The European Union is nearing the completion of approval procedures for reform agendas submitted by Western Balkan countries, a requirement to access the €6 billion Growth Plan. Beneficiaries of the Plan, approved by the EU in May, include Kosovo, Albania, North Macedonia, Montenegro, Bosnia and Herzegovina, and Serbia.

On October 11, the IPA Commission (Instruments for Pre-Accession) approved the reform agendas of five countries. Bosnia and Herzegovina is still pending approval, as its submission did not address all of the European Commission’s recommendations. The European Commission is expected to approve the implementation decision on October 16, allowing the first payments to begin, provided the countries ratify the agreements in their parliaments. Two billion euros of the package will be grants, while the remainder will be favorable loans.

Due to the time required for these procedures, the first payments are expected in early 2025, although they could occur sooner if a country finalizes the ratification process quickly. Each beneficiary will receive a pre-financing payment of 7% of their allocated funds upon approval of their reform agenda.

Estimated allocations include over €880 million for Kosovo, €922 million for Albania, €750 million for North Macedonia, €1.58 billion for Serbia, €383 million for Montenegro, and €1.085 billion for Bosnia and Herzegovina. Pre-financing payments range from €26.8 million for Montenegro to €111 million for Serbia.

The EU’s Growth Plan aims to support economic development in the Western Balkans and accelerate their EU integration. The funds are allocated based on criteria like GDP and population size. The EU has emphasized that if a country fails to implement reforms, its allocated funds could be redistributed to others in the region.

The Plan also promotes regional cooperation and integration into the EU’s single market. It is designed to facilitate, not replace, the EU membership process. The EU plans to expedite the initial disbursement of funds to start project implementation and emphasizes adherence to conditions, including the rule of law, financial oversight, and proper auditing standards. For Kosovo and Serbia, a key requirement is constructive engagement in normalizing relations.

Misuse of funds could lead to repayment demands, and any unspent funds from one country could be redirected to another. This Growth Plan is the EU’s most ambitious initiative for the region, distinct from the regular Pre-Accession Instruments (IPA).