Eastern Europe are doing especially well, with expected market growth for the coming years now running at around 4.4 per cent. While Deloitte notes that there is a lack of major noticeable M&A activity in the construction market in the region, the industry is nevertheless trying to adapt to digital construction activities in order to fully adopt the concept of Construction Industry 4.0. Start-ups today work on improving existing materials by reconstructing their chemical structure in order to turn them into smart materials, such as self-healing concrete, thermal insulation, aerogel and photovoltaic glazing. Virtual and Augmented Reality makes it possible to test every centimetre of a building on a computer, avoiding possible dangers during the construction process. 3D printing technologies develop detailed models and it is already possible to build 3D printed houses in less than 24 hours at relatively low costs. Finally, drones make it possible to provide construction companies with high quality and precise information, inspecting and delivering data in a very short amount of time. Benefits of drones According to investment group Goldman Sachs, the largest

expected take-up for commercial drones is in construction, primarily in surveying and mapping sites. It estimates that total global spending on drones in the commercial market will be 100 billion US dollars over the next two years and that 11.2 billion US dollars of that expenditure will be generated by the construction industry. “Drones are another item in the construction trade tool box, to help customers work smarter while cutting costs, saving time, and completing projects more easily,” says Dominik Wójcik, sales manager for Eastern Europe at the drone company Microdrones. After 10 years of operations, Microdrones has expanded aggressively into Eastern Europe, entering the market in Poland, the Baltic States, the Czech Republic, Hungary, Slovakia and Romania. “Microdrones made the world’s first commercial quadcopter and, today, they lead the drone industry, offering the latest technology and software to help geospatial professionals gain a competitive edge. We are especially known for our mdSolutions integrated drone systems that feature advanced Unmanned Aerial Vehicles (UAVs) complete with sensor hardware, software, workflows and support. Construction professionals can interpolate the data to help them on the job, reduce costs, and streamline their work. We view our role as delivering a full end-toend solution: Plan, Fly, Process, Visualise. So we’re not just talking about the drone and sensors, but also the integrated workflow and software that ties it all together and makes life easy for the construction professional,” adds Mr Wójcik.

The presence of drones in construction is bringing about significant changes within the industry. They are rapidly replacing traditional land-surveillance methods, reducing the labour and time involved in producing accurate surveys, and they eliminate much of the human error involved in the process. Furthermore, drones that feature mounted cameras can provide video footage to facilitate communication and surveillance, allowing companies to keep tabs on employees and workers. Lack of regulation is slowing innovation But while the potential for drones is high, there are still some factors making people cautious about their impending adoption. One imminent challenge is the regulatory environment in which drones operate; wide uncertainty has slowed commercial adoption and innovation. “Drone use in the CEE is not as limited as it may seem. The issue is that every European country has different laws and regulations when it comes to operating them,” Mr Wójcik tells Emerging Europe. “With proper research, permits, and licensing where required, you may be able to fly drones in some of the countries of CEE. Poland is one of few countries that has simplified the process with regulations for safe and controlled drone air space. This was possible because of good collaboration between all interested parties. This included UAV pilots, commercial airlines, the Civil Aviation Authority, and the Polish Air Navigation Services working together to create clear and modern regulations.” As well as with other major innovations, like blockchain and cryptocurrencies, setting clear rules that are easy to follow and understand is the most important factor. “Drones are providing incredible solutions for security, agriculture, transportation, construction and much more. We want to be able to allow all industries to benefit from the incredible solutions that companies like Microdrones can provide. Therefore, the EU needs to

way to create housing for those in need. It also represents a great advancement for green construction firms. Besides, construction professionals and their customers can communicate more clearly and efficiently as even a customer with no architectural background can better express his needs. “One of the core benefits is that it’s relatively inexpensive to 3D print your own house,” says Jože Abram, CEO of BetAbrams, a Slovenian pioneer in 3D houses. As the demand is huge, the company expects to sell Build your house in less than as many as 500 units within the 24 hours next five years and as many as 3,000 units within 10 years. “This could help construction 3D printers have been around since the 1980s, but their widespread workers to rapidly build cheap houses in the Developing World, adoption has only just begun. “If you look around, pretty much leading to a possible decrease in the number of homeless people. everything is made automatically A 3D printed house can last up to today: your shoes, your clothes, 175 years and its costs are 50home appliances, your car. 80 per cent less then a house built The only thing that is still built by hand are these buildings,” said with conventional methods.” According to a European Professor Behrokh Khoshnevis, Commission report, identifying creator of the 3D printing current and future application technique Contour Crafting. areas, existing industrial value “Construction, as we know it today, is wasteful, costly, and often chains and missing competences in the EU, in the area of additive over budget.” manufacturing (3D printing), In fact, 3D printing will save the EU seems to have a very healthy construction companies up to 3D printing climate, when it comes 50 per cent on the cost of building to patenting, research, 3D printing a house. Often as automation and mechanisation rise, prices drop and services and major companies investing in the technology. 3D printing will be an affordable continue to have open discussions about creating universal laws and regulations for drones. Every day we are seeing new opportunities for unmanned flight. With the proper preparation and regulation, what’s to stop us from creating air corridors for transportation of lifesaving equipment or commercial package deliveries? BVLOS flight for construction, corridor mapping and agricultural studies is already possible and should not be prohibited due to a lack of proper laws,” Mr Wójcik adds.

But it is also true that 3D printing is mainly limited to Western Europe. With the exception of Poland, countries such as Slovenia, Croatia, Slovakia, and the Czech Republic are only starting to develop capabilities in the research sector. Investments are being made by manufacturers of printers to enter the Eastern European market but the state of play remains at a very early stage. “I think that is largely because European governments have yet to even start writing laws and regulations about 3D printing in the construction industry. Because of that, people are sceptical about this new technology. We believe it will take at least five more years for people start grasping the possibilities of this technology,” Mr Abrams tells Emerging Europe. Gaining the support from governments and changing mindsets are the main challenges. “Technology by itself is marvelous, and there is still a lot of room for improvements. But as long people do not start thinking in new directions it will be hard. In our experience, we have managed to convince everyone to whom we have demonstrated the 3D printing process. So maybe people - and governments - just need to see it with their own eyes”, he adds. •

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Made in emerging Europe Our quarterly look at some of the region’s most innovative companies.

Biotrem Looking for an eco-friendly alternative to disposable plates and cutlery? Look no further, Biotrem, from Poland, has the answer. The company has developed a wheat bran tableware production process - invented by Jerzy Wysocki, whose family’s milling traditions date back to the beginning of the twentieth century. Biotrem’s modern and booming production facility in Poland offers a wide range of fully biodegradable tableware and cutlery produced from natural and edible wheat bran. Their disposable products, are an alternative to most disposable tableware, made from paper or plastic, the production and utilisation of which is burdensome to the environment. “Our production process does not require significant amounts of water, or mineral resources, or chemical compounds. From one ton of pure, edible wheat bran we can produce up to 10,000 units of plates or bowls. What’s more important, our products are fully biodegradable – composting in just 30 days,” says Mr Wysocki. biotrem.pl/en

Mission Emission Ever wondered what impact your travel has on the environment? If the answer is yes, then why not find out on the Mission Emission website. Every year, traveling is becoming more and more affordable. Distance is no longer a barrier. However, there is another side of traveling. Mission Emission is a project created by two Bulgarian companies, Oblik Studios and BetaPeak, that aims to raise awareness of the environmental impact of traveling. “We believe that actions need to be taken and it is up to every one of us to do something to help limit our carbon footprint. This tool is our team’s contribution to the global community. We hope

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that you will find it useful and it will help you and your friends and family to be more aware of the environmental impact of traveling,” says the company in its mission statement. missionemission.co

Sunreef Yachts

oceanic range, the first carbon built catamaran-superyacht as well as the Nothing screams luxury more than first folding mast on a catamaranowning your own yacht, and in superyacht to name a few. recent years Poland has become one “The shipyard’s creative quest for of the go-to markets to purchase perfection is perpetual with at least these luxury sea going vessels. two new models introduced to the Poland is where Francis Lapp, range each year. Sunreef Yachts’ founder and CEO of Sunreef Yatchs, latest creation is the Sunreef developed a vivid interest for Supreme Range - a radical concept sailing. Seeing a growing demand revisiting the way catamarans from clients, for more comfortable have been designed so far and and larger catamarans and having setting new standards not only discovered a lack of such vessels on for multihulls but for the entire the market, Mr Lapp was inspired yachting world,” says Mr Lapp. to get involved in building large, The company is now the customised, luxury multihulls. This world leader in the design and is how Sunreef Yachts was born. construction of large, customised Sunreef Yachts has now been luxury catamarans. setting the trends in the catamaran sunreef-yachts.com/en industry for years. The shipyard introduced the yachting world to ground breaking solutions including the world’s first flybridge on a luxury catamaran, the first double deck power catamaran with

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Buddy According to Smartmedic, a Lithuanian start-up, many parents have a very rational fear of their children accidentally drowning: it is one of the most common causes of fatalities for children aged up to four. As a result, the company has developed Buddy, the life-collar. Buddy offers a chance to save your child’s life in case of accidental drowning. The collar is made of the latest hi-tech materials. In case of accident, sensors react to pre-set criteria and activate air-pillows. “Our smart life-collar works similarly to an airbag in a car. Once the sensor installed in the collar come in contact with water, it activates the release mechanism, which fully inflates the airbags in 3-4 seconds, and lift the wearer to the surface of the water. The head of the swimmer is kept above the water so they cannot drown”, explains Tadas Juknius, inventor of Buddy. smartmedic.lt/buddy1st-to-save-life

Grubić Design “From street fashion to extravagance” is the motto of Grubić Design, a family-run jewellery brand with over 30 years of experience. Design enthusiast Mladen Grubić made his first pieces of jewellery in the Croatian capital Zagreb in the 1980s. Now with the help of his son Petar, this family-based business has developed into a renowned Croatian brand. Grubić Design has five stores throughout Croatia, and has established numerous business partnerships, both at home and abroad. The duo’s inspiration stems from rich historical periods and Mother Nature, which never ceases to amaze them. From this, their Elizabeth I, Baroque and Knights and Urban Warriors collections were born. Their main means for jewellery making are leather and metal alloys, embellished with different types of glass and crystal. Grubić also works with tropical corals, freshwater pearls and semiprecious stones. •

grubic-design.hr/en

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Media plurality in emerging Europe Even some of the most developed countries in the region struggle when it comes to securing a free press, primarily because ownership rests in the hands of a few people, almost always with close ties to politicians. WORDS TAMARA KARELIDZE

ccording to the World Press Freedom Index, media freedom decreased in most emerging European countries in 2018. Economic challenges are one of the primary reasons, as the small size of the region's markets make it easy for governments to gain influence by applying pressure where they can. In most of the region's states, media is easily divided between outlets which are loyal to the government, and those which are critical. Even mainstream media is rarely entirely free, and legislation which should regulate the market is not always up to international standards. Media owners often have links with politicians or oligarchs – in some cases the most powerful and wealthiest members of society control the media directly. The sad result is that by and large, audiences do not fully trust any media outlet.

