Development of Municipality Bonds Market in the Western Balkan Countries and Republic of Serbia

Despite data showing that the impact of the crisis, which started in 2008, was completed funding to state and local governments is very difficult. Local governments need to develop and invest in large infrastructure projects for which they are not sufficient budgetary resources. Therefore, they had to find new ways to raise funds, and issuing municipal bonds proved to be one of the acceptable. In this paper we present the municipal bonds as one of the solution for funding of cities and municipalities in the Western Balkan region, with all its strengths, weaknesses, opportunities and threats. We also present the result of analysis of municipal bond markets in Croatia, Republika Srpska (Bosnia and Herzegovina), Montenegro and Macedonia, with special emphasis on Serbia. We consider that this way of financing can help municipalities to overcome the consequences of the last crisis and to provide a basis for future development