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Croatia will join the EU with several unsolved problems, one of which threatens to hamper the country's membership, while the other could emerge as a time bomb later. About the dispute between Slovenia and Croatia regarding the payment of compensations from the activities of Ljubljanska bank from the time of former Yugoslavia, euinside extensively wrote and we will continue to follow the issue. The first negotiations took place in the end of August between the selected in the beginning of the summer financial experts of the two countries. This meeting ended with no results and the next is planned for September 18th.

The second issue is more serious because it includes territorial claims but this time on the southern borders of Croatia - those with Bosnia and Herzegovina. This is a problem which is not simply a bilateral issue but it also has European and essential domestic Croatian significance. It is about the plans for connecting Croatia with its southern part (Dubrovnik), now cut off because of a 5-kilometre long territory of Bosnia and Herzegovina, guaranteeing the country access to the Adriatic see. For several years Croatia has been building a motorway to connect the central continental part with the south. The motorway has already reached and surpassed the key port city of Split and construction was going on successfully until it reached a dead end. At the moment, along the Adriatic coast goes a two-lane road (one for each direction), called the Adriatic motorway, the traffic on which during the peak of the touristic season is quite intense.

But this is not the main problem. A bigger problem is that some 50 km from Dubrovnik all travellers on the Adriatic motorway have to enter Bosnia and Herzegovina and 5 kilometres later to re-enter Croatia. For the tourists this is not a big problem, although sometimes one has to wait for some 30-40 minutes. But for the transportation of goods and workers to the southernmost part of Croatia and back to the heart of the country this is a problem. This is why many governments were drawing plans how to connect the two parts to make transportation of goods, services and people uninterrupted.

The Peljesac [Pelyeshats] Bridge

One of the most discussed projects this summer are the plans for construction of a bridge from the place where the border interrupts Croatia's territory (at the Bosnian town of Neum) through the sea to the Peljesac peninsula and from there back onto the Adriatic motorway, thus detouring the 5-kilometre long Bosnian strip. It is envisaged the length of the bridge to be 2.5 km, height 55 meters, with two lanes in every direction. The project, however, has been frozen due to the lack of money. The reason the idea to be dusted out and to become one of the leading topics of Summer 2012 is the plans of the government of Zoran Milanovic to request EU funding for the construction of the bridge. At this stage the European Commission is willing to support the project, although it does not fit into the criterion "important trans-European projects" but it has significance for Croatia's integrity and therefore for its future Schengen membership and the EU as a whole, as sources close to the negotiations told euinside.

In July, Croatia's Foreign Minister Vesna Pusic, who is also responsible for the EU affairs, met in Brussels with Regional Development Commissioner Johannes Hahn. Responding to an inquiry of euinside, the office of Mr Hahn said that during the meeting two options were discussed for connecting with the southern Croatian part - the Peljesac bridge and the Neum corridor (to be mentioned below). The Commission prefers the corridor through Bosnia and Herzegovina, although it admits that the border disputes between the two countries were not discussed at that meeting. The issue, however, will be raised on September 19th when in Brussels there will be a trilateral meeting between Ms Pusic, Bosnia and Herzegovina's Foreign Minister Zlatko Lagumdzija and Stefan Fule, the EU enlargement commissioner.

To be able to make a final decision which project to support, however - whether the bridge or the corridor should be built - the Commission is awaiting the results of the pre-feasibility study. Those results will serve as a starting point for the discussions on a possible co-financing under the EU cohesion policy after Croatia joins the Union next year, the Commission told this website.

Where in the "Peljesac" equation does Bosnia come in? Croatia and Bosnia and Herzegovina have unsolved territorial disputes for which they have temporary agreements. "As long as we do not have defined border demarcation line at Sea, we deem this as an open bilateral issue. Or to put it the other way around, we are not against Peljesac Bridge unless and until it closes our approach towards the Open Sea as it was stipulated by the OUN Convention on the Law of the Sea", Amer Kapetanovic, assistant minister for bilateral relations told euinside.

