Jobs in Western Balkans restored to pre-2008 crisis: World Bank

World Bank Building, Washington, D.C. | pingnews.com

All the Western Balkan countries, except Bosnia & Herzegovina, have restored employment to its level before the crisis in 2008 with around 230,000 jobs being created in 2017.

According to a World Bank report, the region has relatively high unemployment level with youth unemployment being particularly high.

The World Bank’s latest Western Balkans Regular Economic Report said that more than half of the new jobs were created in the private sector, mainly in services.

 “Although unemployment fell across the region, it is still high, ranging from 11.8% in Serbia to 30.6% in Kosovo. In particular, a disproportionate number of the unemployed have been without a job for a considerable time. Youth unemployment is also a concern: more than half of the youth are unemployed in Kosovo, with Albania having the lowest rate in June of 26.4%,” the report on the region issued on November 16 read.

While the economic growth outlook remains positive for countries in the Western Balkans, risks remain. Policy uncertainty or possible policy reversals could dampen investment and growth. According to the report, these risks can be mitigated by maintaining fiscal sustainability, while accelerating structural reforms such as strengthening public finances and improving the environment for investment and integration.

In Bosnia, growth is seen picking up, supported primarily by domestic demand, while in Kosovo it should be backed by expected expansion in public investment and broad-based exports and production growth.

In Macedonia, growth is likely to recover as confidence improves after the political crisis is resolved.

In Serbia, despite a poor agricultural season and slowing growth generally, employment in the country went up by 4.3 percent. The report noted that the higher consumption and investment should support the GDP growth.

On the other hand, in Montenegro's growth is projected to slow significantly in 2018 and 2019 due to fiscal consolidation measures implemented by the government in order to reduce spending and rein in rising public debt.

Before the 2008 global financial crisis, the six Western Balkan countries – Albania, Bosnia, Kosovo, Macedonia, Montenegro and Serbia - were flooded with cheap capital that fuelled average growth of between 5% and 7% a year.

Growth, jobs, and relatively low inflation helped to reduce poverty in the region, according to the report.

“The combination of economic growth and job creation contributed to a decline estimated at 1 percentage point in the region’s poverty rate, which is projected to be 23.6% for 2017. This implies that about 124,000 people in the region have been lifted out of poverty since 2016,” the report said.