The World Bank has just released its part-annual report into the Western Balkans (Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia) which analysis the economic performance and outlook for the region.
This report from the World Bank is insightful in that it clearly lays out that the economic journey every European nation has been on in the past year has been mirrored in the region itself. Where that may differ is the strength of the rebound. Projections of over 4% growth this year in the Western Balkans are ahead of some of the countries which form part of the EU.
It is worth looking at what it has highlighted as the major factors for the region’s future economic growth as we come out of the pandemic.
- The region was hit like the rest of the world with a deep recession. The World Bank estimates that in 2020 economic activity in the region contracted some 3.4%. But this bad news needs to be seen in the context of the rapid rebound in Q3 as the economy came out of lockdown and a global revival in demand. While the recovery may have been further subdued due to the impact of the third wave of Covid throughout mainland Europe as a whole, the region is now on a sustained path for growth
- Employment is strongly rebounding. The past decade has seen, according to the World Bank, real progress in terms of income throughout the Western Balkans and this was threatened by Covid. But active Government interventions helped prevent serious erosion. By the end of 2020 the labour market had already recovered half its pandemic losses and this trend is expected to continue strongly as we come out of the tail end of the ‘third wave’.
- A strong economic recovery is expected by the World Bank in the second half of the year as the vaccination programme continues apace and confidence, consumption and trade all improve dramatically.
- The World Bank is projecting that the regional economy will grow by a staggering 4.4% in 2021 and a further 3.7% in both 2022 and 2023.
Now is the time therefore, to take a closer look at our neighbours in the Balkans and watch that rebound in action.
To read more on what the World Bank is thinking on the region click on the below report.