as foreign owbership was seen as a guarantee of media freedom. Since then, the situation has changed, with a number of local oligarchs now in charge of major newspapers and TV stations. Among them is the country's current prime minister, Andrej Babiš. According to Czech media analysts Mr Babiš Czech Republic today controls the largest publishing house in the country, The ranking of the Czech Republic Mafra. Other media owner in the World Press Freedom Index oligarchs include Daniel Kretinsky, fell from 23rd to 34th place in who bought popular local tabloid 2018, something which did not Blesk and Aha from Germany's come as a huge surprise to most Axel Springer, as well as Czech, media analysts. “There have always Romanian and Polish radio stations been political parties connected from Lagardere, a French company. with various companies, buying The billionaire Merek Dospiva media, but there has never bought part of Passau Publishing been a prime minister, in office, group via Penta Investment, controlling the media directly ostensibly a Cypriot company but through his company,” said allegedly belonging to Mr Dospiva. Marius Dragomir, the director of As a result of the concentration of the Centre for Media, Data and so many media outlets in the Society (CMDS). hands of just a few people, In the immediate aftermath of the country's media freedom is the fall of the Iron Curtain, most increasingly limited. media outlets in the country were bought by foreign media giants, Hungary which were interested in profit and not political influence. Most Similarly to the Czech Republic, Czechs viewed this as an advantage, local Hungarian oligarchs with

close ties to the prime minister, Viktor Orbán, have been buying media outlets from big media houses over the past few years. Currently, allies of the prime minister run most major media outlets, as well as the three staterun TV and six radio stations, where all management staff are appointed directly by the government. Additionally, almost all regional newspapers belong to the friends of the prime minister. Since taking office in 2010, Mr Orbán – who openly admits to wanting to create an illiberal democracy – has put great value on controlling the media. Resarch by a media watchdog, Atlatszo, shows that more than 500 Hungarian media outlets are now under some kind of governmental control. TV stations invariably follow the government line and the opposition has found it increasingly difficult to get its message across on air. Immediately after the latest set of parliamentary elections, held in April 2018 and won comfortably by Mr Orbán, Hungary’s last real opposition daily newspaper, Magyar Namzet announced that

it will cease publication due to financial problems. It belonged to oligarch Lajos Simicska, a former ally who had fallen out with Mr Orbán. The Hungarian Union of Journalists (MÚOSZ) called it a "black day", adding: “the nongovernmental media space has shrunk and this drastic step is a message not only to journalists and editors who work conscientiously, but also to the people who want to exercise their constitutional right to access free information: anybody’s job can be taken away, anybody can be dispossessed of the opportunity of access to non- manipulated information.” To rub salt into the wound, in February 2019, Mr Orbán's preferred newspaper, Magyar Idők, was re-named, re-designed and re-launched as Magyar Nemzet. Poland Since 2015, when the current government dominated by the Law and Justice party (PiS) took office, Poland's media freedom scores have been consistently falling. One of the first actions of the new government was a law which brought the country's public broadcaster, TVP, firmly under government (and party) control. The government has the sole right to appoint (and dismiss) TVP management, and the information broadcast by TVP's outlets has become increasingly pro-government and one-sided. Narratives which are important to the government, such as Poland's need to resist what it views as decadent western influence, are given prominence. The demonisation of the opposition as a tool of the European Union is also a mainstay of television news broadcasts. Piotr Owczarski, who worked at TVP from 2000-17, recently told the European Parliament about the current atmosphere at the station. "There is no exchange of views anymore," he said. "Every day there is a brutal attack on the opposition using the language of hatred. TVP is wary of anyone who thinks differently. Facebook journalists are being monitored, homosexuals are being dismissed. A lot of people voluntarily left

TVP, because they did not agree to the specific editorial policy." In June 2018, the Polish government pushed through a law which makes it a crime to ascribe any responsibility or coresponsibility to Poland for Nazi-era atrocity crimes committed on Polish soil. Following international condemnation, authorities removed the crime’s three-year maximum sentence, but maintained fines. Moldova Political and oligarchal influence in the media, ambiguous media ownership and limited independence for the broadcasting regulatory authorities is common in Moldova, where oligarchfunded media outlets intensively marginalise independent media with fake-news. Despite a broadcasting law which prohibits political parties from owning media entities, around 70 per cent of media outlets belong to political parties and business people with political interests. A Freedom House report from 2018 states that among Moldova's media owners are Vladimir Plahotniuc, the head of the Democratic Party, who controls four TV and three radio stations. President Igor Dodon, a member of the pro-Russian Socialist Party of Moldova, has links with the owners of Accent TV, NTV Moldova and Exclusive TV. These broadcasters provide an almost exclusively pro-Russian narrative. Moldova does have some independent media outlets – mainly in the digital sphere - but despite the assistance of a number of international organisations, they are viewed as fragile and at-risk due to a perennial lack of funds. Ukraine The vast majority of TV companies in Ukraine belong to oligarchs or politicians, but there are also free media outlets, primarily digital. Press and online publishing is of little interest to the country's politicians, as their reach is viewed as being extremely limited. The country's media is viewed by many analysts as being free, but not independent.

The current president, Petro Poroshenko, has a strong connection with the country's Channel 5 TV station. Another station, Espresso TV is linked with former prime minister Arseniy Yatseniuk and Arsen Avakov, a former interior minister. The NewsOne TV channel belongs to oligarchs close to the MPs Vadym Rabinovych and Yevhen Murayev. Reporters Without Borders has claimed that Chanel 112 provides a pro-Russian narrative and receives funds from former president Victor Yanukovych, currently in exile in Russia. South Caucasus A lack of diversity is the main issue facing media freedom in the South Caucasian countries. As with most other countries in Central and Eastern Europe, television is the most popular format, and that is where state authorities, politicians and oligarchs have concentrated their interest. In Azerbaijan, almost all media outlets belong to the government or relatives of the president, Ilham Aliyev. The kidnapping of journalists is common. Moreover, the authority restricts the funding of independent media, and access to the country's leading independent news websites has been restricted since March 2017. Before the revolution of 2018, the ruling political elite had a strong influence on TV in Armenia. The situation has yet to change significantly. Armenian independent media depend on international grants and have little coverage and reach. Despite boasting the best media landscape in the region, Georgian TV also suffers from political interference. The independence of the Georgian public broadcaster has been questioned for a number of years, ever since its board chose a director with close ties to Bidzina Ivanishvili, the country's richest man and founder of the ruling Georgia Dream party. The most popular private TV station, Rustavi 2, is staunchly anti-governmental but is linked with the former president, Mikheil Saakashvili. •

49 BUSINESS

Outlook on Bosnia

Bosnia and Herzegovina's economy grew by three per cent in 2018 but continued political instability and the emigration of some of its most talented young people threaten continued growth. We take an in-depth look at the country and the challenges it faces, as well as the opportunities it offers investors.

OUTLOOK ON BIH

n 2018, the economy of Bosnia and Herzegovina grew by three per cent, according to Focus Economics. “Our current projection is that real GDP growth will be 3.5 per cent in 2019, with public investment being an important driver of growth,” says the EBRD’s Mr Brown. “However, risks are tilted to the downside in light of possible delays in forming new governments, as well as a potential slowdown in the wider European economy.” The World Bank’s forecast is around 3.4 per cent. “From the outset this doesn’t seem to be a bad proportion, but we have two main concerns in this regard,” Mr Salinas tells Emerging Europe. “The first that economic growth has been to a large extent driven by construction, consumption and public sector spending. These are not sustainable sources of growth and they do not necessarily create the more and better jobs that the people in BiH aspire to have, especially the youth.”

The EBRD agrees with the analysis. “Conditions for doing business in Bosnia remain difficult, as shown by the country’s persistently low ranking in the World Bank’s annual Doing Business report. Private investment will be difficult to mobilise unless there are substantial improvements to the business environment,” Mr Brown says. Mr Salinas see all three shifts are as equally challenging and they will require strong commitment and leadership by BIH’s authorities. BiH needs to unleash the potential of the private sector while at the same time reducing the footprint of the very large and inefficient public sector. There needs to be a shift towards a business environment that supports both vibrant small- and medium-sized enterprises and the growth of larger companies. Despite improvements, BiH’s private sector still struggles with a non-conducive business environment, high labour taxes and inflexible labour market policies,” he adds. Internal vs external challenges The World Bank estimates that at this rate of growth, it would take The World Bank says that the key BiH more than 50 years to reach economic challenge for Bosnia and the level of livelihood that we Herzegovina is the imbalance of its observe now in EU. “Altogether, this means that economic model: public policies and incentives are skewed towards economic growth is not sufficiently high and is not necessarily the public rather than the private sector, consumption rather than sustainable and inclusive. We are investment, and imports rather firmly convinced that BiH has an than exports. enormous untapped potential for "These ‘rebalancings’ are critical growth. Unleashing that potential will require concerted action for the country going forward,” says the World Bank’s Mr Salinas. from the government to address “Having an economy that is inward the obstacles that are hampering the country’s development,” looking, based on consumption and where the government is Mr Salinas adds. one of the largest sources of jobs “We have long argued that Bosnia’s prosperity is being held is not sustainable and will likely back by the complex internal not be the basis for a modern and political structure and the slow competitive BiH.”

Photo Emanuel Salinas, World Bank country manager for BiH

pace of reforms, but external conditions are also important, given Bosnia’s growing integration into the wider regional and global economy,” Mr Brown says. Improvements for people’s sake In the World Bank's Doing Business Report 2019, Bosnia and Herzegovina is ranked 89th, three notches lower than in 2018. “To be fair, this doesn’t necessarily mean that the business environment has become more challenging,” Mr Salinas explains. “What is means is that during these years governments in many countries have understood that they simply cannot afford to have a bad business environment and have taken decisive actions to address the obstacles that companies face. Unfortunately, that has not been the case in BiH. This is bad as it sends a very negative signal to the local in foreign investors as per the commitment of the authorities to make BiH a good place to invest.” For the EBRD’s Mr Brown, the main priority is to reduce the complex burden imposed on companies and make it easier to do business. “Progress on privatisation would also help — in the Federation there has been much talk on trying to find buyers for some of the larger SOEs, but very little action,” he says. According to the World Bank much can be done by authorities to improve the economic performance of the country and strengthen resilience to global shocks. “This includes moving ahead with the reforms that have been identified as necessary to enhance macroeconomic sustainability. It also includes taking decisive action to improve the business environment, which is critical to enable new domestic firms to be created, existing firms to grow, and foreign investors to consider BiH as a desirable investment destination,” Mr Salinas says. “The people of BiH are the most valuable resource that the country has, but unfortunately shortcomings in health and education mean that people in BiH, on average, will only get to reach 60 per cent of their

OUTLOOK ON BIH

Ian Brown heads EBRD office for BiH

OUTLOOK ON BIH

a number of sectors, including wood processing, metal and automotive industries, tourism and information technologies. Agriculture is also a sector with strong potential, but the key will be moving from small-scale and subsistence agriculture to a sector that can be competitive in an international arena,” Mr Salinas tells Emerging Europe. As of now, a very large proportion of BiH’s exports are raw materials and low-added value manufacturing. Many companies have outdated technologies and production processes, which limits their productivity and Opportunities awaiting competitiveness. This also means investors that they cannot be the source of the better-paid jobs that people And, for the EBRD, BiH’s aspire to have. Going forward it economy has plenty of potential to develop in areas such as energy, will be important to put in place agribusiness and tourism, to name decisive actions to to support the development of private enterprises. a few sectors. “Then improving An EU accession could speed internal and cross-border infrastructure, to which the EBRD up reforms. Following the general elections in October 2018, Bosnia is contributing in a major way, is helping to integrate Bosnia further and Herzegovina now needs to submit swiftly all the replies to into regional and global markets and supply chains,” Mr Brown says. the questionnaire for the European Commission in order to finalise “As a small, open economy, its opinion on the country's EU BiH has many opportunities membership application. – its proximity to the EU; “We are convinced that EU a well-educated labour force, accession is a critical path for the and export potential in both development of BiH,” says the goods and services. Once the World Bank’s Mr Salinas. “Time distortions to private sector and time again we have seen that development are removed, BiH EU membership helps countries has export opportunities in productive potential over their lifetime. Losing 40 per cent of the productivity of the people in BiH is a major loss for the whole country and its potential to grow and is just one of the many factors that are fully within the hands of the government to resolve. We are terribly sad to see so many talented people leave the country in search of the opportunities that they cannot find here. We hope that the new government will awake to this challenge and take decisive actions to make it easier to do business in BiH,” Mr Salinas adds.

