After the Sarajevo Stability Pact Summit in summer 1999, the whole of Southeastern Europe was gripped with enormous expectations. Indeed, commemorative postage stamps were even issued for the occasion. There was great hope that the international community would be able to generate immediate and massive transfers of assistance that would transform the region overnight. However, when the bulldozers and other heavy construction equipment did not appear, there was a significant letdown and a broad sentiment emerged in the region that the Stability Pact had failed to deliver on its promises.

Part of the problem was a lack of understanding of what the Stability Pact was and what it could realistically achieve. For the Stability Pact was an attempt to replace the reactive, crisis-intervention policy that had characterised international responses to conflict in Southeastern Europe with a comprehensive, long-term conflict-prevention strategy. As such, it is not a funding body or implementing agency. Rather it is a body made up of some 40 countries and international organisations that seeks to develop and promote coordinated strategies to address problems that affect the whole of Southeastern Europe, help achieve synergies among the many actors involved and bring out the best of the implementing agencies working on the ground. In this way, three working tables were set up to cover democratisation and human rights, economic reconstruction and security issues.

In spite of much criticism, an analysis of developments in Southeastern Europe during the past three years indicates that a positive picture is emerging. First of all, donor support has increased and, despite demands for assistance elsewhere in the world, is being maintained. This was demonstrated clearly at the Second Regional Conference in Bucharest, Romania, in October last year when about three billion Euros in support of further Stability Pact activities was unveiled, bringing total donor assistance to some six billion Euros.

The original aim of moving the countries of the region closer to European and Euro-Atlantic institutions and structures is being realised. All countries in the region have been given the perspective of someday becoming EU members through the process of Stabilisation and Association Agreements. Most countries are now members of NATO's Partnership for Peace programme and the Council of Europe. All are now active members of the Organisation for Security and Cooperation in Europe (OSCE). And there is the very real possibility that Bulgaria and Romania may become full NATO members, sooner rather than later. Reforms are being carried out throughout the region to fight organised crime and corruption, to create a more attractive environment for trade and investment and to encourage small and medium-sized business.

The goal of establishing a "virtual free trade area" in Southeastern Europe, under the Memorandum of Understanding on Trade and Liberalisation the Stability Pact brokered in June 2001, is moving ahead as countries accelerate their efforts to honour their commitments to conclude a network of bilateral free-trade agreements by the end of this year. While there is still too little foreign direct investment in the region, such investment is increasing and the elimination of intra-regional trade barriers should make the region considerably more attractive to foreign capital.

Perhaps most importantly, contacts between the countries of the region have been intensified and regularised. A network of initiatives has been established throughout Southeastern Europe to deal with what are now recognised as common problems. Serbia and Montenegro are now full partners in this process and even hold the presidency of one of the more promising regional initiatives, the South East European Cooperation Process. Launched in 1996 at Bulgaria's suggestion, this process seeks to lay the foundations for cooperation among the countries of Southeastern Europe and create a climate of trust, good neighbourliness and stability. Belgrade has made it clear that it will inject much energy into this process during its one-year presidency and the Stability Pact will do what it can to help support this effort.

These regular contacts have begun to change attitudes. There is a growing appreciation that regional cooperation is not a substitute for EU membership, but rather a corollary, if not a prerequisite. European Commissioner Günther Verheugen has underscored this point noting that: "If countries want to join the European Union, they have to demonstrate that they can develop regional cooperation and solve their problems in cooperation with their neighbours." And the same goes for NATO membership. Regular contacts are reducing suspicion, promoting patterns of dialogue and cooperation and gradually improving the security situation. As a result, the possibility of any renewal of inter-state armed conflict in the region now appears extremely remote.

