The states that belong to the Western Balkans are working towards European Union (EU) accession and are therefore referred to as “enlargement countries”. This means that they have or are working hard towards fostering a favorable economic and business climate in an effort to draw more enterprises and help them with their unique needs. As part of the “enlargement countries”, the six Western Balkan states each offer something distinct to investors.
And if you want to find out what sets them apart and makes them perfect for outsourcing to, you’ve come to the right place. In this article, we’ll explore this question as well as offer a broad overview of how you can embark on your outsourcing journey in the Western Balkans with StorsenDigital. So, let’s take a closer look!
Which states belong to the Western Balkans and what do they offer businesses?
The six Western Balkan states are Albania, Bosnia and Herzegovina, North Macedonia, Montenegro, Kosovo, and Serbia. Each of these states has something unique to offer businesses that are considering outsourcing there. Here are some of the reasons to consider when making your decision.
- Albania: Albania is considered an upper middle-income country with a gross domestic product (GDP) of $16.77 billion. The economy is primarily divided into three main sectors, which are the services (54.1%), agriculture (21.7%), and industrial (24.2%) sectors. The country has scored well on the Index of Economic Freedom and the World Bank Doing Business Rankings. It also has a low AML score, as reported by the Basel Institute.
- Bosnia and Herzegovina: Bosnia and Herzegovina is classified as a developing/emerging upper-middle-income economy with an estimated nominal GDP for 2023 valued at $28.49 billion. The largest portion of the labor force is engaged in services, followed respectively by manufacturing and agriculture.
- North Macedonia: doing business is considered “generally easy” in North Macedonia and the legal framework is largely in line with international standards. Numerous large foreign companies operating in the Technological Industrial Development Zones (TIDZ) generally report positive investment experiences. In addition, after the Covid-19 pandemic, we see that government support has cushioned the impact of the crisis on the labor market, with unemployment falling in the first quarter of 2022. In its Growth Acceleration Plan, the government set targets to double the average annual GDP growth rate from 2.5% to 5% from 2022-2026. The country is committed to “green growth” in accordance with the Declaration on Green Agenda. Because of its favorable location, being at the crossroads of pan-European transport corridors, the country is at an advantage with many companies considering near-shoring their production there to be closer to consumption centers in Europe.
- Montenegro: Montenegro is considered a small, open economy that aspires to join the EU by 2025. The Heritage 2023 Index of Economic Freedom mentioned that the results for property rights and especially for the tax burden in Montenegro are good. In particular, Montenegro has competitive corporate tax rates (9-15%) and attractive personal income tax rates (9-15%), giving it an edge over other European countries. It is possible for a foreign entrepreneur to start a limited liability company in the country with a starting capital of only 1 EUR.
- Kosovo: Kosovo is considered an upper-middle-income country, which has experienced steady economic growth over the last decade. It is a small but open economy with greater net imports. Despite this, the country is committed to trade liberalization. In particular, participation in regional and wider trade-facilitating mechanisms has been one of the main policy objectives of Kosovo institutions. It is the cheapest country in Europe in terms of cost of living.
- Serbia: Serbia’s investment climate has improved modestly over the past few years. This growth has been driven by macroeconomic reforms, financial stability, and fiscal discipline. The government prioritizes attracting foreign investment. It is an attractive investment destination because of its cost-effectiveness and is sought after by businesses looking to expand. It has a 15% flat rate of corporate tax and the lowest rate of salary tax and VAT among its East European counterparts. As such, the cost of operating in Serbia is among the lowest in Europe.
How can StorsenDigital help?
At StorsenDigital, you can consider us your partner for outsourcing to the Western Balkans in the most seamless way. We do this through our extensive portfolio of services, which include:
- Talent services and talent-on-demand: we can help source the right talent at the right place at the right time for the right price to ensure your talent pool is enriched with all the best people for an attractive cost.
- Market intelligence: we can help extract market insights for you that no other partner can. Since our location allows us to generate and curate market intelligence competitively, you’ll know exactly where you can boost your competitive advantage.
- Management consulting: with our top-rated management consultants, you have a world of wealth and experience at your fingertips.
- E-commerce: e-commerce is rising across the world and we can make your business goals a reality through the right strategies and technological tools.
- Procurement: looking to boost your supply chains and make them more streamlined and efficient? We can help with this, too!
- Finance and business finance: with the capacity and ability to take your accounting, bookkeeping, and business financial needs and ensure full compliance and accuracy in your reporting, we are the perfect partner for your business’ financial needs.
- Customer experience (CX): we can organize call centers effectively and affordably, among other ways to boost your customer experience. All you need to do is get in touch with us!
In short, investing in the Western Balkan states is a worthwhile endeavor not least because of these countries’ attractive economic and tax climates. But before you’ve outsourced your production or main activities there, you also need the right market intelligence and management consulting services to help you gain a strong foothold in your industry seamlessly. This is where StorsenDigital can help you. As your perfect partner that can meet your unique business needs seamlessly, aren’t you ready to get in touch with us?