to converge faster to higher levels of income per capita both during accession and after becoming a member of the EU. Likewise, we expect that for BiH, the EU accession will help economic growth, including by creating urgency on implementation of the reforms needed.” The IFIs’ plans In the meantime, both the World Bank and the EBRD continue their operations in Bosnia and Herzegovina. The first organisation has invested two billion euros in more than 120 projects, the latter — almost 2.3 billion euros in 156 projects. “At the present time we are providing financing of around 446 million euro for projects that include improving roads and railways; reducing the risk of floods; improving irrigation; protecting and using forestry responsibly; supporting employment; refurbishing schools and hospitals; improving water supply and sanitation; improving management of solid waste; to name just a few areas,” Mr Salinas says. “The EBRD will continue to invest in major infrastructure projects, including the key Corridor Vc motorway project that links BiH with EU markets,” Mr Brown says. “In February last year we signed an MoU with the authorities in BiH with a plan to invest up to EUR 700 million over the next several years in this project, and this plan is well underway to be realised.” In May 2019, the EBRD is organising its Annual Meeting in BiH’s capital, Sarajevo. “We see the Annual Meeting not only as an event for Bosnia and Herzegovina, but also as an event that can showcase the whole interconnected Western Balkans region. EBRD is working intensively to promote regional economic integration in the Western Balkans, and having our Annual Meeting in Sarajevo is an great way both to show the progress made in this, and to promote the region as an investment destination,” Mr Browns concludes. •

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OUTLOOK ON BIH

It's better than another war: a beginner's guide to Bosnian politics Herzegovina (populated primarily by Bosniaks and Croats) and the Republika Srpska (predominantly Serb). The Federation has its own president, bicameral parliament, and is itself split into 10 autonomous provinces with their own WORDS CRAIG TURP governments and assemblies. The Republika Srpska also has its own president, assembly and as Bosniaks) would each have rab a notepad, a pen, and government. Parliaments in both a guaranteed share of power. stock up on patience. Few entities have jurisdiction over Bosnia and Herzegovina's head countries on earth have policing, education, agriculture, of state is nominally the country's a political structure as complex as healthcare, labour policy and president, elected by universal Bosnia and Herzegovina (BiH). internal affairs. At both state and suffrage for a four-year term. Ostensibly one country split entity level, parliaments are obliged However, the country has not one, into two entities, myriads of to ensure that all legislation is but three presidents – a collective, autonomous regions and ethnic acceptable to all ethnic groups. divisions have led to the creation of each representing the three ethnic If that were not complicated endless layers of government which, groups which make up the country's population. Each of the three serves enough already, the eastern province even with a great deal of goodwill, of Brčko is a multicultural district for eight months at a time on would make running the country a rotating basis during the four years of the country which falls inside difficult. In the Balkans alas, the territory of both the Federation of the presidency, meaning that goodwill is often in short supply, and the Republika Srpska, and is and Bosnia is no exception. As such, each of the three will spend a total administered jointly by both entities. of 16 months in office over the the country at times appears to be Within the system are a number course of the four years (two eightungovernable. No wonder some of fault lines, created by those in commentators have compared it to month terms). In last year's the Republika Srpska who long elections, Bosniak voters returned a failed state. The country's latest for an independent state (or, like Šefik Džaferović as their member round of elections, held at the Mr Dodik, unification with Serbia), of the presidency, Croats opted beginning of October 2018, were Croats in the Federation who would for Željko Komšić. The Serbs put predictably inconclusive, voters – like their own entity, and Bosniaks Milorad Dodik, who openly calls for as usual – electing politicians on the unification of the Serb-dominated who would like the country to be purely ethnic criteria. Almost four more centralised. entity, the Republika Srpska, with months on, the country has yet to Serbia, into office. form a new government. While the presidency sets Bosnia's High representative "Bosnia’s political instability foreign policy agenda (it also should be a cause for concern for Overseeing the whole political proposes the state budget and has both the European Union and process – with the authority to control of the military), executive NATO," says Damir Kurtagic, dismiss any Bosnian official, power at country-wide level is a Europe Fellow at Young elected or otherwise - is the High Professionals in Foreign Policy. "As the responsibility of the Council of Representative for Bosnia and the most ethnically diverse country Ministers, headed by a chairman (the de facto prime minister) chosen Herzegovina (OHR), a post created in the Western Balkans, Bosnia’s in 1995 immediately after the signing by the presidency. One third of the institutional strength is pivotal to of the Dayton Agreement. The council's ministers must be from deterring the influence of outside high representative is appointed by powers such as Turkey and Russia." the Republika Srpska. the 55 countries and organisations The Bosnian parliament is split which make up the Peace into two chambers, the house of Blame Dayton Implementation Council (PIC), representatives and the house of the international body charged with peoples. Members of both houses The current morass is the direct implementing Dayton. The current are elected for four-year terms, result of the Dayton Agreement, high representative is an Austrian, with seats split equally between which ended the 1992-95 Bosnian Valentin Inzko, appointed in 2009. the three ethnic groups. War. The agreement set out to He is the longest-serving high Day-to-day government in create a multi-ethnic state within representative, and many in Bosnia Bosnia however is generally Bosnia's existing borders in which hope that he will be the last. left to the two separate entities the country's three major ethnic "The current structural issue with which make up the country: groups (Croats, Serbs and Bosnian the OHR is that its actions are rooted the Federation of Bosnia and Muslims – usually referred to Bosnia has the world's most complicated system of government: a gerrymandered mess overseen by an unelected mandarin. While it pleases almost nobody, the system has helped keep the peace since the end of the Bosnian War. It has also, however, stifled the development of genuine democracy. Craig Turp tries to explain how it works.

in a degree of political consensus on the PIC which once existed but no longer does," says Jasmin Mujanović, a political scientist and analyst of southeast European and international affairs. "In other words, the issue with the OHR is the lack of political will for more meaningful engagement in European capitals, rather than the institution as such." The Economist Intelligence Unit's latest Democracy Index categorises Bosnia as a hybrid regime, ranked 101st globally: slightly more democratic than Belarus, but less democratic than Kyrgyzstan. While the country scores relatively high in the areas of electoral process (not without flaws, but generally free) and political participation, it performs (unsurprisingly) poorly when it comes to functioning of government. "Granted, the OHR may appear nominally incompatible with idealised democratic processes, but BiH is not an ideal democratic polity, in no so small part because of the Dayton constitution which has so fatally undermined just such politics, to the advantage of entrenched, corrupt, ethnonationalist elites of various stripes," Mr Mujanović tells Emerging Europe. The European dream, the Turkish nightmare The European Union's vague promises of eventual membership (as well as vast amounts of financial support) have for a number of years done much to prevent the total collapse of Bosnia and Herzegovina. However, in its Western Balkans Strategy, published in 2018, the European Commission's promises were more vague than ever. No date was given for the beginning of accession talks (indeed, Bosnia has yet to be invited to formally apply for EU membership) and the best the commission could offer was a fiercely non-committal statement that suggested the country could eventually become a candidate for accession "with sustained effort and engagement." No wonder then, that a number of Bosnians are having their heads turned by alternatives to the EU, notably Turkey and Russia.

Turkish President Recep Erdogan has not been slow to spot an opportunity. He held a rally in Sarajevo in May 2018, and was welcomed by Bakir Izetbegovic, the then Bosnian Muslim chairman of the tripartite presidency, with the words: “God has sent [our] nations one person to return them to their religion. He is Recep Tayyip Erdogan. We remain standing with God’s help.” A leader of diaspora Turks hailed Sarajevo as “Jerusalem at the heart of Europe”. "For Erdogan, the Balkans is the region that can put him in a position to realise his political goal of reviving some semblance of the Ottoman Empire while undermining the EU’s influence in these countries," says Alon Ben-Meir, a professor of international relations at the Centre for Global Affairs at NYU. European leaders have already been voicing concerns over Turkey’s influence in the Balkans. Last year French President Emmanuel Macron declared: “I don’t want a Balkans that turns toward Turkey or Russia”. It may be too late, although NATO membership – on the table, if not widely expected any time soon – could ease some of the pain. “Bosnian Muslims have lost their hopes that their trinitarian state will become an EU member," says Xhemal Ahmeti, a historian and expert on the Balkans. "Paradoxically, though, while the Bosnians Muslims seek Erdogan’s protection from the Orthodox (Serbs and Russians), Erdogan’s close allies are Putin and [Serbia’s president] Vucic.” "BiH's future progress is largely dependent on two dynamics coming together: bottom-up, civil society pressure, in particular for reform, and international support for such efforts," concludes Jasmin Mujanović. "BiH's recently reactivated NATO accession path is one concrete objective both locals and internationals can fruitfully work towards. But whether that happens is, as ever, a matter of political will." The election of Mr Dodik in the Republika Srpska – who opposes NATO membership and who has the power to veto it - suggests that political will may not be forthcoming anytime soon. •

OUTLOOK ON BIH

The search for talent: Bosnia's ICT scene With the vast majority of countries in emerging Europe continuing to develop and grow as ICT hubs, Bosnia and Herzegovina (BiH) should in theory be no different. However, BiH currently appears to be lagging behind neighbouring countries and the region, and one of the primary reasons for that is access to talent. WORDS SHAKHIL SHAH

“Y

es, the truth is that we are lagging behind the region when it comes to the input the ICT sector has in GDP,” Gordan Milinić, head of the Foreign Investment Promotion Agency of Bosnia and Herzegovina (FIPA), tells Emerging Europe. The World Economic Forum ranked BiH 135th out of 137 countries in its Global Competitiveness Report for capacity to retain talent, and there are some clear reasons why. “There are two reasons people are leaving the country," Edin Deljkić, president of Bit Alliance, an organisation that aims to develop

the IT industry in BiH, tells Emerging Europe. "First, people who don’t have a prosperous job are going to EU countries to seek better opportunities, and second, those who already have good jobs in Bosnia are leaving in order to have a better quality of life in Germany or somewhere similar. They are starting to have families, they seek cities with better weather, air quality, better social security and health services.” According to FIPA, the future of the ICT sector in BiH is dependent on three strategic objectives: Restructuring of the education system; Improving

the business environment for the support of IT sector development through the establishment of an IT development council, changes to legislation, the establishment of funds and finding ways to implement a wide range of tax incentives or subsidising certain activities; The establishment and construction of Technology Park Sarajevo which will include flexible and functional premises for the needs of IT companies combined with space for the IT faculty and an area for IT research and development that can also integrate the function of a modern innovative IT accelerator.

Education Bosnia's educational and upskilling infrastructure is poor. “One of our biggest challenges is the existing educational institutions that are educating personnel for the IT sector in BiH," says Mr Milinić. "The structure, current enrolment quotas, educational curriculums, profiles of teaching staff and the fact that there is only one specialised IT educational institution are limiting factors for the further development of the IT sector.” According to Mr Milinić, there needs to be a systematic and comprehensive change in both quantitative and qualitative terms. “It is evident that we need to significantly increase the level of knowledge and competencies of teachers, as well as a need for modernisation of the existing curriculums, such as establishing mechanisms to adapt curriculums to dynamic development and technology trends. This requires direct and systematically organised cooperation between IT industries/ companies and educational institutions, so that in the future graduates will be equipped with the practical knowledge required for a job in the IT industry,” Mr Milinić adds. Upskilling and adapting the education system is one step in the right direction, however there is a need to dig deeper and increase the number of places available in universities or colleges as well as including IT in the education structure from an earlier age. “A study carried out in BiH has proposed the establishment of at least two vocational secondary schools (or restructuring two existing schools), the establishment of an IT faculty as a part of the University of Sarajevo and incorporation and attraction of private educational institutions into IT education through a system of subsidies related to employment of their graduates in the IT sector,” Mr Milinić explains. Business environment The total number of IT engineers in BiH is currently relatively low, for a country with a population of almost four million.

OUTLOOK ON BIH

“At present, we have over 2,000 specialists working in software development directly, although this does not include big ICT companies like telecoms,” Mr Deljkić adds. “The number of IT professionals is well below the needs that can ensure the continuity of the existing level of business. In addition to the Information Technology Department at the Faculty of Electrical Engineering in Sarajevo, the Economic Faculty and IToriented courses at the Faculty of Natural Sciences, currently in BiH, there is only one Faculty of Information at public universities (the Faculty of Information Technologies at the Džemal Bijedić University in Mostar). At two accredited private universities in Canton Sarajevo (Sarajevo School of Science and Technology and International University of Sarajevo) there are study directions for IT where between 15 and 25 IT specialists graduate each year,” adds Mr Milinić. Based on information gathered from Bit Alliance and FIPA, there are only about 400 ICT companies in BiH, and of those only 10 per cent are medium and large enterprises. This, Mr Deljkić believes, “offers a lot potential to foreign investors,” as the market is not saturated when it comes to companies operating in the sector.

