Western Balkan Countries Research Articles

Energy Community in the Concept of Achieving Geo-economic and Energy Security of the Countries of the Western Balkans

Energy security is essential to the overall stability of any country and economic development. The Energy Community means a strategic project of cooperation between the European Union and the countries of Southeast Europe, and at the same time the Western Balkans, in the field of energy, promoted at the beginning of this century. It defines the components of a process aimed at stability in the supply and functioning of the energy market. The Energy Union is a compatible plan with the European Commission in providing optimal conditions for its members. The paper also discusses the implications of these concepts on the geo-economic position and perspectives of the Western Balkan countries.

Istraživanje ekonomske pozicioniranosti zemalja zapadnog balkana koriščenjem LOPCOW i EDAS metoda

The issue of analyzing the factors of the dynamics of the economic performance of each economy, which means also the countries of Western Balkan (Albania, Bosnia and Herzegovina, Montenegro, Kosovo, North Macedonia, and Serbia), is continuously very current, challenging, significant and complex. Adequate control of the analyzed economic indicators can have a significant impact on the achievement of the target economic performance of each economy, including the countries of the Western Balkans. The application of multi-criteria decision-making methods enables adequate control of the key factors of the economic performances of the economies of the Western Balkan countries. In this paper, starting from that, the economic performances of the economies of the Western Balkan countries are comparatively analyzed based on the LOPCOW-EDAS method. According to the results of the given research, Serbia is the leading country in the Western Balkans in terms of economic performance. Followed by: Montenegro, Kosovo, North Macedonia, Albania, and Bosnia and Herzegovina. Recently, the economic performance of the Serbian economy has significantly improved. Adequate control of relevant influential factors can greatly influence the achievement of the target economic performance of the Serbian economy. The digitization of the company's entire operations certainly plays a significant role in this.

Analiza uticaja pandemije Kovid-19 na robnu razmenu Republike Srbije sa zemljama Zapadnog Balkana

Doing business in the Western Balkan (WB) is characterized by close connections between member countries as well as a large volume of trade. Similarities in language, culture and friendly relations facilitate the exchange of goods. Due to the importance of WB as a grouping for the Republic of Serbia (hereinafter: RS), the work will be devoted to the analysis of the business operations of companies on WB, specifically business operations before, during and after the pandemic. The subject of this work is to determine and examine how the outbreak of the COVID-19 pandemic affected the business operations of companies in the WB. The goal of the work is to present the latest data on the trade of RS with the WB as a grouping, but also for individual WB countries, which will help companies and state authorities in creating a policy for the development of relations and incentives.

UNEMPLOYMENT RATE AND GDP GROWTH RATE IN SELECTED EUROPEAN COUNTRIES

GDP growth rate and unemployment rate are two crucial macroeconomic variables - their correlation is an important indicator for policymakers and it has been frequently analyzed. This research aims to analyze the GDP growth rate and unemployment rate in EU founders, Visegrad group, and Western Balkan countries and to determine if the negative correlation between these variables exists, to point to differences between developed and developing countries, and to indicate real convergence of developing countries towards developed ones. Data is analyzed on a quarterly level from Q1 2010 to Q4 2021 and the methodology of this paper consists of empirical data analysis, descriptive statistics, and panel analysis for each country group. Obtained results point to a negative correlation in all 3 country groups, but it is statistically significant only in EU founders countries, and the convergence of the Visegrad group and Western Balkan countries towards developed ones can be acknowledged.

EMIGRATION FROM SERBIA AND DEPOPULATION

In Serbia, one of the Western Balkan countries, emigration from the country continues at a high level while immigration to the country has been small. Concomitantly, a decline in population and depopulation in the rural areas continues. This paper aims to grasp how the mechanism of persisting rapid emigration was formed historically. The paper is constructed as follows: Section 2 will give an overview of the Serbian economy after the Second World War, Section 3 will give an overview of the Serbian economy after the system change in 1990, and Section 4 will discuss actual situations of emigration and related problems. Section 5 examines problems of ‘brain drain’ focusing on the area of medical care, and Section 6 examines challenges the country has to tackle. Finally, the paper concludes by stressing the importance of human capital and the necessity for promotion of return migration of highly-skilled Serbian workers living in advanced EU member states.

