Donor Co-Financing Assessment for New Country Strategy
ATQs in detail (1)
Key Transition Challenges
Competitive (4.8)
Weakest quality of the business and
regulatory environment in the region.
Complex institutional and regulatory
framework is burdensome for
companies.
■Labour productivity somewhat above the
regional average but lagging behind new
EU member states
High emigration depleting human capital
■ Large informal economy
More economically complex than an
average WB economy, but significantly
less than the new EU member states
At an early stage of knowledge economy
development
Well-governed (4.1)
Scores below the WB-5 average on all six
World Bank world governance indicators,
lagging behind the most on government
effectiveness
■ Convoluted institutional setting aggravated
by low public administration capacity
Rule of law and judiciary weaknesses
High perception of corruption and weak
progress in anticorruption fight
Public procurement characterised by
complex procedures which facilitate
corruption and preference for domestic
suppliers
■ Corporate governance framework is weak,
especially for SOEs which are often not
sufficiently
transparent,
sustainable or efficient
fiscally
☐
■
European Bank
for Reconstruction and Development
Green (5.0)
Prevalence of coal: majority of the
country's electricity and significant share
of heating coming from antiquated coal-
fired power plants and combined heat and
power plants, some of which are expected
to close in the next few years
Air pollution as a serious problem
High reliance on hydro within the
renewables sector; ample wind and solar
potential
Highest energy intensity in the region, four
times the EU average
Lacks an adequate waste management
system
Climate change risks: floods
Biggest obstacles to doing business
(per cent of firms)
Political instability
Tax rates
Practices of the informal sector
Inadequately educated..
Tax administration
Corruption
Transportation
Electricity
Business licensing and permits
Crime, theft and disorder
Source: EBRD BEEPS VI
05
10 15
20 25
Governance indicators
Voice and
Accountability
Rule of Law
Control of
Corruption
Regulatory
Quality
EU-11
WB-5
Energy intensity 2019*
(kgoe per EUR 1,000 of GDP)
500
Government
400
Effectiveness
300
200
Political Stability
100
0
BIH
KOS SRB MAC MNE ALB
BiH
Source: World Bank's Worldwide Covernance Indicators 2020
* Except for Montenegro (2018) and Albania (2017)
Source: EUROSTAT
9
EU-28
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