Macroeconomic Outlook for the Western Balkans in the Context of the Global Economic Crisis With a Focus on the Republic of Macedonia

The global economic crisis in the past five years has underlined the need for all countries to fundamentally review and strengthen their economic governance. Perhaps no other region in Europe is experiencing greater economic shocks than the Western Balkans, which continues to battle a decline in economic output and an increase in unemployment. In this article, we assess the macroeconomic outlook for the Western Balkan region, including Croatia, Serbia, Albania, Kosovo, Bosnia-Herzegovina, Macedonia, and Montenegro in the years 2012-2013. We use macroeconomic variables that compose economic macro-stabilization hexagon – the real growth rate of gross domestic product, the rate of inflation, the rate of unemployment, the public conventional deficit over GDP, the public debt over GDP, the current account deficit over GDP. Secondary analysis of previous quantitative data and published studies, combined with our own qualitative study in the field, has provided a reliable and convincing basis for analysis. Reducing the negative influence of the crisis on the economies and improving the economic situation of the populations in the respective countries is vital to popular support for, and the advance of, their European perspective. At the same time, despite the severe economic impact of the crisis on these countries, on their economies and the living standards of their populations, this study clearly shows and confirms the pro-European orientation of the Western Balkan countries.The paper considers different studies in view of economic development of the Western Balkan countries during the global economic crisis using statistical macroeconomic analysis. It is also based on the data for economic development of these countries provided by statistics from the IMF’s World Economic Outlook in April 2013 and in particular on recent reports of the European Commission for EU Candidate and Pre-Accession Countries presented in October 2012 and April 2013