While the head of Bit Alliance is positive about the future of the sector in BiH, it would seem as though FIPA have a bleaker view, if change does not happen. “Major foreign direct investment in the IT sector is difficult to foresee at the moment, as such investments are directly determined by two elementary conditions: the size of the local market and the available resources. Namely, the basic resource for the development of the IT sector is the available of talent. Unfortunately, in BiH there is not enough talent for the existing companies, nor is the quality of their education sufficient for the requirements of the turbulent IT market,” adds Mr Milinić In addition to the lack of talent, the existing legal framework offers no adequate legislation to regulate in detail the specifics of the IT sector (custom regulations, the codes of the activity, the profile of the occupation) nor any incentives or support measures for development. “It will be difficult to maintain long-term international competitiveness since most developing countries, as well as neighbouring countries, have been intensively supporting the development of their own IT sector with a broad spectrum of incentives,” concludes Mr Milinić. •

OUTLOOK ON BIH

Energy: A balancing act As Bosnia looks to phase-out coal and move towards hydropower, environmental groups are concerned at the impact on the delicate Balkan ecosystem. WORDS CLAUDIA PATRICOLO

two entities, paving the way for major funding from the European Union and other investors. “We have now completed the adoption of a package of the four most important strategies for economic reforms," said Bosnia’s Prime Minister Denis Zvizdic. “We halted a negative trend that meant we could not apply for energy projects and lost hundreds of millions of euros of investments and grants.” The framework strategy, drafted under EU sponsorship and designed to secure electricity supply and a transition to green energy, anticipated an investment of about nine billion Bosnian marka (4.6 billion euros), expecting to indirectly help increase employment, reduce public debt, and improve competitiveness in Bosnia. “But Bosnia still needs to change its regulations to meet terms set by the European Energy Community,” Mr Sarovic added. “In my opinion preparation of NECP will be a beginning of the shift towards the RES-E. However substantial reforms of electricity markets and elimination of political, administrative and financial barriers to RES-E development should be implemented,” agrees Professor Kušljugić. “It is planned that in 2019 national targets for GHG Closer to the EU emissions reduction, improvement of energy efficiency and the “BiH has just started working increase of RES share in gross on an integrated National Energy final energy consumption for and Climate Plan (NECP) for the period 2021-2030 (with the long the members of the Energy community will be adopted. The term goal of de-carbonisation approved targets will be a guiding until 2050) in order to align with indicator for the development EU energy and climate policies,” of the energy sector in BiH. In Professor Kušljugić explains. general, my expectation is that Last year, Bosnia’s central in the next five to eight years the government also adopted a longshare of electricity production term energy strategy after years from coal TPP will decrease and of political wrangling between its

he energy sector is one of the most powerful economic areas of Bosnia and Herzegovina (BiH) with a long tradition and huge potential, and many possibilities for further development and investment. Thanks to coal, Bosnia and Herzegovina is largely energyindependent, as coal accounts for over 65 per cent of its total primary energy consumption. The country also has a huge hydro potential of 6,000 MW but does not currently make use of its full potential. “The power generation mix in Bosnia at the moment is approximately 40 per cent from hydropower plants (HPP), and 60 per cent from thermal power plants (TPP; based on local coal and lignite). A small percentage comes from renewables (RES-E),” Mirza Kušljugić, a professor at the Faculty of Electrical Engineering at the University of Tuzla tells Emerging Europe. Considering the goals of the European 2020 Strategy and the new framework strategy for 2018-2035, investors have recently expressed great interest in investing in the production of electricity from renewable sources. But with foreign interest growing, many concerns have been raised by the local population worried about the destruction of the landscape.

production from WPP and PV will increase. The main challenge to the de-carbonisation process at the moment comes from the issues related to the political economy aspect of clean energy transition. Phasing out coal will be a special challenge due to the negative social consequences of the process,” he adds. Hydropower Unlike its Balkan neighbours, which rely on imports to meet much of their energy demand, Bosnia is able to export power thanks partly to its hydropower capacity, which provides 40 per cent of its electricity. Last year the construction began on a new CHE Vrilo hydropower plant in Tomislavgrad, while state hydropower producer Hidroelektrane na Trebisnjici (HET) plans to make investments worth 18.64 million

OUTLOOK ON BIH

marka (9.5 million euro) in 2019. “By setting this stone foundation for the construction of CHE Vrlio we confirm our development strategy, respecting the new technologies. We want to be the leading the country in production of green energy,” said General Manager of JP Elektroprivreda HZHB, Marinko Gilja. CHE Vrilo will consist of seven buildings: the upper pool, the entrance of the tunnel, the five kilometre long tunnel, the water and latch chambers, a 450 m long pressure pipe; engine room with exit tunnel and exiting building, plateau and gutter and bottom pool and will produce 196 GWh of electricity annually. Preserving natural landscapes “Our total production is based on clean energy without any adverse consequences on the environment and human health. We are aware

that before the management and workers of EPHZHB is a time of great business challenges, because every new production facility is a step into the future, and therefore uncertainty, this cornerstone is a proof of reliability and persistence,” said Mr Gilja. But several NGOs and local inhabitants have a different opinion, fearing that the proposed run of dams will destroy the landscape, steal their water and extinguish species unique to the Balkans. “Three thousand hydropower plants will destroy these rivers,” said Viktor Bjelić, of the Centre for Environment (CZZS), a Bosnian environmental group. “Many of the species depending on these ecosystems will disappear or will be extremely endangered.” While both the government and the Investment Promotion Agency (FIPA) say boosting hydropower is key to reducing regional

dependency on coal and to falling in line with European Union energy policies. about a third of the planned dam projects are in protected areas, including some in national parks. International banks including the European Investment Bank (EIB), the European Bank for Reconstruction and Development (EBRD) and the World Bank’s International Finance Corporation (IFC), are funding hundreds of projects. “It’s a waste of money and a moral travesty that some of the world’s largest financial institutions have embraced this outdated and exploitative technology,” commented Yvon Chouinard, founder of US clothing company Patagonia, which last year launched a huge campaign to preserve Balkan rivers and dissuade international banks from investing in hydropower. •

OUTLOOK ON BIH

The Heart-Shaped Land Tourism now accounts for almost 10 per cent of Bosnia and Herzegovina's GDP, but there is a great deal of room for the sector to develop even further. WORDS NIJAT ELDAROV

he conflict in Bosnia and Herzegovina in the 1990s was the most complicated, deadliest and longest of all the Balkan wars which followed the breakup of the former Yugoslavia. When President Tito passed away in 1980, ethnic and religious diversity, consolidated for a long time, paved the way for growing tensions. With the evanescing of Communist party control in Bosnia and Herzegovina, a number of nationalistic parties assumed control in the aftermath of the first free elections. In addition to a variety of competing nationalities (Muslim Bosniaks, Catholic Croats and Orthodox Serbs), allegiances from neighbouring Croatia and Serbia and Montenegro intensified the political turmoil even further. Today, 20 years on, the country known as the Heart-Shaped Land is much more peaceful, and the tourism sector is becoming an increasingly important segment of the country's economy. While the historical past of the country generates opportunities for dark tourism associated with death and disasters, its beautiful landscape, friendly people and architectural treasures do far more to attract foreign travellers. The challenge for Bosnia and Herzegovina now is to repeat the tourism success of its Croatian neighbours. Drivers of tourism success After a long period of political instability, Bosnia and Herzegovina’s tourism sector continues to grow, thanks to, in particular, its dynamic tourism promotional system and the warmth of the nation. Since 2013, the government, through the Foreign Investment Promotion Agency (FIPA), has published Investment Opportunities in Bosnia and Herzegovina guides covering the agriculture, metal, energy, tourism, wood, real estate and innovations sectors in order to encourage foreigners to invest

in the country. For the leisure industry, the report outlines ski and mountain tourism, eco-tourism, wellness tourism, religious and cultural tourism, adventure tourism and sea and sun as very propitious domains for investments, and calls on investors to discover “the new unexplored destination.” “This beautiful country has so much to offer for those people who seek different experiences, away from the crowds, whether they are lovers of skiing, rafting, hunting or patient bird-watching. Those who search for more cultural tourism will be able to relive centuries of history by visiting many vestiges and heritage dating back to Roman, even to prehistoric times,” FIPA notes. On the other hand, Bosnia and Herzegovina is consistently praised for its people’s friendliness. In 2013, the World Economic Forum (WEF) listed as the eighth friendliest in the world in terms of the way it welcomes tourists. Moreover, according to WEF, the international openness of Bosnia and Herzegovina, and,

in particular, its soft visa policy accounts for the development of tourism. All EU citizens, citizens of EU visa-free regime countries, Azerbaijan, Bahrain, China, Kuwait, Oman, Qatar, Russia and Turkey are exempt from visa requirements when entering the country. Moreover, all EU citizens, citizens of Western Balkan countries, Liechtenstein, Monaco, San Marino and Switzerland may enter using merely a national ID card for a stay up to 90 days. Infrastructure is also improving, not least the number of airports offering international connections. Tourism in numbers The number of arrivals by international tourists amounted to more than 777,000 in 2016, more than double the 300,000 reported in 2008. Tourist arrivals reached an alltime high in August 2018 August, with 185,648 visiting the country that month alone. According to the latest figures (for 2017) provided by the Agency for Statistics of Bosnia

has since returned to being the vibrant city it was in the past. “Its historic centre blends East and West – visitors can feel they are in Vienna one minute and Istanbul the next,” according to travel writer Jennifer Walker. Unsurprisingly, it is possible to find a mosque, synagogue and Catholic and Orthodox churches all within the same block. Sarajevo is also one of the cheapest capital cities in Europe. Sarajevo's War Tunnel Museum is a must-see. When Sarajevo fell under the siege of Serbian forces in 1992, it became isolated from all supplies from the outside world. The tunnel was the only place through which weapons, ammunition, fuel and electricity were made available. As such, the museum represents the survival of Sarajevans from almost four years of isolation. Today, various tours are held in the tunnels to provide background information while photos, newspaper clippings and a short film guides tourists through their journey. The Museum of Crimes Against Humanity and Genocide also concentrates on the darker aspects of the Balkan wars. Mostar is one of the most picturesque cities in the country. The city is home to the famous Stari Most (Old Bridge), the most visited sight in all Bosnia. The bridge was bombed in 1993, but has since been reconstructed and each summer brave young people dive from its highest point into the river below. Bosnia and Herzegovina is also home to the second largest Catholic pilgrimage site in the world, Međugorje. The story of the Međugorje pilgrimage dates from 1981, when six teenagers playing in the hills between the villages of Međugorje and Bijakovici claimed to have seen the Virgin Mary. While there is much controversy over the legitimacy of the visions, more than 15 million people have so far visited Places to visit the small hillside. Unsurprisingly, Bosnia and Bosnia and Herzegovina is Herzegovina is also home to a crossroads of distinct cultures the largest Islamic pilgrimage site and civilizations, making the (Ajvatovica) in Europe, at Prusac in country rich with sacred places. the centre of the country. The site It is, moreover, a destination of adventure, natural beauty, satisfying was named after Ajvaz Dede (Grandfather Ajvaz), a Sufi dervish cuisine and much more besides. who prayed to God for 40 days to The capital Sarajevo was heavily send rain during a very long period damaged by shells and bombs of draught. On the 40th day, rain during the war in the 1990s, but and Herzegovina, 62.1 per cent of all international tourist arrivals were accounted for by 10 countries: Croatia (10.5 per cent); Turkey (9.8 per cent); Serbia (8.4 per cent); Slovenia (six per cent); Republic of Korea (5.6 per cent); Saudi Arabia (5.2 per cent); Italy (4.7 per cent); Poland (4.3 per cent); Germany (3.7 per cent) and Oman (3.7 per cent). These are followed by China (3.4 per cent), which along with Israel is the fastest growing visitor market. While looking at tourism statistics for Bosnia and Herzegovina, its handy to keep a close eye on figures related to growth. According to the World Travel and Tourism Council’s Travel and Tourism Economic Impact 2018 country report for Bosnia and Herzegovina, visitor exports generated 843.5 million US dollars in 2017, accounting for 13.2 per cent of all exports for the year. This is predicted to grow by 6.1 per cent per annum. What's more, the total contribution of travel and tourism to GDP was 9.6 per cent in 2017 and is forecast to rise to 12.6 per cent in 2028, thanks to an expected rise of about 5.4 per cent per annum. It should, therefore, not come as a surprise that the World Tourism Organisation defined Bosnia and Herzegovina as one of the three countries in the world with overall tourism market growth potential exceeding 10 per cent annually. Moreover, Bosnia and Herzegovina is also in the list of top 10 countries recording most significant increases in tourist arrivals, according to the UNWTO. In 2017, tourist arrivals and overnight stays increased by 13.7 per cent and 12.3 per cent respectively, in comparison with the same period of the preceding year.

