Getting Stronger After COVID-19: Nearshoring Potential in the Western Balkans

This study aims to analyse whether and how the Western Balkan economies could benefit from near-shoring trends after the COVID-19 pandemic. It begins by discussing recent trends in foreign investment, and then presents an econometric analysis of determinants of foreign direct investment in the Weste...

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Bibliographic Details
Published inIDEAS Working Paper Series from RePEc
Main Authors Ćulafić, Balša, Gaber, Martin, Ghodsi, Mahdi, Hasić, Belma, Muela Ibrahimi, Jovanović, Branimir, Kluge, Sophia, Lalović, Ognjenka, Mandić, Marko, Ravik Mima, Nikolova, Sanja, Antoaneta Manova Stavre
Format Paper
LanguageEnglish
Published St. Louis Federal Reserve Bank of St. Louis 01.01.2021
Subjects
Coronaviruses
COVID-19
Pandemics
Trends
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Summary:This study aims to analyse whether and how the Western Balkan economies could benefit from near-shoring trends after the COVID-19 pandemic. It begins by discussing recent trends in foreign investment, and then presents an econometric analysis of determinants of foreign direct investment in the Western Balkans and East Asia. This is followed by a set of surveys, interviews and case studies, of different actors involved in global supply chains and investment, including foreign companies that have invested in the Western Balkans, foreign companies that are considering investing in the Western Balkans, local companies from the Western Balkans, and investment promotion agencies from these economies. The study concludes that Western Balkan economies can indeed benefit from near-shoring trends in the post-pandemic world, but would have to go beyond low labour costs in order to achieve that. Putting a focus on skilled labour, investment in education and training, improving infrastructure and governance would be the most important things to do. This Publication has been replaced by a revised version on 24 June 2021.