TONY BLAIR is to launch a European Union-wide crackdown tomorrow on Balkan crime rings that have established a stranglehold over lucrative rackets in the smuggling of drugs, weapons, cigarettes and prostitutes, writes Tom Walker.

Blair will join Jack Straw, the foreign secretary, and David Blunkett, the home secretary, in warning the governments of countries harbouring the networks that they have little chance of integration into the EU unless they put their houses in order.

“What we failed to realise in many of the states we have tried to rebuild is that the rule of law is needed before you go about setting up democratic elections,” said one delegate to a conference that will bring together justice and interior ministers from the EU and their Balkan counterparts at Lancaster House in London. “The gangs have a free market in crime.”

The gathering will hear that nations such as Bosnia are losing tax revenues worth more than their entire annual budgets because of the crime rackets. Customs and tax scams are estimated to cost Bosnia at least £400m a year.

Few judicial systems in the region are capable of prosecuting the mafia godfathers behind the networks, which simply pay off pliant judges.

The EU states nearest the region, including Italy, will urge a cross-border approach to beating the networks, which thrive because of their ability to move between different jurisdictions. “Women are recruited in Moldova by Romanians for prostitution, taken to Belgrade where they are bought by Albanians, and then moved through Croatia and Slovenia to be exploited by Italians and Romanians,” said Paolo Borgna, an anti-mafia expert.

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