The Balkans in transition

Abstract

The Balkan countries aspire to be part of the European Union but, with
the exception of Greece, economically most of them fall far behind the
average of the European Union. Moreover, their long subjugation to Austro-
Hungarian or Ottoman rule made foreign as well as domestic central control
of economic activity acceptable. Therefore, the state has played an important
role in their relative economic backwardness. Moreover, the countries that
introduced central planning fell further behind those which limited the role of
the state. Difficulties in the transition from central planning to a market
economy are directly related to the degree of former state controls of the markets. Foreign direct investment remains their main hope, but they have not been able to attract it.