As the last High Representative, Dr Schwarz-Schilling has to oversee the transition from today's quasi-protectorate to local ownership. To this end, he will close the Office of the High Representative and give up the wide-ranging powers associated with this post. He will then remain in Bosnia and Herzegovina as Special Representative of the European Union. For the decade prior to his appointment as High Representative, Dr Schwarz-Schilling, a former industrialist and politician, worked throughout Bosnia and Herzegovina as an international mediator. In 1992, he resigned from the German government, where he had been Minister for Post and Telecommunications since 1982, in protest at Germany's and Europe's collective failure to halt the war in Bosnia and Herzegovina. Between 1994 and 2002, when he left the Bundestag, Dr Schwarz-Schilling served as either chairman or deputy chairman of its Human Rights and Humanitarian Aid Committee. As an international mediator, he pioneered so-called integrative mediation, innovative techniques for problem-solving in post-conflict situations. These techniques are being used today in Kosovo and the former Yugoslav Republic of Macedonia* under the auspices of the CSSProject, a programme that Dr Schwarz-Schilling created and which bears his initials.

Bosnia and Herzegovina must become a normal state with functioning institutions providing rule of law and efficient government for every citizen of the country. The path to achieving this is long and complex and there will be many obstacles to overcome in the coming years. However, the preparations required for eventual membership of the European Union already provide a way forward. The challenge, therefore, is to keep to this path. Bosnia and Herzegovina is now travelling in convoy with its neighbours towards Europe. It is behind much of the rest of the region, but, with help, may be able to advance more quickly than other countries. In future, competition among countries of the region will hopefully be about the pace of adjustment to European structures and thereby positive and mutually reinforcing.

The economy must be a high priority. Agriculture is the base of the economy and it will be important to develop export opportunities both within the region and beyond into the European Union. It will also be important to foster a better climate for foreign direct investment into Bosnia and Herzegovina. A second priority is the negotiations on a Stabilisation and Association Agreement with the European Union. I am hoping that these negotiations can be finalised by the end of this year and that they will not be delayed or derailed by issues such as a lack of cooperation with the International Criminal Tribunal for the former Yugoslavia. A third priority is maintaining the reform momentum of recent years with, for example, further constitutional, police and defence reforms. And a fourth priority is education. Only by investing in education will young Bosnians acquire the skills for the modern world and choose to stay in Bosnia and Herzegovina and build a better life at home rather than to emigrate.

I will retain the powers right up until the moment when the Office of High Representative becomes that of the EU Special Representative. No date has yet been fixed for the transition. However, I intend only to use these powers in two instances: in the event that either there is a threat to peace and security or there is an attempt to undermine the work of the International Criminal Tribunal for the former Yugoslavia. If Bosnian authorities attempt to sabotage the peace process in either way, I will not hesitate to use the full powers of the High Representative.

International support has been both necessary and helpful to Bosnia and Herzegovina's post-war recovery. However, Bosnians have contributed most to the reconstruction of their country. Without the effort of ordinary people and good will it would not have been possible to have achieved anywhere near as much. As a result, I believe it is realistic to expect Bosnians to stand on their own two feet and feel that the international community should have greater trust in their abilities. Even if Bosnians don't always take the right decisions, they are capable of learning from their mistakes and turning that experience into something positive.

My optimism is based on my experience working as a mediator in Bosnia and Herzegovina. The only way to reach agreement is to have a lot of patience - more than the international community usually has - and belief and trust in Bosnians. Given that it is only just over ten years since the end of hostilities, it is remarkable how much good will there is. A decade is not a long time in terms of European history. Indeed, it took a lot longer to rebuild trust among the countries of Western Europe in the wake of the Second World War.

Bosnia and Herzegovina desperately needs better market regulation, dramatic reductions in bureaucracy, greater incentives for investment, better facilities for small and medium-sized companies and an awareness that the state has to serve those institutions and individuals that are creating jobs and wealth. These issues have to be tackled and there is a long way to go. However, as reforms are implemented, the economy grows and Bosnians see the benefits of that growth, it should be possible to create a virtuous circle of development. This, in turn, will reinforce feelings of well-being and security among the wider population and thereby boost the peace process. For this to happen, however, it is important that all Bosnians, not only citizens of one or other entity, buy in to the reform process.

