Economic Integration in the Western Balkans Peter Sanfey, Deputy Director, Country Economics and Policy, EBRD 15 May, 2018

Economic integration lags behind in the Western Balkans EBRD transition quality scores for integration in the Western Balkans are well below those in the EU. Source: EBRD. 10 November, 2018

The new Regional Economic Area may help the region become more integrated Four areas of focus: Trade Investment Mobility Digital 10 November, 2018

Trade: focus on removing non-tariff barriers Time and cost to trade are still excessive Source: World Bank Doing Business 2018 Report. 10 November, 2018

Investment: boost FDI through a better business environment FDI stock per capita (EUR) Source: Authors’ calculations based on UNCTAD database. 10 November, 2018

Mobility: focus on skills improvements Share of young people with access to training and finance to start and grow business Source: Authors’ calculations based on Gallup World Poll (2013-2016). 10 November, 2018

Digital: accelerate high-speed broadband roll-out Broadband access (subscriptions per 100 people) Source: The Global Competitiveness Index 2017-2018. 10 November, 2018

But long-term prosperity requires reforms across other areas too Governance: problems with public and private governance are pervasive throughout the region Financial sector: need for deeper financial integration and more diversified sources of funding Infrastructure: huge need for improved transport and energy links, but sources of finance are limited Green: tackle high carbon intensity and strengthen resilience to the problems of global warming and climate change [For further discussion, see Peter Sanfey and Jakov Milatovic, “The Western Balkans in transition: diagnosing the constraints on the path to a sustainable market economy”, available at: http://www.ebrd.com/news/2018/towards-higher-productivity-in-the-western- balkans.html.] 10 November, 2018