The average GDP per capita in the Western Balkans is just under $22.000, while the average at the European Union level is around $59.000. Full membership or greater access to funds would significantly shorten the path to the EU average, especially in economic, social and infrastructure terms.
The average per capita GDP in the Western Balkans is just under 22.000 US dollars, while the average at the European Union level is around 59.000 US dollars. In 20 years of the European integration process, the Western Balkans have achieved around 35 percent of the GDP per capita (GDP) compared to the European Union average. The European Bank for Reconstruction and Development (EBRD) has estimated when the Western Balkan countries would reach the EU average standard of living, with three scenarios: in the most optimistic scenario, assuming the growth rates that preceded the global economic crisis, the Western Balkans would converge with the EU within two to three decades. A more realistic scenario predicts that, if growth rates remain at their current level, the Western Balkans would reach the average within 40 years.
A pessimistic scenario predicts convergence in the distant year 2093 if growth rates were similar to those after the economic crisis. Finally, the Comparative Research conducted in the six Western Balkan countries on the proximity of these countries to the EU average in the field of economy, highlighted that there are several scenarios for convergence with the Union standards. Full membership or greater access to funds significantly shortens the path to the EU average, especially in the economic, social and infrastructure.
The main message is that the goal should not be 100 percent of the EU average, but a sustainable 80 percent, as a realistic level for a better standard of living. “The message of the report is clear: convergence accelerates when EU integration intensifies, but for citizens to feel it, we need to finish our work at home as a society. Therefore, the focus should be on implementation and results, not just on the adoption of laws. The key to accelerating the process is ensuring the rule of law and providing conditions for fair and honest public procurement. At the same time, the budget should be directed towards education, primary health care, preventive health and clean air, and the digitalization of the system should be the basis for fast and quality services,” emphasizes Viktor Mitevski from the Association for Research and Analysis – ZMAI.
According to him, the full completion of all major transport and energy connections and networks, both nationally and with neighbors, is also key to Macedonia’s growth. When these tasks are completed, productivity and formalization of the economy will also increase, and wages will naturally move upwards.
According to the presented calculations and current trends, in a status quo scenario, North Macedonia needs about 59 years to reach the EU average in the economic field. Digitalization stands at approximately 75 percent of the EU level with the potential to close the gap faster, healthcare is at a similar level with the possibility of convergence in a shorter period. At the same time, divergence is registered in education and environment, which indicates an urgent need for results-oriented policies. In the economic sub-components, the following were highlighted: average gross salary ~ € 1.000 (~ 33 percent of the EU), GDP per capita ~ 42 percent of the EU, productivity ~ 53 percent of the EU against the lowest wages, as well as pensions ~ 18 percent of the EU.
The economies of the Western Balkans have made only modest progress in narrowing the economic gap with the European Union in the past two decades, according to a new report from the Organization for Economic Co-operation and Development (OECD). The gross domestic product (GDP) per capita in purchasing power parity of the Western Balkan countries in 2023 was just under 40 percent of the EU average, an increase of about 13 percentage points compared to 2003, according to the OECD report titled “Results of Economic Convergence in the Western Balkans 2025.”
OECD experts point out that this convergence has been contributed by the Region’s sustained economic growth over the past 20 years, with growth rates in the Western Balkans consistently higher than those in the EU. Between 2003 and 2023, GDP per capita in purchasing power parity terms in the Region increased by 120 percent, from $9.725 to $21.305.
However, the report stresses that economic convergence with the EU remains a strategic imperative for the six Western Balkan economies. In addition to raising living standards, a more competitive and sustainable Region is key to increasing trade, attracting investment and deepening integration into European markets.
The OECD analyzed 35 indicators divided into five thematic groups: infrastructure and connectivity, skills, business environment, digital transformation and green economy. The most significant convergence with the EU is observed in the area of infrastructure and connectivity, although overall performance there remains weak. Regional transport infrastructure, especially rail, lags significantly behind the EU, and outdated power plants contribute to energy inefficiency, which is reflected in large energy losses.
Meanwhile, digital infrastructure has benefited from significant investment. This has resulted in significant improvements in digital connectivity and mobile phone usage rates, which are approaching those in the EU. The skills cluster is the weakest performer, despite gradual convergence with EU standards. Although the labour market situation in the Region is improving, youth unemployment and inactivity remain high, and retraining efforts are gaining importance.
When it comes to the business environment, the strongest performing area in the Western Balkans, no clear progress has been made in convergence with the EU over the past ten years. Improvements have been noted in banking stability and investment, but access to affordable finance, especially for small and medium-sized enterprises, remains a challenge.
The report warns that corruption and the grey economy continue to undermine fair competition and discourage investors, and trade flows in the Western Balkans are still below the average of EU member states. Digital transformation is the second most successful cluster in the Region, due to the strong connection between citizens and businesses. Internet use in the Western Balkans reaches over 95 percent of the EU level, and the information and digital technologies sector stands out as a key driver of economic growth.
In the last group – the “Green Agenda” – there is a significant gap and deterioration in performance compared to the EU. The gap is widening, as in most areas results are stagnating or regressing. Although countries have started to implement policies for a greener economy, progress has been limited, particularly in reducing carbon emissions, and there are also growing concerns about resource inefficiency. (koha.mk)