came to the area, and people, seeing it as a sign of God’s work, began visiting the site. Stari Most is not Bosnia and Herzegovina's only entry in UNESCO's World Heritage List. The Mehmed Paša Sokolović Bridge and Stećak medieval tombstone graveyards are also present. Located in Višegrad over the Drina River, the bridge is unique example of Ottoman-era architecture. It was built by the Mimar Sinan on the orders of the Grand Vizier Mehmed Paša Sokolović, after whom the bridge is named. Within the borders of Bosnia and Herzegovina lie more than 60,000 Stećak tombstones, whose origins are still contested by the scholars. The Heart-Shaped Land is also rich with sporting attractions. Banja Luka, through which the river Vrabas flows, is a popular destination for rafting and adventure sports. After the capital Sarajevo hosted the Olympic Winter Games in 1984, the ski resorts which surround the city (Jahorina, Bjelašnica and Igman) became popular tourist attractions. The Vlašić and Kozara mountains are also popular destinations for skiing, snowboarding and eco-tourism. Room for improvement While the tourism sector of Bosnia and Herzegovina is growing remarkably, the cities outside the capital still remain unexplored. Moreover, the development of the tourism sector has neglected sustainability. According to the Travel and Tourism Competitiveness Report 2017 by the WEF, Bosnia and Herzegovina is listed 94th and 120th in terms of attention paid to environmental sustainability and sustainability of travel and tourism industry development, respectively. Moreover, the weaker points of tourism sector are also price competitiveness (110th) along with the taxes and airport charges (114th). The Heart-Shaped Land has unquestionably made much of its tourism potential, yet in order for the industry to function more effectively, these areas need to be developed. •

OUTLOOK ON BIH

Embracing the seeds of change in Bosnia and Herzegovina There is a groundswell in Bosnia and Herzegovina as citizens (mostly young people) are beginning to embrace a vision of hope and change in their country—a change that could lead to democracy and a brighter tomorrow for all. WORDS CLARK CURTIS

T Clark Curtis is a former director of communications at the College of Computing and Informatics at UNC Charlotte.

he seeds of the new vision for Bosnia and Herzegovina were planted in 2018 when Mirsad Hadžikadić, a professor with more than 30 years of experience at the University of North Carolina at Charlotte and a native of the country, ran for the Bosniak presidential council seat. Although he did not win the election, he received nearly 60,000 votes—double his most optimistic forecast. For a relatively unknown, totally underfunded, independent candidate, these results have been deemed unprecedented and historic. More important to Hadžikadić, his candidacy proved to be the “spark” for democracy with the formation of the Platform for Progress Movement, which has survived the election and is growing. People committed to change and democratic values are emerging. Hadžikadić and his team selected November 25, 2018— Statehood Day in Bosnia and Herzegovina—as the day to hold the founding assembly for the Platform for Progress Movement. A historic day for the movement and the country, as the movement officially announced its formation. Members were allowed to elect representatives to a supervisory board as well as the eleven-member presidential board. Members could also review and provide input and vote on the proposed movement statute and its structure. Additionally, for the first time, the diaspora (Bosnian citizens living outside of the country) were allowed to participate directly in this process. Most notably, though, was the introduction of electronic voting for members viewing the live stream of the event. The implementation of electronic voting set a historic precedent, changing the process for countrywide elections moving forward. As one member of Hadžikadić team

pointed out, “citizens were able to witness directly the democratic process.”

Fine tuning

Now the arduous and often tedious task of establishing the Platform for Progress Movement in Change is possible Bosnia and Herzegovina continues. This includes solidifying and fineThe founding assembly took place at Dom Mladih – Skenderija, tuning the internal structure and a youth centre that is part of a large operation of the movement, the long entertainment and sports complex, process of vetting those who will represent the movement throughout nestled in the heart of Sarajevo. Throngs of people arrived, patiently the country, selecting candidates for the 2020 local elections, and waiting in line to gain access to the centre. The complex’s 800 seats establishing an organised presence in cities, towns, and municipalities and any available standing spaces were quickly claimed. The building across the country and neighbouring countries in Europe. All of which was crowded with people eager is necessary and vital as the world to be a part of the moment. These were citizens from Sarajevo, towns, witnesses the budding of democracy in this western European country. and cities from across Bosnia and A major goal for the 2020 local Herzegovina, dignitaries and those viewing remotely as they laid elections is recruiting trustworthy witness to and were a part of history people who will serve and represent the movement as well as scout and democracy in the making. There to embrace the vision of hope prospective council and mayoral candidates. One of the challenges is that together, change is possible determining which of the 140 total in Bosnia and Herzegovina. municipalities are the best to target “When my wife Mirzeta and I for this recruitment. Hadžikadić arrived some 45 minutes before says the objective is not quantity the event on that cool and damp day, there was a long line of people but quality. “We have set a goal of ten to waiting to get in, standing quietly and patiently to enter the facility,” twenty-five mayorships in the upcoming local elections, which we said Hadžikadić. “Bosnians are feel is very doable,” said Hadžikadić. not known for standing in line “We want to send the message quietly, often impatiently trying that we are not afraid and within to get ahead of others in front the movement create a mindset that of them. But, such was not the we must work hard to accomplish case on this day. A magical day our goals. Ten mayorships would as music resonated through the center as people sang the national be excellent; twenty-five would anthem, the newly written anthem be marvelous. Either would show the strength of the movement and of the Platform for Progress for prepare it for success in the general the Movement and were allowed elections in 2022.” in person or electronically Establishing an organised to actually participate in the presence of the movement has political process and have their also expanded outside the borders voices heard.” Sites are now set of Bosnia and Herzegovina. on the 2020 local elections and the 2022 general election as Bosnia Hadžikadić has already been to Switzerland, with more visits and Herzegovina, as well as the planned to Sweden, Austria, and rest of the world, are witnessing Germany. The objective is to start democracy in the making.

forming local organisations within the diaspora in those countries and encouraging them to become more involved with the political process in Bosnia and Herzegovina. He says the introduction of electronic voting will encourage and nurture that involvement. “We hope that as the diaspora will become more involved with the political process not only in Bosnia and Herzegovina but also within their own countries,” said Hadžikadić. “Our aspiration is they will form lobbying groups who will then go before their government leaders using Bosnia and Herzegovina as an example of how change is possible. This will then serve as a catalyst for future talks between myself and the leaders of those countries as we strive to establish mutually beneficial relationships and collaboration moving forward.” The need to get to the polls Spreading this vision of hope and change both within Bosnia and Herzegovina and outside its borders also addresses a key and disturbing issue facing the country.

Citizens are electing to leave in droves. Once they leave, few are returning, which will eventually create a huge economic crisis within the country. Hadžikadić says people are leaving for the very same reason that they are not coming back: the current climate within Bosnia and Herzegovina. “People are fed up and unhappy with the current state of the country where hatred and divisiveness run rampant,” said Hadžikadić. “The nationalists are running the game, tearing the country apart, manipulating the political process. Fear is currency, and nobody can stop them. We, the movement, must continue to share our vision that change is possible. We need those who have become so apathetic with the situation to embrace this vision that change is possible and to either remain in Bosnia and Herzegovina or to return to their homeland and help make it better by restoring the rules of law and a sense of justice.” Hadžikadić says those who have left the country would start coming back; even it meant receiving half the salaries they are currently receiving elsewhere in Europe if

it were not for the current lack of normalcy, fear, and divisiveness. He says this constant divisiveness makes those who have left feel that they are not welcome back. The nationalist parties thrive upon this uncertainty and breaking down those barriers can only serve as a threat to their corrupt ways. “It is imperative that the movement continues to spread the vision that hope and change are possible but only with the participation of everyone,” said Hadžikadić. “For this to become a reality, we must emphasise the need to bear the responsibility of getting involved and contributing. Pointing the blame at others is no longer acceptable. Citizens in Bosnia and Herzegovina and the diaspora need to get to the polls. They need to help change the way elections are being done. Pushing for electronic voting will help streamline the entire voting process, helping to mitigate the cumbersome nature of the process and eliminate the current fears by some to freely vote their conscience. Once they begin to embrace the message and begin to see the ‘light at the end of the tunnel,’ they will return.” •

OUTLOOK ON BIH

After Hours

Pirin National Park in Bulgaria, a UNESCO World Heritage site known for its pristine wildlife. The park is home to bears, chamois, wolves and centuries old pine forests. The park has been threatened in recent years by the further development of Bulgaria's largest ski resort, Bansko. In January, the countryâ&#x20AC;&#x2122;s highest court ruled the plans illegal, saving the forest â&#x20AC;&#x201C; for now.

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ARTS Fashion Georgia's model grandmothers WORDS TAMARA KARELIDZE

n Georgia, a country which has recently recognised that it needs to do more to encourage the active participation of the elderly in everyday economic life, Megi Gabunia, a fashion designer, has decided to make senior members of society the face of her brand, M.G. As such, Angela, 90, and Lamara, a spritely 83, have become models. Everything started from a random meeting. Gabunia found Lamara quite literally on the street. They talked with each other and she found that Lamara had economic problems: she had no proper shelter, couldn’t afford to pay for necessary medicine and had

been left without social benefits. Gabunia made an appeal on Facebook for people to help. “Besides the social media activity, I decided to make her life happier and suggested she participate in a photo shoot,” said Gabunia. “My other model, Angela, is my own grandmother. I wanted to share and express equal love for both of them. In the beginning, Lamara was a little bit confused, she was concerned about what people might think. But when I told that she wouldn’t be alone, she agreed.” “I’m a little bit astonished about what I’m wearing at my age, but I like it. I’m happy and proud how people look after me,” said Lamara. “When I was young, I never had the chance to wear trousers, but I’m wearing them now. When I put my hand in the pocket, I remembered how much I wanted to be a boy. I like being a model and it is great that older people can get involved,” said Angela “I don’t want people to view this as simply dressing grandmothers in trousers and modern clothes. I want to show that they need our attention. With this campaign want to demonstrate that grandparents can work in different fields and that all professionals can find a way to involve senior people in what they do,” said Gabunia. The photo shoot lasted for three hours. During the session both grandmothers talked about different issues and found that they had much in common: both of them became widows at an early age and had to look after small children. They remembered their childhood and how they dressed. “We were eight sisters and we shared our clothes. Sometimes we were stealing from each other so we could wear our favourite clothes,” remembers Angela.

“I never had a lot of clothes but what I had always fitted me. I don’t know if I was beautiful, but others often said so,” said Lamara. Megi Gabunia believes that the campaign was the most successful in the history of M.G. She expected positive feedback but says the reaction has been “unbelievable”. She now says that she will continue the project, getting other grandparents involved, especially people who need help and support.

