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Reduced Waiting Times, Increased GDP

According to the calculations of World Bank analysts, if the average time required to clear a border crossing was shortened by three hours, the GDP of each of the six Western Balkan economies could grow by as much as three per cent over the medium term

It was recorded in early March that haulage vehicles carrying goods from Serbia into the EU had to wait for up to 30 hours at the Batrovci-Bajakovo border crossing between Serbia and Croatia. The record-breaking delays were registered by hauliers shortly after 7 am on 7th March, when an eight-kilometre-long column had formed at the exit from Serbia comprising around 450 waiting trucks – and these weren’t only Serbian trucks, but also vehicles arriving from other Western Balkan countries and from Western Europe, from Croatia and Slovenia, Bulgaria, Greece, Türkiye etc. There were also long waiting times at other entrances to the EU at that time – namely at borders with Hungary. In truth, those delays were slightly shorter and mostly confined to the Horgoš border crossing, where they reached up to 22 hours on 6th March. At the same time, entrances to Serbia were largely unobstructed – with just an hour’s wait at Bajakovo on the Croatian side and about two hours at Röszke on the Hungarian side.

Last year’s World Bank analyses confirmed previous calculations that haulage vehicles unnecessarily lose 26 million hours a year waiting at borders between the Western Balkans and the European Union. A simple mathematical equation reveals direct losses of 130 million euros for haulage companies. With the growth of traffic, an increase in the number of articulated lorries crossing borders and an increase in waiting times, the latest estimates of fixed costs alone rise to almost 170 million euros. The costs incurred by extended waiting times and delayed goods are paid not only by the haulier, but also by all the companies whose goods they transport: local firms, but also companies from the EU that have invested in Serbia and other countries of the region and that export their products from the Western Balkans to the rest of Europe and the world, and among them are Croatian, Slovenian and Hungarian companies, but also other companies that sell their products on the Western Balkan markets or buy from Western Balkan producers… and their customers.

Why are lorries waiting longer at entrances to the EU than at exits; and why do they wait longer at borders with the EU (last year averaging between 5 and 9.5 hours) than at borders within the region, where the average delay was registered as lasting between just a few minutes and an hour and a half?

According to chambers, one of the most effective ways to speed up flows is to introduce joint controls, i.e. to establish integrated borders with the EU at the most popular crossings

Despite the EU having for years called on the leaders and administrations of the Western Balkans to remove their mutual barriers to doing business, including delays at borders, and to build a common regional market as a zone enabling the free flow of people, goods and capital – which forms part of the new Growth Plan for the Western Balkans – it turned out that both problems and costs are much higher at external borders – in trade with the EU – than they are within the region.

At the Chamber of Commerce & Industry of Serbia (CCIS), which has – together with other chambers of the Western Balkans 6, but also with the Chamber of Commerce of Croatia, and with the support of the Transport Union – been addressing Brussels and individual governments for years, appealing for the problem to be solved, they propose an entire set of specific solutions. They insist that most of them are just matters of good will, of good neighbourly agreements and the implementation of those agreements, with or without minimal investments.

“Let’s for starters harmonise the working hours of border services and ensure that all border crossings, or at least the busiest ones, operate 24 hours a day, seven days a week. For example, phytosanitary inspectors at the Batrovci border crossing work 24 hours a day, seven days a week, but the working hours of inspectors on the Croatian side are weekdays from 7am to 7pm, Saturdays from 7am to 3pm (phytosanitary) and from 7am to 7pm (veterinary), while they don’t work at all on Sundays and holidays,” they explain at the CCIS.

The CCIS also highlights many more opportunities to make quick improvements: by increasing staff numbers and better organising the work of existing personnel; by opening more counters during peak hours, purchasing equipment – such as additional scales for weighing loads, implementing minor infrastructure works like the installing of lighting at border crossings or the constructing of 50-70 metres of roadways in the inter-border area in order to better connect the two terminals.

One example of good practice is already operating within the Western Balkans, within the framework of the Open Balkan initiative, at the Preševo-Tabanovce border crossing between Serbia and North Macedonia. Testifying to the claim that this is also possible at borders with the EU is the integrated Leuseni-Albita crossing between EU member state Romania and non-EU country Moldova, which started operating last April.

Mutual electronic exchanges of documentation – customs, phytosanitary and veterinary clearances – that enable advanced announcements of arrivals, with paperwork reaching the border before trucks and controls only carried out on “risky” trucks, represents the essence of the Green Corridors that were established in the Western Balkans during the first months of the pandemic, but also the Green Lanes from the EU, which the region’s chambers of commerce have long been advocating for, and they have been joined lately, and more loudly, by Western Balkan politicians.

If the costs incurred by border delays were fully measurable, they would surely be measured in the billions of euros. Every hour lost at Western Balkan – EU borders costs at least five euros per vehicle

The prerequisite of all prerequisites for accelerating traffic is increasing the infrastructure capacities of border crossings – expansion, reconstruction, modernisation, better equipping of existing crossings and the construction of additional new lanes. The fact is that infrastructure on access roads and border crossings hasn’t kept pace with the increase in volumes of traffic, such that today the same number of lanes serve a significantly larger number of lorries than used to be the case. And yet, there are encouraging interstate agreements (Serbia’s agreements with North Macedonia and Hungary, for example) that have led to official government decisions and works implemented on the ground.

Business leaders also expect the Croatian and Serbian governments to make such agreements on the operational and infrastructure improvements of the Batrovci-Bajakovo crossing, but also the Šid-Tovarnik crossing. According to the Serbian and Croatian chambers, when it comes to easing the burden on the Batrovci-Bajakovo crossing, it is equally important to remove the even greater restrictions that exist on the transport of goods by rail, and to do so as quickly as possible. For starters, this would entail activating the Šid-Tovarnik border crossing, or rather establishing border inspection control on the Tovarnik side.

According to the calculations of World Bank analysts, if the average time required to clear a border crossing was shortened by three hours, the GDP of each of the six Western Balkan economies could grow by as much as three per cent over the medium term, while additional growth would also be recorded by neighbouring EU countries as a result of the increased volume of the goods exchange with the Western Balkans.

This is a small investment with big benefits. And it would make things better… for everyone.

RESTRICTIONS

The migrant crisis raised the border delay problem to fever pitch, but long waits existed before this crisis and will continue after it abates, unless physical, administrative and other restrictions are removed asap.

PREREQUISITE

The prerequisite of all prerequisites for accelerating traffic is increasing the infrastructure capacities of border crossings – expansion, reconstruction, modernisation, and constructing additional new lanes.

PRACTICE

An example of good practice already operates within the Western Balkans, within the framework of the Open Balkan initiative, at the Preševo-Tabanovce border crossing between Serbia and North Macedonia.

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