Bosnia, Serbia risk losing millions in EU funds over slow reforms

Bosnia and Herzegovina, Kosovo, and Serbia are facing the potential loss of millions in European Union funds because they have not met reform deadlines required for EU accession. The EU's Reform and Growth Facility, established in 2024 to support Western Balkan countries in their accession process, has disbursed only about €673 million of its €6 billion budget.

According to EU officials, the majority of the funds disbursed so far have gone to countries that have made the most significant progress in their reform processes. Montenegro, Albania, and North Macedonia are currently leading the way, having implemented domestic reform programs effectively. In contrast, Bosnia and Herzegovina, Kosovo, and Serbia are generally considered to be lagging behind.

The mechanism requires countries to implement agreed-upon reform steps within set deadlines. Failure to meet these deadlines can lead to the suspension of payments. While countries have a year to fulfill their obligations, this period was extended to two years for the first year of the program. The deadline for the initial phase was June 30, 2026.

An EU Commission spokesperson stated that if reform steps are not implemented even after the transitional period, the corresponding funds can be reallocated to other beneficiaries. Bosnia and Herzegovina, which has not received any payments yet due to its complex institutional structure hindering reforms, is expected to be the biggest loser. Kosovo and Serbia, despite receiving some funds, will also be in a less favorable position as unused funds are redirected to countries like Montenegro and Albania, which are seen as frontrunners in the enlargement process.

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As stipulated by the regulation, if reform steps are not implemented even after the expiry of the transitional period, the corresponding funds can be reallocated to other beneficiaries.