The Neum corridor

The second option for connecting with the Croatian south, considered to be much cheaper, is the construction of a corridor through Bosnia and Herzegovina. One possible way for this corridor is the construction of a tunnel. The purpose is to ensure a sovereign corridor from Croatian to Croatian territory - something which Bosnia claims it agrees with. Amer Kapetanovic also said that this is a temporary solution which the country offered to Zagreb to replace the Peljesac bridge because it would be cheaper. According to Kapetanovic, Croatia claims that the Commission insists the corridor to be built only on the basis of a bilateral agreement between the two countries and Croatia to be granted (therefore the EU) full transportation sovereignty over almost 5.5 kilometres of Bosnian soil. Kapetanovic told us that this will be another topic to be discussed on September 19th during the trilateral meeting with Commissioner Fule, "for we want to make sure whether EC really has such requirements", the assistant minister added.

"If that is proven to be the fact, than I am afraid it would hamper possibility for the final agreement in this particular matter. Why? Because giving the consent for the full transport sovereignty, no matter to which country, is highly sensitive issue that goes much beyond a power of one institution in BiH", Amer Kapetanovic said.

The corridor is not among the preferable options in Zagreb because it has no chances to receive funding from the EU structural funds which in the current economic situation in Croatia is of huge importance. The reason, as Minister Pusic explained in an interview with the national TV, is that the corridor would not be on EU territory. It will be some kind of an odd hybrid on Bosnian territory but with Croatian/EU transporting sovereignty.

Pandora's box

In the context of the construction of the Peljesac bridge another issue was raised this summer and that is the ratification of an agreement, concluded in 1999 between the then presidents of Croatia and Bosnia and Herzegovina - Franjo Tudjman and Alija Izetbegovic. This is a border agreement with which Croatia transfers to Bosnia and Herzegovina a peak on the Klek peninsula and two tiny islets in the Adriatic sea. The Milanovic government decided this year to pass the agreement for ratification in Parliament, thus causing vehement disputes in Croatia's public domain, which grew into delicate attacks between President Ivo Josipovic and the government, stirring the spirits among experts too. The document is ratified by the lower chamber of Bosnia's parliament, Kapetanovic claims, but the procedure was suspended because Croatia "has not even begun the ratification procedure".

Between the two countries there is another agreement which is related to the free access of BiH to the port of Ploce and to the free movement of people and goods through Neum for Croatian passengers and goods. It is fully ratified by BiH but not by Croatia, the Bosnian assistant minister added. From his answers it becomes clear that Bosnia expects on September 19th all those open issues to be discussed and it is evident that the big infrastructure projects, related to ensuring uninterrupted access to the southern Croatian territories, will be hostages of the solving of these issues. Ms Vesna Pusic thinks, however, that those will not be the main issues of the trilateral meeting. The main topic in her words for the Croatian national TV will be "what will happen on the 1st of July 2013". And what will happen then is that Croatia will become an external border of the EU and this will force it to prepare its borders in line with the Union requirements and Schengen.

As a temporary measure, new border crossings will be built along the border which will hamper transport but, Pusic assured, this will be a temporary solution. Another topic of the meeting, she added, will be a durable resolution of the problem between the two countries up to the time Bosnia and Herzegovina enters the EU. At this stage the country has not yet filed an application but it is expected to do that this year. Given the condition of the federation, it is unrealistic to expect that it could prepare for a full fledged membership in less than 10 years. This is why it is essential what the three sides will agree on - the EU, Croatia and Bosnia and Herzegovina - to ensure unhindered transportation of goods and people across the EU territory. Given the problems Croatia has had with Slovenia on its path toward EU membership, Zagreb assures that it does not want to be a Slovenia for Bosnia. On September 19 there will be more clarity on whether this is possible.

For now the two countries demonstrate a desire to avoid clashes and attempt solving the open issues as painless as possible. In Croatia it is intensively discussed that the country should not give up sovereignty (over the islets and the Klek peak) but PM Milanovic thinks that it will be better not to open Pandora's box with new negotiations on the borders. Bosnia shares the same opinion. In Mr Kapetanovic's words, "it would be much wiser to stick to what has been defined and signed by Tudjman Izetbegovic agreement, otherwise we are opening Pandora Box".