End-of-year balance of payments data for 2011 suggest that remittances from Albanian migrants (mostly located in crisis-shattered Greece and Italy) did not drop as much as expected; on the contrary, they increased slightly. The inflow of remittances thus accounted for about 8% of GDP, almost as much as the inflow of FDI. Given the positive developments in potentially weak areas of the Albanian economy, we have revised upwards our previous GDP growth rate estimate for 2011 by one percentage point to 2.9% and our GDP growth rate forecast for 2012 by 10 basis points to 2.3%....more

Due to its specific export specialisation, the economy of Bosnia and Herzegovina is hit hard by the adverse international business climate. The current account gap has widened, and a widening gap between government revenues and expenditures is causing headache. It would be difficult to justify expectations of a quick recovery....more

Bulgaria’s economy kept losing steam in the first quarter of 2012 against the backdrop of weakening exports and weak domestic demand. The fiscal stance remains under the reigns of an austerity strive in the absence of policy creativity. There is little chance of reversing this situation in the short run so current expectations are that the economy is likely to stagnate in 2012....more

Croatia is slipping again into recession in 2012 and should finally rebound in 2013 provided a strengthening of external demand and the picking up of investments. Households’ disposable income being hit by high and persistent unemployment will keep domestic demand contracting. Reducing the budget deficit including structural reforms and servicing high foreign debt will remain the most challenging tasks for Croatian authorities. EU accession in 2013 may help to revive investments....more

In the short-term, prospect for growth in Montenegro is dim. Medium-term prospects are also not stellar. The start of negotiations with the EU should boost foreign investments: a helpful development. However, given the need to reduce still further the current account deficit and consolidate public finances, rapid recovery cannot be expected. The government stands ready to ward off political and social disaffection, but at some point a credible opposition will have to come to the fore in order to provide the much-needed impetus to democratic stability....more

The short-term prospects point to some growth in Macedonia that should pick up speed over the next few years, unless the crisis in Greece deteriorates to such an extent that the Greeks will be forced to leave the eurozone. In the medium term, Macedonia should enjoy some measure of recovery, but the country’s potential growth rate will hardly exceed 3% given the institutional and regional fundamentals....more

In Romania the new, centre-left government concentrates power and dilutes fiscal austerity. Controversy between government and president increases political uncertainty. The economy may come out of technical recession based on household demand and exports in the second half of the year....more

In Serbia recovery is unlikely this year and the prospects for the next two years will hinge on political stability and the economic policy pursued by the new government. The chances are that stagnation or slow growth is in the cards in the medium term....more

Three phenomena are topical features of the Turkish economy: relatively low real GDP growth after a spectacular growth bonanza in 2010-11; relatively high, albeit decelerating, inflation; and a somewhat diminished, though still high current account deficit. This deficit, which is of a structural nature, raises concerns about the long-term sustainability of high growth. This notwithstanding, growth may re-accelerate in 2013 and 2014, if external circumstances allow for this. In recent years, Turkey's exporters have been successful in selling to non-EU countries, and this is likely to continue during the next few years. Slow growth or stagnation in the EU has an impact on Turkey, but not necessarily an overwhelming one....more

Slovakia after the elections (by Doris Hanzl-Weiss; pp. 1-3) Keywords: Elections, Fiscal policy Countries covered: Slovakia Topics: Macroeconomic Analysis and Policy Labour market issues in Europe’s Eastern and Western Balkan neighbours (by Hermine Vidovic; pp. 4-9) Keywords: Labour market, Unemployment Countries covered: SEE, CIS Topics: Labour, Migration and Income Distribution Net private savings in relation to the government’s financial balance (by Kazimierz Laski and Leon Podkaminer; pp. 10-13) Keywords: Saving, Investment, Financial balances, Fiscal policy Count...more

Main messages: Differentiated economic development in CESEE countries Strength/weakness of export sector is crucial External demand and deleveraging depress domestic demand Labour market problems increase SEE: Persistent solvency and liquidity problems Growth remains below potential absent external and policy improvements ...more

