The Western Balkans have come a long way. In the last couple of decades, most of the region’s economies experienced dynamic growth and financial expansion. Leveraging on their well-educated labour force and international relations, the region’s economies opened up and attracted significant investments. Income levels and living standards increased. The EU integration process helped drive democratisation, peace and institution building, creating new opportunities.

Today, however, as the previous volume of this report showed, deep-seated challenges remain. Bringing together the knowledge of a wide array of regional stakeholders with OECD expertise, this second volume explores policy options to tackle some of the most salient ones.

Investing more and better in education and competences emerges as the priority: not only does it come out on top of people’s aspirations for quality of life, but it is also essential to unleash the region’s creativity and help its firms leapfrog to new economic activities. What is more, education systems play a key role in building civic engagement skills, providing a foundation for responsible and community-minded citizens.

Next comes the strengthening of social cohesion. Many people still cannot find good employment. Life can be especially hard in rural areas. This strains citizens’ ability to support each other. More employment opportunities and a high premium on quality social protection will help the region’s economies adopt a more people-focused growth.

Finally, a cleaner environment – also among the top desires of citizens – is indispensable for boosting the quality of life and creating economic opportunities, including by attracting investors and trade partners. The region needs a comprehensive and credible vision for its low-carbon energy transition, as well as substantial investments in energy efficiency and renewable sources. Much can be done through regional collaboration, and the ongoing integration with the European Union can create further opportunities.

As the COVID-19 crisis continues to demand counter-cyclical responses, identifying strategic priorities is essential to ensure that resources are well spent. I hope that this regional Multi-dimensional Review, the first of its kind, and now complete in two volumes, can help policy makers in the Western Balkans and their partners deliver innovative solutions, and chart more inclusive and sustainable development pathways.


Ragnheiður Elín Árnadóttir

Director of the OECD Development Centre

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