89 1/2006 South-East Europe Review S. 89 – 96 Bruno S. Sergi and Qerim R. Qerimi Upgrading the Balkans regional infrastructure Introduction The integration of the western Balkans into the European family is certainly a multi- factor enterprise. It does not only demand complying with certain political criteria, but also putting in place a functional regional network of infrastructure and efficient managerial skills, thus ensuring that best international practices and technologies are thoroughly applied in the process of designing and implementing infrastructure projects. The most crucial infrastructure aspects in the Balkans which are in need for strategic intervention are: technical infrastructure; and the institutional component. The principal systems of the technical infrastructure are transport, telecommuni- cations, energy and water. These elements are all critical, but it is the transport infra- structure and telecommunications networks that seems to play the fundamental role in the process of the development and integration of Balkan countries, firstly within themselves and subsequently in connecting the Balkans with the rest of the European continent as well as the entire world. Given its strategic geographic location, the Bal- kans stands at the crossroads of major international trade routes. Making use of such advantage would undoubtedly benefit the Balkan economies and bring them closer to the larger European family. A major step in that direction is that the pan-European transport corridors, an extension of the trans-European networks (TENs), also encom- pass the Balkans region. The Trans-European Line TEL and pipeline transportation are other factors that integrate the Balkans and European regions. Technical infrastructure does, however, have an organic relationship with institu- tional infrastructure in that it is the latter that provides the human, financial and other resources, including the methods and procedures under which they are to be used. Thus, building the institutional infrastructure is, to a great extent, a prerequisite for the successful implementation of projects related to the technical infrastructure. Among the institutional components that require meaningful improvements are the administrative, legal and political structures. Improving regional institutional capabil- ity is decisive in addressing technical infrastructure projects. It is especially important that financial and human resources are used properly, effectively and in line with mar- ket economy standards. It is the responsibility of institutional settings that such qual- ity in services is ensured. Current trends in EU–Balkan relations Despite concerns over the latest EU developments with regard to its draft constitution and the difficult negotiations on its 2007-13 budget, which was rejected by the Euro- pean Parliament on 18 January 2006, the western Balkans were promised a place in the European family by the European Council in Thessaloniki in June 2003. The EU’s heads of state and government committed that all the western Balkans countries have the prospect of eventual EU membership and that they will become an integral part of the EU once they meet the established criteria. This consideration of EU waves of enlargement has meaning not only because of the EU factor that may persuade investors from all around the world to exploit the