Bosnia and Herzegovina, Serbia, Montenegro, Kosovo, Albania and North Macedonia attract attention as the “last stop” where foreign companies can implement new investment trends by using their potential correctly.
The concept of “near-shoring”, which countries have started to prefer more with the Covid-19 epidemic and which means a company locates its production in close locations, is considered an important investment tool for the Western Balkans.
On the other hand, decarbonization, which aims to reduce carbon or greenhouse gas emissions, also makes the region attractive for foreign investments.
Branimir Jovanovic from the Vienna International Economic Research Institute, the leader of the researcher group that shed light on the subject with the research titled “Transforming the Western Balkans with Supply and Decarbonization Investments from Nearby Countries”, made an assessment to the AA correspondent about the importance of the region.
Pointing out that European countries were looking for different alternatives to position their investments with the Covid-19 epidemic and the war in Ukraine, Jovanovic said, “The Western Balkans emerged as the first natural option. The close proximity of the region, relatively low costs and having a quality workforce are among the most important features of the region.” took place.” he said.
Jovanovic stated that the region offers advantages in terms of reducing carbon emissions in terms of both renewable energy and the construction of factories with lower emission rates, and stated that the Western Balkans can contribute to the “Green Deal” of the European Union (EU) in this field.
“‘Supply from nearby countries’ is already being implemented in the region.”
Pointing to the research, Jovanovic said, “Our findings show that ‘nearby country sourcing’ is already being implemented in the Balkans, as we have seen that several companies investing in the region are in the preparation phase in this field. Only Montenegro is not included in this field because it is more focused on tourism than production.” he said.
Jovanovic stated that there are foreign investments in the regional countries other than Kosovo in the field of renewable energy, and said that the surveys conducted within the scope of the research indicate that companies are ready to cooperate more with local companies if carbon dioxide emissions in the region are reduced.
Stating that the region can increase living standards by using the trends of “supplying from nearby countries” and “reducing carbon emissions”, Jovanovic stated that economic development in the region will also reach high levels.
Jovanovic stated that 800 thousand people are unemployed in the region and that this number will decrease significantly through “supply from nearby countries”.
“Western Balkans is attractive for the European market”
Another author of the research, Muela Ibrahimi, Director of the Economic Analysis and Strategic Communication Department of the Kosovo Chamber of Commerce, said that the Kosovo economy has experienced a steady increase in foreign investments and “supply from nearby countries” since the Covid-19 outbreak.
İbrahimi stated that the Western Balkans are attractive for companies that want to reduce their supply chains and increase operational efficiency because they offer fast and safe access to European markets.
Stating that the region, and especially Kosovo, has a young population that is well-educated and trained in important fields such as information technologies and engineering, İbrahimi emphasized that this makes Kosovo and the region an attractive place for investment in sectors that require advanced technological and technical skills.
İbrahimi also noted that low production costs compared to EU countries provide a great competitive advantage and high production and service standards to investors in the region.
Pointing out that Kosovo is on its way to meeting the requirements for reducing air pollution and more responsible use of natural resources with the approved environmental protection and climate change laws, İbrahimi said, “These policies are not only important for improving the quality of life in the country, but also for Kosovo’s green and sustainable supply chains.” “It is also important to help it integrate into the European and global market by becoming a part of it.” he said.
Stating that Kosovo has a great potential in developing the renewable energy sector, İbrahimi said that the country can thus reduce its dependence on traditional energy sources and meet international standards in reducing carbon emissions.
Pointing out that their research shows that decarbonization is the key factor in the decision-making process of foreign investors, İbrahimi said, “Kosovo’s role in decarbonization efforts is very important in terms of increasing regional and international cooperation. This will help it become more competitive and attractive for foreign investments seeking high environmental standards.” “Our study also confirms this.” made his assessment.
Ibrahimi added that Kosovo has a significant opportunity to attract foreign investments through decarbonization and increase its commitment to the transition to a green economy.
“The region is the main destination for remote companies”
North Macedonian Economic Expert Visar Ademi stated that since the Western Balkans are a part of Europe, the region is the main destination of all companies coming from America, China and distant countries that want to sell in Europe and said, “Firstly, the governments of these countries “It provides a lot of financial support to foreign investors. Secondly, labor is relatively cheaper compared to Western European and Southeastern European countries.” he said.
Emphasizing that foreign investors attach importance to issues such as political stability and the rule of law, Ademi said that if these are not present, the company’s property, products, copyrights and innovation rights are in danger, and that if these two prerequisites are met, they can talk about workforce efficiency.
Ademi reminded that the new government in North Macedonia promised to make a lot of investments in renewable energy and green energy, and noted that it is not yet known what effect these will have.
Drawing attention to the region’s dependence on electrical energy in matters such as economy and consumption, Ademi emphasized that the cost of products and living is very high, which is reflected in inflation and purchasing power.
“The process of reducing carbon emissions is important”
Ademi pointed out the importance of the carbon emission reduction process for the region and stated that the criteria for EU membership are not only political but also economic; Therefore, he stated that the issue of decarbonization is important not only in terms of industrial production but also in terms of individual consumption.
In this context, Ademi pointed out that concrete steps should be taken in the process of reducing carbon emissions within 6 years, and made the following statements about the impact of the EU membership of North Macedonia or any country in the region on the economy and decarbonization efforts:
“Trade with the EU will increase greatly, the competitiveness of domestic companies will increase, exports will increase because we are a country very dependent on its strategic partners in the EU. Our number one trade partner is Germany, followed by Greece, Bulgaria and all EU members. Our main target is the EU because we sell there “, we buy from there and gain knowledge there through foreign projects.”
According to the World Bank’s 2023 data, Serbia ranked first in the region in net foreign direct investment inflow with approximately 4.8 billion dollars. Albania came in second with approximately 1.6 billion dollars, Bosnia and Herzegovina came in third with approximately 944 million dollars, and Kosovo came in fourth with 913 million dollars. North Macedonia, which received approximately $702 million in net foreign direct investment in 2023, ranked fifth and Montenegro ranked sixth with approximately $525 million.