The small country of Finland, which became a European Union member in 1995, is now in the EU's presidential seat, with a monumental task ahead. Finnish Ambassador Jaakko Laajava said in an interview yesterday that the most urgent issue will be management of the relief and assistance and reconstruction efforts in Kosovo.

The EU is one of the main actors in this endeavor, with the European Commission--the EU executive body--mandated to play a major role, along with the World Bank. While the humanitarian aspect will be tackled by agencies such as the U.N. High Commissioner for Refugees, Finland has to coordinate the rest.

"That is by far the biggest challenge," Laajava said of what is becoming a central theme in EU-U.S. relations. Meetings in Brussels between World Bank teams and EU task forces will be followed by broader conferences, and the World Bank has appointed a Balkans coordinator, who will be in charge of its southeast European strategy. The whole framework appears to be in a state of flux until finance ministers from the Group of Seven leading industrialized democracies, along with World Bank representatives under President James D. Wolfensohn, attend a meeting Tuesday of the Southeast Europe Reconstruction Task Force to be hosted by the European Commission in Brussels. The high-level steering group will also include officials from Finland, the International Monetary Fund and the Stability Pact, a group formed at the instigation of Germany to ensure stability in the Balkans. Wolfensohn and European Economics Commissioner Yves-Thibault de Silguy will be co-chairmen.

The steering group will discuss issues of financial flows and donor assistance as a whole and will deal with three sets of issues. In the short term, the bulk of the $2.2 billion dollars already pledged to countries neighboring Yugoslavia--such as Macedonia, Albania, Bulgaria, Romania, Croatia and Bosnia--will be disbursed not for humanitarian assistance as such but for additional police, teachers and health workers and to make up for economic disruption wrought by the Kosovo war and influx of refugees. The second set of issues will center on what can be done for Kosovo itself, and the third entails working out long-term development and reconstruction projects in the region. "On Kosovo, we are just getting ourselves organized, which will result in donor conferences in Europe. It is a big challenge," said a senior World Bank official who will be involved in the deliberations.

To be hammered out as well are some new institutional positions within the EU, such as that of Javier Solana, the outgoing secretary general of NATO, who will become the EU's senior representative for common foreign and security policy issues, Laajava said. "It is not decided yet when he will start," he added, saying the new office, which has been in the making for several years, will be in place within a few months. "This is one effort on the part of the EU to provide more consistency and coordination in foreign policy matters. At least now there is one famous telephone number to call, which former secretary of state Henry Kissinger used to wonder about," the Finnish diplomat said.

In addition, the complex operation of EU expansion and the review process of applicant countries' enforcement of the kind of legislation that membership requires will continue, Laajava added. Preparation for an enlarged union will necessitate a revision of the EU's decision-making process as well. Laajava said the Finnish presidency has worked out a transatlantic agenda and priorities list. "This covers our common interest in promoting peace, stability and cooperation cleverly and supporting our common values, such as human rights. Furthermore, it involves strengthening the multilateral World Trade Organization-based trading system," he said.

The next WTO ministerial meetings kick off in Seattle in the fall. "There the EU and the United States are competitors," Laajava said. "At the same time, we know full well that if they can work together, then great results can be achieved in the liberalization of world trade. If we don't, chances are quite slim and meaningless."

When the Europeans and Americans joined forces on Bosnia and Kosovo, the ambassador recalled, they got excellent results. "I think this should be a powerful reminder of our responsibility to try to find ways of cooperating wherever possible. Of course we have to defend our respective interests, but that does not mean we will not be able to cooperate in good partnership," he concluded.

Too Warm for War

Who showed up in coat and tie at Canadian Ambassador Raymond Chretien's prized rooftop July 4 barbecue? Israeli Ambassador Zalman Shoval and Egypt's Ahmed Sayed had to be coaxed into shedding their blazers and ties. Andrew Steinfeld, the outgoing public affairs adviser at the State Department's Near East Affairs bureau had to tease. "Does this mean we have a warm peace?" he asked the Egyptian. "No, you just have peace," Sayed quipped.

Steinfeld leaves for Vienna today to become political counselor at the U.S. mission to the Organization for Security and Cooperation in Europe.