REGIONAL COOPERATION AND ECONOMIC INTEGRATION

PART I:
on a larger trade deficit; mainly financing private consumption of imports. For most SEE
countries remittances are, after the foreign direct investment, the most important source of
external finance. Compared with the GDP of countries of South-Eastern Europe, remittances
add approximately 7 per cent to the recorded GDP (World Bank, 2008). The remittances
are the most important source of consumption in Bosnia and Herzegovina (17.2 per cent of
GDP); very close to this high percentage are Albania (14.9 per cent of its GDP) and Serbia
and Montenegro (13.8 per cent). Those percentages are placing these countries among the
top remittance-receiving countries in the World. The developed countries in this region
relay considerably less on remittances as a source of domestic consumption (Hungary 0.3
per cent, Greece 0.6 per cent, and Slovenia 0.9 per cent).
The data of the World Bank shows that during the analyzed period of eight years in South-
Eastern Europe, the inward remittances have increased three fold, from USD 6.9 billion to
USD 21.2 billion. The remittances to the Western Balkan have more than doubled in the
period from 2000 to 2007 (from USD 4.1 billion to USD 10.4 billion).
Graph 2 shows remittances by countries in the Western Balkan region. In Serbia with
Montenegro, the remittances more than quadrupled in the period analysed (from USD 1.1
billion to USD 4.9 billion), while Bosnia kept the same level from 2004 to 2007 (USD 1.9
billion). In Croatia, remittances more than tripled (from USD 0.6 billion to USD 1.8 billion)
and Albania received USD 1.5 billion from remittances in 2007 alone. However, remittances
could not be a substitute for a sound economic and social development policy.
Graph 2: Remittances in Western Balkan, 2000-2007(millions of US $)
Source: The World Bank, Migration and Remittances, Fact Book 2008.
Note: Migrant’s remittances are defined, by official international methodology, as the sum of workers’ remittances
compensation of employees and migrants transfers.
South-East European countries are opening themselves to the free movement of goods
and services, but have also a freer entrance of foreigners and professional workers. In
the 21st century, according to the data available, increasing number of foreigners will be
working in this region and accordingly, more and more outward remittances are registered
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