AFRICAN SWINE FEVER: A BIOSECURITY CHALLENGE FOR DOMESTIC PIG PRODUCTION IN SERBIA

African swine fever (ASF) is currently the most important challenge for domestic pig production worldwide. The virus reached Eurasia in 2007, and is today affecting more than half of European Union member countries. Among Western Balkan countries, Serbia suffered the first case of ASF in a backyard holding in 2019. Since then, numerous outbreaks in domestic pigs and wild boar have been reported throughout the country despite the efforts of the veterinary authorities to control the disease. The lack of an effective vaccine is one of the main constraints, and the only currently available option to prevent further ASF infections is the application of strict biosecurity measures. Regarding biosecurity, backyard pig producers and smallholding farmers in Serbia have substantial gaps in the knowledge and fail to comply with safe production behaviour that favours the spread of ASF virus. In the currently prevailing smallholder and backyards farming systems, farm biosecurity is largely non-existent. The aim of this review was to identify specific ASF-risks factors in the current pig production system and gaps in biosecurity measures related to the human activities recognised as social and cultural identity in Serbia. Moreover, the main risk factors for ASF spreading and transmission at the domestic/wild boar interface, biosecurity practices in different production systems, and possible future control measures and awareness campaigns are discussed.

The Regional Cooperation of the Western Balkans and the Challenges on the Path of Integration in the European Union

This paper aims to highlight the importance of regional cooperation in the Western Balkan countries and the difficulties on the path to European Union integration. The objectives of the study are to emphasize the advantages of regional collaboration; the aspiration of the Western Balkan nations to join the EU as a catalyst for cooperation by opening up fresh avenues for political, social, and economic advancement; initiatives, processes, and agreements are undertaken under the auspices of the Organization for Economic Co-operation and Development (OECD) and the European Commission for co-operation between them and preparation for EU integration; as well as obstacles and challenges to effective regional cooperation in the Western Balkans. The research method is based on Desk research and includes the study of literature, analysis, and monitoring conducted by independent institutions and bodies on regional cooperation and integration and integration into the European Union. Membership in the European Union as a common goal of the Western Balkan countries has promoted the whole Region for economic, social progress, and regional stability. Greater economic cooperation between the countries of the Western Balkans could be one of the main sources of economic growth in the coming years. The methods of regional cooperation have been the subject of frequent criticism by the governments of individual countries, which considered them arbitrary and unrelated to their reality. The situation created after the Russian attack on Ukraine has made all countries, regions, and international structures re-evaluate the aspects of economic development, political, social, local, regional, and global security.
 
 Received: 26 September 2022 / Accepted: 29 November 2022 / Published: 20 December 2022

Key Features and Challenges of the China-Western Balkan Countries Merchandise Trade Development

The economic growth and development of the Western Balkan largely depend on the integration of national economies into international trade flows. Bearing in mind the expanding presence of China in the Western Balkan countries and the considerable increase in bilateral trade over the previous decade, it is of great importance to focus on the strategies for overcoming main challenges and fostering more balanced trade in the forthcoming period. Regarding that, the main aim of the research was to analyze trade flows and patterns and investigate the trade intensity between the Western Balkan countries and China. Furthermore, the research attempted to determine the main challenges and to consider the strategic approach to their overwhelming, including better exploiting the opportunities provided by trade cooperation with China in the rapidly changing global environment.
 The paper used desk research - a descriptive analysis of data on merchandise trade between six Western Balkans countries (Albania, Bosnia and Herzegovina, Montenegro, Croatia, North Macedonia, and Serbia) and China. The analysis was based on the data available in the UN Comtrade and Trade Map statistical databases for the period 2016-2021. In addition, the Trade intensity index (TTI) was also used in the paper in order to discover how intensively the Western Balkan countries were trading with China.
 However, despite the rapid trade growth with China, its share in the WB countries' total trade remains at a relatively low level of about 7%. The trade deficit also increased significantly, indicating a deepening of the asymmetry in the economic relations of the observed countries. Although the trade intensity index (TII) confirms the deepening of trade relations, the TII value of 0.24 in 2021 indicates that trade between the Western Balkans and China is still under-represented and there is considerable room for improvement.