Of course, much work remains to be done. One challenge is maintaining the necessary levels of donor support as the problems of Southeastern Europe fade from the headlines and donor attention shifts elsewhere. Another is ensuring that the countries of the region remain committed to implementing the reforms to which they have signed up. As we move to the second phase of the Stability Pact's existence under Special Coordinator Erhard Busek - who succeeded Bodo Hombach in January of this year - contributing to regional cooperation on issues of common concern will remain our top overall goal. But to be successful, the Stability Pact must be seen as an initiative that is owned by the region.

Current priorities are trade, investment, infrastructure, energy, refugee returns, fighting organised crime, reducing levels of small arms and light weapons and the establishment of a sub-regional cooperation process designed to engage Kosovo with its immediate neighbours on a number of practical issues. However, our overall activity will be broader. Under the justice and home affairs element of the Stability Pact's Working Table on Security Issues, we are taking forward initiatives in the fight against human trafficking and corruption, we are supporting enhanced regional police training, and are addressing the very serious issues of asylum and migration. In the field of defence and security, we are promoting initiatives on military downsizing and base conversion, cross-border cooperation in handling emergencies and disasters, de-mining, and strengthening the democratic control of the armed forces.

Since the creation of the Stability Pact, we have always stressed that we do not wish to re-invent the wheel or try to do what others might do better. This principle is particularly critical in the area of defence and security where there are already a large number of committed actors. To be effective here we must look to our potential for being a catalyst, bringing countries and institutions together which might not otherwise be in contact, building coalitions of donors around good ideas and encouraging the beneficiaries to take a greater leadership role in these initiatives.

We have looked carefully for actions and initiatives that contribute to our overall goal of conflict prevention by raising levels of confidence and trust and creating new habits of dialogue and new patterns of cooperation. A good example is our effort to reintegrate into civilian labour markets military officers affected by the downsizing of their countries' armed forces. The Stability Pact played a central role in launching this initiative by facilitating contact between NATO and the World Bank, organisations that had not previously dealt with one another. The initial programme for officers that the World Bank financed in Romania has now been expended to Bulgaria and Croatia, and similar schemes are now under consideration in Albania and Bosnia and Herzegovina.

The formula of using NATO expertise to increase the credibility of national programmes with the World Bank and other donor institutions and countries has been expanded to the related area of military base closure and conversion to civilian use. The Stability Pact framework has provided the backdrop to work between NATO and several international financial institutions and other donors to work on a series of pilot projects in Bulgaria and Romania. In this way, the real property of former military bases is being put to use for a variety of social and business purposes that stimulates the economy and creates jobs.

The Stability Pact has also been active in promoting work in the area of de-mining and supports the efforts of the Reay Group, a mine-action coordinating body named after the late Canadian General Gordon Reay, to achieve a stockpile-free Southeastern Europe. In November 2001, the Stability Pact's Security Working Table endorsed a comprehensive regional implementation plan to combat the proliferation of small arms and light weapons. The Belgrade-based South Eastern Europe Clearing House for the Control of Small Arms and Light Weapons is now one of the region's leading actors in this area.

At the June 2001 Regional Table, the policy-setting instrument of the Stability Pact, the Security Working Table was tasked to direct its attention increasingly to the area of security sector reform while avoiding duplication of existing efforts undertaken by the European Union, NATO, the OSCE and the United Nations. To follow up this request, we have developed a Southeastern Europe security sector reform database to provide a departure point for a regional gaps and needs analysis. This web-based database should be operational before the end of the year.

While the gaps that the Stability Pact can fill will be clearer after this work has been finished, the report of the ad hoc working group established to consider our work in the area of security sector reform has suggested particular themes that should be of primary concern to the Stability Pact. The first is the professionalisation and development of civil service and civil society expertise to help ensure democratic oversight and control of defence and security institutions. The second area is the continuation and expansion of on-going, country-specific programmes, particularly the retraining and alternative employment of demobilised military personnel and work on base conversion, where NATO's Economics Directorate has taken the lead.

