Since the beginning of the transition to a market economy in 1989, the Western Balkan (WB) countries have faced particular difficulties in economic development, under the impact of the breakup of SFR Yugoslavia, military conflicts and international sanctions, thus delaying important economic and institutional reforms as well as integration with the European Union.

The WB countries should aim at implementing a model of development that balances economic, social and ecological aspects. Key issues to be addressed in the future, through more efficient industrial policies and development strategies, include agriculture, energy, R&D (human capital) and public administration reform.