The arrest of these individuals and all indictees is of the highest importance because unless and until the most notorious war crimes suspects are in custody, all talk of rule of law is meaningless. Only when these individuals are in The Hague and the cycle of impunity is truly broken will it be possible to demonstrate to ordinary Bosnians that they live in a country in which everyone is equal in front of the law. The arrest and prosecution of Radovan Karadzic and Ratko Mladic is perhaps especially important in the wake of the death of Slobodan Milosevic. His demise before a verdict was reached has undermined the potential impact of his trial on the healing process in both Bosnia and Herzegovina and throughout the Balkans.

I wish to see negotiations on both PfP membership and an EU Stabilisation and Association Agreement taking place in parallel. Unfortunately, the fact that Ratko Mladic and Radovan Karadzic are still at large, if not in Bosnia and Herzegovina, is an obstacle and has delayed the start of these negotiations. It is important that politicians on all sides, including those in Republika Srpska, demonstrate their willingness to do what it takes to put their country on the road to European and Euro-Atlantic integration. I would very much hope that Bosnia and Herzegovina is invited to join the Partnership-for-Peace programme at the Alliance's Riga Summit at the end of the year.

The negotiations that are now taking place with the European Commission on a Stabilisation and Association Agreement (SAA) are an important first step. Agreeing an SAA will be an important milestone, but should only be viewed as the beginning of a long and potentially arduous process. Bosnia and Herzegovina cannot expect to sit back and wait for Europe to do the hard work. Rather, the country will have to adapt its structures and procedures to bring them into line with European standards and norms. The coming years will be crucial. If Bosnia and Herzegovina drags its feet and fails to take necessary reforms, it risks missing a window of opportunity.

The European Union could, however, be more accommodating in several areas. For example, the visa regime between Bosnia and Herzegovina and the European Union should be relaxed. As things stand, even Bosnians with relatives in EU countries find it difficult to obtain visas for travel. Integration must go in both directions and increased contact is of benefit to all sides. I would like to see the lifting of many restrictions on travel to enable Bosnians with family in the European Union, professionals, students and university teachers to make their way easily to and from the European Union. This issue has to be addressed promptly because of the status of Bosnia and Herzegovina's Croat population. Since Bosnian Croats are also entitled to Croatian passports, they will soon be able to travel freely to and from the European Union, which will be in marked contrast to Bosnia and Herzegovina's Muslim and Serb populations.

[b class=Q]How do you envisage your future role as EU Special Representative?

The intrusive role played by the High Representative will come to an end. Instead, Bosnian politicians will have to take ownership of the peace process and with it responsibility for their actions, including both successes and failures. As EU Special Representative, I intend to be a facilitator assisting the process by which Bosnia and Herzegovina is integrated into Europe both internally and externally.

Internally, I hope to do this by providing advice and support, in terms of professional skills and expertise, to Bosnians to assist them in their negotiations. In addition, I will seek to convince them of the necessity of taking what will often be unpopular measures. For this, the primary tool at my disposal will be my power of persuasion. In addition, however, I will look to Bosnian civil society for support. Indeed, I'm hoping that Bosnian civil society will become a powerful lobby for European integration.

Externally, I see my role as one of promoting Bosnia and Herzegovina abroad, in the European Union and beyond, and ensuring that the country receives the help it requires in the coming years. Ongoing international support is critical not just for Bosnia and Herzegovina but for the whole Balkan region and Europe, since it is in all our interests that the country becomes a beacon of stability in Europe rather than a black hole on Europe's edge.

As EU Special Representative, I also intend to develop mechanisms to maintain links with the United States and other non-EU member states, such as Canada, Japan, Norway, Russia and Turkey, that have played an important role and therefore have a stake in the Bosnian peace process. This is important because these countries have had considerable say in the peace process to date via their representation in the Peace Implementation Council overseeing implementation of the Dayton Peace Agreement and in the Office of the High Representative. When the European Union takes charge of the peace process, these countries will no longer have as much influence. I want to make sure that they remain engaged both because of the credibility they have among Bosnians and because of the contribution they can make to Bosnia and Herzegovina's future.