Main messages: Differentiated economic development in CESEE countries Strength/weakness of export sector is crucial External demand and deleveraging depress domestic demand Labour market problems increase SEE: Persistent solvency and liquidity problems Growth remains below potential absent external and policy improvements ...more

The Vienna Institute for International Economic Studies (wiiw) has just published its latest Analyses and Forecasts. The report, titled Fasting or Feasting? Europe - Old and New - at the Crossroads, analyses current economic situation and medium-term forecast for the countries of Central, East and Southeast Europe. For the CESEE countries, wiiw expects 2012 to be a rather disappointing year. GDP growth will be rather slow – at least when judged by the past standards and the ambitions harboured only a few years ago. Some countries (Czech Republic, Hungary, Slovenia, Bosnia and Herzego...more

The Vienna Institute for International Economic Studies (wiiw) has just published its latest Analyses and Forecasts. The report, titled Fasting or Feasting? Europe - Old and New - at the Crossroads, analyses current economic situation and medium-term forecast for the countries of Central, East and Southeast Europe. For the CESEE countries, wiiw expects 2012 to be a rather disappointing year. GDP growth will be rather slow – at least when judged by the past standards and the ambitions harboured only a few years ago. Some countries (Czech Republic, Hungary, Slovenia, Bosnia and Herzego...more

The Vienna Institute for International Economic Studies (wiiw) presents an analysis of foreign direct investment (FDI) in 22 Central, East and Southeast European countries based on the latest update of its database. FDI continues to be of great significance for the development of the former transition economies. The domestic engines of economic growth are still weak, and fiscal consolidation provides a drag on the economies. The short-lived recovery in 2011 was based mainly on external demand, which upgraded the importance of foreign investors, as they generate a major part of exports. ...more

The Vienna Institute for International Economic Studies (wiiw) has just published its latest Analyses and Forecasts. The report, titled New Divide(s) in Europe?, analyses current economic situation and medium-term forecast for the countries of Central, East and Southeast Europe. The present economic crisis bears all the familiar hallmarks of the financial, debt-related and structural aspects of current account crises. All these aspects have lasting level effects and recovery can be very protracted. Export-led growth was an important feature of the recovery period 2010-2011, yet signi...more

Presentation of wiiw's latest growth forecast for the countries of Central, East and Southeast Europe for the period 2010-2013. Presentation of the new wiiw Handbook of Statistics 2011. ...more

The Vienna Institute for International Economic Studies (wiiw) has just published its latest Analyses and Forecasts. The report, titled Recovery: Limp and Battered, analyses current economic situation and medium-term forecast for the countries of Central, East and Southeast Europe. In 2011 the recovery will encompass all countries in the CESEE region – even the laggards that did not grow in 2010. However GDP growth will not accelerate much in countries where the recession ended already in 2010. Later on, GDP growth rates will stabilize throughout the whole region at around 4 to 5 pe...more

The Vienna Institute for International Economic Studies (wiiw) has just published its latest Analyses and Forecasts. The report, titled Recovery: Limp and Battered, analyses current economic situation and medium-term forecast for the countries of Central, East and Southeast Europe. In 2011 the recovery will encompass all countries in the CESEE region – even the laggards that did not grow in 2010. However GDP growth will not accelerate much in countries where the recession ended already in 2010. Later on, GDP growth rates will stabilize throughout the whole region at around 4 to 5 pe...more

In einem speziellen Kapitel („Debt dynamics, flow of funds and deleveraging“) des Konjunkturberichtes "Recovery: Limp and Battered" wird die Verschuldungsdynamik nach Sektoren (Haushalte, Unternehmen, Staat) vor und nach dem Ausbruch der Finanzkrise untersucht und mit den GIPS-Ländern (Griechenland, Irland, Portugal, Spanien) verglichen. Die Last der privaten Verschuldung hat wichtige Konsequenzen für das Ausgaben- und Sparverhalten des Haushalts- und Unternehmenssektors und damit für die Entwicklung der Inlandsnachfrage (Konsum und Investitionen). Dabei zeigen sich sehr unterschiedliche Muste...more