THE IMPACT OF THE WAR IN UKRAINE ON THE WESTERN BALKANS

The war in Ukraine represents a turning point in international relations that significantly affects the common foreign and security policy of the European Union. By taking place on European soil and mainly between Russia and Ukraine, it really indirectly affects several countries united in two important entities, the European Union and NATO. In this paper, we will deal with the analysis of the impact of the war in Ukraine on the countries of the Western Balkans, which are in a significant geopolitical position and have developed relations with Russia in the fields of foreign policy, security, and energy. The work aims to contribute to the understanding of the implications that are happening and that may arise in the domain of internal and foreign policy of the Western Balkan countries, and especially regional relations, as a consequence of the war in Ukraine. In the first part of the paper, attention is paid to a theoretical explanation of war and realism in international relations which could be implied to this war. Furthermore, a brief overview of the political events that led to the Russian invasion of Ukraine will be presented in order to understand the next chapter, which is dedicated to considering the response of each Western Balkan state to the beginning of the war and the events that came as a result of it.

The impact of covid-19 pandemic on tourism development in Western Balkan countries

The impact of covid-19 pandemic on tourism development in Western Balkan countries

Land Productivity and Agri-Environmental Indicators: A Case Study of Western Balkans

Due to the environmental radicalization of European politics, which is reflected in the European Green Deal, Farm to Fork strategy, and new CAP 2023–2027, this paper aims to determine the impact of agri-environmental indicators on soil productivity based on the land productivity function model. The paper focuses on the Western Balkans countries, which are in the process of European integration and which, in the coming period, need to harmonize their agricultural policy with the CAP. First, the aggregate Cobb–Douglas production function has been used to create a land productivity function. Then, the sources of land productivity growth have been calculated, which can be particularly interesting in the context of agri-environmental indicators, such as fertilizer use and livestock density. The research results showed that land productivity is the most elastic concerning changes in the number of livestock units per hectare. Consequently, reducing livestock units had a markedly negative effect on productivity. In addition, the research results showed that using mineral fertilizers is a crucial source of growth in land productivity in these countries. These results imply that the creators of the agricultural policy must carefully assess the pace at which they will harmonize ecological and economic goals, especially if they take into account the current Ukraine crisis that can disrupt the food market.

Possibilities for Public Sector Management Improvement by the Digitalization of Financial Management and Control System in the Western Balkan Countries

Abstract This paper investigated the opportunities for public sector improvement by digitalization Financial Management and Control (FMC) system in the Western Balkans (WB) countries. Optimizing business processes within public sector through the digitalization of the FMC system offers opportunities for public sector improvement. The idea is to analyze the existing legal solutions on FMC system in the WB countries and evaluate the current level of digitalization of the system to find the abilities for improvement FMC. The data obtained through an interview with management persons in the Ministry of Finance of the WB Countries and key experts who worked on behalf of the EU as expert consultants on EU-funded projects. Also, we use secondary data collected by exploring literature and OECD reports. Since the database is limited, we use descriptive statistics to analyze the data and the case-study method. The digitalization of the entire system presented only at the entity and state level in Bosnia and Herzegovina. The research showed that the development of a quality FMC system can be enabled by the digitalization of the entire system. The main contribution of this paper is its focus on digitalization of FMC system, since there is limited research paper on this subject.

The state of the electrical sector in Western Balkan countries. Case study: Republic of Kosovo

The electricity sector around the world is considered one of the most important sectors, which has a direct impact on the economic development of a country. Based on the increase in energy consumption, the crisis with the emission of high levels of harmful gases - the greenhouse effect and the expansion at the economic level of countries, electricity, namely the increase of energy capacity will remain key issues for future discussion at the global level. Electricity is the engine of the rapid economic development of a country; necessarily the well-being of citizens to access to energy sources and energy stability is a key requirement of every consumer, producer or economic operator. How much capacity do countries in the world have to respond to the increase in energy consumption in the future and what sources will be oriented so that the consequences are minimal for the environment, is a question that needs continuous detailed study and concrete approaches from relevant institutions and professionals in this field. Security in electricity supply is essential for our society and necessary for the 24/7 principle for the digital economy. The recent difficulties caused by the Covid-19 pandemic remind us of the great importance of electricity in all aspects of our lives, from the availability of medical equipment and IT systems - for work from home as a growing trend of systemizing jobs during 2020. Ensuring a secure and reliable electricity supply is of paramount importance to all countries in the world. Considering the Western Balkans as one of the regions which since the 90s most of it has been an area which has emerged from devastating wars and which have affected every sphere, including the energy sector. So, the development of the energy sector is one of the most critical issues in the Western Balkans region. Based on the considerable potential of electricity production from renewable sources, it is considered that the production of electricity from RES will create a stable and functional system of energy production by contributing to the principle of diversification of electricity production and decentralization of the power system. So, renewable energy is considered a promising method for building sustainable and resilient energy systems that provide affordable energy to boost a region economic development, reducing import dependence. The purpose of this scientific research is to discuss the development and current state of electricity production from renewable sources in the Western Balkans, with special emphasis on the Republic of Kosovo. Considering that all Western Balkan countries have set targets or targets for RES in their energy policies but not always these pre-defined targets are easily achievable in practice due to thevarious challenges facing the energy sector in this region.