A central element and key partner in our work as we proceed will be the Regional Arms Control and Verification Implementation Centre that was established under Stability Pact auspices in Zagreb, Croatia, in 2001. The Centre already provides an effective forum within the region for professional dialogue, enhanced cooperation and confidence building in Southeastern Europe. The fact that military personnel from all the countries of the region, including Serbia and Montenegro, now regularly participate in programmes there is a clear demonstration of how far the region has come. In addition to the Centre's primary mission of assisting the countries of the region to fulfil their international arms-control commitments, we hope that it will play an increasing role in promoting the full integration of the military into democratic societies and reinforcing the democratic oversight and control of military establishments.

Another innovative Stability Pact programme is the Disaster Preparedness and Prevention Initiative. This was launched for the obvious reason that natural disasters do not recognise borders, while recognising that a regional capacity to respond to disasters did not exist. Regular contacts between national emergency centres in the region have been established and procedures for the coordination of relief requests and responses developed. Two major field exercises scheduled this year will test these links and procedures. The first, called Taming the Dragon 2002, took place in Croatia in May and was the largest European fire-fighting exercise ever mounted. The second is Seesim 2002, a Greek earthquake-simulation exercise scheduled for December.

In the field of justice and home affairs, we are concentrating on enhancing the region's capacity to fight organised crime and criminality. The Stability Pact's Organised Crime Initiative has been moved to Bucharest, Romania, and will be effectively co-located in the parliament building with the already operative Regional Centre for Combating Transborder Crime. This physical proximity will create greater opportunities for efficiency while highlighting our determination to base more of our activities in the region.

The Vienna-based Stability Pact Task Force on Trafficking in Human Beings will be taking forward its three-year action plan. Its strategy is to counter the activities of traffickers and assist victims through programmes for awareness raising, training and exchange programmes, cooperation in law enforcement, victim-protection programmes, return and reintegration assistance, legislative reform and prevention.

The Asylum and Migration Initiative is developing national and regional programmes and is supporting strengthened regional cooperation to encourage orderly migration policies in line with European standards. This is an example of how the Stability Pact seeks to complement the European Union's Stabilisation and Association Process.

The Anti-Corruption Initiative will continue to foster political dialogue between countries and international experts, national programmes and joint-monitoring procedures. It seeks to ensure that the countries of the region adopt and implement European and other international instruments, strengthen relevant legislation, promote integrity in business and encourage active civil society involvement.

Finally, the Stability Pact's efforts to further regional police cooperation through a programme developed by the Association of European Police Colleges should be noted. This initiative seeks to improve police skills, enhance democratic policing and develop regional networks and cross-border cooperation. In 2002, courses cover combating small arms and light weapons trafficking, combating drug trafficking, combating financial crimes and money-laundering, police management, police ethics and policing a multicultural society.

This full agenda has a strong emphasis on the practical, setting activities in motion that generate patterns of dialogue and cooperation and that empower those who are seeking to create lasting democratic institutions in the region. At the same time, our overall efforts in the security field are based on a number of basic principles.

We must accept the principle that democracy is the cornerstone of good governance. If security sector reform is to succeed, we must have effective democratic institutions and capable civilian leadership. Transparency in planning, management and budgeting must be promoted. Lack of transparency will almost certainly undermine a country's economic and political stability more than transparency will threaten its security. We must assist the creation of environments where civil society is able to monitor the security sectors. We need to strengthen the capabilities of non-governmental organisations to carry out this activity. And, of course, we need to continue to give priority to initiatives that promote regional and sub-regional activities.

The Stability Pact is not a panacea for Southeastern Europe. But the region is moving in the right direction and the Stability Pact is increasingly influential in this process. Attributing credit for progress is clearly impossible. However, security sector reform probably benefits more from a coordinated approach than any other area and this is the added value that the Stability Pact seeks to bring. The way forward is, nevertheless, difficult and many years of hard work from all the many actors involved, both regional and international, lie ahead.

For more information on the Stability Pact, see www.stabilitypact.org .