An Unexpected Surge of Optimism?

Recently I had the opportunity to participate in a panel talk in front of a most illustrious audience in Vienna, which became Davos for that week as it hosted a session of the World Economic Forum. This extraordinary organization aims to bring together world political, business and intellectual leaders to discuss contemporary matters of the global economy and our societies. It was a very stimulating experience: every word has a special weight when the audience is responsible for such a big chunk of the world’s GDP, either economically or politically.

As we were supposed to talk about the future of Europe, the omens could hardly have been any gloomier: Austria temporarily reinitiated border control suspending the Schengen practice, in order to ensure the security of the event. The Treaty of Schengen, the actual elimination of the internal borders of Europe and the common European currency are the two most spectacular accomplishments of the European integration. I was there in Vienna, the borders were back around us, and we came to discuss the chances of survival of the Euro amidst all news coming up on a daily basis about the debt crises of the monetary union. Well, I would not have expected the talk to go in the optimistic way it did eventually.

My panel was called “Stress test for Europe”, and the people I sat with included a bright foreign policy expert from Britain, an Italian financial expert and a renowned Dutch economist, of whom only the latter was over his forties. As the end of the fifty-something minutes under the spotlight drew closer, the moderator, representing Associated Press, expressed his surprise (flavoured probably with a tiny bit of disappointment) that we did not bring up our own doomsday scenarios and sinister prophecies.

In fact I came with the opinion that the problem of Europe is not the economy, it is something else – which is in one sense good news (as economies almost always heal slowly and painfully from big busts), but in other sense it is bad, as in order to provide a remedy, people first have to settle over the diagnose. I think Europe is stress-tested, as the name of the panel suggested, not much in a financial way, but in terms of visionary power and political leadership. The fundamentals are intact; history just requires Europe to follow a common rhythm: choose unity, innovation and competitiveness over dissension, anxiety and falling behind.

Though each of us formulated it according to his own subject, we were in agreement over the main message. Very valuable thoughts were developed: It was mentioned that the main problem is political legitimacy, that leaders are supposed to solve an economic distress without a clear political mandate and they fail to outline the possible choices to the voters who are supposed to pay the costs eventually. People keep talking about a crisis of Europe when the debt problem affects a part of Europe whose economic weight accounts for a proportion of the EU’s economy similar to that of the state of Wyoming to the United States. The wealth at stake is incomparable to the wealth created by the common market. In sum: all numbers say that Europe is strong. It is the biggest market, and a “club” of the most developed societies. The economy can be fixed on the short term, but what Europe needs on the long term is a vision for a common future. A more open Europe, where decisions are not made over voters’ heads; policy choices are very well explained to voters who make the final calls. A Europe, which as a political community of independent nations can live up to its joint economic strength on the world political scene. This is what people at the panel envisaged, and, which is more, expected. This is the kind of Europe Montenegro wants to join. And this is the kind of Europe Montenegro wants to contribute to through its economical performance, and social and cultural values. Only a stronger and more open Montenegro can be a strong part of a more open Europe. That’s why we have to restructure our society by implementing reforms and strengthening our competitiveness.

In one sense we are reassuring Europe in these hard times. The fact that we want to, and will join the club shows them that they still are a community which offers enormous advantages to its members, in terms of peaceful coexistence, cultural richness and economic progress. As the great goal of peacefully bringing together the nations of Europe is not yet achieved entirely, enlargement is a genuine vital sign of the European integration. Now with the progress Croatia made, the renewal of Serbian hopes to get candidate status by the end of the year, and of course, with the confirmation that accession talks with Montenegro may start very soon, Europe has shown its vitality. Optimism about the common future is more than justified.

Bookmark and Share
Advertisements
This entry was posted in Economic Policy, European Union. Bookmark the permalink.

13 Responses to An Unexpected Surge of Optimism?

  1. trecikanal says:

    Mr. Luksic,

    you may be a good economist and even a good and honest leader, but the legacy that the previous government left to your cabinet is simply catastrophic. Until you openly acknowledge that (and take the appropriate measures), instead of leading a cabinet aimed at “continuity” with the past times, some of us will simply not take you seriously.

