Your guide to understanding South East Europe

Serbia’s Choices after Russia’s attack on Ukraine

Serbia more than any other nation in Southeast Europe has pursued a policy of neutrality. In other words, seeking to develop relations with the West (EU/US), Russia, China and others over more than two decades. Russia’s invasion of Ukraine on February 24 underlines the limits of that approach. When this is all over, Serbia will […]

Bosnia Herzegovina, Bosniaks and the European Union

Relations between, and indeed within, Bosnia Herzegovina’s three constituent nations (Bosniaks, Croats and Serbs) have been strained in the entire post-1992-1995 war period. The political climate in the country less than eight months from the general election on October 2 is arguably as challenging as it has ever been. While the inability to agree electoral […]

What does 2022 hold in store for Southeast Europe?

Compared to the global financial crisis in 2007/2008 the economies of Southeast Europe are recovering more quickly. In truth, this is a completely different crisis, brought on by the pandemic and with all economies of the region now more resilient after varying degrees of adjustment post-2008. In that context, it makes sense to ask what […]

Is Montenegro offering a way forward for the Western Balkans?

In late September Montenegro’s government announced an ambitious reform programme Evropa sad! (Europe Now!). Montenegro has taken radical economic policy steps in the past, unilaterally introducing the euro in 1998, eight years before independence as well as introducing a flat income tax in 2007 at 15% which was progressively reduced to 9% by 2010. But […]

Is the Croatian political scene going the way of Slovenia?

Opinion polls in Slovenia suggest the centre-right (or right wing) government depending on your political persuasion is unpopular ahead of parliamentary elections, due by June 5, 2022. The Slovenian parliament (Državni zbor) has 90 seats and the Slovenian Democratic Party (SDS)-led government has only 38 seats, relying on confidence and supply support and picking off […]

Joining the euro makes sense for Croatia

For Croatia joining the euro area makes sense

As the procedure for minting Croatia’s euro coins has been revealed, the first formal groups against adoption of the euro have also surfaced. To nobody’s surprise. Neither are the calls for a referendum on the issue. Although there is the small matter of Croatia holding a referendum on joining the EU almost a decade ago. […]

Tourism in Southern Europe: A glass half full

The rebound in tourism this year has done much to stabilise Southern European economies. Too often the sector is seen as too large in these economies, limiting their potential. Perhaps we should ask more often how other sectors of the economy can develop at the same time?

The more things change, the more they stay the same

The more things change: voters send a message in Croatia’s local elections

Despite leftward shifts in Croatia’s two largest cities, the recent local elections again see left of centre parties looking to form a counterweight to the dominant position of the centre-right HDZ.

Times of crisis underline value of EU membership

The strength of institutional structure inherent in EU membership is more evident in times of crisis

The EU vaccination drive has been slow

Has the slow COVID-19 vaccine roll out damaged EU cohesion?

The EU has been slow to roll out COVID-19 vaccines. This has created political reactions, but the EU’s vaccine procurement policy underlines its cohesion.

Brexit unleashes a chain of events

A perspective on Brexit from South East Europe

Brexit is another example of a political event which has taken on a life of its own which may see the UK dissolve. That said, unlike Yugoslavia or part of the Soviet Union, a violent dissolution is unimaginable.

Lower income tax rates in Croatia make sense

Even as fiscal deficits balloon, lowering tax rates makes sense

Lowering income tax rates makes sense even as budget deficit and public debt levels rise. Namely, compared to peers and neighbours, Croatia remains a high tax jurisdiction and lower rates may well stimulate revenue growth and improve the business environment

US policy in South East Europe under president Biden

The Biden White House and South East Europe

With president-elect Biden winning the November 3 election, hopes have risen of a return to a more coordinated US/EU approach to South East Europe

The reverse Venn diagram – a tale about political will in Croatia

The lack of political will is a factor in uneven reform implementation. But inability to focus on common issues as a society also narrows the scope for political will to be deployed.

Land titles reform

Land titles reform – Sisyphean task for how much longer?

Land titles reform remains a challenge in Croatia. Is it time to take a different approach and consider a land tax?

Local government reform. Does size matter?

Local government reform focussed on cost alone misses the point. How to improve effectiveness and assist marginal and border areas to develop are also important aspects to consider.

