The World Bank Group has published the ‘Western Balkans Regular Economic Report: Fall 2019’, a semi-annual report on recent economic developments and economic policies in the Western Balkan countries.
The report, titled ‘Rising Uncertainties’, notes that by June 2019, 150,000 additional jobs had been created in the Western Balkans compared to a year before.
“Some 43,000 young people have found jobs, especially in Albania. Youth unemployment in the region has fallen supported by the growing business-process outsourcing sector. Economic activity in 2018 has attracted more women into the labor force”, the report reads.
Despite these positive developments, however, less than half of the working-age population in the Western Balkans - 44 percent, to be exact - has a job. “In Bosnia and Herzegovina and in Kosovo, only 34 percent and 30 percent of the working-age population has a job, respectively”, the World Bank reported. “Sustaining high and equitable economic growth is essential to creating more, and much-needed, job opportunities in the region”.
According to the World Bank, economic growth in the Western Balkans is projected to reach 3.2 percent in 2019, down from 3.9 percent in 2018. “With the exception of Kosovo and North Macedonia, growth is expected to be lower than in 2018 in all other countries”, the report reads.
Furthermore, the World Bank explained that economic growth slowed as the contribution of investment and exports to growth was fading. “Instead, consumption continues to be the main driver of economic activity in Western Balkan countries, fueled by higher public spending and near double-digit growth in household lending. This raises questions about sustainability of the consumption-driven growth in the region”, the report notes.
The World Bank underlined that all countries were projected to grow faster, except Montenegro, where the phasing-out of an investment cycle is projected to moderate growth. “However, this positive outlook is vulnerable to mounting risks. The region faces rising uncertainty as economic growth slows globally, including in the EU - the Western Balkans’ major trading partner and source of financial flows”, the report concluded.