Book In Europe's Shadow, by Robert D. Kaplan WORDS CRAIG TURP

midst a sea of often wildly inaccurate and turgid rubbish churned out by hacks eager to make a quick buck in the wake of Romania’s 1989 revolution, one of the few genuinely readable accounts of Romania at the time was that which appeared in Robert Kaplan’s excellent Balkan Ghosts. A sweeping tour of the entire Balkan peninsula Balkan Ghosts was ironically limited by the sheer breadth of its overall scope: each country, including Romania, gets just a chapter or two. So vividly written was it that you were left wanting a lot more, as it was clear Kaplan had further insight to add. In Europe’s Shadow (subtitled Two Cold Wars and a Thirty-Year Journey Through Romania and Beyond) puts Romania centre stage and we at last get to find out what else Kaplan has to say about the country we call home. While Kaplan doesn’t have as much to say as we’d perhaps as liked or

expected, his main premise, that Romania must rediscover its past before it can have a future, is valid. Neither a conventional history nor a travelogue In Europe’s Shadow tries to look at Romania’s past, present and future through the prism of those who matter most: its people. Admirably, Kaplan is not the kind of author to sit in his hotel and pass judgement on a country he barely understands. Kaplan has visited Romania many times since the 1970s and clearly knows a thing or two. He also gets out and about, interviewing some key political figures, including former president Ion Iliescu, former foreign minister Mircea Geoana and former prime minister Victor Ponta (indeed, Ponta was in office at the time the book was written). Kaplan does have a habit of reporting the words of a string of nameless ‘friends’ and ‘companions’. We are not for one moment suggesting Kaplan has made these people up, just that sometimes it all appears a little too convenient to have a companion standing by with the perfect quote to complement your own train of thought. Indeed, convenience is a theme of the book. In one instance we are even told how the customers in a Iași (which he throughout refers to as Jassy) cafe are talking in Italian and French, immediately after Kaplan has learned about how well Romanian students absorb foreign languages. The book is at its best when looking back at the Romania of the 1970s and 1980s. Kaplan’s description of the (in)famous restaurant Caru cu bere (pictured above, once known for awful service but now a much more agreeable place under new owners and management) circa 1985 is marvellous: “A Romanian sausage house founded by a Romanian from Brașov was back in those Cold War days terrorised by fat, begrizzled waiters who ignored you for half an hour until they slammed a plate of sausages (mititei, or “meech”) on your table with mustard and watery beer. Little else was on the menu. The dark and sumptuous wooden interior with its stained glass windows was a tub of cigarette fumes and body odour. Women were rare.” The chapter on Moldova is also rather good. Describing Chișinău

poorly led forever. After the events of the last 12 months or so we are inclined to agree with the latter premise.

Comics Ivan Cankar: An unlikely comic book hero WORDS CLAUDIA PATRICOLO

as a city where “the women dress with elegance but the men look like slobs” is little short of genius. Kaplan also succeeds in writing perhaps the clearest and most succinct summary of the fascist Ion Antonescu regime we have ever perhaps read. We also smiled when we discovered that his view of the Legionnaire Movement matches ours: pseudo-religious terrorist fanatics who were to Christianity what Isis are to Islam. He then blots his copybook by interviewing the notorious historian Neagu Djuvara (a leading Legionnaire idealogue in the 1930s who, although he publicly disassociated himself from the Legionnaires in 1943, continued to fill a a number of roles in Antonescu’s government). Kaplan has sympathy for very few Romanian historical figures, with one notable and worthy exception: Iuliu Maniu, the liberal colossus who died at Sighet prison in 1953, and who he rightly identifies as the 20th century’s greatest Romanian. As is so often the case with American writers, there is something of an air of snobbish superiority running through the book, although it’s slightly more forgivable coming from Kaplan, a man of rather humble background, than it is from certain others we shall not bother to name. Kaplan also fails to reach any real conclusion about where Romania, as a country, is bound (beyond the fact that the country needs to rediscover its past). He at times appears absurdly optimistic about Romania’s future, while just a page or two later he views the country as irretrievably fatalist and superstitious, condemned to be

van Cankar, 100 years on from his death, remains one of Slovenia's most important writers, poets and playwrights. He is also now a comic book hero, the main character of Ivan Cankar: podobe iz življenja (Ivan Cankar: Images from Life), written by Blaž Vurnik and Zoran Smiljanić, and recipient of the Book of the Year Grand Prix at the 34rd Slovenian Book Fair. According to the jury, the comic book translates an intense life story full of twists, turns and fatal decisions into a superb reading experience. “Vurnik’s precise, chronologically linear screenplay is supported by fragments of Cankar’s works, letters and documents from his time. Skillful black and white images in Smiljanić’s recognisable film language are dynamically intertwined with the selfconscious design and typographic attentiveness of Katja Kastelic,” the jury said. Cankar’s writings are a mirror of Austrian and Slovenian society in the early 19th century, always in defence of the oppressed and laced with satirical attacks upon those who exploited them. He touches most of the topics of the pre-World War I period: alienation, deracination, economic justice, unrequited love, war, and peace. His first work to be published was a collection of poems under the name of Erotika, which caused huge controversy. The Catholic bishop of Ljubljana bought all available copies and had them burnt. The controversial figure of Cankar has shaped Slovenian literature for decades and through the comic book, the authors aim to build a bridge between one of the greatest Slovenian writer and new generations.

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ARTIST Q&A Nihad Jafarov is a young visual artist from Azerbaijan, who in 2018 founded the ArtChaos group, specialised in digital painting, filmmaking and videography. He spoke to Nijat Eldarov about the role advertising, amongst much else, is playing in the devlopment of the visual arts in Azerbaijan. WORDS NIJAT EIDAROV Nihad Jafarov

Jafarov believes that social media offers digital artists a perfect platform for self expression. "Moreover, some digital artists can make more profit than painters without spending money on colouring products," he adds. Craving real teachers The visual arts – not least those produced in a digital format – are a fast-developing field in Azerbaijan. The challenges emerging artsists face, however, are many. nlike many kids, "First and foremost, none Nihad Jafarov was not a of the secondary and higher fan of computer games. educational institutes provides He did, however, love computers. innovative teaching of the digital And he loved art. Discovering spheres, in particular, artistic Adobe Photoshop was therefore visual fields," says Jafarov. "I something of a revelation, opening have repeatedly underscored the up a road towards the digital work necessity of a combination of he produces today. subjects related to IT and fine arts in "It took me many years of my life the Azerbaijani education system." to learn the tools and algorithms, "Many of my colleagues engage and left me with a huge portfolio of in successful visual arts projects test work that – while they took a both locally and globally, and long time to put together – should the majority of them owe these never be seen by the public," he says. achievements to their personal Admitting that he is a bigger fan self-development, through manifold of Warhol than Rembrandt, Jafarov failures," adds Jafarov. "I still do not says that he can feel art in his soul. believe that talent is extraordinary. "Art is undoubtedly the most Indeed, art does not just sum up the utmost form of self-expression," knowledge of technique; successful he tells me. "It is the only form works demand taste, along with which can travel from petroglyphs hybrid thinking and good vision. to social network stickers, yet Azerbaijani youth are craving for still maintain its authenticy. the real professors that would invite Even the most extreme art piece them to the philosophy of arts - which has a power to step on through their conversations and values - possesses peaceful selfexperiences. These professors do expression which cannot engender not have to teach in an educational a physical harm towards anyone. institute, by the way. I think that the Notwithstanding, any selfpioneers of this domain – the young expression needs a broad audience people themselves - have to take and a secure environment." their own steps and wake up their

inner Walter Gropius, who set up the Bauhaus school along with his artist colleagues. It is already more than a year since we, as Artchaos Group, have been engaged in multidimensional commercial and non-commercial artistic activities, together with local artists. Today the biggest barriers facing young artists are heated rivalry, absurd criticism and an intolerance towards criticism." Social change Jafarov's work raises awareness on a number of social topics, such as gender, religion and politics. Does he think the visual arts contribute to the social change? "Well, I feel like a successor of Azim Azimzade, an Azerbaijani painter who was once beaten for bringing paint to the religious school. The geography I am a part of has been familiar with illustrations on social topics since the beginning of the last century through the Molla Nasraddin satirical magazine." Molla Nasraddin was an Azerbaijani satirical magazine published in 1906-1917, 1921 and 1922-31, touching upon issues such as politics, religion and gender inequality. It is considered to have been remarkably similar to the French Charlie Hebdo satirical weekly magazine. Jafarov admits to being inspired by its contributors. "Although I am disappointed that many of the topics and problems depicted in Molla Nasraddin persist to this day, I have undoubtedly drawn inspiration from its contributors. Societies revolutionised through art have

been disposed to managing themselves independently, but this is not an immediate process, notably now, in the age of globalisation." Jafarov views artists as having a key role to play in shaping the modern world, and feels that digital works can have an even greater impact than the traditonal arts. "Every day I see inspiring motives in the public transport, streets and the narrow estates of my childhood. Presenting them to the audience through cultification serves to eradicate these problems with the passage of time. Visual arts, particularly, have an influence on urban life, and I would recommend, to anyone interested in this subject, a work by Christoph Niemann, the illustrator of The New Yorker entitled The Abstract City, which is about his hometown. Artists such as Marco Melgrati and Davide Bonazzi have raised awareness of global problems with huge audiences. This exhibits the stronger impact of productive digital works on our communities in comparison with traditional arts. Speaking globally, we, the free artists, are actually living in cages like other people. However, our cages are bigger in size. An artist, in order to defend his or her views, should think of vital topics wisely and to the extent he or she does not care about his life." Born artists That visual communication is limited to social media and smartphone screens is a common misperception Jafarov is keen to eradicate. "The world is still enthusiastically reading magazines such as

factors with the work we produce. The New Yorker, The Economist Tastes are not taught, they can or Popular Science whose content is rich with digital illustrations. only be disseminated." • Magazine culture is not popular in Azerbaijan and therefore, our new generation digital artists lean towards the world of advertising, as the economic market is not compensated through mass media. As such, most of the works addressing social issues are non-commercial and products of the artists' personal creativity. However, there is speedy progress in this sphere owing to the emergence of advertising culture," he says. "An Azerbaijani is principally born for the arts," Jafarov says. "An Azerbaijani is more emotional and more honest than needed. It is enough to be familiar with the life of Absheron school painter Rasim Babayev, in order to understand that. And yet we are in the bottom position in our region in terms of visual arts. In many of the global poster competitions in which we take part, we find Iranian artists as jurors. They have become well-known by objecting to the world they live in through the visual arts. To my consideration, at the moment we have to accept the reality of our benefits from advertising culture and we have to take greater steps in order to improve this from a social perspective. We cannot save the world like superheroes, but it is in our hands to change certain

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Gaming emerging Europe Emerging Europe is home to more than a thousand game production studios. Many of their biggest hits focus on the region's troubled history. WORDS SHAKHIL SHAH

rom toddlers through adulthood and even into retirement, for some the joys of scavenging, and exploring magical realms in an alternate universe offers hope, happiness and an escape from their everyday lives. And an increasing number of those games are coming out of emerging Europe, playing homage to Slavic history, telling dark tales of the region's history and the struggles people have had to face, touching on war, occupation and the daily struggle to survive. The emerging Europe region has produced some very popular games over the last decade or so, while a number of global titles produced by international companies have been developed here, including FIFA. Yet the real story is about independent studios that have gained international success, “establishing … a development culture with a unique, often very dark visual and stylistic tradition, which is beginning to make waves across the global video games industry,” says Marijam Didzgalvyte in Games Industry. The region is now home to more than a thousand game development studios, with over 25,000 people employed by the industry. The Witcher One of the biggest games to come out of the region is The Witcher, in which players become Geralt of Rivia, a solitary monster hunter who struggles to find his place in a world where people often prove more wicked than beasts. Battling your way through a medieval world, thwarting plans of world domination, The Witcher series has become such a popular franchise since being turned into a game that, Netflix have announced that The Witcher TV series, based on Andrzej Sapkowski novels, will be released later in 2019. If battling monsters and elves seems too much like fantasy, how

