Regional Economic Issues, April 2015 : Europe: The Western Balkans: 15 Years of Economic Transition

Cover -- CONTENTS -- FOREWORD -- STRUCTURE AND FOCUS OF THE REPORT -- COUNTRY COVERAGE AND ACRONYMS -- EXECUTIVE SUMMARY -- OVERVIEW: ECONOMIC TRANSFORMATION IN THE WESTERN BALKANS -- CHAPTER 1: JOBS, GROWTH, AND CONVERGENCE: OBSTACLES AND THE ROADMAP TO REFORM -- A. Growth and Convergence-A Cup Half Full or Half Empty? -- B. Progress in Economic Transformation -- C. Ranking Structural Reforms Priorities for Faster Growth -- D. The Quest for Jobs -- E. Lessons for Stronger Convergence -- CHAPTER 2: MACROECONOMIC DEVELOPMENTS AND POLICIES: BOOM, BUST, AND THE AFTERMATH -- A. Background and Context-Macroeconomic Stabilization in the 1990s -- B. Before the Global Financial Crisis: Optimism and Inflows -- C. Recession and Recovery after the Global Financial Crisis -- D. Lessons from the Crisis and Policy Challenges -- CHAPTER 3: FINANCIAL SECTOR: DEEPENING, RESILIENCE, AND ONGOING CHALLENGES -- A. Financial Deepening from a Low Base -- B. Credit Swings and Financial Stability -- C. Financial Sector Inclusion and Efficiency -- D. The Unfinished Institutional Reform Agenda and International Cooperation -- E. Cross-Border Finance and the Future of Western Balkan Banking -- BOXES -- Box 1.1. Inequality and Poverty in the Western Balkans -- Box 1.2. Reform Gaps in Institutions, Infrastructure, Goods Market Efficiency, and Labor Markets -- Box 1.3. Structural Reform in Kosovo: Past Achievements and Future Priorities -- Box 2.1. The Western Balkans and the IMF -- Box 2.2. Public Pension Spending in the Western Balkans -- Box 3.1. Nonbank Financial Deepening in the Western Balkans -- Box 3.2. Croatia's Defense against the Boom -- Box 3.3. Nonperforming Loans in the Western Balkans: Why Has Progress Been So Limited? -- ANNEXES -- Annex 1.1. Growth Accounting -- Annex 1.2. Convergence Analysis -- Annex 1.3. Trade Linkages