Policy focus bring two pieces of good news for Croatia

Policy focus behind Croatia’s day of good news

The ECB’s positive AQR for Croatian banks and Fitch reaffirming Croatia’s investment grade rating with stable outlook underlines the importance of defining long term policy goals and implementing them.

Hope for a quick recovery, but don’t expect it

A V-shaped economic recovery is unlikely. Even if the coronavirus were to disappear, high indebtedness, unemployment, Sino-American tensions and falling global trade suggest a gradual and uneven recovery is more likely.

Differing policy response options underline diverse nature of South East Europe

Coronavirus exposes the extent of diversity in South East Europe

The coronavirus pandemic means the whole of South East Europe will experience a deep recession. Difference starting points, constraints and policy choices underline the diversity of the region.

Coronavirus and the Chernobyl disaster: how governance has improved

The difference in response to the coronavirus outbreak and the Chernobyl disaster in 1986 shows how much governance has improved in Croatia

UK leaves the EU as other countries see hope in new EU enlargement approach

EU enlargement and Brexit. Two sides of the same coin?

While the UK has left the EU, exposing itself to new risks, countries in South East Europe hope to join.

South East Europe’s economies: greater uncertainty in 2020

Another year of growth while debt is rising means the global economy is exposed to increasing risk in 2020. South East Europe is better placed for a downturn than in 2008, but that readiness is not uniformly distributed

Joining the euro: the fear of inflation is overdone

Fear of inflation when joining the euro is an everpresent, yet overdone sentiment. Many other factors are in play in determining inflation outcomes but the advent of a new currency tends to mask them.

Does it make sense to offer foreign investors subsidies?

News that VW has delayed a decision on an investment in Turkey has seen promises of subsidies from nations in South East Europe hopeful of becoming alternative investment locations.

What do Frankenstein and referendums have in common?

Referendums are a standard part of developed democracies. Yet, as Brexit shows they can destabilise even the most developed democracies. Referendums cannot become as a vehicle to bypass government and parliament.

Regional differences to become evident as uncertainty in the global economy rises

How will the growing uncertainty surrounding global economic prospects impact on South East Europe? IMELUM’s current Macroeconomic Quarterly provides an in depth look at the risks and opportunities facing the region.

Migration and Eastern Europe. Is the glass half full?

Migration from Eastern Europe to older EU member states is a major political issue. Various complex factors ensure not all countries are equally affected.

Croatia: Long term factors come into play as GDP growth accelerates

Participation in the EU’s single market is driving the integration of local companies into European and global supply chains, gradually increasing absorption of EU is supporting investment, while the reduction in the country’s risk profile has seen a return to investment grade status, thus lowering funding costs for the economy. These are all structural, as opposed to cyclical, reasons for optimism Croatia’s growth potential.

Speed also kills when making investment decisions

China’s Belt and Road Initiative offers a quicker, debt financing path to investments than EU procedures. But EU grants, as long as stringent conditions are met, are a far more sustainable and less risky option for EU member states.

The many ways Brexit will impact South East Europe and beyond

As the Brexit endgame fast approaches, the value of safety in numbers should become evident over time, especially for smaller EU member states.

Croatia and Slovenia: Two natural allies

As neighbouring countries with shared histories, Croatia and Slovenia have much in common. Accession to the EU has deepened these links, which Brexit is likely to strengthen.

How prepared is South East Europe for the next downturn?

The financial crisis of 2008/09 left a large scar on the region. With global economic conditions worsening, how prepared is South East Europe for the next downturn?

Playground logic necessary for successful entry into eurozone

When the big boys fight, smaller boys usually stay away. Strategic goals should not cloud policymakers’ judgement on adopting the euro.

Regional Monetary Policy: It’s all about the Exchange Rate

The exchange rate will remain the primary transmission mechanism of monetary policy in South East Europe as long as households prefer to save in foreign currency.

The most interesting aspects of the World Bank Doing Business 2019 Survey

A detailed look at the World Bank Doing Business 2019 Survey and Croatia’s performance according to the main criteria.

EU poverty indicators: Croatia between Spain and Italy

Insight into the risk of poverty or social exclusion in EU countries from the Eurostat’s Risk of Poverty or Social Exclusion Report.

The end game for Croatia’s shipyards?

Croatia’s shipyards employ far from best available technology. To get there, someone would have invest hundreds of millions of euros.