73 about wandering the streets of fictional city: Pogoren, Graznavia, in This War of Mine, inspired by the Siege of Sarajevo in 1992-1996 during the Bosnian War. The game offers players a twist: instead of being military personnel, your mission is to help a group or civilians survive the war. Using only what is available to you, you are forced to scavenge, build and trade in order to make it through another day. “After the success of This War Of Mine, we felt encouraged that the stories from our region matter," says Pawel Miechowski from the game's developer, 11 bit Studios. In November 2018, 11 bit studios announced the release of This War Of Mine: Complete Edition, exclusively for the Nintendo Switch, which contains the original game as well as other episodes developed over the years. Keeping with the theme of war, take a step back even further to the 1940’s with Attentat 1942, in a game that tells the story of Nazi occupation from the perspective of those who experienced it first-hand. Key events In Attentat 1942, you go in search of answers following the arrest of your grandfather by the Gestapo shortly after the assassination of Reinhard Heydrich, ruler of the Nazi-occupied Czech lands and leading architect of the Holocaust. The game revolves around trying to understand why he was arrested and what his role was in the whole saga. Attentat is unique in the fact that it includes rare digitised film footage, challenging mini-games, and cinematic-style interviews that have been researched and written by a team of professional historians. As part of the game you will speak to eyewitnesses, live their memories, and discover the untold story of your family. "Attentat 1942 is the first game in a series that will ultimately cover key events of the second half of the 20th century, including the post-war arrangement of Czechoslovakia, the expulsion of Sudeten Germans, the rise of communism to power, and the

Prague Spring," Vit Šisler, creator of Attentat 1942, told Games Industry. Alternatively, you can become Henry, the son of a blacksmith, in Kingdom Come: Deliverance whose peaceful life is destroyed by a mercenary raid, at the order of Hungarian King Sigismund, which burns your village to the ground. With nothing left, you join Lord Radzig Kobyla’s resistance to fight in a civil war for the future of Bohemia and restore Bohemia's rightful king and Sigismund's half-brother, Wenceslaus IV, to the throne. The list of games and studios from the region is constantly growing, and has gained worldwide recognition, so much so that in 2018

the first edition of the Central and Eastern European Game Awards (CEEGA) was launched. Fifteen countries from the region make up the organisers and partners of CEEGA, its mission being to recognise and promote the best video games from the region. "Everyone knows about the Knights of the Round Table or the Loch Ness monster, because these cultural tropes have been around for a while now…We're only scratching the surface here with the subjects that we can introduce from our region, that will soon enter the cultural discourse," said Paweł Szyszka, one of 11 bit Studios' game designers. •

AFTER HOURS

Cooking with childhood memories

AFTER HOURS

Costes, in Budapest, is just one of four restaurants in Hungary to hold a Michelin star. Its head chef, Eszter Palagyi, speaks to Emerging Europe.

Eszter Palagyi

WORDS CLAUDIA PATRICOLO

ne of Eszter Palagyi's first memories is peeling potatoes with her father, who she says adored cooking. "Every weekend we had a family gathering where we cooked and ate together. My father often took me to the countryside to discover traditional Hungarian cuisine, but despite that I never actually wanted to be a chef. I wanted to study marketing at university but during my last year at school I went out for a party and disappeared for three days. My dad was so mad at me that he decided that he was not going to pay for me to go to university anymore." Palagyi says she then took up cooking because she could work while attending cooking school, and pay her rent. "My father was really upset and was convinced that I would quit in a couple of months. But I wanted to show him that I could make it and that I could become a good chef. So, I moved to

Downtown received one in 2016. "For the owner the Michelin star is really important because it is a matter if prestige," says Palagyi. "It is something which certifies that Rejuvenating Hungarian food his restaurant is doing something different. Michelin stars usually She decided to move back to attract more foreigners than Hungary because she wanted locals, but we have also seen to reinvent Hungarian cuisine. A chance meeting led her to Costes. the number of Hungarian customers increasing because I am "I met the former chef of Costes Hungarian, and they want to see in Austria because he was a guest what this local chef can do." at the restaurant I was working for," she tells Emerging Europe. Coping with fame "When he heard that I had returned to Hungary he offered With an increasingly high profile me a job as pastry chef, and I both locally and internationally, accepted immediately because Palagyi has had to come to terms it was not a big deal and it meant with a certain amount of fame. fewer responsibilities. But almost "I don’t like the fame," she admits. immediately I was promoted to "Unfortunately, in Hungary it is not sous-chef because he had to travel a lot. Two years later he left Hungary always a good thing to be a wellknown chef because when you are and I became the head chef." a celebrity people think you do not In 2010 Costes was awarded a Michelin star – the first in Hungary work for a living and that you are only the face: they think the work - and its sister restaurant Costes Ireland and then England, France and Austria, to study and practice different culinary traditions."

is something other people do, in the background. While abroad it is different, it is better. Chefs know other chefs and like to include them in their clubs, in their circles." As for being a woman in what is still usually a male-oriented field, Palagyi is comfortable. "For me it is easier than for other women," she admits, "because I worked abroad since I was very young so people see that I am not scared to work too much. I push even more than men and no one ever noticed a difference. Of course, when I moved back to Hungary it was difficult because I had it all: I was young, new and a woman. Now people know me so they expect me to be in the kitchen. It is also cool to see the guy side from a girl's perspective, in order to understand more about relationships and work. I might even say that men talk even more than women, especially in the kitchen. I had only one time when I felt discriminated against, by one colleague from an Arab country for whom it was impossible to work together with a woman. But that was an extreme case."

and sees it as being an important part of her work. "It is always important to have a personal touch about the food, otherwise it is not real, even if you cook simple food. I like to use my childhood memories. Then I combine the Hungarian f lavours with the elegant touch and technique of French cuisine. Hungarians recognise immediately the taste and they are surprised how the same dish can appear in different ways. Hungarian food is usually really heavy and just put there, on a plate, so it is difficult to understand the different ingredients. It is also an interesting food for foreigners as they can understand our gastronomic history."

Restaurants like Costes are one of the reasons that Hungarian attitudes to food are changing, although as Palagyi admits, more needs to be done to encourage sustainability of supply. "Budapest is a pop-up city," she says. "We are fashionable now for everything that concerns art, food and style. There are better quality suppliers, all from Hungary. Ten years ago 90 per cent of the ingredients had to be ordered from France. I still have a few things from abroad but it is a very low percentage. People now are well educated about food, and the impact it has on health. But when it comes to sustainability, in Hungary we are really weak in this aspect. This, however, is the direction the whole industry should go." •

75 AFTER HOURS

Flavour, elegance and technique

Costes Restaurant

Palagyi is committed to using local produce as much as possible

76 AFTER HOURS

Once you cross the border into Transnistria, you'll need to show your passport in order to get a transit visa that will give you 10 hours in the country. If you're staying overnight, you'll need to show proof of reservation at a local hotel in order to get an extended visa. Downtown

ransnistria has a fearsome reputation as being the last bastion of the Soviet Union, and Western governments post scary warnings for anyone who dares to enter this tiny breakaway republic between Moldova and Ukraine. But undaunted travellers will find its capital Tiraspol to be a friendly and remarkably modern European city. And while it's true that there are visual reminders of the Soviet Union everywhere you look, today, Tiraspol is also home to Bitcoin miners, a next-gen electronic payment system, and a slew of local smartphone apps for summoning a taxi à la Uber or ordering in some sushi. Why visit now? In late 2016, a new political faction came to power. The change in leadership has revitalised Transnistria's concept of selfhood, including investing in the tourism sector for the first time.

Your first stop should definitely be the new tourism office (intersection of Lenin and 9 January Street) just a short walk from the combined bus/train station where you can pick up a free paper map. From there, make your way on foot to the parliament building on Karl Liebnechkt Street. Taking a photo of the colossal state of Lenin out front is mandatory, but you'll ruin the illusion if you tell your friends back home that the statue Getting there was actually purchased in Germany after the fall of the Soviet Union. Due to the 1994 peace accord, Across the street from the red Tiraspol's airport remains shuttered. Lenin is a must-see war memorial, The closest airport is in Chișinău, a golden-domed "pocket" church, about an hour's drive away. and a T-34 tank atop a pedestal. Every 30 minutes throughout the day, buses run from Chișinău's From there, head south to 25th October Street, the main central bus station (Str. Ismail) to east-west thoroughfare anchored Tiraspol for around 40 Moldovan by a large equestrian statue of the lei. Return buses will cost you country's most important hero, around 50 lei or 43 Transnistrian roubles, with the last bus departing Alexander Suvorov. 25th October Street is also Tiraspol for Chișinău at 6:30pm. where the finest eateries are The most comfortable way to get to Tiraspol from Chișinău is to take found. Most tourists opt for the morning train (departs at 6.57am a burger or pizza at Andy's (25th October 72), but foodies and arrives at 8.30am) that runs are better off choosing Mafia to Odessa with a stop in Tiraspol. Brand-new and spacious, taking the (25th October 92) for some highend Italian or Japanese cuisine. train will set you back just 21 lei. No visit to Tiraspol is complete From Odessa, the same train without taking one of the wine returns to Chișinău, departing Odessa daily at 6.45pm and arriving or cognac (brandy) tasting at 9pm in Tiraspol. About 10 buses tours at Kvint (Lenin Street 38), the award-winning winery and per day depart Odessa (from ul. distillery founded in 1897. But be Kolontaevskaya) for Tiraspol at a cost of around 120 hryvnia, the last sure to book in advance as walkins are not accepted. one departing at 6pm.

Sleep

extensive menu of international and local beers and wines at Craft Finish off your Soviet Gastro Pub (Yunosti Street 2a), experience by spending a night the first restaurant of its kind in at the Lenin Hostel. Two cosy the country. rooms in a genuine Soviet-era Another option for your second apartment block right in the heart day in town is a tour of Aquatir, one of Tiraspol are lovingly decorated of the largest indoor caviar producing in Soviet memorabilia that are facilities in the world. Advance just begging to be Instagrammed. reservations are required.

If you're coming into Tiraspol from Ukraine and continuing on to the Republic of Moldova, you'll need to visit the Immigration Department (at Stefan cel Mare 126 in Chișinău) to get an official entry stamp into Moldova to avoid problems with your onward journey. The primary language used in Tiraspol is Russian, but most young Off the grid Important things to be aware of people speak at least a little English. If you're heading to Chișinău, Not shown on the free tourist Transnistria has its own currency keep in mind that buses will show map, Tiraspol has a somewhat secret called the rouble. Visitors must their destination as КИШИНЕВ second city centre area called Balka, exchange US dollars, euros, (the Russian spelling of the city). where trendy locals congregate. Russian rubles, Ukrainian hryvnia, The official name of the country The easiest way to get to Balka is or Moldovan lei for local roubles is the Pridnestrovian Moldovan to take the eastbound #2 trolleybus in order to eat, drink, and shop as Republic or Pridnestrovie for from anywhere on 25th October foreign bank cards will not work. short. Referring to the country as Street. The Balka area features a Transnistrian currency comes Transnistria is considered offensive brand-new mall and a lovely area in the form of paper banknotes, as it was the name for the region for sightseeing. Pair a gourmet metal coins, and next-generation imposed by occupying fascist forces meal with a selection from the plastic tokens. during World War II. •

77 AFTER HOURS

78 AFTER HOURS

48 hours in Łódź Born as a result of the Industrial Revolution, Poland’s third-largest city entered the new millennium looking black-eyed and bankrupt. The last decade, however, has witnessed a remarkable turnaround during which this factory town has evolved into the nation’s undisputed crucible of alternative culture and urban cool. WORDS ALEX WEBBER

Why visit now?

