THE WESTERN BALKANS: ECONOMIC POTENTIALS AND LABOUR MARKET GAPS ON THE SUSTAINABLE PATH TO EUROPEAN UNION

Abstract

One of the main aims of the paper is to estimate how sustainable is the transition of Western Balkans to the European union and to present scenario analysis for this region. The new momentum for real chance of success in accession process towards European Union depends on both economic results and political will of the governing bodies. In this respect, more flexible and differentiated approach towards the Western Balkans is required to enable the exploitation of economic potentials and reduction labour market gaps. Western Balkan Countries' ability to assume obligations of EU membership are summarized by using selected indicators which indicate the readiness of each country to integrate and to harmonize economic system. Taking into account the six transition qualities (Competitive, Well-governed, Green, Inclusive, Resilient, Integrated),the ranking of the Western Balkans countries was performed. By calculating the Pearson coefficient for economic potential (measured by GDP per capita) and the labor market indicator (Average monthly gross wages) in the period 2012-2017. for six Western Balkan countries, it is concluded that there is strong positive correlation between them. The basic research question which has been tested during the research is whether country rank based on transition qualities, respond to country rank based on labour market indicators (such as Average monthly gross wages).