Although overall economic strength is still relatively low and per capita income still varies enormously between the countries, this heterogenous region is developing into an interesting production location and dynamic sales market. The economists at Allianz Dresdner Economic Research expect prosperity to almost double over the next decade. As a result the region’s imports are set to rise by around 20 % a year.
Southeastern Europe: From upheaval to boom
The reasons behind this healthy trend are manifold: once the region had managed to pull itself up by the bootstraps, economic policy geared to EU accession is now bearing fruit. Inflation rates are in one-digit territory, public sector finances are in order. In terms off oreign direct investment in relation to economic strength southeastern Europe has now overtaken the central and eastern European countries of the first accession wave and is becoming increasingly integrated with Europe. Resolute opening-up of the banking markets has helped advance domestic financial intermediation, reducing reliance on foreign loans. Financial assistance from the EU, which is being channeled chiefly into the establishment of stable institutions, rounds off the picture. Although EU accession is still some way off in many countries, all in all southeastern Europe is on the right track to enjoying a brighter economic future.