House Andel’s (Ogrodowa 17, viennahouse.com) has enjoyed Łodz is ‘the city of today’. a reputation as the best bed in Recovering from years spent in the town, with the likes of Bieber and doldrums, it’s a place of raw energy, Rihanna all bunking down inside arty vibes, soaring ambition and this redbrick former textile factory. creative thinking. The excitement Featuring a modern, loft-style is palpable. aesthetic, the crowning point – literally – is a spectacular pool that First steps hangs dramatically off the edge of the top-floor. Set seven kilometres or so southwest of the centre, Wladyslaw Street’s ahead Reymont Airport handles a modest number of incoming flights – if Piotrkowska is the one street you’re on one, expect to pay name you’re unlikely to forget. approximately PLN 30 to cab it Poland’s longest street is lined into town. Instead, most visitors with handsome Art Nouveau arrive via Warsaw with regular tenements, many returned to their trains from the capital (journey best following a longstanding time: approx. 80 mins) terminating program of renovation. Spanning at the revamped Fabryczna station, 4.9 kilometres, find it sprinkled a spectacular edifice capped by with zany monuments (e.g. a striking vaulted steel and glass a piano-playing Rubinstein canopy. Taxis wait outside, but installation), murals and cult the main high street, Piotrkowska, diversions such as 6 Dzielnica is an easy eight-minute walk (Piotrkowska 102, szostadzielnica. due West. For years, the Vienna pl): blurring the lines between

exhibition space, performance venue and hip drinking hangout, find it inside a peeling apartment space up a creaky set of stairs. Rickshaw drivers pant up and down Piotrkowska, but clambering aboard one runs the risk of missing this street’s many covert glories: for instance, Rosa’s passage (Piotrkowska 3). Proof that radical public art isn’t limited to murals, this once gloomy side alley has seen its walls clad in a mosaic composed of thousands of mirrored shards. Off the wall Even in a country championed for its XXL wall art, this city stands out as something special. Since 2009, over 80 large-format murals have been added to the ‘blind walls’ of Łodz, transforming the town into a thrilling open air gallery. Helping to resuscitate a city that was left emasculated by the post-communist implosion of the local economy, this

outbreak of ‘muralosis’ has given Łodz international exposure and a powerful sense of creative individuality. Plan your own arty urban safari by downloading a mural map from urbanforms.org.

AFTER HOURS

Holly-Woodgel Poland’s finest cinematic talents cut their teeth at the local film school with alumni numbering the likes of Polanski, Wajda and Kieslowski. Seek out the Cinematography Museum (pl. Lech Kaczynskiego 1, kinomuzeum.pl) to wander amid retro film posters, vintage equipment and reclaimed film sets. The fotoplastikon, a pre-war 3D picture booth, is one of only six known to exist in the world. But do not let your film-inspired tour of Łodz end there. Prior to a much-publicised falling-out with the local authorities, David Lynch was a regular visitor, with the town’s sooty skies, frayed streets and empty factories all acting to captivate the director: to follow in his footsteps, book into the fading Grand Hotel (Piotrkowska 72, grand.hotel.com.pl), an ageing 19th century monolith that played a starring role in Inland Empire.

former cotton factory raised the city’s domestic profile, announcing to the nation that this wasn’t a city quite ready to expire. Whilst most natives flock to the many shops contained within this vast plot, Get off Piotrkowska other attractions of this mixeduse development have served Named by CNN as ‘the hippest to highlight this is as more than neighbourhood in the whole of Europe’, OFF (Piotrkowka 138/140, just a mall. For an understanding of the history of this site visit offpiotrkowska.com) has come to The Museum of the Factory define all that’s edgy and dynamic (muzeumfabryki.com.pl), before about this city and its people. finishing up atMS2 (msl.org.pl), What was a derelict and decrepit a multi-floored gallery hosting one factory space has been in-filled of the most important collections with independent businesses, of contemporary art in the country. upcoming local fashion brands and edgy concept stores such as The melting pot the retro-inspired Pan Tu NiexStal (pantuniestal.com). Mostly though, Prior to WWII Łodz thrived OFF is about food, drink and long, as a cultural crossroads: Poles, murky nights: don’t miss Brush, a Germans, Jews and Russians all barber shop that, come evening, turns into a bar serving confounding co-existed in an atmosphere of mutual tolerance. Evidence of this cocktails inside Edison bulbs and heritage survives in the form of the plant pots. onion-domed Alexander Nevksy Cathedral (Kilinskiego 56), not More than a mall? to mention the elegant residences of German industrialists such as Fears that the Manufaktura (Drewnowska 58, en.manufaktura. Oskar Kon and Ludwik Geyer. com) project would become a white The pre-war Jewish influence was particularly pronounced, elephant have proved unfounded; with Jews comprising around opened in 2006, the revival of a third of the city’s population: Izrael Poznanski’s 19th century

the Jewish Cemetery (Bracka 40) is the largest such necropolis in Europe, with the 44 hectare area home to everything from crumbling headstones and mass graves dating from the Holocaust. What’s a woonerf? Łodz’s adoption of trending urban solutions best manifests itself by way of the city’s worship of the woonerf – a Dutch concept that seeks to turn roads into living, people-friendly organisms on which pedestrians, cyclists and car traffic flow together as one. Intersected by Piotrkowska, Traugutta and 6 Sierpnia streets are prime examples: on these, join glam, local ’slebs to dine on Poland’s best sushi at Ato (6 Sierpnia 1/3, atosushi.pl), or head to Motywy (Traugutta 14, restauracjamotywy.pl) for slow food in cool surrounds. Drinks-wise, the laidback Owoce I Warzywa (Traugutta9) serve specialty coffee inside a former grocery store now crowded with freelancers slouched on vintage armchairs, whilst Piwoteka is popular with bearded dudes sampling wacky craft brews such as coconut and chili beer. •

80 AFTER HOURS

Life in Estonia WORDS JYRI JÄNTII

Jyri Jäntii is a Finn currently completing his studies in International Relations at Tallinn University, while working as a freelance content writer and translator. (That is when he is not pouring beer at festivals).

hen I moved to Tallinn four years ago, I realised that it gets more difficult to explain to new people where you live. If they know the Baltics, they usually don’t know in which order the countries are in (Estonia is the northernmost). None-the-less, tiny Estonia, with its 1.3 million inhabitants (be sure to not forget the 0.3, as small margins count here) has of late been taking continuously huge leaps forwards, and is seeing an interesting group of students and entrepreneurs moving in. Be it e-residency, online voting, young leaders, top education, easy and fast bureaucracy, startups or craft beers, this small country in the Baltics is hitting the mainstream consciousness more often. And this change has been rapid. I remember visiting Tallinn 10 years ago, and it was a different city, a different country. Since then it has become a hub of constant activity and change. Tallinn has become home to a steady flow of youth coming to study, like I did, and even more coming to start a company. But what surprised me the most is that for such a small place, Estonia and its capital Tallinn sure do rouse up some strong emotions. People love it, hate it, fall in love there, cry there, laugh there, are amazed, are disappointed. Many people leave just to come back after couple years. But the locals - and often the more vocal migrants agree on a bunch of things. Firstly, very few people can manage not to be amazed by the old town of Tallinn when they walk into it for the first time. Built in medieval times, its winding streets are reminiscent of bygone eras and are easy to get lost in. The Teutonic Knights once ruled these parts, as did the Danes (who actually got their flag from Tallinn). It is difficult to describe but it’s easy to fall in love with Tallinn's old town. Many of my friends say “It looks a tad like Hogwarts.” Secondly, even though the city sometimes feels gloomy in the dark

months of autumn and the long winter, nature is never far away. Neither is a cosy cellar serving mulled wine where you can chat with an interesting collection of people and keep warm during freezing nights. Also, it’s good to remember that even though it sometimes feels difficult to get into the inner circles of the locals, it’s worth the try. The language might be difficult, but the culture is rich and interesting. There are holidays built around singing together as a nation, nights for ancient bonfires and big party for the longest day of the year, Jaanipäev. The food might be not that of Italy, but many small breweries and eateries with innovative young minds behind them are making it easier for outsiders to get into Estonian flavors. Finally, a lot of things are stunningly easy. Simply put, the paperwork in Estonia is a breeze. In fact, you will rarely even see

paper, as everything is online. Sign a contract – online. Vote – online. Want to start a company? – not only online, but it takes you roughly 17 minutes to register (although first timers should maybe schedule some extra minutes). Estonia is a young country that’s growing fast and it does sometimes get a few growing pains. It has many imbalances and even though it has racked up wealth quickly, not everyone has benefitted from it equally. Tallinn has everything from old town to glass and steel to hipsters living in wooden houses and dining in industrial halls. It also has elderly people begging on the streets as their pensions don’t get them through the month. It has big movie festivals and small shacks serving pelmeni with sour cream and dill. It has bright summers and dark winters, and many more striking contrasts. Tallinn has been an interesting ride with ups and downs, but it’s a risk I would easily recommend anyone to take. •

Invest in Bydgoszcz Poland

• CIJ Awards Poland 2017: Best Investor-Friendly City • CEE Shared Services and Outsourcing Awards 2016: Emerging City of the Year • Eurobuild Awards 2015: Most Investor-Friendly City

• More than 1 million residents within 50 km • 1st place in The World Bank’s report – Doing Business in Poland 2015 • Regional economic centre • Academic hub of the region • International airport located within 3.5 km from the city centre

www.barr.pl www.investin.bydgoszcz.eu barr@barr.pl

82 AFTER HOURS

The world turned upside down WORDS CRAIG TURP

am fairly certain that just about every foreigner living in emerging Europe has at one stage or another greatly exaggerated their suffering at the hands of their host country’s weather/bureaucracy/ infrastructure/insert-your-owngripe to the good people back home. I know I have. It’s part of the att raction of living abroad, no? The chance to bang on about how cold it gets, or how unreliable the electricity is? For many, it is a means of ensuring that their employers will continue to handover a hardship allowance for another year. I know a number of people living in what are now (and indeed have been for more than a decade) EU countries who still receive such hardship allowances. One of them (who I shall not name) used last year’s allowance to install a hot-tub in his apartment. For others - especially for us Brits - exaggerating hardship is often simply a way of starting a conversation in a pub. As a nation we adore talking about the weather even when there isn’t much weather to talk about, so when outside it’s blowing a blizzard and the temperature is -20°C, we are usually all too willing to bang on about the day’s walk to the office in terms that would suggest we have been recreating the opening scenes of Doctor Zhivago. Less amusing are those people - none of whom (I hope) read this column - who fi nd genuine hardship and outright poverty really quite charming. Just recently a friend who owns a farm in the Romanian countryside was telling us about some English visitors to a village close to his who remarked how ‘sweet and quaint’ it was that women still fetched water from a well each morning. Sweet and quaint? For whom exactly? The women carrying the buckets? I have long held a quite an open grudge against Prince Charles (so much so that I was quoted in the latest biography to be written

about him), considered by just about all and sundry as a ‘great friend of Romania’. Charles owns a number of properties in parts of rural Transylvania (some of which he has renovated at vast expense and rents out to holidaymakers) and visits Romania on a regular basis. His message is always the same, centred on just how wonderful life is in those parts of the world where almost everything has been unchanged since the Middle Ages. Alas, ‘unchanged since the Middle Ages’, usually translates as no running water, no gas, sometimes no electricity and a life of back-breaking work before keeling over with old age at 55. A wonderful life indeed! What the heir to the British throne (who has a reported 82 servants) and those other, many visitors to the Romanian countryside forget is that the life they fi nd so charming - a preindustrial life, where social mobility is unheard of - is not the life those who live it actually chose for themselves. They were condemned to it by birth. For Charles and the tourists, playing at being a peasant is an agreeable way to spend a holiday. They can return to their lives of wealth and privilege anytime. For real peasants in the most deprived parts of Europe, there is no other life to return to. Fo Charles, Viscri - the Potemkin village that Charles has put on the tourist map more than any other - is

more or less as good as it should get for a Romanian peasant. A home made of traditional materials, some land to farm (using traditional, back-breaking methods of course) and a regular stream of visitors to keep the village's pensions in business. Why would anyone want more? Why would anyone aspire to the kind of life that, oh, Charles himself enjoys? A life of unadulterated privilege and luxury? No, dear peasants: such things are not for the likes of you. While we admit - grudgingly - Charles might want to make the life of the Romanian peasant (or at least some of them) a litt le less uncomfortable, he would nevertheless be horrified if the population of the entire Romanian countryside decided en bloc to down tools in order to demand something better. Like the troopers sent to wipe out the Diggers' claim on St. George's Hill he would tell them to know their place and get back to work else they feel the wrath of their masters. That’s why I have become so opposed to the idea that he is a 'friend of Romania'. He is not. Charles is a reactionary determined to conserve the existing social order. If he genuinely cared for the Romanian peasant he would be trying, like the Diggers, to turn that order upside down. Yes, he may bring in a few tourists, but then so does Dracula, and nobody has ever suggested he is an agent of progressive social change. •

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