Macro Analysis /

EEMEA Country Note - Not alone: Financial support of the Western Balkans

    Mauro Giorgio Marrano
    Mauro Giorgio Marrano

    Senior CEE Economist

    20 January 2021
    Published byUniCredit
    • The Western Balkans are not EU members yet and thus cannot access significant EU funding available through SURE, ESM, NGEU and MFF to deal with the COVID-19 emergency and support a recovery.
    • However, the Western Balkans benefit from access to funding for the public sector from official external sources: the EU, the IMF, the World Bank and foreign governments.
    • Official funding available for the COVID-19 emergency (for immediate needs) is similar in size to that available to most EU-CEE countries through the SURE and the ESM’s Pandemic Crisis Support, ranging from 3.1% to 6.0% of the recipient nation’s GDP.
    • The EU is the largest contributor in this regard. On average, 60% of these funds are provided by the EU, around 30% by the IMF and around 10% by the World Bank. New bilateral funding from foreign governments is notably absent.
    • The Western Balkans have access to less funding for their medium-term recovery compared to most EU-CEE countries. The EU remains the Western Balkans’ main source of financing.
    • The new EU accession process, which envisages the gradual granting of access to EU funding as a result of progress made on reforms, could be an attractive opportunity to obtain additional financing for the medium term.