The Effects of Globalization on the International Competitiveness of the Western Balkan Countries

Abstract The Western Balkan countries, which are in the late transition process, fail to take advantage of the opportunities brought by globalization and the removal of restrictions to the free flow of capital, technology, knowledge, people and information. Despite the entry of a significant stock of foreign capital into these countries, they failed to significantly improve the technological level of production and the competitiveness of their economies. The subject of the paper research is the examination of the impact of globalization on the reached level of competitiveness of the economies of the Western Balkan, as well as the countries of Central and Eastern Europe, in the period before the emergence of the COVID crisis. The question raised in the paper is to what extent the process of globalization and the entry of transnational corporations into the Western Balkan countries affected their economies’competitiveness. These two issues permeate each other to a large extent, considering that the governments of the transition countries believe that the foreign capital inflow, in the form of highly sophisticated technology, will simultaneously enable the completion of the transition process and a more decisive integration of the five countries of the Western Balkan in global investment and trade flows. The research confirmed that the degree of involvement in international economic flows has a statistically significant and positive impact on the growth of competitiveness, and that these effects are more pronounced in the Western Balkans than in the Central and Eastern European regions.

A multi-criteria approach to the comparative analysis of the global innovation index on the example of the Western Balkan countries

Abstract Innovation is crucial for the competitiveness of countries in the global market. Countries oriented to progress must invest in innovative activities. Using the example of the Western Balkan countries, this study investigated their innovative competitiveness. The indicators of the Global Innovation Index (GII) were used for the years 2019, 2020, and 2021. A multi-criteria approach was based on the innovative SMART approach. The weights of the criteria were determined using the CRITIC (criteria importance through intercriteria correlation) method, while the CRADIS (compromise ranking of alternatives from distance to ideal solution) method ranked the Western Balkan countries according to their innovative characteristics. The results showed that Montenegro had the best innovation indicators, followed by Serbia, while Albania had the worst indicators. This research showed an innovative approach of using four normalizations, and the advantages of these normalizations were used to contribute to stabilization in multi-criteria decision-making.

Women’s Economic Empowerment through Tourism: A Case Study of Selected Western Balkans Countries

Tourism is considered to be an essential means of empowering women in the national, regional and global economy, presenting both opportunities for gender equality and women’s empowerment. However, the general lack of women’s empowerment worldwide calls for research. This paper investigates opportunities for women to improve their socioeconomic status through tourism in Bosnia and Herzegovina, Montenegro, and Serbia. Its methodology is based on qualitative research. A survey was conducted on a sample of 388 female respondents engaged within the tourism sector from these countries. The results are presented through descriptive methods, comparing the attitudes of women 18 to 65 years of age, their respective levels of education and barriers within entrepreneurship activities in tourism. The data obtained were analyzed in accordance with the objectives of this study and the research questions posed. It is found that training and further education as well as providing financial assistance would significantly assist women in opening their own tourism business within the region. The study also finds that women generally report financial support as a crucial factor in helping support business in the tourism sector.

