The International Economic Position of Western Balkan Countries in Light of their European Integration Ambitions

Abstract

From the EU perspective, the Western Balkans region is considered to be an important sphere of interest with the prospect of stepwise EU accession. This is evidenced by establishing a specific accession process for these countries, including an option of granting the status of potential candidate. The progress, particularly concerning the economic preparedness and competitiveness of the Western Balkan countries, is uneven. This paper compares the readiness of particular Western Balkan countries for EU membership on the basis of accession progress assessment, as well as on the basis of international economic position assessment. Taking into account official progress reports published by the European Commission providing a comprehensive assessment of the EU membership criteria, we broaden the perspective of the economic progress assessment by employing the assessment of the international economic positions of the Western Balkan countries based on multifactor indicators. For this purpose, we developed our own composite index of international involvement. We then compared the assessment based on our own index with assessments based on both the Global Competitiveness Index and the Index of Economic Freedom. Based on our findings, the best international economic positions among the Western Balkan countries belong to the Former Yugoslav Republic of Macedonia (FYROM) and Montenegro. Therefore, it may be concluded that accession progress is accompanied by an adequate fit of these economies represented by their international economic position. Contrary to that, Serbia belongs among the worst assessed Western Balkan countries despite its advanced accession progress.

The Effect of Business Enabling Policies, Tax Treatment, Corruption and Political Connections on Business Climate

“…Given these figures, entrepreneurship support should be of a particular interest to Albanian policymakers. In addition, improving the business climate may also lead to attracting foreign direct investments and to developing a better functioning market economy, particularly in the Western Balkans [24], [25].…”

Analysis of the Western Balkans Territories Using the Index of Economic Freedom

“…Trade Freedom, Investment Freedom, Financial Freedom Each of the twelve economic freedoms is rated on a scale from 0 to 100. The total score of a country is calculated as the average of the individual economic freedoms [Kittová & Steinhauser, 2018]. The Index of Economic Freedom is published at the beginning of a calendar year, the score for 2020 reflects the situation in 2019.…”

The role of access to information in trading relationship and plans for future activities

“…These agreements can be verbal or written. In Albania, written contracts in farming are uncommon because the agricultural market is mainly oriented by spot market transactions completed through verbal agreements (Imami, Zhllima, Viaggi, & Bokelmann, 2013;Kittova & Steinhauser, 2018). Agriculture is the main source of Albania's national income and the main sector of employment, being the greatest contributor to GDP, at around 19% (INSTAT, 2020).…”