    So… your blog’s tagline is “Straight talk from the heart of the Balkans”, whereas I thought that you were supportive of gay rights in Montenegro. Not that I expect that the latter is, among Montenegrin politicians, anything more than a declarative statement, but the wording should nevertheless be more carefully chosen. Well, given this topic, there are many delicate questions as well: how can a homophobe be the Minister for Human Rights in your cabinet, why has the Gay Pride parade in Montenegro been cancelled, and why is none of you from the cabinet willing to appear in it? Do not let our euro-atlantic integration be jeopardized by this trivial issue, please!

    • This was me above, I have no idea where that thing came from.

    • Will Spencer says:

      Why should you expect that a cabinet member would appear in the parade? If I decide to have a parade for left-handed people, can I demand to have a cabinet member appear in it?

      Homosexuals and heterosexuals should be treated equally by the government. Homosexuals appear to be demanding special preferences and this will not win supporters for their cause.

      • Mr. Spencer,

        you have obviously never lived in the Balkans. Your logic is correct outside of the context, but the region has just had its first Gay Pride parade without incidents (meaning serious physical injuries) in Zagreb. After 10 years of trying.

        The first Montenegrin parade has been cancelled this year precisely because none of the cabinet members were willing to join. The organizers demanded the presence of some high government figure to ensure that opponents would not be attacking those taking part, as well as to ensure that the police (which often sympathizes with the hooligans) will really protect them.

      • I’m sorry, I forgot one more thing. It is important that cabinet members appear in the parade to demonstrate that they are sincerely supporting the human rights causes. They are willing to promise all kinds of things to EU representatives in order to ensure our “euro-atlantic integration”, but when it comes to taking responsibility for their words, they all seem to be busy, traveling or just playing dumb.

  2. Will Spencer says:

    Vladimir:

    Your presumption is extremely insulting. As a matter of fact, I do live in the Balkans. I live in Montenegro.

    If the organized did in fact cancel the parade “precisely because none of the cabinet members were willing to join” then they don’t _deserve_ to have a parade. That is demanding and childish behavior — behavior of which anyone should be ashamed. It is reasonable to have your parade, but it is not reasonable that you should be able to force anyone to attend. When I throw parties, I send out invitations — not demands for attendance.

    Prime Minister Lukšić has thrown his support behind your parade. I note that he never does this for _my_ parties. The next time I have a barbecue, perhaps I will refuse to hold it until Prime Minister Lukšić declares his support for it and at least one cabinet member finds time for it in his schedule. Also, they should bring beer.

    If you want the respect of your fellow men, hold your parade. Veselin Veljović, the Montenegrin Chief of Police, has guaranteed security for the event and a protocol should be finalized this month for how the police and participants will coordinate. Frankly, the parade cancellation caused me to lose a lot of respect for the organizers. If you’re serious about his parade, be serious about this parade. This lack of commitment makes it look as if the organizers never had any real intention of holding a parade — that their actions were taken for the purposes of attracting negative attention to themselves and to Montenegro as a whole.

    The massive negative publicity which the parade organizers have created have had significant negative impacts on the entire nation in terms of tourism and investment. Live up to your commitments — hold your parade so that the entire nation can move on and recover from the damage which you have caused.

    • Mr. Spencer,

      it’s not “my parade”, and I have no interest in it being organized except for (1) ensuring equal rights for everybody and (2) seeing that Montenegrin politicians stand behind their promises to EU officials. Because my opinion is that most of those are merely declarative.

      I have said what I had to say in my previous comments. I can only conclude that, living in Montenegro, you seem to still look at it as an outsider. Comparing your barbecue party to a parade which goes against deeply rooted beliefs and convictions of the population is not only naive, it is dangerous. I assume that you have not felt political pressure, been discriminated against or threatened in Montenegro, so that you cannot relate.

  3. Will Spencer says:

    Vladimir:

    Once again your assumptions are incorrect and offensive. We have all felt political pressure or been discriminated against or threatened at one time or another. For me, it has happened for many different reasons in many different countries. This pressure is one of the reasons why it is important for the LGBT community to live up to their commitments and hold the parade. The Montenegrin government did not cancel the parade, the organizers did.

    The organizers said “we want to hold a parade” and expected a backlash of intolerance. Instead, they received considerable support. This obviously wasn’t what the organizers wanted, so they created ridiculous demands and then used those as an excuse to cancel the parade. This is not honest. This is not respectable. This is not good for the LGBT community and it is not good for Montenegro. If the LGBT community wants to have a parade, they must organize it and make it a success — it is not the job of government to organize parades for private groups. It’s time for the LGBT community to step up and make some positive contributions to Montenegrin society instead of demanding special treatment from the government.

