Balkan economies remain resilient despite slow growth

Significance

The WB6 have weathered the double shock of COVID and the Ukraine war yet weakening external demand, high inflation and tighter financing conditions are dampening growth.

Impacts

• Fiscal balances in WB6 will come under pressure through 2023.
• Political instability in Bosnia-Hercegovina will delay essential governance reforms.
• Support by the EU and the IMF will provide a solid anchor for WB6 economies.
• Energy-sector reform is key for longer-term growth and development across the region.