The Stabilization and Association Agreements in the Western Balkans as a tool for trade promotion and regional reconciliation

Abstract

The purpose of this paper is to analyze the impact of the Stabilization and Association Agreement (SAA) on the economic development of the Western Balkans. The basic aim of this agreement was the economic development of the countries of this region. Many firms would benefit from trade and contractual relationships with the European Union (EU). The methodology used is the gravity model, which predicts bilateral trade flows based on the economic sizes and distance between the EU and the Western Balkans. The model has been used in international relations to evaluate the impact of treaties on trade, and it has been used to test the effectiveness of trade agreements on the economy. Statistics of export, import, economic growth, etc. have been provided for a ten-year period 2007–2017. This paper is based on the research of Qorraj (2016), Qorraj and Jusufi (2018), and Leka et al. (2022). The relevance of the paper depends on that, within the ten years, there was no significant increase in the exports of these countries to the EU market. This paper concludes that the SAA has not ensured the export growth of these countries because products originating from this region are not competitive in the EU market, EU exports to this region have increased more than the other way around.