    • Mr. Spencer,

      I’m afraid we’re talking past each other (I hope this is not offensive). My conclusions are based on what you are writing, and thus cannot be considered presumptions, as they come after the fact. How do you form your opinion about the situation in Montenegro? Do you speak the language? Where do you get the news and which media do you follow? Do you only hang out with the members of “the establishment” or you sometimes talk to those talented and capable people who are unemployed because they do not wish to become members of the ruling party/ies? Do you visit the north part of the country, do you go off the main roads to see the poverty? Do you sometimes walk to Drac, 100m from the center of Podgorica, where even basic sanitary conditions are not met? Are you aware how many laws are broken every day by the high party officials? Do you know who the richest men in the country are and how they earned their capital? Do you know the legacy of the previous cabinet, led by Milo Djukanovic through wars, smuggling, political murders, and political transformations of every sort? I could go on for days.

      I don’t know how to convince you, and whether I should do that in the first place, that the main issue in Montenegro is not in the commitment. Here, LGBT parade is only a side issue, sparked by my notification of Luksic’ tagline. My main point was indicated in the sentence preceding that. But even on this side issue, I wanted to make a point that people of Montenegro are sick and tired of empty promises, or should I say lies. You seem to believe the words of government officials, I certainly do not, and you can find some reasons for such a stance in the questions above.

  4. Will Spencer says:

    Vladimir:

    I will not try to make the argument that Montenegro is perfect. I have lived and worked in over two dozen countries on five continents and have not yet found one to be perfect. Montenegro has a lot of room for improvement. I think it’s important to realize that Igor Lukšić is not going to make Montenegro perfect — he’s an economist, not a god.

    One of Igor Lukšić’s best qualities is his humility. He realizes that he can’t do everything — or even all that much — as Prime Minister. He can set direction and hope that people follow. He can coordinate, he can cajole, he can pressure, he can influence, but he can’t actually do all that much directly. He is just one man. This is why he focuses so much on working with the many NGO’s that operate in Montenegro — he realizes that he needs their help to make this nation a better place.

    Moreover, he needs _all of our help_ to do this. I am doing my part by promoting investment and tourism in Montenegro, Mr. Lukšić is doing his part by improving efficiency and accountability within the government and by making it easier to bring investment dollars into the country. I do not know what your part is, but I hope that you are doing it.

    Mr. Lukšić has made an official announcement in support of the parade. That is as much or more than should be required of a prime minister. He has other, far more important, work to do. Does David Cameron make statements in support of every parade in the United Kingdom? Other government officials have also been working to make the parade a reality — devoting time and effort which could otherwise have been spent on more important tasks. The parade organizers have acted selfishly by demanding that the government organize this parade for them. They aren’t working to make Montenegro a better place, they are distracting people from that effort. In addition, they have been spreading negative propaganda internationally, which makes it more difficult to attract investment and tourism dollars to Montenegro. If you want to help reduce poverty in Montenegro, help organize the parade and get it over with so that we can limit the damage the organizers are doing to the Montenegrin economy.

    There is a saying in America, “It is better to light a single candle than to curse the darkness.” Light your candle Vladimir.

    • Mr. Spencer,

      aware of the fact that there is no perfect society, I nevertheless do not like to compare Montenegro to other countries, as this often leads to relativistic statements. Montenegro is a country of stunning beauty and amazing natural potential, while having only 650+ thousand inhabitants. The equation is simple: with such resources at hand, it is very easy to feed this many people. All sorts of excuses put forward to justify why the standard of living is not so high could even be acceptable if those using them did not become very rich in the process. That is the problem in Montenegro (and in many other places, but as I said, I like to concern myself with my own yard), and the reason why every attempt to forget the past and move forward will fail. It is a small country, where everybody knows each other and where everybody knows what friends and relatives of Djukanovic were doing before and how they’re doing now. With such uneven distribution of wealth, the government has alienated the people to the point that half of the population does not care whether something does negative propaganda to the country or not. It is impossible to expect the sense of common interest in a society where the prime minister sets such a wrong example. Given the region’s patriarchal mentality, people such as the prime minister have a much greater responsibility, and it cannot simply be said that we should all do our part and everything will be fine. What Luksic is trying to do may be fine, but given that, in his own words, he leads the cabinet of continuity with times past, it is simply cosmetics given all of the above. The mentioned ‘humility’ may then be precisely the feature that recommended him to the current position, as well as the one that earned him the nickname ‘proxy’ in some circles.