In a special chapter ("Debt dynamics, flow of funds and deleveraging") of the wiiw Forecast "Recovery: Limp and Battered", the debt developments of the private (households, corporate) and public sectors before and after the start of the financial crisis are examined and compared with those in the GIPS countries (Greece, Ireland, Portugal, Spain). The burden of the build-up of private sector debt before the crisis has important consequences for spending and savings behaviour of households and enterprises and hence for the development of domestic demand (consumption and investment). In this resp...more

The Vienna Institute for International Economic Studies (wiiw) presents an analysis of foreign direct investment (FDI) in 20 Central, East and Southeast European countries based on the latest update of its database. FDI is still of great importance for the development of CEECs especially as the domestic engines of economic growth are still weak, and fiscal consolidation drags on many of the economies. The economic recovery that has started in the region is mainly based on external demand, which has upgraded the role of foreign investors whose subsidiaries produce the main part of exp...more

The Vienna Institute for International Economic Studies (wiiw) has just published its latest Analyses and Forecasts. The report, titled Recovery – in Low Gear across Tough Terrain, analyses current economic situation and medium-term forecast for the countries of Central, East and Southeast Europe. All Central, East and Southeast European (CESEE) countries will return to growth in 2011. The post-crisis GDP growth will be slower than before and not suffice to generate additional jobs. The role of external demand gradually weakens, while both household consumption and gross fixed inves...more

The Vienna Institute for International Economic Studies (wiiw) has just published its latest Analyses and Forecasts. The report, titled Will exports prevail over austerity?, analyses current economic situation and medium-term forecast for the countries of Central, East and Southeast Europe, and China The Central, East and Southeast European (CESEE) economies will experience on average a minor rebound of economic growth to 1% in 2010 which will speed up to 2.5% in 2011 and 3.5% in 2012. GDP growth will be higher in the CIS countries and in Turkey, about average in the Central European N...more

The Vienna Institute for International Economic Studies (wiiw) has just published its latest Analyses and Forecasts. The report, titled Crisis Is Over, but Problems Loom Ahead, analyses recent economic developments and short- and medium-term prospects of the countries of Central and Eastern Europe, Southeast Europe including Turkey, as well as Kazakhstan, Russia, Ukraine and China. Most countries in Central, East and Southeast Europe have emerged from the trough of the crisis already at the end of 2009. Several leading indicators point to a modest upswing. All countries in the regio...more

wiiw presents its new analysis of FDI developments in 20 Central, East and Southeast European countries, based on the latest update of the wiiw FDI Database. German: Das wiiw präsentiert seine aktuelle Analyse der Entwicklung der Auslandsinvestitionen in Zentral-, Ost- und Südosteuropa, sowie den Update der "FDI Database" mit detaillierten Statistiken über Auslandsinvestitionen in 20 Ländern....more

The current global economic crisis is affecting the countries of Central, Eastern and Southeastern Europe (CEE and SEE) in some ways more severely than other European countries. Moreover these economies face more con-straints in putting the types of policies in place which are currently pursued in most of Western Europe, the USA and Japan. However, policies designed to stabilize the banking system and provide fiscal stimulus have as much justifi-cation to be pursued in these economies as in the higher-income countries. Therefore a coordinated approach by EU institutions and EU governments (in ...more

Current financial developments and global imbalances of savings and investments are increasingly affecting economic developments. The panel will discuss the consequences for transition countries in Central, East and Southeast Europe. Many of these countries exhibit high credit growth with current account deficits. That raises concerns about the soundness of their financial systems and of other vulnerabilities with important policy implications. There are concerns that some of these economies are overheating and that risks to macroeconomic stability are increasing. Speakers will address the ris...more