Economic Development, Unemployment and Inflation in the Western Balkans

Economic security is one of the main challenges facing the Western Balkans. Poverty, unemployment and inequality threaten the everyday security of average citizens in the region. The Western Balkan economies have emerged from a serious economic recession and are in search of a new growth path on their way to eventual EU membership. However, they are beset by numerous economic and social problems that hinder their progress. The economic transition in the Western Balkans implicated a large structural change which has come through the processes of privatization and enterprise restructuring which caused the disappearance of many professions and jobs and have made the stock of skills inherited from the former system obsolete. All countries in the Western Balkans are striving to join the European Union. This transformation process presents enormous challenges and requires many changes and improvements in various fields especially when regards the economic development and employment. The Western Balkan (WB6) region, consisting in small emerging market economies, is aspiring to embark on an export-led growth and convergence path. After a late start in transition due to civil wars, the region experienced notable income growth nearly doubling its real GDP level in the last two decades. However, income convergence with advanced Europe has been less impressive when compared to new member states, partly reflecting lower exports. Western Balkan countries have the same problematics which regard widespread corruption, the presence of organized crime, the lack of freedom of legal functioning, and the deep politicization of public administration. The countries differ according to the importance and the sensibility of their problems, politics will treat them according to their platforms, legal frameworks in place and capacity for enforcement. These issues have a great impact for economic performance, generating employment, state revenue collection, and the development of small and medium enterprises. These problems are rooted in the general state of democracy and the political culture in the region, as well as diplomatic issues surrounding statehood. The main aim of this paper is to reflect and analyze the economic development through GDP in the Western Balkan in relation to unemployment and inflation. The analysis is based on the literature review, on the reports given form different structures and also based on quantitative data form the Worl Bank for Western Balkans’ countries on GDP, unemployment and inflation and testing their correlations through the e Ordinary Least Squares (OLS) Model. At the end of this paper based on the theoretical and practical review are give the conclusions and the recommendation of the study.
 
 Received: 10 September 2022 / Accepted: 21 October 2022 / Published: 30 November 2022

The Open Balkans and the Impact on EU Membership

The Open Balkans and the Impact on EU Membership

Building Economic Resilience in Western Balkans during COVID-19

COVID-19 has had a significant impact on global trade costs (WTO, 2021). Predicting, and managing risks is a necessary and difficult task for policymakers thus to minimize the negative effects coming from these unexpected incoming shocks. Natural disasters, health crisis and political conflicts over the recent decade, are pushing more pressure to developing countries to re-evaluate their trade partners in the international cooperation, as a way to prevent the direct impact of a probable shock on trade. The early stages of the pandemic exposed also how reliant Western Balkans had become on relatively few global producers of critical medical supplies, prompting widespread calls for greater supply chain diversification. This study attempts to answer the question: Did the effects of the COVID-19 pandemic on regional trade policies revealed an increase or decrease of economic resilience? Travel restrictions and border closures, which were an important part of the initial policy response to the pandemic, disrupted freight transport, business travel and the supply of services that rely on the presence of individuals abroad. Trade facilitation measures taken at the border made it possible for supply chains to continue delivering and have been critical during the COVID-19 crisis. GDP recovery in the last year has been faster in economies with strong pre-pandemic trade ties to countries with fewer COVID-19 cases. In the post COVID-19 area, the Western Balkan countries are recommended to make sustainability and resilience a baseline requirement for every trade and investment decision.
 
 Received: 10 September 2022 / Accepted: 21 October 2022 / Published: 30 November 2022

The Relationship between Government Health Expenditure and Economic Growth: Evidence from Western Balkan Countries

This paper aims to investigate the effect of government expenditure on health and other relevant factors like health insurance, longevity, average age and death rate on economic growth in Western Balkan countries. Countries with higher levels of government expenditure on health tend to have higher levels of economic growth. Investment in healthcare may result in a greater supply of health incentives which may help human capital and enhance productivity and the economy’s performance. This paper uses annual data from 2000-2020 for the following Western Balkan countries: Albania, Bosnia, Herzegovina, Kosovo, Montenegro, Northern Macedonia and Serbia. This region represents a diverse set of countries at different stages of development with varying government expenditures on health. This provides an opportunity to study the impact of health on economic growth in an environment with a lot of "real-world" variation. The data is collected from the World Bank, National Statistical Offices and Eurostat. The dependent variable is economic growth, measured as Gross Domestic Product (GDP) per capita growth. The independent variables are government expenditure on health as a percentage of GDP, health insurance, longevity, the average age of the population, health expenditure per capita and the death rate. In order to measure the impact of individual factors, the study uses econometric models with fixed effects and random effects. The regression analysis results show that government expenditure on health has a positive and significant impact on economic growth in Western Balkans countries.