      Surely, many people in Montenegro use some of the above as excuses for their own laziness, lack of commitment and weakness of character, as well as a reason to lament about their miserable fate. I will be the first to accept, and condemn, that. But again, I believe that government officials should set the right example in that sense, rather than doing the opposite, as only then we can expect a change of mindset. Unfortunately, the effect of wrong examples in the past (50+) 20 years has led to a complete deformation in the system of values. Just look at UDG University and the culture it creates, but do not think that it is representative for all of Montenegro – although it is one of the reasons why many bright young people leave the country and contribute to some other societies.

      One more thing. I know the saying, it is by Confucius. I try to do what I can, setting my own example. I would love to see Montenegro prosper, but would prefer if we use its potential to create a sustainable, “green” economy with small-scale urban and rural projects rather than wannabe elite tourism. I am very interested in innovation (see http://nl.linkedin.com/in/vladimirnedovic), and my plans may some day involve Montenegro, but certainly not if it’s required to be connected to government officials in order to ensure projects.

  5. Will Spencer says:

    Montenegro will have trouble growing economically unless it successfully gets those people “into the game.” The way to do that involves growing the economy to the point where there is room for those who are currently disenfranchised. With Montenegro’s current unemployment rate, there is little motivation for many people to work towards becoming engaged with the system. If they work hard, they are still unemployed or underemployed. So, why should they work hard? When people lack an upward path, they have idle time to focus on other people who are more successful than them. This is largely dysfunctional because it is mostly a waste of time and energy. Class hatred may be an enjoyable passtime to while away the hours while drinking loza, but it is remarkably useless in actually achieving progress.

    On the other hand, imagine if Montenegro’s business environment grew to the point where businesses _needed_ to hire those additional workers? Unemployment would go down, wages would rise, businesses would be forced to train new employees, and the currently disenfranchised would become “part of the system.”

    What will it take to create this economic growth? Well, that leads us directly to “relativistic statements.” Let’s take a look at how we currently compare against all 183 nations on the globe:

    Ease of Doing Business Rank: 66
    Starting a Business: 51
    Dealing with Construction Permits: 161
    Registering Property: 116
    Getting Credit: 32
    Protecting Investors: 28
    Paying Taxes: 139
    Trading Across Borders: 34
    Enforcing Contracts: 135
    Closing a Business: 47

    If Igor Lukšić, as prime minister, can push through meaninful reforms of Montenegro’s terrible construction permit process, it will make doing business in Montenegro far more efficient. This will create jobs and grow the economy. If he can push through reforms that make paying taxes easier, it will convince more people to do business in the formal economy instead of the black market economy. If he can make enforcing contracts more straightforward and honest, it will enable a huge inflow of foreign direct investment (FDI) which will restart many of the half-finished construction projects which blight the roadsides of Montenegro.

    However, we all live in a real world, and this means that pushing forward these changes involves working with a lot of stakeholders. As prime minister, Lukšić can not do much on his own. He has to work within an environment where any change, no matter how positive, will negatively impact someone. Every improvement in government process will be fought tooth and nail by the bureaucrats whose jobs will be changed — and possibly eliminated — by the improvement.

    Is progress being made? I believe it is or I would not be here. Am I frustrated by the pace of change? Certainly I am, and I am sure that Mr. Lukšić is also. You appear to be frustrated also. Welcome to the team. We’re all frustrated and trying to make the present into the future at a faster pace. I think that you and Mr. Lukšić are allied far more closely than you currently believe.

    • Mr. Spencer,

      I don’t need Prime minister Luksic or booming Montenegro economy in order to make it myself. But there is no “game” in which you can “get” me if that implies forgetting that Djukanovic & co. have plundered the country and its resources (after taking the country through wars etc. as already mentioned). This is not class hatred, it is a matter of principle and law obedience, and it is not specific to Montenegro or the Balkans (in “The Big Lebowski”, there is an American character called Walter Sobchak who agrees with me on this point ;). I do not advocate revolution – I demand an independent inquiry about war involvement, extra profit, organized crime, etc. Until Mr. Luksic starts working in this direction, I will consider him as the gatekeeper of Djukanovic & co’s stolen millions.

      You seem to think that all problems will be solved if the economy gets going. I am sure Djukanovic & co. share this hope, but I tend to value life with some additional criteria.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s