Vlahovic: Initiatives like "Open Balkan" are important; countries in the region are important trading partners for each other

Regional initiatives like "Open Balkan" or the Berlin Process are very important because they contribute to increasing cooperation among the Western Balkan countries, which are significant trading partners for each other, Aleksandar Vlahovic, the President of the Serbian Association of Economists, who is participating in the 20th Vienna Economic Forum said.

"Initiatives like 'Open Balkan' or the Berlin Process are important because they increase the level of regional cooperation among Western Balkan countries. Unfortunately, both of them have a political dimension, so only three countries have joined 'Open Balkan', not all six", Vlahovic noted.

He pointed out the need to eliminate all barriers to the free movement of goods, capital, and people within the Western Balkans because it would contribute to boosting the overall economic activity of all countries and lead to faster EU accession. 

He also emphasized that the Western Balkan countries were, in fact, the second-largest trading partner of Serbia, and the same could be said from the perspective of each of those countries.

Vlahovic notes that in Serbia's total foreign trade, the exchange with the EU accounts for about two-thirds, and when you add the Western Balkan countries to that, it even reaches around 85 percent.

"We have repeatedly stated that for Serbia, exports to Bosnia and Herzegovina are larger than exports to Russia or China, and this market is essential for Serbia", Vlahovic added.

According to him, all Western Balkan countries do not have a robust growth rate that would ensure rapid convergence with the EU.

"The question arises as to why this is the case and why we cannot have a growth rate of five percent or more over an extended period, which would significantly increase the standard of living in the region. This is because we have weak institutions that we need to strengthen, and they represent the most significant obstacle to the investment of domestic private investors", Vlahovic observed.

He emphasizes that robust economic growth requires investments of over 24 percent of the GDP.

"Such growth cannot rely solely on capital investments and foreign direct investments but also on increasing overall domestic investments, for which it is necessary to improve the functioning of institutions", Vlahovic concluded.