Regional competitiveness and growth strategy in Western Balkan countries : the case of FYR Macedonia, Serbia and Albania

Abstract

For the Western Balkan countries, the transition from socialism to capitalism and democracy was less smooth than in other parts of Emerging Europe. Once the war ended and peace returned, these countries did more than rebuild: they began a transformation into market economies, liberalizing prices, privatizing many state- and socially-owned enterprises, and building the institutions needed to support a market economy. Nevertheless, progress over the last two decades has been evident in every country, resulting in rising incomes and living standards. Perhaps the most tangible achievement of all lies in the fact that most of the Western Balkan countries are on a path towards European Union accession, something that seemed far off in the 1990s. It is incumbent upon us not to understate the serious challenges that lie ahead, both in terms of macroeconomic stability and even more so with regard to longer-term development. Yet, I remain confident that the region will rise to the challenge, as happened time and again in the past. Western Balkan countries understand that, without macroeconomic stability, there can be no hope of durable growth.